HomeMy WebLinkAbout2013-03-04 City Council Agenda PacketCITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Council Chambers
March 4, 2013
6:00 PM
Agenda posted according to PAMC Section 2.04.070. Supporting materials are available in the
Council Chambers on the Thursday preceding the meeting.
1 March 4, 2013
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part of the Council's effort to manage its time at Council meetings. Listed times are
estimates only and are subject to change at any time, including while the meeting is in
progress. The Council reserves the right to use more or less time on any item, to change
the order of items and/or to continue items to another meeting. Particular items may be
heard before or after the time estimated on the agenda. This may occur in order to best
manage the time at a meeting or to adapt to the participation of the public. To ensure
participation in a particular item, we suggest arriving at the beginning of the meeting and
remaining until the item is called.
Call to Order
Closed Session 6:00- 7:00 PM
Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker.
1. CONFERENCE WITH CITY ATTORNEY
Potential Litigation Relating to Retiree Health Benefits
Section 54956.9 - Significant Exposure to Litigation
Agenda Changes, Additions and Deletions
HEARINGS REQUIRED BY LAW: Applications and/or appellants may have up to ten minutes at the outset of the
public discussion to make their remarks and put up to three minutes for concluding remarks after other members of
the public have spoken.
OTHER AGENDA ITEMS: Public comments or testimony on agenda items other than Oral Communications shall be
limited to a maximum of three minutes per speaker.
Special Orders of the Day 7:00-7:15 PM
2. Abilities United for a Public/Private Community Partnership Presentation
City Manager Comments 7:15-7:25 PM
Oral Communications 7:25-7:45 PM
Members of the public may speak to any item not on the agenda; three minutes per speaker. Council reserves the
right to limit the duration of Oral Communications period to 30 minutes.
2 March 4, 2013
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Minutes Approval 7:45-7:50 PM
January 14, 2013
January 22, 2013
January 28, 2013
Consent Calendar 7:50-7:55 PM
Items will be voted on in one motion unless removed from the calendar by two Council Members.
3. Finance Committee Recommendation that the City Council Adopt a
Resolution Approving a Carbon Neutral Plan for the Electric Supply
Portfolio to Achieve Carbon Neutrality by 2013
4. Staff Recommends Approval of an Agreement with Palo Alto Unified
School District (PAUSD) under which the City of Palo Alto (City) will
Provide the District with Fiscal Services as part of the PAUSD 2013
Summer Enrichment Program and Provide Collaborative After-School
Summer Programs.
5. Adoption of a Budget Amendment Ordinance in the Amount of
$468,283.19 to Fund the Purchase and Make Ready Costs of up to 17
Honda Civic Natural Gas Vehicles and Approval of a Purchase Order with
Stevens Creek Honda in an Amount of $459,783.19 to Purchase up to
17 Compressed Natural Gas Honda Civics
6. Approval and Authorization of the City Manager to execute an Electric
Enterprise Fund Construction Contract with PAR Electrical Contractors,
Inc. in the Amount of $961,460 to Rebuild a Portion of the 60kV
Overhead Transmission System
7. Approval of a Water Enterprise Fund Contract with RMC Water and
Environment, Inc. for a Total Not to Exceed Amount of $193,914 to
Complete the Environmental Analysis of Expanding the City's Recycled
Water Delivery System
8. Approval of Amendment No. 1 to Contract #C12140966 in the Amount
of $500,000 with Hydromax USA, Inc. To Provide Additional Services
Associated with the Cross-Bore Investigation Project, for a Total Not to
Exceed Amount of $4,300,000
3 March 4, 2013
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA
PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE.
DURING NORMAL BUSINESS HOURS.
9. Adoption of Budget Amendment Ordinance to Provide Additional Loan to
Palo Alto Housing Corporation and Approval of a Short Term Loan to
Palo Alto Housing Corporation in the Amount of $2,600,000 to Palo Alto
Housing Corporation for the Acquisition of 567-595 Maybell Avenue for
Purposes of Developing a Below Market Rate Senior Housing Project
10. Approval of On-Call Transportation Consultant Contract with TJKM
Transportation Consultants for a Total of $281,820 to Implement Bicycle
& Pedestrian Transportation Plan and to Provide Project Support
Services
11. Request for Authorization to (1) Increase the Contract with Moscone
Emblidge Sater & Otis in the Amount of $220,000 for a Total Not to
Exceed Amount of $455,000 for Legal Services and (2) Enter into
Contracts with Project Controls and Forensics, LLC in an amount not to
exceed $100,000 and with David Neagley, AIA in an amount not to
exceed $275,000 for Expert Consultant Services Related to Public Works
Construction Matters
12. Staff Recommends That Council Approve the Short Form Agreement for
Revenue Contracts (Attachment A) Extending the Joint Venture Between
the City of Palo Alto and the Cardiac Therapy Foundation of the Mid-
Peninsula, Inc. (CTF) through December 31, 2014.
13. Adoption of an Ordinance Reducing the Size of the Library Advisory
Commission from Seven to Five Commissioners and Amending the
Frequency of Regular Meetings to Bi-Monthly
14. Approval of the Mutual Cooperation and Support Agreement between
the City of Palo Alto and the Friends of Palo Alto Children's Theatre
Action Items
Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials,
Unfinished Business and Council Matters.
7:55-8:05 PM
15. Public Hearing: Adoption of Finding that the Main Library Expansion and
Renovation Project (CIP PE-11000) is "Substantially Complex" under
Public Contract Code Section 7201 and Direction to Increase the
Retention Schedule from 5% to 10%
4 March 4, 2013
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA
PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE.
DURING NORMAL BUSINESS HOURS.
8:05-9:05 PM
16. Update and Direction to Staff Regarding Development Process for
Edgewood Plaza
9:05-10:20 PM
17. Update of California Avenue Transit Hub Corridor Streetscape
Improvements Project Roadway Design and Consideration of Street
Lighting Options
Council Member Questions, Comments and Announcements
Members of the public may not speak to the item(s)
Adjournment
AMERICANS WITH DISABILITY ACT (ADA) Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may
contact (650) 329-2550 (Voice) 24 hours in advance.
PUBLIC COMMENT
Members of the Public are entitled to directly address the City Council/Committee concerning any item that is
described in the notice of this meeting, before or during consideration of that item. If you wish to address the Council/Committee on any issue that is on this agenda, please complete a speaker request card located on the
table at the entrance to the Council Chambers, and deliver it to the City Clerk prior to discussion of the item. You
are not required to give your name on the speaker card in order to speak to the Council/Committee, but it is very helpful.
5 March 4, 2013
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA
PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE.
DURING NORMAL BUSINESS HOURS.
Additional Information
Standing Committee Meetings
Finance Committee Meeting
Council Appointed Officers Committee Meeting (CAO)
Committee for Potential Infrastructure Finance Measure Meeting
Schedule of Meetings
Schedule of Meetings from the City Clerk
Tentative Agenda
Tentative Agenda from the City Clerk
Informational Report
Contracts Awarded by the City Manager from July 1, 2012 through
December 31, 2012
Citywide Transportation Survey
City of Palo Alto Sales Tax Digest Summary Third Quarter Sales (July -
September 2012)
Palo Alto Arbor Day on March 7, 2013 Proclamation
Public Letters to Council Set 1
City of Palo Alto (ID # 3587)
City Council Staff Report
Report Type: Special Orders of the Day Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Abilitites United for a Public/Private Community Partnership
Presentation
Title: Abilities United for a Public/Private Community Partnership
Presentation
From: City Manager
Lead Department: Community Services
Betty Wright (1909-2004) had a vision. And in 1954 that vision came to fruition in the
Barron Park neighborhood of Palo Alto. Betty wanted to create a community, a place
where people across generations and abilities would come together to learn from one
another. The vehicle was learning how to be water-safe, with the goal of leveraging the
healing powers of water to build such community. Water – Betty prophesized – is the
greatest equalizer. Betty’s vision spread quickly through the neighborhood and with
major changes in developmental disability care and community integration her timing
could not have been more fitting. Children and teens who just a few years earlier were
locked away in institutions, now were returning to their families’ homes and were
accommodated in regular schools with support from social services. It was 1965, and
Betty had outgrown Barron Park. Now set up as the “Weddi Handiswimmers”, nearly
300 community volunteers were the organizing unit behind the coming success. The
Redwood City YMCA contracted with the Weddi Handiswimmers to run the Y pool
program. For the next three years the program kept going, while the focus evolved
toward building a new facility in Palo Alto, which would meet an even larger vision:
aquatic therapy to benefit people with any neurodegenerative condition. In 1968, the
Betty Wright Aquatic Center opened to the public. An indoor, one-story Eichler
construction, the pool offered many ADA features new at the time, including walking
protection for the blind, access ramps for those in wheelchairs, radiant heated floors
across the facility and sound baffles throughout – to create a calm sensory-integrated
environment for anyone on the Autism spectrum. A federal block grant was secured for
the amount of $71,000, equivalent to $429,000 in today’s currency, to support program
evaluation and impact of aquatic therapy. Programming ranged from morning and mid-
day services for adults with arthritic, orthopedic, and neurological conditions, to swim
lessons for children with mental retardation and cerebral palsy, throughout the day. The
program was operated until the early 1980s primarily through volunteer labor.
City of Palo Alto Page 2
With Betty’s retirement in the 1980s, the era of volunteer-driven operations gradually
came to an end. Slowly, the program shifted to being run by hired workers, and
eventually the operational costs became unsustainable. The facility was also aging and
the 1989 earthquake forced the pool shell apart from the foundation, requiring major
repairs to be performed. Nonetheless, local support stood strong for the community-
based organization, which now provided physical therapy, fitness classes, self-directed
exercises for adults, open–pool time for families and the swim lesson programs for
children with developmental disabilities. The latter programs were now paid through
third-party billing with California’s regional centers, under mandate by the Lanterman
Act in California.
As state resources dwindled, and the administrative requirements for third-party
contracting grew ever more complex, the flagship developmental disability swim lesson
program became a cost-prohibitive proposition: only one third of its costs were
supported by regional center reimbursement. Donors’ priorities shifted to infrastructure
improvements and staff development funds. The program was at the brink of closure in
2006, losing more than $350,000 in direct operating costs annually, while serving some
of the region’s most disabled and debilitating community members alongside men and
women with hidden yet debilitating disabilities, such as fibromyalgia, low-back pain, and
osteoarthritis.
A new vision and action-based leadership have fueled a new wave of investments. The
community has invested in capital improvements, leadership development, and staff
competencies, which have enhanced function and form of the aging center. Today the
center, operated at capacity, offers continuum-of-care chronic disease management for
a wide range of conditions. Tailored services include aquatic physical therapy and
hydrotherapy, often based on physicians’ referrals, and rehabilitation, fitness, and self-
directed classes conducted also with the support of program volunteers. Children enjoy
health promotion courses starting from parent-tot water safety classes and growing into
learn-to–swim programs, in inclusive integrated settings. Volunteers undergo training in
our rich history, American Red Cross water safety training, and in-water handling.
Considered a regional leader in the Western United States, and serving as a blueprint
model for community health & wellness, the Betty Wright Swim Center operates today
under a three-year strategic plan “Local therapy center today: National aquatic health
and wellness leaders in 2014.”
City of Palo Alto (ID # 3550)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Council Priority: Environmental Sustainability
Summary Title: Electric Supply Portfolio Carbon Neutral Plan
Title: Finance Committee Recommendation that the City Council Adopt a
Resolution Approving a Carbon Neutral Plan for the Electric Supply Portfolio
to Achieve Carbon Neutrality by 2013
From: City Manager
Lead Department: Utilities
Recommendation
Staff, the Utilities Advisory Commission, and the Finance Committee recommend that the City
Council:
Approve the attached resolution adopting the Carbon Neutral Plan, which would
enable the City to achieve a carbon neutral electric supply portfolio starting in
calendar year 2013 within an annual rate impact not to exceed 0.15 cents per
kilowatt-hour (₵/kWh).
This carbon neutral rate impact is in addition to the 0.5₵/kWh rate impact limit for acquiring
resources for the City’s Renewable Portfolio Standard (RPS).
Summary
The proposed Carbon Neutral Plan achieves carbon neutrality for the electric supply portfolio
by 2013 with 100% renewable resources. The cost to implement the plan is expected to be less
than 0.1₵/kWh in addition to the expected cost of about 0.4₵/kWh to meet the City’s
Renewable Portfolio Standard goal.
City of Palo Alto Page 2
The proposed plan is to purchase renewable energy under long-term contracts for about half of
the City’s electric supply needs and rely on existing carbon-free hydroelectric resources for the
other half of the City’s needs. Until those long-term contracts are in place, the plan achieves
carbon neutrality by purchasing short-term renewable resources and/or renewable energy
certificates (RECs) to supplement existing and committed long-term renewable and
hydroelectric resources.
Staff expects that a 50% RPS can be achieved with long-term renewable resources within the
existing 0.5₵/kWh rate impact limit approved by Council for RPS. Since about 50% of the
current electric supply portfolio consists of carbon-free hydroelectric resources, the additional
cost of achieving carbon neutrality in the long term is very low. In the near term (2013-2016)
before the long-term contracts are providing renewable energy, the expected cost to achieve
carbon neutrality is less than 0.1₵/kWh. The cost could increase if hydro conditions are dry and
the cost of RECs goes up significantly. However, the proposed plan includes a retail rate cap of
0.15₵/kWh to achieve carbon neutrality. If the cost is expected to exceed this rate cap in any
year, staff will return to the UAC and Council for further direction.
Committee Review and Recommendation
At its February 5, 2013 meeting, the Finance Committee discussed the proposed Carbon
Neutral Plan. The staff report to the Finance Committee with the proposed Carbon Neutral
Plan is provided as Attachment C. Staff provided a presentation of the Carbon Neutral Plan
highlighting the key policy decisions considered in the development of the plan, including
alternative products and strategies to achieve carbon neutrality; how to deal with variations in
hydroelectric supply resources; rate impacts under various hydroelectric supply and green
premium scenarios; how to pay for carbon neutrality; and community support for carbon
neutrality.
Staff explained that potential revenues from the auction of carbon allowances under the cap-
and-trade system could be used to offset the cost of achieving carbon neutrality, consistent
with the policy approved by Council for the use of cap-and-trade revenues (Resolution No.
9307). In the annual budget process, staff will propose how to pay for carbon neutrality
considering the use of cap-and-trade revenues, raising retail rates and/or using other electric
fund revenues as necessary.
Representing the Utilities Advisory Commission (UAC), Commissioner Steve Eglash indicated
that the UAC overwhelmingly supported the proposed plan with the 0.15₵/kWh rate impact
limitation and took a close look at the timing and cost of the plan. Committee members
commented that they valued the UAC’s thorough review. Committee members and speakers
from the public remarked on the leadership position the City takes with the adoption of this
plan and expressed a desire that other communities follow suit to enhance the effect of its
City of Palo Alto Page 3
adoption. After discussion, the Finance Committee voted unanimously to recommend Council
approve the proposed Carbon Neutral Plan. The minutes of the Finance Committee’s February
5, 2013 meeting are provided as Attachment D.
Resource Impact
The expected annual cost for the next five years, assuming average hydroelectric generation, to
implement the proposed Carbon Neutral Plan is shown in Table 1. Also shown is the projected
impact of these additional costs on the median residential annual electric bill (based on the
median residential monthly consumption level of 407 kWh). The actual cost is subject to actual
load, availability of hydroelectric generation, renewable energy costs, renewable attributes
banked from one calendar year to the next, and emissions emitted by existing renewable
resources and the City’s back-up generator.
Deferring implementation of the Carbon Neutral Plan to 2015 or 2017 would result in not
spending $1.24 million or $2.72 million, respectively.
Table 1: 5-Year Expected Cost and Bill Impact to Achieve Carbon Neutrality
2013 2014 2015 2016 2017
Total Cost $630,000 $610,000 $570,000 $910,000 $ 40,000
Median Residential Bill Impact ($/year) $3.07 $2.93 $2.73 $4.36 $0.19
Adoption of the Carbon Neutral Plan will not result in a need to adjust the adopted electric
commodity budget for FY 2013. Any purchases of renewable resources for calendar year 2013
will be included as part of the proposed FY 2014 Electric Fund budget.
As part of the City’s annual budget process, staff will estimate the incremental cost associated
with implementing the Carbon Neutral Plan based on the latest forecast for electric load
projections, supply resource conditions and the price of acquiring renewable resources and will
recommend how to cover these costs including the use of Electric Fund reserves, revenues from
the sale of allowances in the cap-and-trade auctions, and/or electric rate increases.
Table 2 illustrates potential customer bill impacts under different usage levels for the expected
cost and if the full rate impact limit of 0.15₵/kWh is imposed in 2013. The table also shows
how the City’s bill would compare to neighboring communities including those served by Pacific
Gas and Electric (PG&E).
City of Palo Alto Page 4
Table 2: Monthly Electric Bill Comparison for 2013
Usage
(kWh/month)
Palo Alto’s
Current Bill
($/month)
Palo Alto’s Bill with Carbon Neutral
Plan ($/month)
Santa Clara
($/month)
PG&E
($/month)
Expected Cost With 0.15₵/kWh
Residential Customer Monthly Bill
300 $28.57 $28.75 $29.02 $30.37 $38.54
(Median) 407 $42.50 $42.77 $43.18 $41.66 $53.21
650 $76.33 $76.72 $77.31 $67.11 $117.72
1,200 $172.03 $172.75 $173.83 $124.84 $300.23
Commercial Customer Monthly Bill
1,000 $127 $128 $129 $156 $163
160,000 $17,245 $17,341 $17,485 $18,002 $18,801
500,000 $50,430 $50,730 $51,180 $54,352 $54,285
2,000,000 $178,800 $180,000 $181,800 $210,129 $222,168
Policy Impacts
Approval of the recommended Carbon Neutral Plan is consistent with the Council-approved
Long-term Electric Acquisition (LEA) Objectives, Strategies and Implementation Plan; supports
the Council-approved 2011 Utilities Strategic Plan’s environmental sustainability objective; is
consistent with the City’s Climate Protection Plan; and supports environmental sustainability,
one of the City Council’s top priorities.
Environmental Impacts
Implementation of the Carbon Neutral Plan is expected to reduce 330,000 metric tons of GHG
emissions in 2013 through 2016. Beyond 2016, reductions of GHG emissions are mostly
attributed to achieving an RPS of about 50%.
Adopting a carbon neutral plan does not meet the California Environmental Quality Act‘s
(CEQA) definition of a “project” under California Public Resources Code Sec. 21065, thus no
environmental review is required.
Attachments:
Attachment A - Resolution Approving Carbon Neutral Plan (PDF)
City of Palo Alto Page 5
Attachment B - Carbon Neutral Plan (PDF)
Attachment C - Staff Report ID 3404 Electric Supply Portfolio Carbon Neutral Plan Report
for Finance Committee (PDF)
Attachment D - Draft Minutes of the Finance Committee Meeting of 02-05-13 (PDF)
* NOT YET APPROVED *
130211 dm 6051879
Resolution No. _________
Resolution of the Council of the City of Palo Alto Approving a Carbon
Neutral Plan for the Electric Supply Portfolio to Achieve Carbon
Neutrality by 2013
A. In an effort to combat climate change in December 2007 the City of Palo Alto (“City”)
adopted the Climate Protection Plan, which set aggressive greenhouse gas (GHG) emission
reduction goals to be achieved by the year 2020.
B. In March 2011, the City unanimously approved the Long-term Electric Acquisition
Plan (LEAP) a strategic planning document focused on how the City’s Utilities Department (CPAU)
can successfully balance environmental and economic sustainability as it provides electric service
to CPAU customers. LEAP was updated in April 2012 through Resolution 9241.
C. In accordance with the LEAP Climate Protection Strategy #5 to reduce the electric
portfolio’s carbon intensity, staff evaluated the costs, benefits and impacts of the implementation
of an electric portfolio carbon neutral policy and the setting of quantitative goals. Staff’s
preliminary findings were presented to the Utilities Advisory Commission (“UAC”), Finance
Committee and Council and in May 2012, the City Council directed staff to develop a plan to
achieve carbon neutrality for the electric supply portfolio by January 2015 (Staff report 2525).
D. On November 5, 2012, Council approved (Staff Report 3194) the following
definition of carbon neutrality for the City’s electric supply portfolio: A carbon neutral electric
supply portfolio will demonstrate annual net zero greenhouse gas (GHG) emissions, measured
at the Citygate, in accordance with The Climate Registry’s Electric Power Sector protocol for
GHG emissions measurement and reporting.
E. Staff presented the Carbon Neutral Plan to the UAC on December 5, 2012 and
the UAC voted unanimously (six in favor and one absent) to recommend that the City adopt the
Carbon Neutral Plan.
F. On December 16, 2012, UAC Commissioners James Cook (Chair), Steve Eglash and
John Melton presented a Commissioner’s Memorandum to request the Carbon Neutral Plan be
revisited. The Commissioner’s Memorandum was discussed at the January 9, 2013 UAC meeting
and the UAC voted (four in favor, two opposed and one absent) to recommend to Council that the
Carbon Neutral Plan’s rate cap be reduced from 0.25 cents/kWh to 0.15 cents/kWh.
G. Subsequent to the January 2013 UAC meeting, staff revised its spending cap
recommendation to limit any future electric rate impact to 0.15 cents/kWh.
H. On February 5, 2013, the Finance Committee voted unanimously (four in favor)
//
//
//
* NOT YET APPROVED *
130211 dm 6051879
to approve the revised Carbon Neutral Plan, which includes the 0.15 cents/kWh rate cap.
The Council of the City of Palo Alto does hereby RESOLVE as follows:
SECTION 1. The Council hereby adopts the resolution approving the Carbon Neutral
Plan as provided for in Exhibit A.
SECTION 2. The Council directs staff to return to the UAC and the Council in the event
that the cost of City’s achievement of carbon neutrality for the electric supply portfolio would
exceed an electric retail rate impact of 0.15 cents/kWh.
SECTION 3. The Council finds that any eventual changes to the City’s electric rates
impacted by Council’s adoption of the Carbon Neutral Plan shall not create special taxes
because such rates shall be charges imposed for a specific government service or product
provided directly to the payor that are not provided to those not charged, and which shall not
exceed the reasonable costs to the City of providing the service or product.
SECTION 4. The Council finds that the adoption of this resolution does not constitute
a project under Section 21065 of the California Environmental Quality Act (CEQA) and the CEQA
Guidelines, and therefore, no environmental assessment is required.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
___________________________ ___________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ ___________________________
Senior Deputy City Attorney City Manager
___________________________
Director of Utilities
___________________________
Director of Administrative
Services
ATTACHMENT B
1
Exhibit A to Resolution No XXXX
Adopted by City Council on ________________________________
City of Palo Alto Utilities
Electric Supply Portfolio Carbon Neutral Plan
1. Carbon Neutral Definition
A carbon neutral electric supply portfolio will demonstrate annual net zero greenhouse gas
(GHG) emissions, measured at the Citygate1, in accordance with The Climate Registry’s Electric
Power Sector protocol for GHG emissions measurement and reporting.
2. Carbon Neutral Plan Objective
Reduce the City of Palo Alto’s overall community GHG emissions by achieving carbon neutrality
for the Electric Supply Portfolio starting in calendar year 2013 within an annual rate impact not
to exceed 0.15 cents per kilowatt-hour (₵/kWh) primarily through the: 1) engagement of
customers to increase energy efficiency; 2) expansion of long-term renewable resource
commitments; 3) promotion of local renewable resources; 4) continued reliance on existing
hydroelectric resources; and 5) meeting short-term balancing requirements and/or neutralizing
residual carbon through the use of short-term purchases of renewable resources and/or
renewable energy certificates (RECs).
3. Resource Strategies
a. Energy Efficiency
i. Continue to pursue energy efficiency strategies as identified in the Council-
approved ten-year Energy Efficiency Plan.
b. Long-term Renewable Resources
i. Continue to pursue the City’s Renewable Portfolio Standard (RPS) goal to
purchase renewable energy to supply at least 33% of retail sales by 2015 while
ensuring that the retail rate impact of these purchases does not exceed 0.5
₵/kWh.
ii. Continue to pursue local renewable resources through the Palo Alto CLEAN and
PV Partners programs.
iii. Pursue additional RPS-eligible, long-term renewable resources (beyond the RPS
goals) to achieve a target of 100% carbon-free resources based on average year
hydroelectric generation.
1 Citygate is the location of the City’s main meter where the City interconnects to the Pacific Gas and Electric
transmission system. Emissions associated with of the output of the locally sited fossil gas fired combustions units
(COBUG), while not measured at Citygate, will be neutralized.
ATTACHMENT B
2
c. Short-term Renewable Resources and Renewable Energy Certificates
i. For calendar years 2013 through 2016, procure short-term renewables, if the
price is comparable to that of an un-bundled REC;
ii. For calendar years 2013 through 2016, procure RPS-eligible, un-bundled RECs as
needed to achieve carbon neutrality based on actual load and resources;
iii. Neutralize anthropogenic GHG emissions associated with renewable resources
with unbundled-RECs, which may or may not be RPS-eligible.
d. Banking and Truing Up
i. In the event that there are surplus renewables beyond the load in a particular
year, bank as many RECs as allowable under the TCR EPS protocol from
qualifying renewables from that year to minimize the need for purchasing RECs
in subsequent years.
ii. Neutralize emissions associated with market purchases resulting from deviations
between expected and actual load and renewable and hydroelectric generation
resources with unbundled-RECs, which may or may not be RPS-eligible.
4. Hydroelectric Resources
a. Continue to preserve and advocate for existing carbon-neutral hydroelectric generation
resources that provide approximately 50% of average year resource needs.
b. Plan for and acquire carbon neutral resources assuming average hydroelectric
conditions going forward.
c. Under adverse hydroelectric conditions, procure unbundled-RECs, which may or may
not be RPS-eligible, to achieve carbon neutrality up to the 0.15 ₵/kWh rate impact limit
and seek Council direction if carbon neutrality cannot be achieved within the rate
impact limit.
d. Under favorable hydroelectric conditions, where carbon neutral resources are expected
to be surplus to needs, even after allowable banking, then pursue selling short-term
renewable energy, or the renewable attributes, associated with one or more carbon-
neutral resources in the portfolio.
5. Financial and Rate Payer Impacts
a. In addition to the RPS annual rate impact limit of 0.5 ₵/kWh, the cost of achieving
carbon neutrality shall not exceed 0.15 ₵/kWh based on an average hydro year.
b. Revenues collected from surplus energy sales related to hydroelectric resources under
favorable conditions (e.g. wet years), will be maintained within reserves to adjust for the
cost of achieving carbon neutrality under adverse hydroelectric years.
c. To the extent available and allowable, revenues from the auction of cap-and-trade
allowances may be used to fund resources acquired to meet the carbon neutrality goals.
6. Reporting and Communication
a. Develop a communication plan for stakeholders to inform them of the City’s efforts
towards achieving a carbon neutral electric supply.
ATTACHMENT B
3
b. Submit an annual, verified report of the carbon content of the electric supply portfolio
to The Climate Registry.
c. Provide customers a report of the electric supply portfolio’s carbon content to
supplement the mandated Power Content Label.
d. Inform large commercial and/or corporate customers of the City’s carbon neutral
portfolio and its relevance to their individual corporate sustainability goals.
7. Implementation Plan
The tasks that need to be completed in the next two years pending Council approval of the
Carbon Neutral Plan in February 2013 are listed in the table below.
Item Timeframe
1. Modify electric supply portfolio models and Energy Risk
Management Policies, Guidelines and Procedures to account for
Carbon Neutral objectives, balancing, banking of renewable
attributes, reporting and financial impacts.
By April 2013
2. Modify the Long-term Electric Acquisition Plan (LEAP) to include
the carbon neutral objective
By June 2013
3. Develop communication plan to inform customers and
stakeholders of Carbon Neutral Plan and efforts.
February to April
2013
4. Based on response to the Fall 2012 request for proposals, seek
approval of new renewable power purchase agreements to meet
the City’s RPS up to approximately 100% of the long-term resource
needs in average hydro years.
December 2012 to
June 2013
5. Determine resource needs for CY 2013 through CY 2016 and
develop plan to acquire short-term renewable resources.
By June 2013
6. Determine long-term renewable purchase volumes for beyond CY
2016 and develop plan to acquire long-term renewable resources.
By September 2013
7. Procure RECs as needed to neutralize carbon emissions based on
actual load and resources for CY 2013.
By May 2014
8. Along with annual Power Content Label, produce and report to
customers the carbon intensity of the electric supply portfolio.
May/June 2014 and
annually thereafter
9. Produce and submit Electric Power Sector (EPS) and Local
Governments Operation Protocol (LGOP) reports to The Climate
Registry (TCR) for CY 2013.
July and October
2014 and annually
thereafter
10. Get independent verification of TCR reports and submit audited
reports to TCR.
By December 2014
and annually
thereafter
11. Redesign the PaloAltoGreen program according to Council
direction.
By December 2013
City of Palo Alto (ID # 3404)
Finance Committee Staff Report
Report Type: Meeting Date: 2/5/2013
City of Palo Alto Page 1
Council Priority: Environmental Sustainability
Summary Title: Electric Supply Portfolio Carbon Neutral Plan
Title: Utilities Advisory Commission Recommendation that the City Council
Adopt a Resolution Approving a Carbon Neutral Plan for the Electric Supply
Portfolio to Achieve Carbon Neutrality by 2013
From: City Manager
Lead Department: Utilities
Recommendation
Staff requests that the Finance Committee recommend that the City Council:
Approve the attached resolution adopting the Carbon Neutral Plan, which would
enable the City to achieve a carbon neutral electric supply portfolio starting in
calendar year 2013 within an annual rate impact not to exceed 0.15 cents per
kilowatt-hour (₵/kWh).
This carbon neutral rate impact is in addition to the 0.5₵/kWh rate impact limit for acquiring
resources for the City’s Renewable Portfolio Standard (RPS).
Originally, staff recommended a rate impact limit of 0.25₵/kWh for achieving carbon neutrality
for the electric supply portfolio. However, staff is comfortable with a rate impact limit of
0.15₵/kWh with the understanding that, if staff anticipates that the cost to achieve carbon
neutrality will exceed 0.15₵/kWh, staff will return to Council for direction. This staff position is
in response to the Utilities Advisory Commission (UAC) recommendation of 0.15₵/kWh.
At its January 2013 meeting, the Utilities Advisory Commission (UAC) recommended that the
City Council approve the attached resolution with a 0.15₵/kWh rate impact limit.
City of Palo Alto Page 2
Summary
The proposed Carbon Neutral Plan relies on long-term renewable contracts. However, since
those contracts take time to negotiate and the renewable projects take time to build, sufficient
renewable energy for the City’s needs will not be in place until 2017. In the interim, the plan
uses RPS-eligible Renewable Energy Certificates (RECs) from 2013 through 2016. Although the
Council directed staff to develop a plan to achieve carbon neutrality by 2015, the proposed
Carbon Neutral Plan allows the City to deliver zero carbon electricity starting in 2013 since the
cost is expected to be very reasonable ($500,000 to $900,000 per year for 2013 to 2016),
causing a rate impact of only 0.05 to 0.09₵/kWh. Options other than the use of RPS-eligible
RECs to achieve carbon neutrality can cost slightly less (if non-RPS-eligible RECs are used) or
significantly more (if short-term renewable energy is purchased) than the recommended plan.
Annual costs may increase due to higher costs for RECs or poor hydroelectric generation, but
the plan includes a rate impact limit of 0.15₵/kWh. If costs were to exceed that limit in any
year, staff would return to the Council for direction as to whether to continue efforts to achieve
carbon neutrality for that year.
Recognizing the significance of climate change resulting from greenhouse gas (GHG) emissions
and their potential devastating impacts to both the local and global environment and economy,
the City has a record of taking initiatives towards environmental sustainability. As such, the City
recognized environmental sustainability as one of its top priorities and in 2007 approved an
aggressive Climate Protection Plan which identified community-wide GHG emission reduction
goals.
Further, for its electric supply portfolio, the City has taken aggressive steps towards reducing
GHG emissions through its energy efficiency efforts, encouragement of the installation of solar
photovoltaic panels on rooftops, participation in the PaloAltoGreen program, and adoption of
an accelerated Renewable Portfolio Standard (RPS). Combined, these efforts are expected to
account for an over 40% drop in GHG emissions related to the local use of electricity in 2012
compared to 2005 levels (assuming average hydrological conditions).
The proposed Carbon Neutral Plan leaps the City forward in its efforts to combat climate
change by implementing a policy to effectively eliminate all GHG emissions from the electric
portfolio. Additionally, with the intent of placing the City at the forefront of environmental
sustainability, the Carbon Neutral Plan is designed to be transparent, credible, sustainable,
inspirational and repeatable by other communities. The proposed Carbon Neutral Plan
achieves carbon neutrality for the electric supply portfolio by 2013 with 100% renewable
resources. The cost of this plan is expected to be less than 0.1₵/kWh in addition to the
expected cost of about 0.4₵/kWh to meet the City’s RPS goal.
City of Palo Alto Page 3
The proposed plan has two phases. In the near term (2013 through 2016), staff recommends
purchasing short-term renewable resources and/or RECs to supplement existing and committed
long-term renewable and hydroelectric resources. Existing and committed long-term
renewable and hydroelectric resources account for 65% to 83% of the portfolio. In the long
term (beyond 2016), long-term renewable resources will provide about a 50% RPS level within
the existing 0.5₵/kWh annual RPS rate limit. Since about 50% of the electric supply portfolio is
carbon-free hydroelectric resources, the additional cost of achieving carbon neutrality between
2017 and 2020 is very small. Table 1 is a summary of the expected cost of achieving carbon
neutrality in average hydroelectric conditions.
Table 1: Total Cost to Achieve Carbon Neutrality – cents per kWh
2013 2014 2015 2016 2017 2018 2019 2020
RPS Plan: committed and additional
long-term renewables to meet RPS goal
0.10 0.24 0.38 0.38 0.40 0.40 0.40 0.40
Carbon Neutral Plan: additional costs to
achieve a carbon neutral portfolio
0.06 0.06 0.05 0.09 0.00 0.00 0.00 0.01
Total Cost 0.16 0.30 0.42 0.46 0.40 0.40 0.40 0.41
In dry years, the amount of hydroelectric generation is significantly lower than in an average
hydro year. Thus, in dry years, there are expected to be additional costs to replace the reduced
hydroelectric generation with carbon-free resources to maintain a carbon neutral portfolio.
Therefore, although staff expects that the cost of achieving carbon neutrality will be within the
0.5₵/kWh limit to meet the City’s RPS goals, staff is requesting an additional 0.15₵/kWh to
achieve carbon neutrality, if needed in the event of a dry year scenario or other unanticipated
cost increases for renewable energy.
Table 2 shows the annual cost to implement the proposed Carbon Neutral Plan. The maximum
cost, in the event that the full 0.15₵/kWh was needed to achieve carbon neutrality, is about
$1.5 million per year, or about 1.2% of total Electric Fund retail revenues. Over the period from
2013 to 2016, the expected cost of the plan is $2.6 million, but if the full 0.15₵/kWh is needed,
the total cost would be $6 million.
Table 2: Annual Cost to Implement Carbon Neutral Plan ($millions)
2013 2014 2015 2016 2017 2018 2019 2020 Total
Expected Cost 0.6 0.6 0.5 0.9 0.0 0.0 0.0 0.1 2.7
Maximum Cost (@0.15₵/kWh) 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 12
City of Palo Alto Page 4
At its December 2012 meeting, the UAC unanimously recommended Council approve the
proposed Carbon Neutral Plan. At its January 2013 meeting, the UAC reviewed the expected
and maximum costs of the proposed Carbon Neutral Plan again and recommended a rate
impact cap of 0.15₵/kWh.
Background
Policy Direction
Council approved the City’s Climate Protection Plan (CPP) in December 2007 (CMR 435:07). The
CPP set a goal to reduce GHG emissions by 15% from 2005 levels by the year 2020. In March
2011 Council approved the Long-term Electric Acquisition Plan (LEAP) (Staff Report 1317)
establishing general direction for efforts to reduce the electric portfolio’s carbon intensity. In
July 2011 Council approved the Utilities Strategic Plan (Staff Report 1880), including a
performance measure to reduce the carbon intensity of the electric portfolio. When Council
last updated LEAP in April 2012 (Staff Report 2710), it clarified that the City’s RPS is to pursue
renewable purchases of at least 33% of retail sales by 2015 within a retail rate impact of
0.5¢/kWh.
The LEAP implementation plan included a task to evaluate the costs, benefits and impacts of
implementing a carbon neutral electric supply portfolio policy and/or setting quantitative GHG
emission goals for the electric supply portfolio. On May 21, 2012, Council unanimously directed
staff to develop a plan by December 2012 to achieve carbon neutrality for the electric supply
portfolio by January 2015 (Staff Report 2525). On November 5, 2012, Council approved the
following definition of carbon neutrality for the City’s electric supply portfolio (Staff Report
3194):
Carbon Neutrality: A carbon neutral electric supply portfolio will demonstrate
annual net zero greenhouse gas (GHG) emissions, measured at the Citygate1, in
accordance with The Climate Registry’s Electric Power Sector protocol for GHG
emissions measurement and reporting.
On December 10, 2012, the Council approved a policy for the use of cap-and-trade revenues
(Staff Report 33342) which is intended to be consistent with the goals set forth in the State of
California’s Global Warming Act, also known as Assembly Bill 32 (AB 32). Recognizing a
potential cap-and-trade program revenue benefit of approximately $4.5 million per year for the
City’s electricity customers, the policy establishes the proper use of the potential revenues,
1 Citygate is the industry term for the location of the City’s main meter where the City interconnects to the Pacific
Gas and Electric transmission system.
City of Palo Alto Page 5
including funding investments in activities to reduce GHG emissions and/or achieve a carbon
neutral electric supply portfolio.
Electric Portfolio Mix
Energy Efficiency: As required by state law (AB 2021, 2006), publicly owned electric utilities
must identify all potentially achievable cost-effective electric energy efficiency (EE) savings and
establish annual targets for energy efficiency over 10 years. The ten-year energy savings and
demand reduction targets are required to be updated every four years to reflect changes in
technologies, building codes, equipment standards, energy cost, etc. These targets were last
updated in December 2012, when the Council adopted the latest 10-year cumulative electric
savings target of 4.8% for 2014 to 2023, which included an explicit accounting of savings
attributed to appliance codes and building standards upgrades (Staff Report 3358).
Renewable Energy: Staff expects to reach an RPS of 33% of retail sales by 2015 and an RPS of
about 50% of retail sales by 2017 within the 0.5₵/kWh RPS rate impact limit. These committed
and expected RPS resources are all from long-term Power Purchase Agreements (PPAs). The
cost of each resource is compared to the cost of an equivalent amount of brown power and the
increased (or decreased) cost, or “green premium” of the renewable energy is calculated. Table
3 is a summary of the City’s committed renewable resources and the green premium for each
resource type. As shown, the green premium for all committed resources totals $3.86 million,
or a rate impact of 0.38¢/kWh.
Table 3 – Summary of Currently Committed Renewable Energy Supplies in 2015
Annual Generation
(GWh)
Total Annual Green
Premium ($1000)
Small Hydro 10.0 0
Wind 120.3 (339)
Landfill Gas to Energy 126.0 2,229
Geothermal 33.1 1,107
Solar 50.7 857
Total Committed Renewable Supplies 340.0 3,855
*Annual green premium associated with a rate impact of 0.5¢/kWh is equal to $5.1 million
Community Support for Carbon Neutrality
Sensitive to adding even modest costs to the electric supply portfolio in a time when costs are
projected to increase substantially due to external factors including transmission and delivery
costs and increased regulatory requirements, staff sought input from the community to assess
City of Palo Alto Page 6
support for carbon neutral efforts and their willingness to pay for a carbon neutral electric
supply. In general, support by residents for efforts to achieve carbon neutral are high, with 73%
of those residents surveyed indicating a willingness to pay at least $2 more per month to
achieve carbon neutrality and 63% willing to pay $5 or more.
By contrast, 63% of a relatively small sampling of commercial customers responded to the same
anonymous survey and indicated that they would not be willing to pay more in support of
carbon neutrality. A summary of the survey responses is provided as Attachment C. In
addition, staff individually contacted many of the largest commercial customers and found that
all those contacted supported the City’s pursuit of a carbon neutral electric portfolio at a
moderate cost and stated that such an endeavor would assist them in meeting their own
corporate GHG emissions reduction goals.
Discussion
The definition of carbon neutrality establishes the measuring point, scope, and balancing period
for the achievement of zero net GHG emissions for the electric supply portfolio. While the
Carbon Neutral Plan provides for how and when carbon neutrality will be achieved, it is
intended to work in concert with the City’s EE goals, local resource generation efforts and RPS
to achieve the overall goal of cost effectively eliminating GHG emissions from the electric
supply portfolio.
Base Case (Make no extra attempt to achieve carbon neutrality)
The current (“Base Case”) electric supply portfolio consists of hydroelectric resources, which
provide about 51% of the City’s electric needs in an average year. In addition, committed RPS-
eligible renewable resources account for 23% and 27% of the City’s needs in 2013 and 2014,
respectively and 33% of the City’s needs in 2015 and beyond. In addition, the City’s ten-year EE
goals and the long-term PV Partners program goals are assumed to be met.
Since the committed renewable resources consume about 0.38₵/kWh of the RPS green
premium, the Base Case assumes that additional renewables will be pursued to meet the City’s
additional long-term electric needs. Based on the responses to a solicitation released in the Fall
of 2012 for additional renewable energy PPAs, staff expects to be able to purchase long-term
renewable energy resources for the balance of the City’s electric needs within the 0.5₵/kWh
rate impact limit starting in 2017.
Therefore, due to the RPS goal, and even without a carbon neutral goal, carbon-free large
hydroelectric resources would provide about half of the electric supplies required and long-
term RPS-eligible resources would provide the other half starting in 2017 (when the additional
City of Palo Alto Page 7
long-term resources are expected to be on-line and delivering energy). Staff expects that this
can be achieved with a rate impact of only 0.4₵/kWh. Table 4 is a summary of the Base Case
resource mix, including the current and additional resources to meet the RPS goal. Figure 1
shows the committed and expected resources to meet the City’s RPS in the Base Case portfolio.
Table 4: Committed and Expected (Base Case) Resource Supply Mix
2013 2014 2015 2016 2017 2018 2019 2020
Load (GWh) 1,040 1,053 1,056 1,054 1,052 1,054 1,057 1,059
Large hydroelectric (% of Load) 43% 44% 51% 51% 51% 51% 51% 51%
Committed renewable RPS-compliant resources
Committed renewable resources (GWh) 234 281 340 340 339 339 339 339
% of Retail Sales (RPS) 23% 28% 33% 33% 33% 33% 33% 33%
% of Load 23% 27% 32% 32% 32% 32% 32% 32%
RPS Green Premium consumed (¢/kWh) 0.10 0.24 0.38 0.38 0.38 0.38 0.38 0.38
Total committed plus hydro resources
(% of Load)
65% 71% 83% 83% 83% 83% 83% 83%
Committed plus additional long-term RPS-compliant renewables – BASE CASE
Additional long-term resources (GWh) 0 0 0 0 180 176 176 175
% of Retail Sales (RPS) 23% 28% 33% 33% 51% 51% 50% 50%
% of Load 23% 27% 32% 32% 49% 49% 49% 48%
RPS Green Premium consumed (¢/kWh) 0.10 0.24 0.38 0.38 0.40 0.40 0.40 0.40
Total committed and additional
renewables plus hydro resources
(% of Load)
65% 71% 83% 83% 100% 100% 100% 100%
City of Palo Alto Page 8
Figure 1: Electric Portfolio Load and Expected Resource Supply Mix (Base Case)
Due to the electric supply portfolio’s heavy reliance on hydroelectric sources, the volume of
system energy purchases can vary substantially from year to year given variations in the
hydrologic cycle. These hydroelectric generation variations are an important driver of the costs
associated with zeroing out GHG emissions in dry years.
Electric Portfolio’s GHG Emissions
Under the adopted carbon neutrality definition, which uses The Climate Registry’s Electric
Power Sector (TCR EPS) protocol, GHG emissions from all supply resources must be counted
(See Attachment D for a summary of the TCR EPS protocol). According to the protocol, the only
resources in the Base Case with GHG emissions are associated with renewable energy
generated from the geothermal project, the small amount of emissions associated with the
City-owned back-up generator (COBUG), and the market purchases.
The TCR EPS protocol allows the use of a default emissions factor for landfill-gas-to-energy
projects of 38 lb CO2e/MWh if there is no information about the emissions associated with the
specific projects in the portfolio. The emissions for these projects are derived from the use of
City of Palo Alto Page 9
fossil-fuel based natural gas used to supplement the renewable landfill gas used in the
generators. However, for Palo Alto’s PPAs for landfill-gas-to-energy projects, only landfill gas is
used, so those resources are carbon-free and an emissions factor of 0 lb CO2e/MWh is applied.
Table 5 shows the GHG emissions for the Base Case for the years 2013 thorugh 2020. As
shown, the bulk of the GHG emissions for the near term are due to the market purchases. After
2017, due to the large amount of renewable resources, the GHG emissions are projected to be
very small.
Table 5: Base Case Electric Supply Resources and GHG Emissions by Year
2013 2014 2015 2016 2017 2018 2019 2020
Load and Resources (GWh)
Load 1,040 1,053 1,056 1,054 1,052 1,054 1,057 1,059
Committed Carbon-
Free Resources (1)
681 744 840 844 843 846 848 848
Geothermal 0 5 33 33 33 33 33 33
Additional
renewables
0 0 0 0 180 176 176 175
Market Purchases
(“System Energy”) (2)
359 304 182 177 -4 -1 1 3
GHG emissions (Metric Tons CO2e)
Geothermal 0 589 3,523 3,533 3,523 3,523 3,523 3,533
COBUG 278 278 278 279 278 278 278 279
Market Purchases (2) 107,634 91,120 54,720 52,998 0 0 242 934
Total GHG emissions 107,912 91,987 58,521 56,810 3,801 3,801 4,043 4,746
(1) Includes hydroelectric, wind, landfill gas-to-energy, and solar resources
(2) A Market Purchase, also called System Energy, is “brown” power whose source is
unspecified, or not tied to a specific generator
Resources that Can Be Used to Achieve Carbon Neutrality
Emissions from the sources listed in Table 5 can be zeroed out through three primary methods:
purchasing RECs, purchasing renewable energy, and purchasing carbon offsets. RECs can be
purchased separately from the associated energy (“unbundled”) or together with the energy
from the renewable energy project (“bundled”).
City of Palo Alto Page 10
Renewable Energy Certificates (RECs) – A Primer
The U.S. Environmental Protection Agency (EPA) has provided a definition and descriptions of
the various types of RECs2. According to EPA:
“A REC represents the property rights to the environmental, social, and other non-
power qualities of renewable electricity generation. A REC, and its associated attributes
and benefits, can be sold separately from the underlying physical electricity associated
with a renewable-based generation source. RECs provide buyers flexibility in procuring
green power across a diverse geographical area, and in applying the renewable
attributes to the electricity use at a facility of choice. This flexibility allows organizations
to support renewable energy development and protect the environment when green
power products are not locally available.
“All grid-tied renewable-based electricity generators produce two distinct products:
physical electricity and RECs. At the point of generation, both product components can
be sold together or separately, as a bundled or unbundled product. In either case, the
renewable generator feeds the physical electricity onto the electricity grid, where it
mixes with electricity from other generation sources. Since electrons from all generation
sources are indistinguishable, it is impossible to track the physical electrons from a
specific point of generation to a specific point of use.
“As renewable generators produce electricity, they create one REC for every 1000
kilowatt-hours (or 1 megawatt-hour) of electricity placed on the grid. If the physical
electricity and the associated RECs are sold to separate buyers, the electricity is no
longer considered “renewable” or “green.” The REC product is what conveys the
attributes and benefits of the renewable electricity, not the electricity itself.
“RECs serve the role of laying claim to and accounting for the associated attributes of
renewable-based generation. The REC and the associated underlying physical electricity
take separate pathways to the point of end use. As renewable generators produce
electricity, they have a positive impact, reducing the need for fossil fuel-based
generation sources to meet consumer demand. RECs embody these positive
environmental impacts and convey these benefits to the REC owner.”
2 See EPA’s white paper on RECs at: http://www.epa.gov/greenpower/documents/gpp_basics-recs.pdf
City of Palo Alto Page 11
Unbundled RECs
System energy emissions can be eliminated on a carbon accounting basis through purchasing an
equal amount of RECs, which are denominated in MWhs. In essence, this “converts” system
energy into non-emitting renewable energy. This is similar in concept to how green pricing
programs such as PaloAltoGreen are administered. These unbundled RECs are also referred to
as “Bucket 3” RECs3 and qualifying Bucket 3 RECs can meet a portion of the RPS goals.
TCR protocols allow entities that procure unbundled RECs to adjust their emissions inventories
to account for these products. Even though the physical energy is not delivered, TCR allows the
use of unbundled RECs—whether RPS eligible or not—to displace an equivalent amount of
power from the actual power mix. This adjustment is allowed because the RECs include all
renewable and environmental attributes associated with the production of electricity from the
renewable energy resource.
RECs are also denominated in pounds of CO2e emissions reductions. Each REC can be used for
its MWh denomination, or its carbon intensity, but not both. RECs are assigned carbon
emissions factors based on the location of the renewable energy project associated with the
REC. The TCR protocol allows such uses of RECs to zero out emissions associated with emitting
renewable or brown resources.
As described by the EPA above, RECs mitigate the environmental harm associated with brown
power purchases by creating and maintaining the market for renewable energy and providing
renewable generators a source of income from buyers wishing to purchase the renewable
attribute, even if physical delivery of the energy is too expensive or complicated to complete.
In addition, the cost of this mitigation is reasonable, particularly now when the cost of
unbundled RECs is quite low. For example, when last purchased for the PaloAltoGreen
program, unbundled REC prices were less than 1₵/kWh so a REC buyer could “green up” brown
power purchases for a modest cost.
Renewable Energy – Bundled Energy and RECs
To eliminate GHG emissions, carbon-free resources can be purchased instead of system energy.
In other words, instead of purchasing system energy in the spot market or on a forward basis to
meet loads, CPAU would purchase energy from carbon-free resources. These carbon-free
resources can be purchased in the spot markets, on a forward basis in the short-term (less than
three years out), or in the long-term markets (similar to the City’s long-term renewable PPAs).
3 California’s RPS rules classify RPS eligible products into three Procurement Categories or “Buckets.” Bucket 1 is
for bundled energy and RECs that are generated in-state. Bucket 2 is for “firmed and shaped” bundled energy and
RECs – which generally means energy from a resource located out-of-state that is delivered to California after it is
generated. Bucket 3 is for REC only products (RECs separated, or “unbundled”, from the underlying energy).
City of Palo Alto Page 12
These carbon-free resources may or may not be RPS-eligible resources. RPS-eligible bundled
energy and RECs are also referred to as “Bucket 1” (in-state) and “Bucket 2” (out-of-state)
resources.
Environmental Offsets
GHG emissions can be zeroed out, or “neutralized”, by purchasing GHG offsets in amounts
equal to the emissions. This is a relatively straightforward calculation of computing the total
annual tonnage of emissions and purchasing an equivalent tonnage of third party certified
carbon offsets.
GHG offsets4 are tradable credits issued for emissions reductions resulting from qualifying GHG
mitigation projects. They can be purchased in the voluntary market (for example to achieve
carbon neutral objectives) or in the compliance markets (for example, to meet cap-and-trade
requirements). The California Air Resources Board (CARB) currently recognizes offsets issued by
the Climate Action Reserve for several types of GHG mitigation projects—including forestry,
urban forestry, livestock methane, and ozone depleting substances—for use in meeting AB32
GHG reduction goals.
With the uncertainty associated with the use and eligibility of various types of offset products
coupled with the lack of compliance-driven buyers, the market for offsets is currently very
illiquid and there is a great deal of uncertainty around the long-term market price of these
products.
Alternative Carbon Neutral Portfolios
Alternative electric supply portfolios can be constructed to achieve carbon neutrality. Given
the timing of the committed and planned additional renewable resources, it is helpful to
evaluate the near term (2013 through 2016) separately from the longer term (2017 and
beyond). In the longer term, since the Base Case portfolio consists of hydro resources and long-
term renewable PPAs, resources will only be needed to neutralize the small amount of carbon
emissions from the portfolio and to balance actual energy production and usage on an annual
basis.
The types of resources available to achieve carbon neutrality are limited in the near term to
short-term bundled renewable resources, unbundled RECs from existing facilities, or
environmental offsets. While the carbon neutral definition allows for the use of environmental
4 The World Resource Institute defines a carbon offset as “a unit of carbon dioxide-equivalent (CO2e) that is
reduced, avoided, or sequestered to compensate for emissions occurring elsewhere.”
City of Palo Alto Page 13
offsets to neutralize carbon, staff is not recommending using them at this time, however will
continue to evaluate for future consideration. The cost of acquiring renewable resources is
dependent on the area from which the renewable energy is derived, whether or not it qualifies
as an RPS-eligible renewable resource and the RPS compliance category it falls within. Table 6
is a summary of the estimated green cost premium (cost of green resource above the cost of
brown power) of each product.
Table 6: Short-term Products to Achieve Carbon Neutrality
Product RPS Eligible
Cost Premium
($/MWh)
Bundled renewable energy with RECs from California Yes – Bucket 1 $10-$30
Bundled renewable energy RECs imported into California Yes – Bucket 2 $5-$25
Unbundled RECs Yes – Bucket 3 $1-$10
Non-RPS Unbundled RECs No $1-$5
To assess how the different products can alter the costs of achieving carbon neutrality for the
electric supply portfolio, staff developed three alternatives to the Base Case portfolio to
evaluate how changes in the resource mix result in different costs. In each case, the Base Case
portfolio is the starting point so that the long-term portfolio (beyond 2016) is essentially the
same for each alternative (about 50% hydro and 50% long-term RPS-eligible PPAs). The
alternative portfolios are:
1. Proposed Carbon Neutral Plan: In this plan, carbon neutrality is achieved in the near
term (2013 to 2016) by acquiring RPS-eligible unbundled RECs to green up brown
market purchases on an annual basis. In dry years, the plan also calls for the purchase
of RPS-eligible unbundled RECs to meet needs.
2. Non-RPS Unbunbled RECs Plan: This plan involves procuring non-RPS eligible,
unbundled RECs to achieve carbon neutrality in the near term and in dry years.
3. Hard Resources Plan: This alternative limits the purchase of unbundled RECs and,
instead, displays a strong preference for actual renewable energy deliveries. In this
plan, carbon neutrality is achieved in the near term through commitments to short-term
renewable resources (bundled energy and RECs). In dry years, to the extent they are
available, short-term renewable resources would be purchased as well. If unavailable,
unbundled RECs would be purchased in dry years to meet needs.
City of Palo Alto Page 14
In all years and for all of the alternatives, non-RPS eligible unbundled RECs will be used to
neutralize actual GHG emissions (e.g. from geothermal resources and the COBUG units) and to
cover variations in needs associated with deviations in load, renewable energy and
hydroelectric generation output. These purchases will likely be made after the calendar year is
over when actual load and resources are known. Staff could pursue acquiring additional hard
resources and/or RPS-eligible resources to cover the deviations, however given the timing of
when the purchases will be made, it is less likely that such resources will be available and
therefore unbundled non-RPS compliant RECs may be the only viable alternative. Table 7
summarizes the Base Case and the alternatives evaluated.
Table 7: Summary of Base Case (Do Nothing) and Carbon Neutral Alternatives
Base Case Recommended
Plan
Non-RPS
Unbundled RECs Hard Resources
Resources for balance of
needs in near term (2013-
2016)
Market
purchases
Market
purchases plus
RPS-eligible
unbundled RECs
Market
purchases plus
non-RPS eligible
unbundled RECs
Short-term bundled
renewable
resources
Additional resources
required in dry years
Market
purchases
Market purchases plus non-RPS
eligible unbundled RECs
Short-term bundled
renewables (if
available) or market
purchases plus
unbundled RECs
Balancing for actual needs
and actual generation
Market
purchases/
sales
Market purchases/sales, banking plus unbundled RECs
Resources to neutralize GHG
emissions associated with
renewables and COBUG
None Non-RPS eligible unbundled RECs
Resources for long-term
needs (beyond 2016)
Long-term RPS-eligible PPAs and hydro resources to meet
approximately 100% of needs
Table 8 illustrates the cumulative cost, financial impacts, and RPS for the various alternatives
relative to the Base Case, in which carbon neutrality is not pursued.
City of Palo Alto Page 15
Table 8: 2013-2020 Cumulative Costs and RPS of Various Alternatives 2013-2020
Base Case Recommended
Plan
Non-RPS
Unbundled
RECs
Hard
Resources
Cost and Rate Impacts
Incremental Cost to Base Case ($M) N/A $2.93 $1.86 $16.5
Rate Impact (¢/kWh) N/A 0.035 0.022 0.20
Rate Impact (%) * N/A 0.3% 0.2% 1.7%
Average Residential Bill Impact ($/year) • N/A $1.70 $1.08 $9.60
RPS
2013 23% 58% 23% 58%
2014 28% 57% 28% 57%
2015 and 2016 33% 51% 33% 51%
Beyond 2016 51% 51% 51% 51%
* Rate impact calculations assume that the system average retail rate for the Base Case is 12.1¢/kWh in
2015
Assuming median residential class usage of 407 kWh/month (actual from FY 2011)
The analysis shows that the cumulative cost (from 2013 through 2020) of achieving carbon
neutrality under the recommended plan is expected to be $2.93 million more than the Base
Case and would result in an average increase in rates of 0.035₵/kWh over the Base Case. The
analysis also shows that carbon neutrality can be achieved at lower costs by purchasing non-
RPS compliant RECs as in the Non-RPS Unbundled RECs case. The cost of pursuing the
Recommended Carbon Neutral Plan is $1.07 million more than the Non-RPS Unbundled RECs
alternative, with the majority of the cost occurring in the near term. While the Non-RPS
Unbundled RECs alternative is less expensive than the Recommended Carbon Neutral Plan, it
does not increase the City’s RPS in the near term, which may be of value to the community.
Conversely, pursuing the Hard Resources alternative would result in a significantly higher cost—
$16.5 million over the Base Case and $13.6 million more than the Recommended Carbon
Neutral Plan—while having the same RPS as the Recommended Carbon Neutral Plan.
Sensitivity Analysis
The alternatives were evaluated under different scenarios including variations in the green
premium price of resources and generation from hydroelectric resources. The estimated rate
impact of each alternative plan was assessed under the expected case, which assumes average
hydroelectric generation and expected green premiums, and four scenarios, including:
City of Palo Alto Page 16
1. High Renewable Premium Price – assumes average hydroelectric generation and that
the price of acquiring renewables is 50% higher than expected;
2. Dry Hydroelectric Year – assumes the expected renewable premium price for purchasing
carbon neutral resources for quantities up to the amount needed under average
hydroelectric conditions. The increased amount needed between the dry hydro and
average hydroelectric conditions is made up with non-RPS eligible unbundled RECs,
since these RECs would likely be the most readily available;
3. Dry Hydroelectric Year and High Renewable Premium Price – same as the second
scenario, but the premiums for acquiring all resources is 50% higher than expected; and
4. Wet Hydroelectric Year – assumes favorable hydroelectric conditions and the expected
price for acquiring and/or selling surplus renewables.
City of Palo Alto Page 17
Table 9: Cost of Carbon Neutrality of Alternative Plans versus Base Case Plan (cents per kWh)
Strategy/Scenario 2013 2014 2015 2016 2017 2018 2019 2020
Expected - Average Hydro Year, Base Green Premium Prices
1. Recommended Plan 0.06 0.06 0.05 0.09 0.00 0.00 0.00 0.01
2. Non-RPS Unbundled RECs 0.03 0.04 0.04 0.04 0.00 0.00 0.00 0.01
3. Hard Resources 0.35 0.43 0.35 0.42 0.00 0.00 0.01 0.01
Average Hydro Year, High Green Premium Prices
1. Recommended Plan 0.09 0.09 0.08 0.13 0.00 0.00 0.01 0.01
2. Non-RPS Unbundled RECs 0.05 0.07 0.05 0.07 0.00 0.00 0.00 0.01
3. Hard Resources 0.52 0.65 0.52 0.63 0.00 0.00 0.01 0.02
Dry Hydro Year, Base Green Premium Prices
1. Recommended Plan 0.07 0.08 0.10 0.15 0.07 0.09 0.10 0.11
2. Non-RPS Unbundled RECs 0.05 0.07 0.08 0.10 0.08 0.09 0.10 0.11
3. Hard Resources 0.35 0.45 0.39 0.47 0.07 0.09 0.11 0.11
Dry Hydro Year, High Green Premium Prices
1. Recommended Plan 0.10 0.11 0.13 0.19 0.07 0.09 0.11 0.11
2. Non-RPS Unbundled RECs 0.06 0.09 0.10 0.13 0.07 0.09 0.10 0.11
3. Hard Resources 0.53 0.67 0.56 0.68 0.06 0.09 0.11 0.11
Wet Hydro Year, Base Green Premium Prices
1. Recommended Plan 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2. Non-RPS Unbundled RECs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
3. Hard Resources 0.04 0.00 0.00 0.00 0.00 0.00 0.00 0.00
As shown in Table 9, the cost to achieve carbon neutrality is minimal after 2016 due to the high
level of long-term renewable PPAs in the portfolio. In those years, the cost increases somewhat
in dry years, but no more than 0.11₵/kWh.
In the near term, under the average hydroelectric conditions and expected green premium
prices, the cost of achieving carbon neutrality can range from zero to 0.43₵/kWh, depending on
the plan. When subjected to high green premiums and a dry hydro year, the cost to achieve
carbon neutrality increases and can be as high as 0.68₵/kWh, depending on the plan. Under
the Recommended and Non-RPS Unbundled RECs plans, however, the incremental cost under
City of Palo Alto Page 18
all scenarios is expected to remain under the proposed 0.15₵/kWh carbon neutral rate impact
limit except in the scenario with dry hydro conditions and high green premium prices. In fact,
given that the expected RPS cost is 0.41₵/kWh, the cost of both RPS and carbon neutrality is
under 0.50₵/kWh in all but the worst cases.
The analysis shows that the cost in any given year can vary significantly. For example, in 2016
the cost for the Hard Resources plan is expected to be 0.42₵/kWh, but can be as high as
0.68₵/kWh under adverse hydroelectric and market conditions. In such a case, the incremental
cost of achieving carbon neutrality is significantly higher than the recommended carbon neutral
rate impact limit of 0.15₵/kWh. Should the estimated incremental cost in any year exceed the
rate impact limit, staff will seek Council direction about whether or not to pursue carbon
neutrality for that year.
Conversely, in favorable hydroelectric conditions, the portfolio can have more carbon neutral
resources than needed to meet load. Should this condition materialize, staff will carry over, or
“bank”, the renewable attributes from one year to the next to the extent allowed under the
TCR EPS protocol. The protocol does not allow for the banking of renewable attributes
associated with the City’s existing hydroelectric resources, therefore only attributes from the
City’s other renewable resources will be banked. Should the portfolio contain surplus carbon
neutral resources in consecutive years, then the City could sell excess renewable attributes to
offset the cost of achieving carbon neutrality.
Summary of the Carbon Neutral Plan
The attached Carbon Neutral Plan (Attachment B) provides a summary of the resource
acquisition strategies, management of existing hydroelectric resources, communication and
reporting to stakeholders, funding carbon neutrality and describes the implementation plan.
In summary, the proposed Carbon Neutral Plan comprises the following policy decisions:
1. What to do in the near term: The options are to buy short-term renewables, unbundled
RPS-eligible RECs, or unbundled non-RPS RECs. The proposed plan is to allow staff
discretion to buy unbundled RECs with a preference for RPS-eligible RECs, but,
depending on the price difference between RPS-eligible and non-RPS RECs, allow the
purchase of non-RPS RECs. The expected cost difference is shown in the Table 10.
City of Palo Alto Page 19
Table 10: Expected Cost to Achieve Carbon Neutrality in the Near Term
2013 2014 2015 2016
Expected cost for Recommended Plan
(use RPS-eligible RECs) $630,000 $610,000 $570,000 $910,000
Expected cost to use non-RPS eligible RECs $360,000 $460,000 $390,000 $470,000
Expected cost to use short-term renewables $3,600,000 $4,600,000 $3,700,000 $4,400,000
Table 10 also shows the cost to achieve carbon neutrality as early as 2013. If carbon
neutrality is not pursued until 2015, for example, the costs shown for 2013 and 2014
would be avoided. Based on the relatively low costs, the Recommended Carbon Neutral
Plan is to achieve carbon neutrality starting in 2013.
2. Balancing to true up loads and resources each year: Truing up loads and resources each
year to ensure carbon neutrality will occur each year after the fact. This means that
loads and resources will not be trued up on a daily, weekly, or monthly basis, but on an
annual basis for purposes of achieving a carbon neutral portfolio. The recommended
resources for these small amounts are unbundled RECs. Staff expects to purchase these
RECs to ensure that the end of the year GHG emissions counting will result in a carbon
neutral portfolio. If RECs are needed, staff will purchase them and, if resources are
greater than loads, RECs will be banked as allowed by the TCR EPS protocol.
3. What to do in dry years: Additional resources will be required in dry years. Staff
requests discretion in what resources to purchase in these years within the allowable
rate impact limit. At least some of the purchases will likely take place after the fact as
the loads and resources are balanced and unbundled RECs will likely be the best product
for this balancing.
4. What to do in wet years: In wet years, banking of RECs will be pursued as allowed by
the TCR EPS protocol. However, not all RECs may be able to be banked, or there may be
consecutive wet years so staff expects to sell surplus renewable and/or hydro resources
and/or RECs to cost-effectively balance resources and needs.
5. Neutralizing GHG emissions: The plan to neutralize the portfolio’s GHG emissions from
renewable resources (i.e. geothermal PPA) and the COBUG units is to buy unbundled
RECs for their CO2e emissions reductions. Staff plans to buy the lowest cost RECs (in
$/pound of CO2e emissions) for these requirements. The geothermal project and the
COBUG are estimated to have 3,811 metric tons per year of GHG emissions. The cost
City of Palo Alto Page 20
for the RECs (denominated in pounds of CO2e emissions) to neutralize these emissions
is expected to cost about $10,000 per year.
Figure 2 shows the resources planned for the Proposed Carbon Neutral Plan. As shown, large
hydroelectric supplies provide about 50% of the City’s needs while committed renewable
resources provide an additional 35% of the City’s needs starting in 2017. The plan is for future
long-term contracts for renewable energy to provide the balance of the City’s needs in the long-
term. Short-term renewable energy purchases or RECs are proposed to be used to achieve
carbon neutrality until 2017.
Figure 2: Electric Portfolio Expected Resource Supply Mix for Proposed Carbon Neutral Plan
GHG Emission Reductions Beyond the Electric Supply Portfolio
Once the electric supply portfolio is carbon neutral, the primary sources of GHG emissions for
the City and community are related to the use of natural gas and transportation fuels.
Strategies to reduce GHG emissions for those sources will be addressed in the Climate
City of Palo Alto Page 21
Protection Plan and could include some of the following strategies that may impact the electric
utility:
1. Support the expanded use of electric vehicles.
2. Support customers who wish to switch from natural gas to electric for appliances.
3. Support customers who wish to switch from natural gas or propane to electric for water
or space heating.
4. Modify the PaloAltoGreen program to compliment a carbon neutral electric portfolio
consistent with existing participants’ sustainability goals.
The proposed Carbon Neutral Plan for the electric supply portfolio does not address these
strategies, but their implementation will affect the electric utility’s load and, therefore, the
Carbon Neutral Plan.
Commission Review and Recommendation
At its December 5, 2012 meeting, the UAC discussed the proposed Carbon Neutral Plan for the
electric supply portfolio. Staff provided a brief presentation of the proposed Carbon Neutral
Plan, which at that time included a rate impact limit of 0.25₵/kWh.
The presentation was followed by oral comments from community members in favor of the
proposed Carbon Neutral Plan. The discussion by the UAC commissioners centered on the cost
of achieving carbon neutrality in the near term versus long-term and the bill impact for
residential and commercial customers. The UAC requested that it be noted that savings could
be achieved by not pursuing carbon neutrality as soon as 2013 and requested that staff clearly
provide Council with the annual cost to achieve carbon neutrality.
The UAC voted unanimously to recommend that Council approve the proposed Carbon Neutral
Plan with a rate impact limit of 0.25₵/kWh. The minutes of the UAC’s December 5, 2012
meeting are provided as Attachment E.
Subsequent to the UAC’s December meeting, members of the UAC provided a Commissioners’
Memorandum (Attachment F) requesting further discussion about the expected cost of
achieving carbon neutrality and the proposed spending limit of 0.25₵/kWh. A discussion about
the Commissioners’ Memorandum, which advised a cap on total spending between 2013 and
2016 and a cap on the price per REC purchased, was held at the UAC’s January 9, 2013 meeting.
The Commission discussed the impacts of the 0.25₵/kWh limit in the case of adverse
conditions, noting that costs could range from $2.5 million to $5 million to achieve carbon
neutrality in 2013 instead of 2015, which is the date by which the Council requested staff
City of Palo Alto Page 22
develop the plan to achieve carbon neutrality. The Commission made clear that it supported
the Carbon Neutral Plan, but was concerned about expenditures that might be required to do
so.
Commissioner Eglash made a motion to revise the rate impact cap to 0.15₵/kWh, instead of
0.25₵/kWh. The motion to recommend that Council achieve carbon neutrality for the electric
supply portfolio within a cost cap of 0.15₵/kWh passed (4-2) with Foster and Melton opposed
and Waldfogel absent. Draft minutes of the UAC’s January 9, 2013 meeting are provided as
Attachment G.
Following the UAC’s January 2013 meeting, staff decided to revise its recommendation for the
spending cap to a rate impact limit of 0.15₵/kWh with the idea that, if additional funds are
needed to achieve carbon neutrality, it will return to the UAC for recommendation and to the
Council for direction.
Resource Impact
Adoption of the Carbon Neutral Plan will not result in a need to adjust the adopted electric
commodity budget for FY 2013. Any purchases of RECs and/or renewable resources for CY
2013 will most likely occur after the fiscal year has ended and will be included as part of the
proposed FY 2014 Electric Fund budget. The cost of reporting and verifying GHG emissions to
The Climate Registry will also be identified and included in the annual budget process. Existing
staff resources are sufficient to implement the Carbon Neutral Plan.
Table 11 shows the expected cost per calendar year for the next five years, assuming average
hydroelectric generation and the expected cost of acquiring renewable resources based on the
proposed Carbon Neutral Plan. Table 11 also shows the impact of these additional costs on the
median residential annual electric bill (based on the median residential monthly consumption
level of 407 kWh). The actual cost is subject to actual load, availability of hydroelectric
generation , renewable energy costs, renewable attributes banked from one calendar year to
the next, and emissions emitted by existing renewable resources and the City’s back-up
generator. The timing for a rate increase to implement the plan depends upon other aspects of
the electric budget and the level of reserves. However, if Council approves the proposed
Carbon Neutral Plan, the cost would increase as shown in Table 11 as early as 2013. Deferring
implementation of the Carbon Neutral Plan to 2015 or 2017 would result in not spending $1.24
million or $2.72 million, respectively.
City of Palo Alto Page 23
Table 11: 5-Year Expected Cost and Bill Impact to Achieve Carbon Neutrality
2013 2014 2015 2016 2017
Total Cost $630,000 $610,000 $570,000 $910,000 $ 40,000
Median Residential Bill Impact ($/year) $3.07 $2.93 $2.73 $4.36 $0.19
As part of the City’s annual budget process, staff will estimate the incremental cost associated
with implementing the Carbon Neutral Plan based on the latest forecast for electric load
projections, supply resource conditions and the price of acquiring renewable resources.
Further, through the annual budget process, staff will assess the financial situation of the
Electric Fund and recommend how to cover any cost increases associated with implementing
the Carbon Neutral Plan including the use of Electric Fund reserves, revenues from the sale of
allowances in the cap-and-trade auctions and/or electric rate increases.
Table 12 shows the expected and maximum costs (given rate impact limits of 0.15₵/kWh and
0.25₵/kWh) from 2013 to 2020. As shown, the expected cost for the recommended Carbon
Neutral Plan is $2.7 million from 2013 to 2020. The maximum cost over that time with a rate
impact limit of 0.15₵/kWh is $12 million and the maximum cost with a rate impact limit of
0.25₵/kWh is $20 million.
Table 12: Annual Cost to Implement Carbon Neutral Plan ($millions)
2013 2014 2015 2016 2017 2018 2019 2020 Total
Expected Cost 0.6 0.6 0.5 0.9 0.0 0.0 0.0 0.1 2.7
Maximum Cost (with a rate
impact limit of 0.15 ₵/kWh)
1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 12
Maximum Cost (with a rate
impact limit of 0.25 ₵/kWh)
2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 20
Table 13 illustrates potential bill impacts under different usages and for the median residential
customer, should Council adjust rates to reflect the cost of achieving carbon neutrality in 2013
and how the City’s bill would compare to neighboring communities including those served by
Pacific Gas and Electric (PG&E).
City of Palo Alto Page 24
Table 13: Monthly Electric Bill Comparison for 2013
Usage
(kWh/month)
Palo Alto’s
Current Bill
($/month)
Palo Alto’s Bill with Carbon Neutral
Plan ($/month) Santa Clara
($/month)
PG&E
($/month) Expected Cost With 0.15₵/kWh
Residential Customer Monthly Bill
300 $28.57 $28.75 $29.02 $30.37 $38.54
(Median) 407 $42.50 $42.77 $43.18 $41.66 $53.21
650 $76.33 $76.72 $77.31 $67.11 $117.72
1,200 $172.03 $172.75 $173.83 $124.84 $300.23
Commercial Customer Monthly Bill
1,000 $127 $128 $129 $156 $163
160,000 $17,245 $17,341 $17,485 $18,002 $18,801
500,000 $50,430 $50,730 $51,180 $54,352 $54,285
2,000,000 $178,800 $180,000 $181,800 $210,129 $222,168
Policy Impacts
Approval of the recommended Carbon Neutral Plan is consistent with the Council-approved
LEAP Objectives; Strategies and Implementation Plan; supports the Council-approved 2011
Utilities Strategic Plan’s environmental sustainability objective; is consistent with the City’s
Climate Protection Plan; and supports environmental sustainability, one of the City Council’s
top priorities.
Environmental Impacts
Implementation of the Carbon Neutral Plan is expected to reduce 330,000 metric tons of GHG
emissions in 2013 through 2016 (based on the EPA’s eGRID emissions factor for California for
2012 of 661.2 pounds of CO2e per MWh). Beyond 2016, reductions of GHG emissions are
mostly attributed to other Utilities efforts – principally achieving an RPS of about 50%.
Adopting a carbon neutral plan does not meet the California Environmental Quality Act‘s
(CEQA) definition of a “project” under California Public Resources Code Sec. 21065, thus no
environmental review is required.
Attachments:
Attachment A: Draft Resolution Approving Carbon Neutral Plan (PDF)
City of Palo Alto Page 25
Attachment B: Carbon Neutral Plan (PDF)
Attachment C: Carbon Neutral Survey Results (PDF)
Attachment D: Summary of TCR EPS protocol (PDF)
Attachment E: Excerpted Final UAC Minutes of December 5, 2012 (PDF)
Attachment F: UAC Colleagues Memo, December 16, 2012 (PDF)
Attachment G: Excerpted Draft UAC Minutes of January 9, 2013 Special Meeting (PDF)
* NOT YET APPROVED *
250113 sdl 6051879
Resolution No. _________
Resolution of the Council of the City of Palo Alto Approving a
Carbon Neutral Plan for the Electric Supply Portfolio to Achieve
Carbon Neutrality by 2013
A. In an effort to combat climate change in December 2007 the City of Palo Alto
(“City”) adopted the Climate Protection Plan, which set aggressive greenhouse gas (GHG)
emission reduction goals to be achieved by the year 2020.
B. In March 2011, the City unanimously approved the Long-term Electric
Acquisition Plan (LEAP) a strategic planning document focused on how the City’s Utilities
Department (CPAU) can successfully balance environmental and economic sustainability as it
provides electric service to CPAU customers. LEAP was updated in April 2012 through
Resolution 9241.
C. In accordance with the LEAP Climate Protection Strategy #5 to reduce the
electric portfolio’s carbon intensity, staff evaluated the costs, benefits and impacts of the
implementation of an electric portfolio carbon neutral policy and the setting of quantitative
goals. Staff’s preliminary findings were presented to the Utilities Advisory Commission (“UAC”),
Finance Committee and Council and in May 2012, the City Council directed staff to develop a
plan to achieve carbon neutrality for the electric supply portfolio by January 2015 (Staff report
2525).
D. On November 5, 2012, Council approved (Staff Report 3194) the following definition
of carbon neutrality for the City’s electric supply portfolio: A carbon neutral electric supply
portfolio will demonstrate annual net zero greenhouse gas (GHG) emissions, measured at the
Citygate, in accordance with The Climate Registry’s Electric Power Sector protocol for GHG
emissions measurement and reporting.
E. Staff presented the Carbon Neutral Plan to the UAC on December 5, 2012 and the
UAC voted unanimously (six in favor and one absent) to recommend that the City adopt the
Carbon Neutral Plan.
F. On December 16, 2012, UAC Commissioners James Cook (Chair), Steve Eglash and
John Melton provided a Commission Memorandum to request the Carbon Neutral Plan be
revisited. The Commission Memorandum was discussed at the January 9, 2013 UAC meeting
and the UAC voted (four in favor, two opposed and one absent) to recommend to Council that
the Carbon Neutral Plan’s rate cap be reduced from 0.25 cents/kWh to 0.15 cents/kWh.
G. Subsequent to the January 2013 UAC meeting, staff revised its spending cap
recommendation to limit any future electric rate impact to 0.15 cents/kWh.
H. On February 5, 2013, the Finance Committee voted _________________________.
* NOT YET APPROVED *
250113 sdl 6051879
The Council of the City of Palo Alto does hereby RESOLVE as follows:
SECTION 1. The Council hereby adopts the resolution approving the Carbon Neutral
Plan as provided for in Exhibit A.
SECTION 2. The Council directs staff to return to the UAC and the Council in the event
that the cost of City’s achievement of carbon neutrality for the electric supply portfolio would
exceed an electric retail rate impact of 0.15 cents/kWh.
SECTION 3. The Council finds that any eventual changes to the City’s electric rates
impacted by Council’s adoption of the Carbon Neutral Plan shall not create special taxes
because such rates shall be charges imposed for a specific government service or product
provided directly to the payor that are not provided to those not charged, and which shall not
exceed the reasonable costs to the City of providing the service or product.
SECTION 4. The Council finds that the adoption of this resolution does not constitute
a project under Section 21065 of the California Environmental Quality Act (CEQA) and the CEQA
Guidelines, and therefore, no environmental assessment is required.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
___________________________ ___________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ ___________________________
Senior Deputy City Attorney City Manager
___________________________
Director of Utilities
___________________________
Director of Administrative
Services
ATTACHMENT B
1
Exhibit A to Resolution No XXXX
Adopted by City Council on ________________________________
City of Palo Alto Utilities
Electric Supply Portfolio Carbon Neutral Plan
1. Carbon Neutral Definition
A carbon neutral electric supply portfolio will demonstrate annual net zero greenhouse gas
(GHG) emissions, measured at the Citygate1, in accordance with The Climate Registry’s Electric
Power Sector protocol for GHG emissions measurement and reporting.
2. Carbon Neutral Plan Objective
Reduce the City of Palo Alto’s overall community GHG emissions by achieving carbon neutrality
for the Electric Supply Portfolio starting in calendar year 2013 within an annual rate impact not
to exceed 0.15 cents per kilowatt-hour (₵/kWh) primarily through the: 1) engagement of
customers to increase energy efficiency; 2) expansion of long-term renewable resource
commitments; 3) promotion of local renewable resources; 4) continued reliance on existing
hydroelectric resources; and 5) meeting short-term balancing requirements and/or neutralizing
residual carbon through the use of short-term purchases of renewable resources and/or
renewable energy certificates (RECs).
3. Resource Strategies
a. Energy Efficiency
i. Continue to pursue energy efficiency strategies as identified in the Council-
approved ten-year Energy Efficiency Plan.
b. Long-term Renewable Resources
i. Continue to pursue the City’s Renewable Portfolio Standard (RPS) goal to
purchase renewable energy to supply at least 33% of retail sales by 2015 while
ensuring that the retail rate impact of these purchases does not exceed 0.5
₵/kWh.
ii. Continue to pursue local renewable resources through the Palo Alto CLEAN and
PV Partners programs.
iii. Pursue additional RPS-eligible, long-term renewable resources (beyond the RPS
goals) to achieve a target of 100% carbon-free resources based on average year
hydroelectric generation.
1 Citygate is the location of the City’s main meter where the City interconnects to the Pacific Gas and Electric
transmission system. Emissions associated with of the output of the locally sited fossil gas fired combustions units
(COBUG), while not measured at Citygate, will be neutralized.
ATTACHMENT B
2
c. Short-term Renewable Resources and Renewable Energy Certificates
i. For calendar years 2013 through 2016, procure short-term renewables, if the
price is comparable to that of an un-bundled REC;
ii. For calendar years 2013 through 2016, procure RPS-eligible, un-bundled RECs as
needed to achieve carbon neutrality based on actual load and resources;
iii. Neutralize anthropogenic GHG emissions associated with renewable resources
with unbundled-RECs, which may or may not be RPS-eligible.
d. Banking and Truing Up
i. In the event that there are surplus renewables beyond the load in a particular
year, bank as many RECs as allowable under the TCR EPS protocol from
qualifying renewables from that year to minimize the need for purchasing RECs
in subsequent years.
ii. Neutralize emissions associated with market purchases resulting from deviations
between expected and actual load and renewable and hydroelectric generation
resources with unbundled-RECs, which may or may not be RPS-eligible.
4. Hydroelectric Resources
a. Continue to preserve and advocate for existing carbon-neutral hydroelectric generation
resources that provide approximately 50% of average year resource needs.
b. Plan for and acquire carbon neutral resources assuming average hydroelectric
conditions going forward.
c. Under adverse hydroelectric conditions, procure unbundled-RECs, which may or may
not be RPS-eligible, to achieve carbon neutrality up to the 0.15 ₵/kWh rate impact limit
and seek Council direction if carbon neutrality cannot be achieved within the rate
impact limit.
d. Under favorable hydroelectric conditions, where carbon neutral resources are expected
to be surplus to needs, even after allowable banking, then pursue selling short-term
renewable energy, or the renewable attributes, associated with one or more carbon-
neutral resources in the portfolio.
5. Financial and Rate Payer Impacts
a. In addition to the RPS annual rate impact limit of 0.5 ₵/kWh, the cost of achieving
carbon neutrality shall not exceed 0.15 ₵/kWh based on an average hydro year.
b. Revenues collected from surplus energy sales related to hydroelectric resources under
favorable conditions (e.g. wet years), will be maintained within reserves to adjust for the
cost of achieving carbon neutrality under adverse hydroelectric years.
c. To the extent available and allowable, revenues from the auction of cap-and-trade
allowances may be used to fund resources acquired to meet the carbon neutrality goals.
6. Reporting and Communication
a. Develop a communication plan for stakeholders to inform them of the City’s efforts
towards achieving a carbon neutral electric supply.
ATTACHMENT B
3
b. Submit an annual, verified report of the carbon content of the electric supply portfolio
to The Climate Registry.
c. Provide customers a report of the electric supply portfolio’s carbon content to
supplement the mandated Power Content Label.
d. Inform large commercial and/or corporate customers of the City’s carbon neutral
portfolio and its relevance to their individual corporate sustainability goals.
7. Implementation Plan
The tasks that need to be completed in the next two years pending Council approval of the
Carbon Neutral Plan in February 2013 are listed in the table below.
Item Timeframe
1. Modify electric supply portfolio models and Energy Risk
Management Policies, Guidelines and Procedures to account for
Carbon Neutral objectives, balancing, banking of renewable
attributes, reporting and financial impacts.
By April 2013
2. Modify the Long-term Electric Acquisition Plan (LEAP) to include
the carbon neutral objective
By June 2013
3. Develop communication plan to inform customers and
stakeholders of Carbon Neutral Plan and efforts.
February to April
2013
4. Based on response to the Fall 2012 request for proposals, seek
approval of new renewable power purchase agreements to meet
the City’s RPS up to approximately 100% of the long-term resource
needs in average hydro years.
December 2012 to
June 2013
5. Determine resource needs for CY 2013 through CY 2016 and
develop plan to acquire short-term renewable resources.
By June 2013
6. Determine long-term renewable purchase volumes for beyond CY
2016 and develop plan to acquire long-term renewable resources.
By September 2013
7. Procure RECs as needed to neutralize carbon emissions based on
actual load and resources for CY 2013.
By May 2014
8. Along with annual Power Content Label, produce and report to
customers the carbon intensity of the electric supply portfolio.
May/June 2014 and
annually thereafter
9. Produce and submit Electric Power Sector (EPS) and Local
Governments Operation Protocol (LGOP) reports to The Climate
Registry (TCR) for CY 2013.
July and October
2014 and annually
thereafter
10. Get independent verification of TCR reports and submit audited
reports to TCR.
By December 2014
and annually
thereafter
11. Redesign the PaloAltoGreen program according to Council
direction.
By December 2013
Attachment C
City of Palo Alto Utilities – Electric Supply Portfolio
Carbon Neutral Survey
Residential Customers
1. How much more would you be willing to pay on your electric bill for 100%
renewable energy supplies?
Answer Options Response
Percent
Response
Count
No more 27.3% 259
$2 more per month 9.0% 85
Up to $5 more per month 22.2% 210
Up to $10 more per month 23.3% 221
More than $10 more per month 18.2% 173
answered question 948
skipped question 11
2. Are you currently a PaloAltoGreen customer?
Answer Options Response
Percent
Response
Count
Yes 58.1% 554
No 41.9% 399
answered question 953
skipped question 6
3. If your electricity supply is 100% carbon-free, and your electric rate has
increased about 4% as a result, would you be more or less motivated to
invest in energy efficiency improvements?
Answer Options Response
Percent
Response
Count
More motivated 27.5% 261
Less motivated 12.1% 115
No change in motivation 60.3% 572
answered question 948
skipped question 11
4. Do you have any further comments for us on the idea only purchasing
“green” carbon-free power?
answered question 514
skipped question 444
# Response Text Count
Negative - Bills too high 93
Negative - Other Issues 88
Other Issues – Neutral 125
Positive – Qualified 85
Positive – Unqualified 123
Grand Count 514
Commercial Customers
1. How much more would you be willing
to pay on your electric bill for 100%
renewable energy supplies?
Answer Options Response Percent
Response
Count
No more 63.0% 17
2% more per month 14.8% 4
Up to 5% more per month 7.4% 2
Up to 10% more per month 7.4% 2
More than 10% per month 7.4% 2
answered question
27
skipped question
1
2. Are you currently a PaloAltoGreen customer?
Answer Options
Response
Percent
Response
Count
Yes 25.0% 7
No 75.0% 21
answered question 28
skipped question 0
3. If your electricity supply is 100%
carbon-free, and your electric rate has
increased about 4% as a result, would
you be more or less motivated to
invest in energy efficiency
improvements?
Answer Options
Response
Percent
Response
Count
More motivated 14.8% 4
Less motivated 14.8% 4
No change in motivation 70.4% 19
answered question 27
skipped question 1
Q4. Do you have any further comments for us
on the idea only purchasing “green” carbon-
free power?
Response Count
10
answered question 10
skipped question 18
Page 1 of 10
ATTACHMENT D
Summary of Implementation of The Climate Registry’s Electric Power Sector Protocol in
Pursuit of Carbon Neutrality for the City of Palo Alto’s Electric Portfolio
The key policy elements discussed in the TCR EPS protocol include:
1. Measurement, Accounting, Reporting and Verification Protocol
2. Inventory Scope of GHG Emissions Covered by Definition
3. GHG Emission Factor by Resource
4. Balancing Periods and Banking
5. Role of PaloAltoGreen Program
6. Portfolio Alternatives to Achieve Carbon Neutrality
1. Measurement, Accounting, Reporting and Verification Protocol
There are several GHG accounting standards in the industry, although all are based on the
accounting architecture developed by The World Resources Institute (WRI). WRI is regarded as
a global leader on the topic of GHG measurement and accounting standards through its
development of accounting tools for governments and businesses that enable them to
understand, quantify, and manage GHG emissions. WRI’s methodology divides GHG emissions
into three types: Scope 1, Scope 2, and Scope 3. For a GHG reporting entity such as the City,
Scope 1 includes the direct emissions the entity has control over, such as factory emissions,
building emissions, emissions from utility owned generation and emissions from vehicles it
owns or controls. Scope 2 includes primarily emissions associated with electricity the reporting
entity consumes for its own operations but did not produce. Scope 3 emissions are all other
emissions over which the reporting entity does not have control. Scope 3 emissions include
sources such as electricity purchased by electric utilities for the use of its customers, commutes
by employees and emissions associated with concrete purchased for construction.
The WRI protocol is the accounting foundation for The Climate Registry (TCR) GHG reporting
protocol. TCR is a U.S. Environmental Protection Agency (US EPA) recognized national GHG
reporting public platform, and the City has been reporting to this agency (and its predecessor
agency, the California Climate Action Registry) since 2005.
Figure 1 is an illustration of the various emissions types and how they are accounted for under
WRI’s Scope 1, Scope 2, and Scope 3 definitions.
Page 2 of 10
Figure 1: Overview of Scope 1, 2, and 3 GHG Emissions
Source: World Resources Institute
TCR protocol directs an electric utility to report its own Scope 1 and Scope 2 emissions under
the General Reporting Protocol (GRP), and allows for the utility to compute the emissions (in
metric tons of CO2e) using standardized emission factors (in pounds of CO2e per unit of
electricity delivered to different customers) under the Electric Power Sector (EPS) protocol1.
The portfolio or program level emission factors generated by electricity providers, calculated
using the EPS protocol, may then be used by end-use customers to report the Scope 2
emissions associated with their own electricity usage.
To help ensure transparency and credibility of the City’s efforts towards carbon neutrality, staff
recommends that TCR’s EPS protocol be adopted as the standard for accounting, reporting, and
verification.
2. Inventory Scope of GHG Emissions Covered by Definition
Electric Supply
Staff recommends limiting the scope of the emissions to be counted to those associated with
the electric supply portfolio as measured at the City’s main meter (Citygate) plus output from
City-owned generation facilities (the city-owned back-up generator, or COBUG) within City
boundaries. The electric supply portfolio consists of all resources purchased and/or owned,
including deliveries from its two hydroelectric resources, Western and Calaveras, all renewable
resources acquired under power purchase agreements, and net market purchases (total
1 www.theclimateregistry.org/resources/protocols/electric-power-sector-protocol
Page 3 of 10
purchases minus total sales in the wholesale markets) made to meet load requirements on an
annual, calendar year basis.
Electric Grid Reliability & Transmission Losses
Given the highly variable nature of the City’s long-term electric supply resources—on a minute-
to-minute, month-to-month and year-to-year level—it is inevitable that the City will rely to
some extent on generation reserves connected to the California Independent System Operator
(CAISO) grid. Specifically, some generation capacity is always reserved to follow loads in the
event that actual load and generation resources deviate widely from forecasted levels.
Consistent with the EPS protocol, the emissions associated with these load-following resources
are reported by the generation owners as Scope 1 emissions. To the extent that CPAU requires
these resources to meet unplanned electric load, this energy will be delivered to Citygate and
thus the emissions associated with the energy will be counted as Scope 2 or 3 emissions on the
City’s emissions inventory, just like all of its purchased power.
In 2008 the City effected a 15-year assignment of its share in the California-Oregon
Transmission Project (COTP). Since the City currently does not own or operate transmission,
according to the TCR EPS protocol it does not need to include transmission line losses in its
emissions calculation. Emissions associated with transmission losses may need to be
considered in future inventories depending on TCR protocols, or if the City reacquires
transmission ownership rights.
Distribution System
In addition to the GHG emissions associated with electric supply, electric distribution
operations also generate GHG emissions. The City reports to TCR on electric utility operational
activities producing GHG emissions2 including fuel consumption by the CPAU vehicle fleet
(Scope 1), potential SF6 emissions from substation breakers (Scope 1), and electricity used in
CPAU buildings (Scope 2). However, since carbon neutrality is being defined as emissions
related to electricity supply only, emissions associated with operations will not be included in
the emission inventory. Electricity losses in distribution system wires, which are estimated at
five percent of electric purchases, will be accounted for since the electric supply is measured at
Citygate and not at customer meters. Table 1 below is a summary of the emissions to be
included in the City’s electric supply portfolio inventory.
2 GHG emissions from electric operations represent less than 0.5 percent of all emissions produced by the electric
utility.
Page 4 of 10
Table 1: Electric Portfolio Carbon Neutral Emission Inventory
Scope Categories Description
1 Stationary combustion Emissions from owned/controlled facilities. For
CPAU this includes COBUG
2 Distribution system losses CPAU owned distribution line losses only
Purchased power for own
consumption
Electricity used by all City facilities is included in
the measure at the City’s meter (Citygate)
3 Purchased power for customers Electricity purchased for resale to the City’s
customers measured at Citygate
3. GHG Emission Factor by Resource
TCR protocols allow for project-specific emissions factors, in pounds of CO2e per megawatt-
hour (MWh), to be used as the basis for calculating portfolio emissions. These emissions would
be based on actual metered fossil fuel consumption or measurement of GHG releases. If
project-specific emissions factors are not known, TCR allows the use of generic technology-
based emission factors based on US EPA numbers as shown in Table 2.
Table 2: Default Emissions Factors for Power Purchases from Specific Resources
Resource Emissions Factor
(pounds CO2/MWh) CPAU Resources
Natural Gas
Combined Cycle – Two Turbines 909 N/A
Combined Cycle – Single Shaft 860 N/A
Combustion Turbine 1,329 N/A
Steam Turbine 1,532 N/A
Internal Combustion 1,226 COBUG
Biogenic Fuels
Anthropogenic Biogenic
Landfill Gas3 38 2,677 6 Ameresco PPAs
Municipal Solid Waste 1,353 2,513 N/A
Geothermal
(Non-binary)
200 lbs CO2/MWh
1.66 lbs CH4/MWh n/a Western GeoPower
PPA
Source: The Climate Registry Electric Power Sector Protocol for Voluntary Reporting Program
(Annex 1 to the General Protocol) v1.0, June 2009.
California Non-specific Emissions Factor
The wholesale brown market power purchases that the City executes to balance its resource
supply with its load are not from a specific generator, and are called “unspecified” resources.
TCR protocols dictate that the emissions associated with power purchases from unspecified
resources be calculated by applying a default emissions factor based on the geographic region
3 Bio-gas and anaerobic digester plants are assumed to have roughly the same amount of anthropogenic emissions
as landfill gas generation.
Page 5 of 10
from which the power likely originated. These geography-based non-specific emissions factors
are found in the US EPA’s Emissions & Generation Resource Integrated Database (eGRID). It is
assumed that all of the City’s wholesale market power purchases originate in the “WECC
California” eGRID subregion, for which the current emissions factor is 661.2 pounds of CO2e per
MWh.
Biogenic and Anthropogenic Emissions
TCR protocols require that both biogenic and anthropogenic emissions be counted – and
reported separately – in an entity’s emissions inventory. Biogenic emissions of GHGs are those
that would occur naturally from living organisms’ respiration and digestion. Anthropogenic
GHG emissions are due to human activity, mostly from burning of fossil fuels. In the electric
generation sector, examples of biogenic emissions include CO2 emissions resulting from the
combustion of plant biomass, sludge digester gas or landfill gas. Since biogenic emissions are
not a GHG consequence of City projects and activities, the emissions will not be included in the
calculation of emissions for the city’s electric supply portfolio.
Anthropogenic emissions factors are shown in Table 2 for various types of generation resources
that will be counted in the City’s emission inventory along with the eGRID listed emission
factors for unspecified resources. For illustrative purposes, Table 3 shows the expected 2015
GHG emissions intensity of the City’s electric supply portfolio assuming a 4.2% reduction in
usage from energy efficiency; a 33% RPS; average hydroelectric conditions; and the remaining
load met through unspecified market purchases.
Table 3: GHG Emissions Associated with the City’s 2015 Electric Supply Resources
Resource Type Generation
(GWh)
Emissions Coefficient
(lb CO2e/MWh)
Total Emissions
(Metric Tons CO2e)
Hydro 533 0 0
Wind 120 0 0
Landfill Gas 126 04 0
Geothermal 33 235 3,523
Other Renewables
(for a total RPS 33% of sales) 51 0 0
COBUG 0.5 1,226 278
Market Purchases 193 661 57,869
Total 1,056 61,670
4. Balancing Periods and Banking
The City’s electric load requirements and supply resources vary significantly on an hourly, daily,
monthly and annual basis. Under the current plan in 2015, the City’s electric portfolio is
expected to require market purchases of about 19% of the annual load; however, even in an
4 The TCR EPS protocol allows the use of a default emissions factor of 38 lb CO2e/MWh for landfill-gas-to-energy
plants, but the facilities that Palo Alto has contracted the energy from do not use any fossil-fuel natural gas to
supplement the landfill gas so the anthropogenic emissions factor for Palo Alto’s projects is zero.
Page 6 of 10
average hydroelectric year the portfolio’s electric resources will exceed loads in months when
hydroelectric generation and wind output are highest. Figure 2 is an illustration of monthly
variability in load and supply resources in 2015.
The City’s hydroelectric resources cause large variations in supply resources on an annual basis.
Hydroelectric supplies provide from 30% to 80% of the City’s annual electric needs depending
on hydrologic conditions. Currently, under wet hydrologic conditions the City may have
resources surplus to load by as much as 55% during the spring months. Adding additional
carbon neutral resources to the portfolio would extend these surpluses even further,
particularly if the new resources had an annual load shape like hydroelectric, California wind or
solar resources.
Figure 2: Expected Monthly Load and Resource Balance in 2015
0
20
40
60
80
100
120
140
Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15
Mo
n
t
h
l
y
L
o
a
d
a
n
d
R
e
s
o
u
r
c
e
S
u
p
p
l
y
(
G
W
h
)
LOAD
Geothermal
Hydro Generation
Wind Generation
Landfill Generation
Solar
Operationally the City’s electric load must be balanced with a supply resource every 10 minutes.
As the City’s scheduling coordinator, the Northern California Power Agency (NCPA) actively
buys and sells electricity through the CAISO on a daily, hourly, and real-time basis. The level of
granularity the City seeks to pursue through its carbon neutral effort will influence the cost of
achieving carbon neutrality and, to some extent, will dictate the types of resources available.
Ensuring that the City’s portfolio is carbon neutral on a monthly (or even daily) basis may prove
to be costly insofar as it leads to more transaction costs incurred. For example, in the spring
Page 7 of 10
and some summer months, the City’s availability of carbon-free resources from wind and
hydroelectric resources is highest. Since it is not possible to schedule resources in excess of
load, NCPA sells excess supply as a “system sale” (i.e., non-resource specific) and the renewable
attributes associated with the resource are retained by the City. Conversely, in months where
the City is deficient, NCPA makes system purchases to meet load. Assuring carbon neutrality in
time increments less than on an annual basis would require that the City sell excess renewable
resources in surplus months and purchase additional renewable resources in deficit months.
The TCR EPS reporting protocol requires an annual report showing net emissions for the
calendar year, thus allowing for the carryover of surplus renewable attributes (i.e., RECs) from
some months to be used to cover deficits in other months. Further, the protocol allows for the
carryover of surplus renewable attributes beyond the calendar year in which they were
produced. This practice is referred to as “banking” and is commonly used to minimize
transaction costs. TCR protocols allow for banking only for new renewable resources (less than
15 years old), with restrictions on how long the RECs can be banked. As such, because the
City’s two hydroelectric resources are older than 15 years, RECs from these two resources may
only be counted towards offsetting emissions in the calendar year in which they are produced.
Figure 3 shows the City’s electric supply portfolio emissions following the recommended
reporting protocol given 33% RPS and unspecified market purchases. These emissions would
need to be “zeroed out” through the purchase of RECs and/or offsets to achieve carbon
neutrality for the electric supply portfolio. The wide annual variation in emissions for the
period from 2005 through 2011 is primarily due to variations in generation from hydro
resources. The declining amount of emissions projected after 2012 is due to additional
renewable resources expected to become available.
Page 8 of 10
Figure 3: Actual/Projected GHG Emissions for the City’s Electric Supply Portfolio
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
To
t
a
l
E
l
e
c
t
r
i
c
i
t
y
S
u
p
p
l
y
E
m
i
s
s
i
o
n
s
(
T
o
n
n
e
s
C
O
2
e
)
Calendar Year
Total Emissions (Actual / Projected)
Total Emissions (Average Hydro)
Total Emissions with New Renewables PPAs
Actual ProjectedActualProjected
5. Role of PaloAltoGreen Program
PaloAltoGreen, which started in 2003, is a voluntary program where customers elect to pay a
premium in order to ensure that their supply is comprised of 100% renewable resources.5 With
roughly 25% of the City’s customers (8% of retail load) on PaloAltoGreen, the City’s program is
recognized as the top-ranked voluntary renewable program in the country by participation rate.
In 2011, PaloAltoGreen accounted for approximately 28,000 metric tons of CO2e of GHG
reductions for the community.
At the time the PaloAltoGreen program started, the City did not have a renewable resource
portfolio standard and participants received 100% renewable resources for their needs.
However, as the City approaches its RPS goal, PaloAltoGreen participants may have less
incentive to remain part of the program and pay extra for renewable resources.
In the event that the City continues to offer PaloAltoGreen as an alternative to the City’s
regular supply portfolio, the TCR EPS protocol allows for the reporting of multiple electric
5 In 2011 PaloAltoGreen was sourced through RECs purchased from wind projects in Washington and Wyoming
(97.5% of supply) and solar projects in California (2.5% of supply).
Page 9 of 10
supply emission tables to be used by customers in their voluntary reporting of their own Scope
2 emissions. However, the TCR EPS protocol does not allow emission reductions from
PaloAltoGreen to be counted towards carbon neutrality efforts of the non-voluntary portfolio.
A task to redesign the PaloAltoGreen program is part of the LEAP Implementation Plan. That
redesign will be done in the context of the pursuit of carbon neutrality for the electric supply
portfolio. As PaloAltoGreen has tapped into an important community resource involving a
willingness to support environmental stewardship, PaloAltoGreen redesign efforts will explore
alternatives for continuing to provide GHG emission reduction efforts throughout the
community.
6. Product Alternatives to Achieve Carbon Neutrality
There are several types of resources and/or environmental products that the City could use
under TCR protocols to achieve carbon neutrality for the electric portfolio. A general
description of these products is provided below. The plan to achieve carbon neutrality will
provide further detail regarding costs and availability of each resource along with a
recommendation of whether or not to use them as part of the City’s carbon neutral efforts.
RPS Eligible Resources:
RPS eligible resources are those certified by the California Energy Commission (CEC) and are
included in the CEC’s RPS Eligibility Guidebook. The City’s RPS requires that resources meet the
CEC RPS eligibility requirements as well. The list of renewable resource technologies that meet
the CEC’s RPS eligibility standards includes energy from landfill gas-to-energy, solar
photovoltaic, solar thermal electric, wind, small hydroelectric, and geothermal projects. Under
California’s RPS law (SB X1-2), unbundled RECs (i.e., RECs without any physical energy
associated with them, or Bucket 3) and renewable resources that are located out-of-state (i.e.,
Bucket 2) can be used for RPS compliance, with some restrictions on the degree to which these
resources can be relied upon to meet the state RPS requirement. For the purpose of reporting
emissions, the TCR protocol does not distinguish between RPS eligible resources and non-RPS
eligible resources.
REC-Only Products
TCR protocols allow entities that procure unbundled RECs to adjust their emissions inventories
to account for these products. Even though the physical energy is not delivered to the entity,
TCR allows the use of unbundled RECs—whether RPS eligible or not—to displace an equivalent
amount of power from the actual power mix. This adjustment is allowed because the RECs
include all renewable and environmental attributes associated with the production of electricity
from the renewable energy resource.
Carbon-free, Non-RPS Eligible Renewable Resources
Non-RPS eligible resources that can be reported as being carbon-free under the TCR protocols
include large hydroelectric (such as from Western and Calaveras resources), nuclear and out-of-
state renewable resources built before 2005.
Page 10 of 10
Environmental Offsets
GHG offsets6 are tradable credits issued for emissions reductions resulting from qualifying GHG
mitigation projects. They can be purchased on the voluntary market (for example to achieve
carbon neutral objectives) or in the compliance markets (for example to meet cap-and-trade
requirements). Qualified offsets for California’s cap-and-trade system are certified and issued
by the Climate Action Reserve and are typically transacted on a bilateral basis. The California
Air Resources Board (CARB) currently recognizes offsets issued by the Climate Action Reserve
for several types of GHG mitigation projects—including forestry, urban forestry, livestock
methane, and ozone depleting substances—for use in meeting AB32 GHG reduction goals for
2020. There are other international offset markets, such as the Clean Development Mechanism
which facilitates offsets from developing countries to be sold into the European Union’s
Emission Trading Scheme.
With the uncertainty associated with the use and eligibility of various types of offset products
coupled with the lack of compliance-driven buyers, the market for offsets is currently very
illiquid and there is a great deal of uncertainty around the long-term market price of these
products.
Table 4 is a summary of the various products including RPS specifications and how they are
currently reported under California’s Power Content Label requirements.
Table 4: Summary of Various Renewable Energy and Environmental Products
RPS Eligible
Energy
RPS Eligible
RECs
Non-RPS
RECs
Non-RPS Carbon-
free Energy
Environmental
Offsets
Description
Bucket 1: In-
state projects,
and Bucket 2:
firmed and
shaped products
from out-of-
state resources
Bucket 3: REC-
only deals or
other
transactions,
subject to
compliance
limits
Unbundled
RECs from
projects not
RPS certified
by the CEC
These could
include large
hydro, nuclear, or
older out-of-state
renewable energy
projects
Emissions
reduction credits
from qualifying
GHG mitigation
projects
RPS Eligible? Yes Yes No No No
Power Content
Label
Eligible
Renewable
Eligible
Renewable
Eligible
Renewable Specific Resource Unspecified
Market
The Climate
Registry
Emissions
reported *
Emissions
reported *
Emissions
reported * Zero emissions
Emission
reductions
counted
* Anthropogenic emissions, if applicable, reported.
6 WRI defines a carbon offset as “a unit of carbon dioxide-equivalent (CO2e) that is reduced, avoided, or
sequestered to compensate for emissions occurring elsewhere.”
Utilities Advisory Commission Minutes Approved on: January 9, 2013 Page 1 of 4
EXCERPTED FINAL MINUTES OF THE DECEMBER 5, 2012
UTILITIES ADVISORY COMMISSION MEETING
ITEM 4: ACTION: Utilities Advisory Commission Recommendation that Council Approve a
Carbon Neutral Plan for the Electric Supply Portfolio
Senior Resource Planner Monica Padilla presented a summary of the carbon neutral plan
report. She stated that after 2016, the portfolio will have very low carbon content due to RPS
resources as well as hydroelectric contracts. The key policy decisions include what types of
resources to pursue in the near term (until 2016) and long term, what types of resources to use
for annual true-ups of load and resources and for covering anthropogenic greenhouse gas
(GHG) emissions.
Padilla described the proposed Carbon Neutral Plan as pursuing short-term renewables and/or
unbundled renewable energy certificates (RECs) in the near term and using RECs for balancing
and for neutralizing the geothermal and back-up generator GHG emissions.
Vice Chair Foster asked if there were any other communities that have pursued carbon neutral
plans. Padilla responded that through a study conducted by Navigant Consulting, staff has
learned that other communities including Seattle City Light and the Marin Energy Authority are
pursuing 100% renewable portfolios through the use of hydroelectric supplies, bundled
renewables and RECs.
Public Comment
Walt Hayes indicated his support for the proposed plan and described the moderate cost as
well as the strong leadership shown by Palo Alto.
Commissioner Eglash asked Mr. Hayes if he supported this because of the symbolism, or the
GHG emissions reductions. Mr. Hayes responded that the City has taken the initiative and
stated that after Palo Alto's Green Ribbon task force, other cities nearby began to develop their
own sustainability plans.
Bruce Hodge, from Carbon Free Palo Alto, stated his strong support of the plan, especially the
move to get to carbon neutral as soon as 2013. He urged the UAC to recommend approval of
the plan.
Dirk Morbitzer, stated that he follows market developments of renewable energy across the
globe. He stated that other cities across the U.S. and the world will follow Palo Alto's lead. He
Utilities Advisory Commission Minutes Approved on: January 9, 2013 Page 2 of 4
recommended that the solar resource be local since that strategy keeps financial resources
local and assists with electricity availability in case of emergencies. He noted that solar costs
have fallen in Europe and can further fall in the U.S.
Gary Hedden, Los Altos Environmental Commission, noted that the plan is inspirational, but
may not be repeatable since they buy their energy from PG&E.
Craig Lewis, CLEAN Coalition, supported the proposed plan and acknowledged the work of staff
and community members to complete the plan. He stated that in Germany, local solar projects
cost as low as 7 cents/kWh now, which is less than remote renewable energy projects
transported to Palo Alto two years from now. Mr. Lewis added that Palo Alto's actions are seen
widely around the country and its actions are followed by others since other areas want to
emulate what’s done in Palo Alto.
Bret Anderson, local resident, supported the proposed plan. He stated that it was important to
him that the energy source is green, which makes using an electric car for transportation truly
green.
Commissioner Chang asked if the plan for the near term included purchasing short-term
renewables and/or RECs to cover the brown energy. Padilla stated that staff plans to shop for
both products—short-term renewables and unbundled RECs—and choose the least costly
resource. She noted that this is clearly spelled out in the plan, which is Attachment A to the
report, under Section 3.b.i.
Vice Chair Foster thanked the speakers for expressing their opinions at the meeting. He noted
that the falling price of renewable energy has made the decision an easy one to support the
proposed plan.
Commissioner Eglash stated that reducing GHG emissions to be a very important goal. He
noted that GHG emissions accrue from many of our actions and the use of electricity is but a
small source. He is concerned that the plan is primarily an accounting exercise and that it is
symbolic at most since the electric portfolio is almost carbon neutral already. He stated that
the cost is low since the impact is low.
Vice Chair Foster responded to Commissioner Eglash's concerns by saying that this is a
significant step and that we can then turn to other sources of GHG emissions reductions.
Commissioner Waldfogel said that we should get to carbon neutrality since we're almost there
and it's better to be there, than almost there. He asked if the City considered stopping RPS at
33% and then using the additional money under the 0.5 cent/kWh rate impact for carbon
neutrality. Assistant Director Jane Ratchye stated that the Council adopted an RPS goal of
reaching at least 33% RPS, but to go as far as possible within the rate impact limit.
Commissioner Waldfogel asked if the PaloAltoGreen program was ended, would other
customers see a rate increase as a result of the loss in PaloAltoGreen revenues. Padilla said
Utilities Advisory Commission Minutes Approved on: January 9, 2013 Page 3 of 4
that the revenues for the voluntary PaloAltoGreen program are separate and used only to
offset the cost of procuring RECs for PaloAltoGreen so there would be no impact.
Commissioner Eglash asked about the cost of achieving carbon neutrality by 2017 instead of
2013. He noted that the cost of carbon neutrality in the near term is $2.7 million for 2013 to
2016 and that this cost will be paid primarily by non-residential customers.
Vice Chair Foster asked how the increased cost (0.05 to 0.09 cents/kWh) would impact the
rates and how it would compare to surrounding communities. Director Fong stated that the
increase would be minor and that our rates are low compared to PG&E. Vice Chair Foster
noted that this is a very small expense to pay for this important program and that we should go
ahead now since time is of the essence.
Chair Cook read a statement provided by Commissioner Hall, who was unable to attend the
meeting: “I wholeheartedly support Staff’s proposed efforts to achieve carbon neutrality ahead
of the January 2015 target date set by the Council. I note that the percentage of surveyed
residents who are willing to pay more than $2 per month was 66% - a good majority. Happily, it
appears possible for residents to support carbon neutrality by the end of 2013 for an average of
not much more than $2 per year using the recommended strategy. And, given that the
anticipated Cap-and-Trade revenues will far exceed the cost of this program, it’s preferable to
utilize a sufficient portion of Cap and Trade revenues to offset the cost of this program – so that
residents will see no rate increase at all.”
Chair Cook asked about risks of the plan, especially the risks of costs rising to implement the
plan, for example, if the cost of renewable energy rises significantly leading to a rapid rise in
rates. Director Fong stated that the renewable energy contracts have locked in prices so there
is protection of rising costs there. In addition, the plan proposed a rate impact limit of 0.25
cents/kWh to protect ratepayers.
Chair Cook thanked the public speakers and noted that the involvement of the community by
attending the meeting, providing comments, and sending emails is the most he has experienced
in his time on the UAC. He stated that he also supported the plan and stated that the low price
to achieve the plan is acceptable. Chair Cook noted that this is a great policy, but there is still
more to do.
Commissioner Eglash noted that the cost of getting to carbon neutrality in the near term (2013
to 2016) at $2.7 million accounts for the majority of the costs and that most of the cost will be
borne by commercial customers. Commissioner Eglash further asked if the City delayed getting
to carbon neutrality from 2013 to 2017 whether the funds could be used for other carbon
reduction efforts such as energy efficiency. Director Fong noted that Council directed staff to
develop a plan to get to carbon neutrality by January 2015 so staff would not have proposed
achieving carbon neutrality by 2017. In addition, the Council has already adopted a very
aggressive energy efficiency program. Director Fong stated that if the City decided not to
achieve carbon neutrality before 2017, then the funds would simply not be spent so if the City
Utilities Advisory Commission Minutes Approved on: January 9, 2013 Page 4 of 4
was not going to seek to achieve carbon neutrality, then the costs would simply not be
incurred.
Commissioner Melton asked that in order to aid Council in their decision it be noted in
upcoming staff reports the cost of getting to carbon neutrality based on alternative start years
(i.e., 2013 versus 2017) and to explicitly state that it is expected to cost an additional $2.7
million to achieve carbon neutrality in 2013 instead of 2017. Then Council will have the
information of the price tag to be paid by ratepayers from that policy direction. Director Fong
agreed to provide this information in the report and note the discussion in the upcoming staff
reports to Council. Chair Cook added that a representative from the UAC can attend Finance
Committee and Council meetings to underscore the UAC’s discussions.
ACTION:
Vice Chair Foster moved to support the staff's recommendation. Commissioner Melton
seconded the motion. The motion carried unanimously (6-0) with Commissioner Hall absent.
5
CITY OF PALO ALTO UTILITIES ADVISORY COMMISSION
COMMISSIONER MEMO
TO: Valerie Fong, Director, Utilities
Audrey Chang, Jonathan Foster, Garth Hall, and Asher Waldfogel, Utilities
Advisory Commission
FROM: James Cook (Chair), Steve Eglash, and John Melton, Utilities Advisory
Commission
DATE: Initially submitted December 16, 2012; final version December 28, 2012
SUBJECT: Request to agendize and revisit the cost limitations of the carbon neutral plan for
the electric portfolio at the January 9, 2013, UAC meeting
Background. At the December 5, 2012, UAC Meeting the commissioners voted unanimously
(six in favor and one absent) to recommend that the City Council adopt staff’s carbon neutral
plan for the electric portfolio. This plan directs staff to achieve carbon neutrality for the City’s
electric portfolio beginning in 2013 by purchasing RECs to make up for any brown power
consumed by the City. The proposed plan includes Council authorization for CoPA Utilities to
spend up to $0.0025/kWh to achieve carbon neutrality. The expected cost is between zero and
$2.7 million total for the period 2013 – 2016 and very low thereafter.
The issue. The discussion at the December 5, 2012, UAC Meeting focused primarily on the
expected cost and relatively little time was devoted to the spending cap. The authorization
permits CoPA Utilities to spend up to $0.0025/kWh, equivalent to approximately $2.5 million
per year or $10 million total for the period 2013 – 2016. There is no limit on the price per REC.
The purpose of this memo is to request that the carbon neutrality topic be discussed at the
January 9, 2013, UAC Meeting with a particular focus on spending limits. Two types of
spending caps are recommended: a cap on total spending during 2013 – 2016 and a cap on the
price per REC regardless of the number of RECs to be purchased.
Two examples serve to illustrate the possible need for a lower total cap during 2013 – 2016 and
the possible need for a cap on the price to be paid for a REC at all times.
Example 1. In the event of a dry hydro year, the City might use more brown power than
assumed in the likely scenario. In this case the carbon neutrality plan directs staff to purchase
RECs up to a rate impact of $0.0025/kWh, or roughly $2.5 million per year. In the unlikely
event that poor hydro conditions required the Utility to do this for all four years 2013 – 2016,
then the carbon neutrality plan would cost the rate payers $10 million, not $2.7 million as in the
likely scenario discussed in the memo and at the UAC meeting. The authors of this
Commissioner Memo would like the UAC to discuss whether a more restrictive cap on total
spending is appropriate during 2013 – 2016. One possibility is a cap of $1 million per year,
which would have the effect of limiting total spending during the four-year period to $4 million.
Commissioner Memo
December 28, 2012
Page 2
Example 2. There is no limit in the proposed plan on the price per REC. In order to protect
ratepayers from paying a relatively large amount for a small reduction in carbon emissions, the
authors of this Commissioner Memo would like the UAC to consider setting a maximum price
per REC that the Utility is authorized to spend, regardless of how few RECs are to be purchased.
One possibility is a cap of $20/MWh. (Staff has indicated that the expected price of RPS-
eligible unbundled RECs is $1-10/MWh.) Such a limit would be in addition to the limit on total
annual spending described in Example 1.
To be clear, it is not the authors’ intention to backtrack from our support for the carbon neutrality
plan, but rather to put appropriate limits on what the City should spend (more accurately, what
the City’s ratepayers should be asked to spend) in achieving carbon neutrality. In consideration
of the UAC’s oversight role, of the UAC’s advisory role to the City Council, and of being good
stewards of our residential and business ratepayers’ money, we believe that the issues raised in
this memo should be discussed by the UAC.
EXCERPTED DRAFT MINUTES OF THE JANUARY 9, 2013
UTILITIES ADVISORY COMMISSION MEETING
ITEM 5: ACTION: Commissioners’ Memo Recommendation that the Utilities Advisory
Commission Discuss and Potentially Act Upon the Cost Limitation Provision of the Carbon
Neutral Plan for the Electric Portfolio
Commissioner Eglash provided a brief synopsis of the memo signed by Chair Cook, and
Commissioners Eglash and Melton and stated that the discussion at the UAC's December
meeting focused on the expected cost to achieve carbon neutrality and not on the potential
maximum cost. Particularly before the long-term renewable resources are on-line, for 2013
through 2016, the cost could be significant to get to carbon neutrality. He summarized the
recommendations in the memo as limiting total spending during 2013 to 2016 and a cap on the
price of Renewable Energy Certificates (RECs).
Public Comment:
Bruce Hodge stated that the additional limitations recommended by the Commissioners' Memo
are unnecessary and supported the cost cap in the proposed plan. He shared his analysis of the
bill impact for customers using different amounts of electricity per month and showed that the
impact was small and reasonable.
Walt Hays agreed with Bruce Hodge since Bruce Hodge had done the analysis. Walt Hays
reminded the Commission of the risks of climate change and said that the City should not
quibble with the small costs being proposed in the plan. He added that the plan is more than
symbolic and, even if only symbolic, may have greater impact as the bold plan it is.
Commissioner Melton asked for staff’s opinion of the recommendations in the Commissioners’
Memo. Director Fong stated that staff has put its proposal forward and the Commissioners’
Memo provides another option.
Vice Chair Foster stated that he feels like the message the plan sends is valid and that the plan
has only a small rate impact anyway and he doesn't support a lower cost limitation. However,
he stated that he could support the proposed REC cost limitation.
Commissioner Melton stated that the spending limit proposed in the memo is a "black swan"
protection device. He stated that we need some maximum spending limitation in case
something changes dramatically.
Responding to Commissioner Melton’s recommendation, Vice Chair Foster stated that he
agreed that there needed to be a spending limit and that the proposed plan does have a
limitation of $2.5 million/year.
Commissioner Eglash agreed that the proposed plan does have a spending limit of about $2.5
million per year. He stated that the question at hand is whether we are comfortable with the
proposed rate cap for our residential and commercial customers. This is especially an issue in
the years from 2013 to 2016 before the long-term renewable contracts come on line.
Commissioner Chang asked how the cap in the proposed plan of 0.25 cents/kWh was derived.
Director Fong said it was proposed by staff to cover the uncertainties in hydroelectric
production and the future cost of RECs. She stated that another idea is to have a dollar amount
that is a trigger point when staff needs to return to the Council for further direction.
Commissioner Hall stated that he supports a 0.15 cents/kWh which appears to be an adequate
cap rather than a total dollar cap. In addition, he doesn't support a price cap on RECs as that
limits staff and removes flexibility.
Commissioner Eglash said that the concern raised in the memo is that we could look foolish by
some ratepayers, particularly those who are cost sensitive. He doesn't want to spend any
amount of money to get the last little bit of carbon neutrality when that additional cost could
be extreme.
Vice Chair Foster stated that he supports a trigger point to ensure that costs are not exceeded,
but not necessarily a lower cost cap.
Commissioner Melton stated that he supports a trigger point.
Chair Cook said that the point of the memo was to ensure that the UAC has done its job and
clearly thought through the costs to make sure that the costs are reasonable.
Vice Chair Foster was concerned that any action will show that the UAC supports carbon
neutrality, but doesn't want to pay much at all for it. He would rather not take a new formal
action, but rely on staff to less formally provide an early heads up to the UAC and Council if
costs are higher than anticipated.
Commissioner Melton asked if staff could come back to the UAC with an update of the cost to
get to carbon neutral based on better information about hydroelectric conditions. He asked a
cost trigger could be put in place which if met would prompt staff to come back to the UAC to
discuss whether or not it made sense to pursue carbon neutrality for that year. The cost trigger
would be less than the cap approved by Council, so that staff would not have to return to
Council if the decision was to move forward with carbon neutrality.
Director Fong asked Senior Resource Planner Monica Padilla to discuss how a cost trigger would
be used by staff. Padilla stated that RECs will be purchased after the fact when hydro
conditions are known and we'll have a better idea of REC costs and that staff could return to
the UAC with updated costs before purchasing RECs.
ACTION:
Commissioner Eglash made a motion to recommend that Council direct staff that, if cost is
higher than 0.15 cents/kWh, staff should come back to the UAC for additional discussion. He
explained that it could be left to staff's discretion to inform the UAC regarding a significant
increase in the cost of RECs.
Commissioner Hall made a substitute motion to revise the cap to 0.15 cents/kWh, instead of
0.25 cents/kWh. Commissioner Eglash seconded the substitute motion. Commissioner Hall
explained that it's more straightforward to have a cap, rather than a trigger point to return for
discussions. If it looks like the cap will be exceeded, staff could return and request additional
spending authority.
Vice Chair Foster stated that he supports a request for discussion, rather than a lowering of the
cap. But, if a lower cap is proposed, then he would support a cap of 0.2 cents/kWh, not 0.15
cents/kWh.
Commissioner Eglash stated that Council supported carbon neutral by 2015, but the additional
costs to move it up to 2013 were high and a cap will reduce the cost of moving up the date of
implementation.
Vice Chair Foster proposed an amendment to the substitute motion to revise the cap to 0.2
cents/kWh. The amendment died for lack of second.
The substitute motion to recommend that Council achieve carbon neutrality for the electric
supply portfolio within a cost cap of 0.15 cents/kWh passed (4-2) with Foster and Melton
opposed and Waldfogel absent.
FINANCE COMMITTEE
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Regular Meeting
Tuesday, February 5, 2013
Chairperson Burt called the meeting to order at 7:00 P.M. in the Council
Conference Room, 250 Hamilton Avenue, Palo Alto, California.
Present: Berman, Burt (Chair), Schmid, Shepherd
Absent:
ORAL COMMUNICATIONS
None
AGENDA ITEMS
1. Utilities Advisory Commission Recommendation that the City Council
Adopt a Resolution Approving a Carbon Neutral Plan for the Electric
Supply Portfolio to Achieve Carbon Neutrality by 2013.
Monica Padilla, Senior Resource Planner reported in December 2007 the
Council approved the Climate Protection Plan (CPP), setting out broad goals
to reduce greenhouse gas (GHG) emissions. In March 2011, the Council
approved an updated Long-term Electric Acquisition Plan (LEAP), setting
broad objections for management of the portfolio and directing Staff to
review cost benefits of achieving a carbon neutral portfolio. Staff
determined the City could achieve carbon neutrality quickly with minimal
risk. In May 2012 the Council directed Staff to develop a Plan to achieve
carbon neutrality by 2015. First, Staff defined carbon neutrality, and the
Council approved the definition in November 2012. In developing a Carbon
Neutral Plan (Plan), Staff established high level objectives: achieve
community-wide reductions in GHG emissions consistent with the CPP;
achieve carbon neutrality quickly and with a reasonable cost; support the
City's continued commitment to energy efficiency and long-term renewables;
and meet the Renewable Portfolio Standard (RPS) for remote and local
renewables and large hydroelectric generation. If the Council took no
action, Staff expected to have approximately 50 percent of supply needs
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met through large hydroelectric generation, 33-35 percent through
committed renewable resources, and the remainder through market
purchases. Beyond 2016, Staff expected to bring on some new renewable
resources to meet RPS within the 1/2 cent rate impact limit. Through those
contracts for renewable resources, Staff believed the City could attain 100
percent carbon neutrality by 2017 within the 1/2 cent rate impact. In
struggling with actions to take between 2013 and 2016, Staff considered key
policy decisions of using 100 percent long-term renewables, combining long-
term and short-term renewables, using Renewable Energy Certificates
(REC), allowing for banking, buying unbundled RECs, and using cap-and-
trade revenues or other ratepayer funds. Staff's recommendation did not
include a method to pay for carbon neutrality, because that would be part of
the Budget process. In developing the recommended Plan, Staff considered
alternative strategies that could be employed to reach carbon neutrality.
Chair Burt requested an explanation of acronyms.
Ms. Padilla explained Power Purchase Agreements were PPAs, and RPS was
Renewable Portfolio Standard. The recommended Plan included continued
purchases from the brown market in order to meet load requirements, while
neutralizing those purchases through the use of RPS eligible unbundled RECs
and possibly short-term renewables if available at a comparable price. In a
dry year, the City would continue to make market purchases to meet load
and neutralize market purchases with non-RPS-eligible unbundled RECs.
Use of only RPS-eligible renewables could be quite exorbitant in a dry year.
To annually true up the portfolio, Staff proposed banking as much as
possible, and then using unbundled RECs to neutralize resources. To
neutralize anthropogenic and small emissions associated with the
cooperatively owned backup unit generator (COBUG), the City would use
non-RPS-eligible unbundled RECs. Use of non-RPS unbundled RECs was less
expensive; however, use of only short-term bundled renewable resources
was the gold standard for a carbon neutral portfolio.
Chair Burt asked Staff to explain the difference between RPS-eligible
renewables, non-RPS-eligible unbundled RECs, and other resources.
Ms. Padilla explained the California Energy Commission certified resources to
meet the RPS. There were some vintage requirements that resources be
built after a certain date and that resources cover a variety of types of
generation including biogas, wind, solar, small hydroelectric, and
geothermal.
Chair Burt inquired whether resources must be in state or could be out of
state.
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Ms. Padilla stated out-of-state renewables were RPS eligible but there were
limits on the number that could be brought into California.
Chair Burt reiterated that only a certain portion of resources in the RPS-
eligible category could be out-of-state.
Ms. Padilla agreed.
Chair Burt added those out-of-state resources must have certain
characteristics.
Ms. Padilla explained a REC was essentially the green attribute associated
with a particular renewable facility. The REC could be stripped from the
actual energy and sold as an unbundled REC. Under the RPS rules an
unbundled REC was an RPS-eligible resource but there were limitations on
how many a portfolio could contain. A bundled REC was the renewable
attribute and the energy together. They were eligible for RPS with few
limitations.
Valerie Fong, Utilities Director noted all renewable resources currently under
contract were fully eligible under the state rules because the City was
keeping the energy and the green attribute together. There were markets to
purchase bundled and unbundled RECs.
Ms. Padilla reported all resources in the City's RPS were RPS eligible. To
meet carbon neutrality, the City did not have to pursue RPS-eligible
resources; resources had to be carbon free and/or renewables.
James Keene, City Manager asked why market purchases were included in
resources for the near term.
Ms. Padilla explained the City had to make market purchases in order to
meet load requirements. Once the City knew how many market purchases
were made to meet load requirements, it would then buy an equivalent
amount of RECs.
Mr. Keene inquired whether offsetting RECs would negate the market
purchases.
Ms. Padilla answered yes.
Chair Burt posed the scenario of utilizing 50 percent hydroelectric, 40
percent renewables, and 10 percent market purchases, and asked if the City
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would then need to purchase under this proposal non-RPS-eligible unbundled
RECs to compensate for the 10 percent of market purchases.
Ms. Fong replied yes, under that scenario.
Council Member Berman inquired whether the City could purchase either
RPS-eligible RECs or non-RPS-eligible RECs.
Ms. Fong suggested the City could purchase RPS-eligible unbundled RECs.
Mr. Keene inquired about a scenario that would allow the City to bank RECs.
Ms. Padilla stated a wet hydroelectric year would allow that.
Chair Burt indicated the recommendation was to offset market purchases
with RPS-eligible RECs.
Ms. Padilla noted the table on Packet Page 15 discussed the prices of the
different products. The least expensive product was a non-RPS unbundled
REC with a premium between $1 and $5. An RPS-eligible unbundled REC
had a premium between $1 and $10. A bundled renewable energy and REC,
short -term bundled product, had a premium between $5 and $25 for an
out-of-state product, and a premium between $10 and $30 for an in-state
product. The prices were market prices at the time the report was produced
and were subject to change.
Council Member Berman noted the City did not have to meet the RPS
standards yet; however, the portfolio had to reach 33 percent at some point.
Chair Burt stated the portfolio had to reach 33 percent by 2020.
Ms. Padilla explained those were interim compliance requirements, and the
City was on track to meet all of them.
Council Member Berman believed the real reason for purchasing RPS versus
non-RPS RECs was the environmental benefit.
Chair Burt provided an overview of the Council's discussions of and
objectives for carbon neutrality. The Plan was not driven by state or federal
mandate but by a Palo Alto initiative.
Council Member Berman inquired about the cost difference between the
recommended Plan and the non-RPS Plan using the hypothetical of 50
percent hydroelectric, 40 percent renewables, and 10 percent market
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purchases.
Ms. Padilla reported the recommended Plan fell between the two
alternatives. All plans achieved carbon neutrality by the adopted definition.
Staff recommended implementing the recommended Plan as early as 2013
because it could be achieved relatively inexpensively. From 2013 through
2015 the City could achieve carbon neutrality through the use of short-term
renewables, if they were available at a reasonable price, and/or unbundled
RECs to neutralize brown energy associated with market purchases. Beyond
2016, use of the 1/2 cent would achieve 50 percent carbon neutrality. The
City could reach carbon neutrality with hydroelectric and renewables in 2017
while balancing unbundled RECs and utilizing the banking mechanism to the
extent the possibilities. Anthropogenic emissions and COBUG emissions
could be neutralized with non-RPS-eligible RECs.
Chair Burt requested an explanation of anthropogenic and COBUG.
Ms. Padilla explained anthropogenic emissions were the result of man
extracting steam from geothermal plants. No anthropogenic emissions were
associated with Palo Alto's landfill gas generators.
Chair Burt stated anthropogenic emissions were associated with renewables.
Ms. Padilla explained biogenic emissions occurred naturally and
anthropogenic emissions occurred because man did something to the site to
extract energy. Staff recommended neutralizing anthropogenic emissions
with non-RPS-eligible RECs. COBUG had emissions because of the fossil-fuel
fired generator.
Vice Mayor Shepherd asked why COBUG did not need to have RECs.
Ms. Fong explained COBUG was exempt from the compliance requirements.
Ms. Padilla reported Staff recommended achieving carbon neutrality within a
rate impact limit of 0.15 cents per kWh. If Staff determined the limit would
be exceeded they would return to the Council for direction. Between 2013
and 2016 market purchases were covered with short-term renewables or
RECs to neutralize that part of the portfolio. Everything else remained the
same. If the Plan was approved and implemented Staff expected the cost to
attain carbon neutrality would be relatively moderate. In 2013-2016 the
cost would range between $610,000 and $910,000 annually. Beyond 2016
the costs became minimal at approximately $40,000 per year, associated
mainly with the anthropogenic emissions and COBUG. The costs were based
on expected hydroelectric production and expected product costs. The
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expected cumulative costs between 2013 and 2020 would be approximately
$2.9 million. An average residential bill would increase between $2.60 and
$4.20 a year. Beyond 2016 an average residential bill would increase
approximately 10 cents a year.
Ms. Fong requested Ms. Padilla explain why there was a marked contrast
between the 2013-2016 period and beyond 2016.
Ms. Padilla reported beyond 2016 Staff used the 1/2 cent premium allocated
to the RPS. Costs were in addition to the 1/2 cent premium. At 0.15 cents
per kWh, the cap on costs to reach carbon neutrality equated to
approximately $1.5 million per year.
Ms. Fong indicated the $1.5 million amount compared to the expected value
of $610,000 to $910,000 per year.
Ms. Padilla stated if costs reached the maximum of $1.5 million a year the
cumulative costs between 2013 and 2020 would be approximately $12
million. Because the portfolio and all cost assessments were based on
expected values, which were not likely to occur, Staff considered different
scenarios for the recommended portfolio and the alternatives. There are
very few months in a dry year when the City could meet load requirements.
In a wet year, the City had surplus resources in many months. In 2020
when Staff expected to have additional long-term renewables, the problem
in a wet year was exacerbated because more renewable resources were
available. The Plan called for neutralizing on an annual basis not a monthly
basis.
Council Member Berman suggested Staff provide the average monthly load
requirement and the average monthly amount generated for the different
options to understand it did even out.
Ms. Padilla reported the scenario analysis provided the expected costs in a
wet year, a dry year, a high-price year, and a hybrid. With the exception of
2016, in all years Staff expected to be within that 0.15 cent rate limit. The
analysis assumed that those renewables being evaluated were viable and
could be billed and delivered at the price expected.
Mr. Keene inquired whether Chart 1 assumed the baseline scenario and
whether the gap would be made up through the new renewable portfolio in
2020.
Ms. Padilla indicated the portfolio would reflect Chart 1 in 2020 with the new
renewables.
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Ms. Fong explained in the expected year, the City would not meet load
requirements. The winter months typically had less hydroelectric generation
and the summer months had more hydroelectric generation. That was the
pattern for determining the value in the market.
Ms. Padilla stated the City did not have sufficient hydroelectric resources to
meet load requirements in every month, so market purchases would be used
to compensate.
Mr. Keene noted the projection for 2020 was 100 percent renewable
resources, so the market purchases would be of renewable resources.
Ms. Fong explained all the excess would be used to average out the gap. It
was an annual accounting issue when discussing the annual profile for
carbon neutrality under the adopted protocol.
Ms. Padilla reported the graph showed what the costs under expected
hydroelectric and market price conditions would be for the different
portfolios. Costs for the recommended Plan were approximately 0.06 cents
per kWh through 2016 when Staff expected costs to increase slightly due to
an increased price of renewable resources.
Ms. Fong stated the City would have more renewables in its portfolio.
Vice Mayor Shepherd asked if renewables were hard resources.
Ms. Fong explained hard resources were the bundled energy plus the
renewable attribute.
Ms. Padilla added shorter-term PPAs as hard resources. In that case, the
City would not reach carbon neutrality at less than 0.15 cents even under
expected conditions. Staff sought community input regarding willingness to
pay and support for pursuit of carbon neutrality. 27 percent of residential
customers were not willing to pay any more for carbon neutrality; however,
the vast majority were willing to pay at least $2 more per month to reach
carbon neutrality. 58 percent of survey participants were PaloAltoGreen
participants.
Chair Burt inquired whether Staff knew how low the monthly cost would be
when it conducted the survey.
Ms. Padilla answered no.
Chair Burt felt more residents would participate if the new cost was only 25
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cents per month.
Ms. Padilla reported the proposed Plan relied heavily on aggressive energy
efficiency efforts, long-term pursuit of RPS, and large hydroelectric
resources. It was comprised of 100 percent renewable resources and relied
on RECs only until long-term renewable resources came online in 2017. The
Plan could be implemented as early as 2013 at a moderate cost, supported
Palo Alto environmental leadership goals, and followed a verifiable and
established protocol. Staff asked that the Finance Committee support the
recommendation to recommend to the Council adoption of a Resolution to
approve the Plan with the 0.15 cent per kWh rate impact.
Steve Eglash, Utilities Advisory Commissioner reported the Utilities Advisory
Commission (UAC) and public comments overwhelmingly supported the Plan.
The UAC had no disagreement on any of the high level points, but
recommended significant limits on the amount to spend to achieve carbon
neutrality, particularly prior to 2016. Because of the City's progress in
meeting its RPS, beginning in 2017 the cost would be zero. The UAC
attempted to balance the benefits of carbon neutrality with respect for the
ratepayers. In trying to balance that, the UAC voted for a slightly tighter
limit on spending between now and 2016. The UAC recommendation was
reflected in Staff's recommendation.
Chair Burt inquired whether the 0.15 cent cap on rate impact was Staff's
recommendation and the UAC's recommendation.
Ms. Fong answered yes.
Mr. Keene believed Staff had been promoting the higher rate but was
convinced by the UAC and the fact that the cap could be revisited.
Mr. Eglash indicated Commissioners who did not support a tighter cap felt
the message of achieving carbon neutrality was more effective; however,
the majority of Commissioners supported the rate cap.
Chair Burt asked if Staff considered use of cap-and-trade revenues to offset
this expense.
Ms. Fong reported Staff left the funding source open, because they would
need to explain how they proposed spending cap-and-trade funds during the
Budget process. Cap-and-trade revenues could be used for energy efficiency
or for this Plan.
Chair Burt suspected that there would be some difference in thinking by the
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Council, the UAC, and members of the public if the cost of the Plan was
offset by cap-and-trade revenues. From a policy standpoint, whether or not
the Plan impacted ratepayers would influence the parties.
Mr. Eglash stated the UAC did not discuss cap-and-trade revenues in relation
to the Plan.
Ms. Fong reported one tenet for spending cap-and-trade revenues was to
spend those monies on projects the Council would do anyway in case of a
legal challenge.
Bruce Hodge was pleased to offer unqualified support for the Plan. Both the
timeline and costs were worth noting. Beyond the immediate benefits, this
Plan would send a message of hope and change to the larger audience.
Walt Hays felt climate change was the most severe threat humankind had
faced. If people knew the cost would be only 25 cents per month, the
percentage of survey respondents agreeing would have been substantially
higher. He hoped the Finance Committee would follow Staff's
recommendation.
Herb Borock stated this was the first time a legal reason had been asserted
for not recommending the use of cap-and-trade revenue. In the UAC
discussion regarding the rate impact limit, the argument was made that the
cumulative amounts paid by commercial customers could be a burden on
them; however, the amount paid by top commercial electric users was
minute.
Council Member Schmid felt the issue was presenting the Plan to the public
and noted the survey indicated 58 percent of residents participated in
PaloAltoGreen, whereas the performance report indicated 20 percent of
residents participated in PaloAltoGreen.
Ms. Padilla clarified that 58 percent of those responding to the survey
participated in PaloAltoGreen.
Council Member Schmid suggested Staff be careful how they present
information regarding customers.
Ms. Fong agreed.
Council Member Schmid understood the 1/2 cent per kWh would attain the
goal of 33 percent and asked if it would attain the 50 percent goal.
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Ms. Fong answered yes.
Council Member Schmid inquired whether Staff was confident that given the
price structure of renewables the amount approved two years ago was
enough to attain the 50 percent goal.
Ms. Fong indicated the Council approved the amount six or seven years ago
and got it right.
Council Member Schmid stated that was a real accomplishment given the
cap set years ago. He recalled a scenario of a dry hydroelectric year with
high renewable prices and felt that was a likely scenario.
Ms. Fong explained if RECs were increasingly high the cap would take effect.
Council Member Schmid inquired about the effects of 100 percent renewable
resources or carbon neutrality on the PaloAltoGreen program.
Ms. Fong stated the Council would have a Study Session on PaloAltoGreen
the following week.
Chair Burt reported the Study Session recognized that the PaloAltoGreen
program would not serve a purpose in its present form as the City moved to
100 percent renewables.
Council Member Schmid noted the trading or banking of hydroelectric credits
had to be made within a calendar year and inquired about the effect of using
the City's fiscal year; which would split the wet season between years.
Ms. Padilla reported the carbon neutral definition required use of the
calendar year basis not fiscal.
Council Member Schmid asked what would be the effect if the fiscal year was
used.
Ms. Fong stated the Council adopted the protocol of the calendar year.
Mr. Keene clarified that Council Member Schmid asked for the implication if
it were structured on the fiscal year.
Council Member Schmid expressed concern about the ability to bank. The
goal could be achieved more effectively if the diagram was split in half.
Ms. Fong indicated a protocol had to be followed once it was adopted. It
DRAFT MINUTES
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was difficult to change accounting rules in midstream with respect to
meeting goals.
Council Member Schmid explained that at the end of the year in December,
the City could not use the surplus generated in hydroelectric past that date.
The City would have a surplus that could be shared with others, but the City
was not able to use the surplus effectively.
Ms. Fong stated it was a bit more complicated than that. In hydroelectric
generation, the reservoirs allowed for crossover to different fiscal years or
even into different calendar years. The reservoir heights were typically
managed such that not all hydroelectric fuel was burned in one year.
Council Member Schmid noted several statements indicating it could not be
done after the calendar year was over as allowable, yet Staff implied it was
more flexible.
Ms. Fong reported the definition, the protocol and the accounting were not
flexible. Council Member Schmid was concerned that water in the reservoir
would be used in one year; however, hydroelectric generation was not
typically run that way.
Council Member Schmid indicated there was a substantial change year from
year with regard to dry, average and high, and there would not be much
banking, trading, shifting, or moving.
Mr. Keene did not understand why that was different if the year was divided
in July rather than December.
Chair Burt inquired whether the graph indicated there was a year-to-year
fluctuation of a high hydroelectric, low and median, or was it a range over
several years.
Ms. Padilla reported the graph represented how hydroelectric generation
would materialize in a typical year on a month-to-month basis.
Chair Burt inquired whether the graph reflected what might occur in a single
year of a dry or wet year or did it level out the impact over several years.
Ms. Fong explained the graph was what Staff predicted would happen in
2015 under wet conditions and dry conditions in terms of the actual
generation. What was not shown was what 2016 might look like.
Vice Mayor Shepherd asked if dry and wet years could be merged if this year
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was dry and the next was wet.
Ms. Padilla answered no. The Climate Registry's protocol did not allow for
banking of hydroelectric generation.
Ms. Fong indicated a calendar year or fiscal had to be chosen and used.
Council Member Schmid stated under this scenario trading could not occur in
December. At the peak of the summer period, it would be easy to say this
was a great year and to use that credit in the next year.
Mr. Keene asked for clarification of Council Member Schmid's question.
Chair Burt said the hydroelectric suppliers were not draining the reservoirs in
a dry year and overproducing in a wet year; thus, it would level out.
Council Member Schmid stated the graph showed quite dramatically that
there was a very different outcome in electrical generation from the
hydroelectric sources in different years, and the sharing was very weak.
Chair Burt believed it did not show how hydroelectric was leveled. If a fiscal
year was used, then Council Member Schmid's argument would only hold
true if hydroelectric was not leveled. Otherwise, there was an impact in the
second half of the outlying fiscal year.
Ms. Fong stated the net result was almost the same.
Mr. Keene explained there would not be enough credits at the beginning of
the year to cover the winter, resulting in the same scenario whether a fiscal
year or calendar were used.
Ms. Fong felt it was irrelevant whether the 12-month period began in July or
January.
Council Member Schmid inquired where The Climate Registry's protocols
came from.
Ms. Fong indicated it was the Council's discretion.
Chair Burt indicated that topic was not before the Finance Committee.
Ms. Fong explained if a different protocol was chosen Staff would work with
the new parameters.
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Council Member Schmid felt issues were raised about banking, saving, and
the time period of 15 years. He asked if that meant that next year every
solar array that was produced 16 years ago would drop out of the RPS
standard portfolio.
Ms. Fong stated those hypotheticals did not apply. The City signed its first
renewable contract in 2005. The oldest resource was hydroelectric
generation, which was not RPS eligible.
Council Member Schmid believed by agreeing to that, 50 percent of carbon
neutral energy generation was not renewable.
Ms. Fong reiterated that it was acknowledged as carbon neutral, and the
discussion concerned carbon neutrality.
Council Member Schmid recalled a few years past PaloAltoGreen considered
coal as renewable energy, now it was carbon neutral.
Ms. Fong said PaloAltoGreen was 100 percent green through RECs, not
through hard resources. RECs were used to make a portfolio have a
different look.
Chair Burt stated the discussion would not revisit the definition of carbon
neutral, which the Council adopted the prior year. The topic for discussion
was the proposed Plan based upon the adopted definition.
Council Member Schmid believed they were approving The Climate Registry's
definitions.
Chair Burt stated the adopted definitions had to be included in the Plan. It
was not a reconsideration of a definition.
Council Member Schmid felt it was reasonable when considering
consequences.
Chair Burt overruled Council Member Schmid.
Ms. Fong reported Staff's recommendation was to approve the Plan to attain
carbon neutrality. The key points were the year to reach carbon neutrality
and the cap to apply to the carbon neutral portfolio.
Council Member Berman inquired whether the Finance Committee would
recommend a Plan.
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Mr. Keene clarified that to mean which purchases to make.
Ms. Fong indicated the recommended Plan included the renewable RPS.
Council Member Berman felt it was helpful to understand the decision points.
MOTION: Vice Mayor Shepherd moved, seconded by Chair Burt to
recommend the City Council adopt the Resolution adopting the Carbon
Neutral Plan, enabling the City to achieve a carbon neutral electric supply
portfolio starting in calendar year 2013 within an annual rate impact not to
exceed 0.15 cents per kilowatt-hour.
Vice Mayor Shepherd noted the Council had made incremental decisions to
reach the current point. One of the decisions was the technique for
discussing purchases and consideration of the label of carbon neutrality.
The COBUG was exempt.
Ms. Fong clarified COBUG was exempt from AB 32 compliance. Exempt
meant the City did have to purchase allowances to offset the emissions.
Vice Mayor Shepherd applauded the UAC's questioning and study of issues.
RECs were limited and using them was a privilege.
Chair Burt reported the history of the definition of carbon neutral. The City
was able to use a budget established seven years ago for renewables to
achieve a greater outcome than originally projected to have costs lower
than Pacific, Gas, and Electric (PG&E)'s costs was quite an achievement.
Implementation of a Plan would assist corporate customers with achieving
their own sustainability goals.
Council Member Berman supported achieving a carbon neutral electric
supply portfolio in 2013; utilizing a rate cap of 0.15 cents per kWh; Staff's
recommended model; and the Motion. The City should share its
achievements to encourage other cities to consider a carbon neutral plan.
Council Member Schmid felt the use of the 0.15 cents per kWh cap while
achieving 50 percent renewables should be the main focus of the discussion.
Mr. Keene indicated possible changes in the PaloAltoGreen program could
leverage more investments resulting in a more sustainable Palo Alto.
MOTION PASSED: 4-0
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FUTURE MEETINGS AND AGENDAS
Lalo Perez, Administrative Services Director reported the next scheduled
meeting was February 19, 2013. Topics for upcoming Agendas included the
following:
2/19/13 (Shepherd Absent)
FY 2013 Q2 Financial Results and Midyear BAO—capture changes in
the Budget
Potential Modification to Street Sweeping Program—Pilot program
recommendation
Contract Amendment with Brad Lozares—five-year agreement for
management of the Golf Course Clubhouse
3/5/13
Review of Follow up Items from Human Services Needs Assessment—
follow-up from previous year
3/19/13
Cost of Services Study—sample methodologies and timeline
He provided a timeline of the May Budget hearings, and requested the
Finance Committee (Committee) members provide him with dates they
would not be available. Three members present were needed for a quorum.
The Budget wrap-up would allow the Committee to revisit decisions made
when a member was absent.
Council Member Schmid inquired whether the final vote on the Budget would
be held on June 10, 2013.
Mr. Perez indicated the Budget wrap-up could be held on May 21, 2013 with
a back-up date on May 23rd if necessary. The Council's Budget hearing
would open on June 3rd with adoption of the Budget on June 10th.
James Keene, City Manager reported the schedule was designed to provide
the Council with a few meeting dates between Budget adoption and the
Council recess.
Chair Burt noted fiber to the premises was not included in the items for
referral to the Committee, even though it was elevated to a priority
consideration.
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Mr. Keene would provide a timeline for the Committee on fiber to the
premises.
Vice Mayor Shepherd stated the topic would come to the Committee before
being presented to the Council.
ADJOURNMENT: Meeting adjourned at 8:35 pm.
City of Palo Alto (ID # 3556)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: CITY/PAUSD 2013 Summer Enrichment Program
Title: Staff Recommends Approval of an Agreement with Palo Alto Unified
School District (PAUSD) under which the City of Palo Alto (City) will Provide
the District with Fiscal Services as part of the PAUSD 2013 Summer
Enrichment Program and Provide Collaborative After-School Summer
Programs.
From: City Manager
Lead Department: Community Services
RECOMMENDATION
Staff recommends that Council approve, and authorize the City Manager or designee to
execute, the attached contract with the Palo Alto Unified School District (PAUSD),
authorizing the City to act as the fiscal agent for PAUSD’s 2013 summer enrichment
program; and, working in collaboration with PAUSD, provide an after-school camp
program and a variety of other summer programs on PAUSD sites.
DISCUSSION
In 2001, it was agreed that the City and PAUSD would collaborate in order to facilitate
summer enrichment programs for PAUSD. The collaboration is evaluated annually and
continues to be very successful.
The terms and conditions of this agreement are essentially the same as previous years.
Staff has modified terms to better define Summer Enrichment programs, that is, they
are ancillary learning classes offered by PAUSD and camps are offered by the City that
complement, but do not replace or make up, PAUSD classes offered throughout the
academic year. The Summer Enrichment programs (classes and camps) are not for credit
classes for elementary, middle or high school graduation requirements.
City of Palo Alto Page 2
Under the agreement, the City acts as the fiscal agent for PAUSD’s summer enrichment
classes at selected schools. PAUSD collects the checks and credit card forms made
payable to the City and delivers them to the City. The City deposits the checks and credit
card charges into the General Fund, and returns 92 percent of the revenue collected to
PAUSD, while retaining the remaining 8 percent as administrative fees for its fiscal
services. In 2013 the City anticipates processing $500,000 for PAUSD’s summer
enrichment classes for approximately 1,400 participants.
In addition to the City’s role as the fiscal agent, PAUSD and the City’s Community
Services Department will again work collaboratively to provide summer enrichment
recreation and art camps during the summer school period. One of the 2013 summer
enrichment/recreation camps is entitled ‘Camp JIVE.’ This Middle School camp takes
place during PAUSD Summer School session. City staff will work closely with PAUSD
Summer School staff at the summer school campus to provide a variety of activities
after summer school ends. Typically located in a classroom on the summer school
campus Camp JIVE provides a safe and fun place for students to visit during the
afternoons. Participants will meet new friends, swim at Rinconada Pool twice a week,
participate in special events, play sports and create art projects.
This year the City and PAUSD will also offer a two-week camp that will challenge
students to explore and create art. Using a variety of different media, students will learn
new art techniques or continue to strengthen their artistic talents. Art Explosion is a full
day camp. In the morning and early afternoon students will be in a classroom with a
PAUSD teacher and in the afternoon will participate in recreation activities and field
trips with the City’s Recreation staff. Both the teacher and Recreation staff work closely
to ensure continuity between morning and afternoon programs. In the past, the City has
offered Future Authors and Coastal Adventures camps similar to the Art Explosion full
day camp. PAUSD will also provide 6 additional classrooms for other City summer camps
at no cost to the City as part of this agreement
RESOURCE IMPACT
The contract will generate sufficient revenues to offset the expense of providing this
service; a budget amendment is not required.
POLICY IMPLICATIONS
The recommendation in this report is consistent with current City policies.
City of Palo Alto Page 3
ENVIRONMENTAL REVIEW
This contract is not a project as defined by the California Environmental Quality Act
(CEQA) and is not subject to CEQA requirements.
Attachments:
Attachment A - Agreement with PAUSD for the Annual Summer Enrichment Program
(DOCX)
PAUSD Insurance Cert (PDF)
EXHIBIT B - Palo-Alto-Unified-Liability (PDF)
ATTACHMENT A
130115 dm 00710142A 1
ANNUAL SUMMER ENRICHMENT PROGRAM AGREEMENT
BETWEEN THE CITY OF PALO ALTO AND THE PALO ALTO
UNIFIED SCHOOL DISTRICT
This Annual Summer Enrichment Program Agreement (the “Agreement”), dated, for
convenience, __________________, 2013 (the “Effective Date”) is made by and between the
CITY OF PALO ALTO, a California chartered municipal corporation (the “CITY”) and the PALO
ALTO UNIFIED SCHOOL DISTRICT, a unified school district of the State of California (the
“DISTRICT”) (individually, a “Party” and, collectively, the “Parties”), in reference to the following
facts and circumstances:
RECITALS:
A. For many years, the Parties have collaborated in providing a summer enrichment
program at various DISTRICT schools located within the CITY’s jurisdictional boundary, including
the public elementary, middle and high schools.
B. The Parties wish to continue to work collaboratively on a summer enrichment
program, whereby the CITY will sponsor and manage, directly or indirectly, an after-school
summer camp program in conjunction with the summer enrichment school program.
C. The Parties wish and fully expect that the DISTRICT’s students will have an
opportunity for an enriching, learning experience during the summer months and the CITY’s
young residents will have the opportunity to participate in recreational and learning activities.
D. The Summer Enrichment programs are ancillary learning classes offered by the
DISTRICT and camps offered by the CITY that complement, but do not replace or make up, the
DISTRICT classes offered throughout the academic year. The Summer Enrichment programs
(classes and camps) may not be taken for credit toward elementary, middle or high school
graduation requirements.
NOW, THEREFORE, in consideration of the Recitals A through C, inclusive, which are a
substantive part of this Agreement, and the following covenants, terms, and conditions, the
Parties agree:
AGREEMENT:
SECTION 1. TERM.
1.1 This Agreement shall have a term of one (1) contract year, commencing as of the
Effective Date. The original term may be renewed for two (2) additional, consecutive one-
contract year terms, unless and until it is earlier terminated by a Party upon furnishing notice in
accordance with Section 6.2.
ATTACHMENT A
130115 dm 00710142A 2
SECTION 2. PARTIES’ SUMMER ENRICHMENT PROGRAMS
2.1 At the start of each contract year and prior to offering any classes to the public,
the Parties shall agree, in writing, on the Summer Enrichment classes and camps to be offered,
including the respective locations of the classes and camps by the DISTRICT and the CITY,
respectively, and the start and end dates of each Summer Enrichment class and camp program
to be offered during that contract year.
2.2 The CITY will periodically offer a new Summer Enrichment camp program, as
appropriate. The Parties agree, in writing, to the camps the CITY will provide and the dates, on
which the camps will be held prior to offering to the public. The DISTRICT shall be solely
responsible for designing the curricula of the DISTRICT’s Summer Enrichment classes, which
shall be scheduled to commence no earlier than 8:00 a.m. and to end no later than 12:30 p.m.,
Monday through Friday, holidays included. The CITY’s Community Services Department (the
“Department”) shall design and provide the camp activities for participants attending the CITY’s
Summer Enrichment camps, which shall be offered from 12:30 p.m. to 5:30 p.m., Monday
through Friday, holidays included. The Parties may collaborate in other ways in an effort to
provide complementary full-day programs for students during the summer season. The
commencing and ending times for to-be-specified DISTRICT Summer Enrichment classes and for
to-be-specified CITY Summer Enrichment camps may be extended by mutual agreement of the
Parties to allow for the conduct of all-day classes and camps. The Parties agree that their
individual and joint Summer Enrichment classes and camps programs will include a variety of
recreation and/or art programs and field trips, which will be held at various DISTRICT and CITY
sites located within the boundaries of Palo Alto.
2.3 In consideration of the DISTRICT’s provision of teacher(s) necessary for the CITY’s
Summer Enrichment camps, the CITY will pay the DISTRICT a fee of Five Thousand Dollars
($5,000.00) per teacher, per contract year; the fee shall be deducted from the administrative
fee payable to the CITY, as referred to in Section 3.3. The Parties may agree to alternative
payment arrangements, which may be dependent on the shorter length of courses and
workshops, provided, however, the CITY’s obligation to pay any such administrative fee will
extend only to any teacher(s) hired for the CITY’s 2013 Summer Enrichment program,
commencing on or after June 10, 2013 and ending on or before August 31, 2013.
SECTION 3. DISTRICT OBLIGATIONS
3.1 The DISTRICT shall provide its Summer Enrichment classes in accordance with,
and subject to all applicable standards and obligations required of a public school district, at the
DISTRICT elementary, middle and high schools.
3.2 The DISTRICT shall provide a minimum of six (6) classrooms for CITY camps, at no
cost to the CITY beyond the administrative fee payable pursuant to Section 3.4,
ATTACHMENT A
130115 dm 00710142A 3
3.3 The DISTRICT shall collect the checks, and credit card forms made in payment for
the Parties’ Summer Enrichment classes and camps, excluding any camps to be offered at
various DISTRICT school sites, which will be made payable to the CITY, and deliver them to the
CITY in a manner approved by the CITY’s Revenue Collections Division. The CITY will deposit
checks and credit card payments into the CITY’s General Fund. The CITY shall prepare and
provide to the DISTRICT an accounting of the deposits, and shall return 92% of the total funds
collected to the DISTRICT, and shall retain the remaining eight percent (8%) as an administrative
fee for its fiscal services. All supporting documentation relating to the CITY’s role as fiscal agent
for the DISTRICT will be available for review by the DISTRICT, upon request. The CITY will
directly collect and handle all fees for its own Summer Enrichments camps.
3.4 Student participants enrolling in any of the joint CITY and DISTRICT’s Summer
Enrichment classes and camps may register through the CITY’s registration process. The CITY
shall prepare and provide to the DISTRICT an accounting of all revenues and expenses for all
camps. Revenue will be used to cover all camp expenses and any net income will be distributed
evenly between the DISTRICT and the City.
3.5 The DISTRICT shall provide teacher(s) who will be necessary to staff the CITY’s
Summer Enrichment camps, and will provide the necessary information, in writing, regarding
the teacher(s) prior to the commencement of the Summer Enrichment camps.
SECTION 4. INDEMNITY
4.1 The DISTRICT will indemnify, defend and hold harmless the CITY and its elected
and appointed officials, officers, and employees from and against any and all loss, damage,
claim or liability (including, without limitation, reasonable attorneys’ fees) arising or alleged to
arise out of the DISTRICT’s negligent acts, errors or omissions in its performance under this
Agreement. The DISTRICT will obtain and maintain, in full force and effect during the term of
this Agreement, the insurance coverage described in Exhibit “A,” insuring not only the DISTRICT
and its contractors, if any, but also, with the exception of workers’ compensation and
employer’s liability, naming the CITY as an additional insured concerning DISTRICT’s obligations
under this Agreement.
4.2 The CITY will indemnify, defend and hold harmless the DISTRICT and its officers,
employees, and board members from and against any and all loss, damage, claim or liability
(including, without limitation, reasonable attorneys’ fees) arising or alleged to arise out of the
CITY’s negligent acts, errors or omissions under this Agreement. The CITY is a self-insured
governmental entity and therefore will not be required to obtain and maintain, in full force and
effect during the term of this Agreement, any insurance coverage, unless they are specifically
identified in Exhibit “B.” Any such insurance with the exception of workers’ compensation and
employer’s liability, will name the DISTRICT as an additional insured concerning CITY’S
obligations under this Agreement. Evidence of adequate self-insurance shall be acceptable
compliance with this requirement.
SECTION 5. NOTICES
ATTACHMENT A
130115 dm 00710142A 4
5.1 All notices shall be submitted, in writing, and sent by the United States mail,
certified and postage prepaid by private express delivery service, by facsimile transmission
followed by delivery of hard copy, or by any other process mutually acceptable to the parties to
the addresses stated below or to any other address noticed in writing.
To CITY: Office of the City Clerk
City of Palo Alto
250 Hamilton Avenue
Palo Alto, CA 94301
With a copy to: Recreation Division Manager
1305 Middlefield Rd.
Palo Alto, CA 94301
To DISTRICT: Superintendent
Palo Alto Unified School District
25 Churchill Avenue
Palo Alto, CA 94306
SECTION 6. MISCELLANEOUS
6.1 This Agreement shall be governed by and construed in accordance with the laws
of the State of California.
6.2 Either Party may terminate this Agreement upon 120 days’ prior written notice,
with or without cause, to the other Party of its intent to terminate this agreement.
6.3 This Agreement may be executed in any number of counterparts, each of which
shall be an original, but all of which together shall constitute one and the same instrument.
6.4 This Agreement constitutes the entire agreement between the parties
concerning its subject matter, and there are no other oral or written agreements between the
Parties not incorporated in this Agreement.
6.5 This Agreement shall not be modified, unless the parties first agree to and
approve of such modification in writing through a duly authorized amendment.
6.6 If a court of competent jurisdiction finds or rules that any provision of this
Agreement is void or unenforceable, the unaffected provisions of this Agreement shall remain
in effect.
6.7 The prevailing Party in any action brought to enforce the terms of this
Agreement may recover from the other Party its reasonable costs and attorney’s fees expended
in connection with such an action.
ATTACHMENT A
130115 dm 00710142A 5
6.8 Both Parties shall give their personal attention to the faithful performance of this
Agreement and shall not assign, transfer, convey, or otherwise dispose of this Agreement or
any right, title or interest in or to the same or any part thereof without the prior written
consent of the other party, and then only subject to such terms and conditions as the other
Party may require. A consent to one assignment shall not be deemed to be such a consent to
any subsequent assignments. Any assignment without such approval shall void and, at the
option of the other party, shall terminate this Agreement and any license or privilege granted
herein. This Agreement and any interest herein shall not be assigned by operation of law
without the prior written consent of the other Party.
IN WITNESS WHEREOF, the Parties by their duly appointed representatives have
executed this Agreement as of the Effective Date.
APPROVED AS TO FORM: CITY OF PALO ALTO
_________________________________ __________________________
Senior Asst. City Attorney City Manager
APPROVED:
_________________________________
Director of Administrative Services
PALO ALTO UNIFIED SCHOOL
_________________________________ DISTRICT
Director of Community Services
By: ___________________________
Name: ___________________________
Title: ____________________________
Attachments:
Exhibit “A”: District’s Insurance Requirements
Exhibit “B”: City Insurance Requirements
CERTIFICATE OF COVERAGE Issue Date
ADMINISTRATOR:
COVERED PARTY:
LICENSE #
ENTITIES AFFORDING COVERAGE:
ENTITY A:
THIS IS TO CERTIFY THAT THE COVERAGES LISTED BELOW HAVE BEEN ISSUED TO THE COVERED PARTY NAMED ABOVE FOR THE PERIOD INDICATED. NOTWITHSTANDING ANY
REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN. THE COVERAGE
AFFORDED HEREIN IS SUBJECT TO ALL THE TERMS AND CONDITIONS OF SUCH COVERAGE DOCUMENTS.
ENT
LTR TYPE OF COVERAGE COVERAGE
DOCUMENTS
EFFECTIVE/
EXPIRATION DATE
MEMBER
RETAINED LIMIT
/ DEDUCTIBLE LIMITS
GENERAL LIABILITY
EACH OCCURRENCE
AUTOMOBILE LIABILITY
PROPERTY
COMBINED SINGLE LIMIT EACH OCCURRENCE
STUDENT PROFESSIONAL LIABILITY
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/RESTRICTIONS/SPECIAL PROVISIONS:
CERTIFICATE HOLDER: CANCELLATION…...SHOULD ANY OF THE ABOVE DESCRIBED COVERAGES BE
CANCELED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING ENTITY/JPA
WILL ENDEAVOR TO MAIL _____ DAYS WRITTEN NOTICE TO THE CERTIFICATE
HOLDER NAMED TO THE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL
IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE ENTITY/JPA, ITS
AGENTS OR REPRESENTATIVES.
AUTHORIZED REPRESENTATIVE
[ ] GENERAL LIABILITY
[ ] CLAIMS MADE ( ) OCCURRENCE
[ ] GOVERNMENT CODES
[ ] ERRORS & OMISSIONS
[ ]
[ ] ANY AUTO
[ ] HIRED AUTO
[ ] NON-OWNED AUTO
[ ] GARAGE LIABILITY
[ ] AUTO PHYSICAL DAMAGE
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY
AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS
CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE
EACH OCCURRENCE
OTHER
$
$
$
$
$
$
$
$
ENTITY B:
ENTITY C:
ENTITY D:
ENTITY E:
WORKERS COMPENSATION
[ ] EMPLOYERS’ LIABILITY
[ ] WC STATUTORY LIMITS [ ] OTHER
E.L. EACH ACCIDENT
E.L. DISEASE - EACH EMPLOYEE
E.L. DISEASE - POLICY LIMITS
COMBINED SINGLE LIMIT EACH OCCURRENCE
$
$
$
[ ] ALL RISK
[ ] EXCLUDES EARTHQUAKE & FLOOD
[ ] BUILDER’S RISK
$
$
$
www.eCertsOnline.com
EXCESS WORKERS COMPENSATION
[ ] EMPLOYERS’ LIABILITY $
AFFORDED BY THE COVERAGE DOCUMENTS BELOW.
3 333
NCR 01705-11 7/1/2012
7/1/2013
1,000,00050,000
33333
NCR 01705-11 7/1/2012
7/1/2013
50,000 1,000,000
NCR 01705-11 7/1/2012
7/1/2013
250,000,00050,000
NCR 01705-11 7/1/2012
7/1/2013
50,000 Included
Excess Workers Comp WSRSWC00025704 7/1/2012
7/1/2013
500,000
Keenan & Associates
1740 Technology Drive, Suite 300
San Jose, CA 95110
www.keenan.com Northern California ReLiEF
A
A
10/19/2012
0451271
1,000,000
1,000,000
1,000,000
33
A
A
D
Northern California ReLiEF
WCX 0034148 03 7/1/2011
7/1/2012
1,000,0003C
Arch Insurance Company
3
408-441-0754
Castle Point Insurance Company
Graham Grice
Palo Alto Unified School District
25 Churchill Avenue
Palo Alto CA 94306
City of Palo Alto
Recreation and Youth Sciences
1305 Middlefield Road
Palo Alto CA 94301
30XXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXX
The City of Palo Alto is named Additional Covered Party as respects to use of facilities at Lucie Stern Community Center
for Team building/staff event on December 14, 2012, as scheduled.
CERT NO.: 14441806 CLIENT CODE: PALOALTU Marcia Malone 10/19/2012 4:08:37 PM Page 1 of 2
ENDORSEMENT
ADDITIONAL COVERED PARTY
COVERED PARTY
COVERAGE DOCUMENT
ADMINISTRATOR
Subject to all its terms, conditions, exclusions, and endorsements, such additional
covered party as is afforded by the coverage document shall also apply to the following
entity but only as respects to liability arising directly from the actions and activities of the
covered party described under “as respects” below.
Additional Covered Party:
As Respects:
____________________________________________
Authorized Representative
Issue Date:
10/19/2012
Palo Alto Unified School District NCR 01705-11 Keenan & Associates
The City of Palo Alto is named Additional Covered Party as respects to use of facilities at Lucie Stern
Community Center for Team building/staff event on December 14, 2012, as scheduled.
City of Palo AltoRecreation and Youth Sciences1305 Middlefield RoadPalo Alto CA 94301
CERT NO.: 14441806 CLIENT CODE: PALOALTU Marcia Malone 10/19/2012 4:08:37 PM Page 2 of 2
CERTIFICATE OF COVERAGE DATE (MM/DD/YYYY)
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF EVIDENCE ONLY AND CONFERES NO RIGHTS
UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR
NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE MEMORANDUM(S) OF COVERAGE BELOW.
THIS CERTIFICATE OF COVERAGE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE
ISSUING COVERAGE PROVIDER, AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER.
IMPORTANT: IF THE CERTIFICATE HOLDER IS AN ADDITIONAL COVERED PARTY, THE MEMORANDUM OF COVERAGE MUST BE ENDORSED. A STATEMENT ON THIS CERTIFICATE DOES NOT CONFER RIGHTS TO THE CERTIFICATE HOLDER IN LIEU OF SUCH ENDORSEMENT(S).
IMPORTANT: IF SUBROGATION IS WAIVED, SUBJECT TO THE TERMS AND CONDITIONS OF THE MEMORANDUM(S) OF COVERAGE AN ENDORSEMENT MAY BE REQUIRED. A STATEMENT ON THE CERTIFICATE DOES NOT CONFER RIGHTS TO THE CERTIFICATE HOLDER IN LIEU OF SUCH ENDORSEMENT(S).
NAMED COVERED PARTY
PROGRAM AFFORDING COVERAGE
A:
B:
C:
COVERAGES
THIS IS TO CERTIFY THAT THE COVERAGE IS AFFORDED TO THE ABOVE NAMED MEMBER, AS PROVIDED BY THE MEMORANDUM(S) OF COVERAGE, FOR THE PERIOD SHOWN BELOW, NOT WITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN. THE COVERAGE AFFORDED BY THE PROGRAM DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS, AND CONDITIONS OF SUCH MEMORANDUM(S) OF COVERAGE. THE FOLOWING COVERAGE IS IN EFFECT.
JPALTR TYPE OF COVERAGE MEMORANDUM NUMBER COVERAGE EFFECTIVEDATE (MM/DD/YY)COVERAGE EXPIRATIONDATE (MM/DD/YY) LIMITS
GENERAL LIABILITY EACH OCCURRENCE $
COMMERCIAL GENERAL LIABILITY FIRE DAMAGE (Any one fire) $
CLAIMS MADE OCCUR MED EXPENSE (Any one person) $
PERSONAL & ADV INJURY $
GENERAL AGGREGATE $
GEN’L AGGREGATE LIMIT APPLIES PER: PRODUCTS-COMP/OP AGG $
MEMOR-ANDUM PROJECT LOC
AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT(Ea accident)
$
ANY AUTO $
ALL OWNED AUTOS
SCHEDULED AUTOS
HIRED AUTOS
NON-OWNED AUTOS
WORKERS’ COMPENSATION AND
EMPLOYERS LIABILITY
ANY PROPRIETOR/PARTNER/EXECUTIVE/OFFICER/MEMBER
EXCLUDED?
IF YES, DESCRIBED UNDER SPECIAL PROVISION BELOW
WCSTATUTORYLIMITS
OTHER
E.L. EACH ACCIDENT $
E.L. DISEASE – EA EMPLOYEE $
E.L. DISEASE – POLICY LIMIT $
OTHER
OTHER
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/EXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL/PROVISIONS
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED MEMORANDUM(S) OF COVERAGE
BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE
DELIVERED IN ACCORDANCE WITH THE MEMORANDUM(S) OF COVERAGE
PROVISIONS.
AUTHORIZED REPRESENTATIVE
ACCEL
Alliant Insurance Services, Inc.
100 Pine Street, 11th floor
San Francisco CA 94111
ACCEL - City of Palo Alto
250 Hamilton Avenue
Attn: Sandra Blanch
Palo Alto CA 94303
6/29/2012
A Public Entity Liability ACC1213PAL171 7/1/2012 7/1/2013 $2,000,000
$1,000,000
Per Occur
S.I.R.
Palo Alto Unified School District, its officers, agents and employees are named as
additional insured for liability but only with respect to the use of facilities for City
of Palo Alto functions.
Palo Alto Unified School District (PAUSD)
25 Churchill Avenue
Palo Alto CA 94303
City of Palo Alto (ID # 3552)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: BAO and Award of Contract for CNG Honda Civics
Title: Adoption of a Budget Amendment Ordinance in the Amount of
$468,283.19 to Fund the Purchase and Make Ready Costs of up to 17 Honda
Civic Natural Gas Vehicles and Approval of a Purchase Order with Stevens
Creek Honda in an Amount of $459,783.19 to Purchase up to 17 Compressed
Natural Gas Honda Civics
From: City Manager
Lead Department: Public Works
Recommendation
Staff recommends that Council:
1. Adopt the attached Budget Amendment Ordinance (BAO) in the amount of
$468,283.19 to provide an appropriation for the replacement of up to
seventeen (17) Honda Civic Natural Gas Vehicles through the Equipment
Replacement CIP (VR-13000) and
2. Approve and authorize the City Manager or designee to execute a purchase
order with Stevens Creek Honda in the amount of $459,783.19 for the
purchase of up to seventeen (17) Compressed Natural Gas Honda Civics.
This amount includes $468,283.19 for the vehicles and $8,500 for minor
modifications necessary to make these vehicles ready for service.
Discussion
The vehicle and equipment replacement policy described in City Policy and
Procedures 4-1 (Vehicle and Equipment Use, Maintenance, and Replacement),
provides for the on-going replacement of City fleet vehicles and equipment.
City of Palo Alto Page 2
Replacements are scheduled using guidelines based on age, mileage
accumulation, and obsolescence.
Audit of Vehicle Utilization and Replacement
This purchase is being conducted in keeping with recommendations from the
2010 “Audit of Fleet Replacement and Utilization”, which recommended that
when possible, future vehicle replacements be alternative fuel vehicles. The
vehicles being replaced through this purchase have, on average, greatly exceeded
the minimum mileage accumulation of 2,500 miles or 50 usage hours annually.
The Fleet Review Committee (FRC), which is comprised of representatives from
the City Manager, Public Works, Fire, Utilities and Administrative Services
Departments has reviewed these vehicles proposed for replacement and has
authorized their replacement. The FRC approved the replacement of these
vehicles in accordance with the audit recommendations. The approval was based
on:
An examination of each vehicle’s current usage;
An analysis of each vehicle’s operating and replacement costs;
A comparison of the age, mileage, operating cost and performance of each
vehicle with others in the class; and
An analysis of alternatives to ownership, such as mileage reimbursement;
pooling/sharing; the reassignment of another underutilized vehicle, or
renting.
The City’s pool car fleet currently includes 15 compressed natural gas (CNG)
fueled sedans. These pool cars are shared by multiple departments and are
located at several city facilities including City Hall, Municipal Services Center,
Lucie Stern, Elwell Court, and Cubberley Community Center. Unlike gasoline
fueled vehicles, CNG vehicles come with fuel tanks that are only certified for use
for a limited amount of time. Once the expiration date on the fuel tanks is
reached, the CNG vehicles can no longer be operated. At that point, the options
are to either have new fuel tanks installed (at a cost of approximately $6,000 per
City of Palo Alto Page 3
vehicle) or eliminate the vehicles from the fleet for a considerably low resale
value. The City currently operates 15 CNG Honda Civics that have fuel tanks
scheduled to expire in 2013. Staff recommends replacing the existing CNG pool
cars now while the fuel tanks are still useable so that there is an opportunity to
benefit from the resale value. There is currently a strong demand for alternate
fueled vehicles which is creating higher than normal resale values on CNG
vehicles, as long as the vehicles’ fuel tanks are not yet expired. Because the cost
to re-tank a vehicle is more than the resale value, staff does not recommend re-
tanking the vehicles. Fourteen of the fifteen current CNG vehicles will be
replaced with similar CNG vehicles. One CNG vehicle will be replaced with a non-
CNG vehicle to meet the individual department’s specific need for more carrying
capacity and longer driving range per tank of gas.
Staff is also proposing to expand the use of alternative fuel vehicles and replace
two existing gasoline fueled sedans with CNG vehicles. The first vehicle is a 2000
Chevrolet Impala assigned to the Police Department, with an odometer reading of
110,000 miles. Fleet Management staff has realized higher than normal
maintenance costs on this vehicle. Policy and Procedures 4-1 recommends that
Police staff cars be replaced at 5-years and/or 70,000 miles. This vehicle has
exceeded the replacement criteria in both mileage and age. The second vehicle
that will be replaced is a sedan that was damaged in a vehicle accident and
considered totaled.
The final CNG vehicle is designated for the newly hired Fire Chief. To continue
expanding the use of alternative fuel, standardize vehicles within the fleet, and to
meet the needs of the department, staff recommends that a Honda CNG be
purchased for this application. Fleet Management is working toward
standardizing vehicles whenever possible to take advantage of efficiency and cost
savings related to bidding, equipment mechanic training and parts inventories.
The FRC determined that there are no alternatives to outright replacement of the
vehicles included in this report. They are each used on a continuous daily basis,
are at remote locations, and/or are already being used as part of the shared pool
system. There are no similar, underutilized vehicles available to use as
replacements for these vehicles.
City of Palo Alto Page 4
Bidding and Selection Process
On two occasions in 2012 (November 5 and December 5), staff initiated a Request
for Quotations (RFQ) to purchase these vehicles. On both occasions, the city
received no bids. Staff contacted potential vendors to identify why no bids were
received and the response was that vendors were concerned about being able to
provide all of the vehicles at one time. Honda is no longer building the 2012
model and does not yet have enough stock of the 2013 models for vendors to
commit to obtaining all of the units. Staff then contacted several vendors to
obtain individual pricing and identify workable delivery schedules. Pricing from
the three lowest bidders was:
Oxnard Honda $26,417 per car plus tax and License
Anderson Honda $25,707 per car plus tax and license
Stevens Creek Honda $24,744 per car plus tax and license
Staff has reviewed all informal bids submitted and recommends that the bid
submitted by Stevens Creek Honda be declared as the lowest bidder. Stevens
Creek Honda will acquire as many vehicles as are available with the goal of
purchasing seventeen cars. If seventeen cars are not available, Palo Alto will
purchase as many vehicles as possible and the remainder of the cars will be
purchased later in the year. As of February 6, 2013, there are enough cars
available for this purchase. Staff met with Stevens Creek Honda staff and has also
checked references supplied by the vendor for previous contracts and has found
no significant complaints.
Resource Impact
The attached Budget Amendment Ordinance will provide for the transfer of
funding from the Vehicle Replacement Fund Reserve into the current year’s
Scheduled Vehicle and Equipment Replacement CIP (VR-13000). As a result of this
appropriation, the Vehicle Replacement Fund Reserve will decrease to
$6,697,584.
City of Palo Alto Page 5
Policy Implications
Authorization of the contract does not represent any change to the existing
policy. Purchase of these vehicles supports Comprehensive Plan(s) N5, N40 and
N41 by supporting the use of alternative fuel vehicles and also removing older,
more polluting vehicles from the roadways and replacing them with newer, more
efficient ones.
Environmental Review
The vehicles being supplied are in conformance with all applicable emissions laws
and regulations. Accordingly, this purchase is exempt from the California
Environmental Quality Act under the CEQA guidelines (Section 15061).
Attachments:
Attachment A- Budget Amendment Ordinance (DOC)
ORDINANCE NO.xxxx
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR THE FISCAL YEAR 2013 TO
PROVIDE AN APPROPRIATION OF $468,283 TO CAPITAL
IMPROVEMENT PROGRAM PROJECT NUMBER VR-13000,
SCHEDULED VEHICLE AND EQUIPMENT REPLACEMENTS
The Council of the City of Palo Alto does ordain as follows:
SECTION 1. The Council of the City of Palo Alto finds and
determines as follows:
A. Pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto, the Council on
June 18, 2012 did adopt a budget for fiscal year 2013; and
B. City policy on vehicle and equipment replacement
provides for the on-going replacement of City fleet vehicles
and equipment. Specifically, Policy 4-1 prescribes replacement
intervals using guidelines based on age, mileage accumulation,
and obsolescence; and
C. The Fleet Review Committee (FRC) approved the purchase
of seventeen Compressed Natural Gas (CNG) Honda Civics for
$459,783 to replace fifteen CNG-fueled sedans and two
gasoline-fueled sedans. Funding for these vehicles was not
included in VR-13000 Scheduled Vehicle and Equipment
Replacements; and
D. Funding of $8,500 is needed for minor modifications
to make these vehicles ready for service; and
E. These purchases are being conducted with full
consideration for the Audit of Vehicle Utilization and
Replacement which was conducted by the City Auditor; and
F. City Council authorization is needed to amend the 2013
budget as hereinafter set forth.
SECTION 2. The sum of Four Hundred Sixty-Eight Thousand
Two Hundred Eighty-Three Dollars ($468,283) is hereby
appropriated to CIP Project Number VR-13000.
SECTION 3. The Vehicle Replacement Fund Reserve is hereby
reduced by Four Hundred Sixty-Eight Thousand Two Hundred
Eighty-Three Dollars ($468,283) to Six Million Six Hundred
Ninety-Seven Thousand Five Hundred Eighty-Four Dollars
($6,697,584).
SECTION 4. As specified in Section 2.28.080(a) of the
Palo Alto Municipal Code, a two-thirds vote of the City
Council is required to adopt this ordinance.
SECTION 5. As provided in Section 2.04.330 of the Palo
Alto Municipal Code, this ordinance shall become effective
upon adoption.
SECTION 6. The vehicles being purchased are in compliance
with all applicable emissions laws and regulations.
Accordingly, this purchase is exempt from the California
Environmental Quality Act under the CEQA guidelines (Section
15061).
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
_________________________
City Clerk
__________________________
Mayor
APPROVED AS TO FORM:
_________________________
Senior Assistant City
Attorney
__________________________
City Manager
__________________________
Director of Public Works
__________________________
Director of Administrative
Services
City of Palo Alto (ID # 3477)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: 60kV Reconductoring from Quarry Sub to Encina
Title: Approval and Authorization of the City Manager to execute an Electric
Enterprise Fund Construction Contract with PAR Electrical Contractors, Inc. in
the Amount of $961,460 to Rebuild a Portion of the 60kV Overhead
Transmission System
From: City Manager
Lead Department: Utilities
Recommendation
Staff recommends that Council approve and authorize the City Manager or his designee to
execute the attached construction contract with PAR Electrical Contractors, Inc., in the amount
of $961,460 to rebuild the 60kV overhead electric conductor system from the Quarry Electric
Substation to Encina Avenue.
Staff recommends that Council approve and authorize the City Manager or his designee to
negotiate and execute one or more change orders to the contract with PAR Electrical
Contractors, Inc., for related, additional but unforeseen, work which may develop during the
project; the total of which shall not exceed $96,146 (10% of contract amount).
Background
This is the second phase of a multiyear Capital Improvement Program, EL-11015, to rebuild a
section of the 60kV electric system. This project will install higher capacity conductor and new
insulators in a section of the 60kV system; eliminating overloading of this section of conductor
during emergencies.
Discussion
City of Palo Alto Page 2
The work to be performed under this contract involves the replacement of 5,000 feet of
overhead transmission conductor from Quarry Substation to Encina Avenue. Removing the
existing conductor and installing a new lightweight conductor, ACCR (Aluminum Conductor
Composite Reinforcement) increases the transmission line capacity without requiring the
replacement of any poles in this section of the circuit. Reuse of the existing poles reduces the
cost of the work.
Included in the contract are the construction activities necessary to install alternate electric
feeds to customers impacted during construction, new conductors, and associated hardware.
This includes labor, equipment, material and management of all field activities in coordination
with the City’s Utilities Electric Operation’s staff and Transportation Division. The construction
portion of the project is being contracted out as there are insufficient resources within the
Utilities Department to construct these larger projects.
The following table is a summary of the bid process:
Bid Name / Number 60kV Reconductoring With ACCR on City’s
Overhead Electric Sub-Transmission System
IFB – 148111
Proposed Length of Project 3 months
Number of Bids Mailed to Contractors 10
Number of Bids Mailed to Builder’s Exchanges 13
Total Days to Respond to Bid 27
Pre-Bid Meeting Yes, Dec. 19, 2012
Number of Company Attendees at Pre-Bid
Meeting
6
Number of Bids Received 3
Bid Price Range From $961,460 to $1,977,639
* Bid summary provided as attachment.
Staff has reviewed all bids submitted (Attachment B: Bid Summary) and recommends that the
bid of $961,460 submitted by PAR Electrical Contractors, Inc. be accepted and that PAR
Electrical Contractors, Inc. be declared the lowest responsible bidder by Council. The
contingency amount of $96,146, which equals 10% of the total contract, is requested for
additional unforeseen work that may develop during the project.
City of Palo Alto Page 3
Staff confirmed with the Contractor’s State License Board that the recommended contractor
has an active license on file. Staff checked references supplied by the contractor for previous
work performed and found all to be satisfactory.
Timeline
Construction is scheduled to begin the week of July 1, 2013 and is to be completed within 90
days.
Resource Impact
Funds for this capital improvement project are available in the Electric Enterprise Fund’s
FY2012 – 2013 60kV Reconductoring Project (EL-11015) budget.
Policy Implications
The approval of this contract is consistent with existing City policies, including the Council
approved Utilities Strategic Plan Key Strategy No. 1 to ensure a high level of system reliability in
a cost effective and timely manner and, Objective No. 1, to enhance customer satisfaction and
utility infrastructure.
Environmental Review
This project is categorically exempt from California Environmental Quality Act (CEQA) pursuant
to CEQA Guidelines section 15302 (replacement or reconstruction of existing utility systems
and/or facilities involving negligible or no expansion of capacity).
Attachments:
Attachment A: Contract C13148111 (PDF)
Attachment B: Bid Summary (PDF)
Attachment C: Map (PDF)
Rev. July 2012
CONSTRUCTION CONTRACT
Contract No. C13148111
City of Palo Alto
and
PAR Electrical Contractors, Inc.
PROJECT
“Reconductoring 60 kV from Quarry Substation to Encina”
Rev. July 2012
CONSTRUCTION CONTRACT
TABLE OF CONTENTS
SECTION 1. INCORPORATION OF RECITALS AND DEFINITIONS……………………………….. .................... 5
1.1 Recitals ................................................................................................................ 5
1.2 Definitions ........................................................................................................... 5
SECTION 2. THE PROJECT……………………………………………………………………………… .............................. 5
SECTION 3. THE CONTRACT DOCUMENTS…………………………………………………………. ......................... 5
3.1 List of Documents …………………………………………………………………………………………. ..... 5
3.2 Order of Precedence …………………………………………………………………………… ................ 6
SECTION 4. THE WORK ………………………………………………………………………………… .............................. 6
SECTION 5. PROJECT TEAM ………………………………………………………………………….. ............................. 7
SECTION 6. TIME OF COMPLETION ………………………………………………………………….. .......................... 7
6.1 Time Is of Essence ........................................................................................ ……… 7
6.2 Commencement of Work ..................................................................................... 7
6.3 Contract Time ....................................................................................................... 7
6.4 Liquidated Damages ............................................................................................. 7
6.4.1 Entitlement……………………………………………………………………………………………. 7
6.4.2 Daily Amount…………………………………………………………………………………………. 7
6.4.3 Exclusive Remedy………………………………………………………………………………….. 7
6.4.4 Other Remedies…………………………………………………………………………………... 7
6.5 Adjustments to Contract Time ........................................................................... … 8
SECTION 7. COMPENSATION TO CONTRACTOR………………………………………………………………………... 8
7.1 Contract Sum ……………………………………………………………………………………………………… 8
7.2 Full Compensation …………………………………………………………………………………………….. 8
7.3 Compensation for Extra or Deleted Work …………………………………………………………….8
7.3.1 Self Performed Work………………………………………………………………………………… 8
7.3.2 Subcontractors…………………………………………………………………………………………. 8
SECTION 8. STANDARD OF CARE ...................................................................................................
10
SECTION 9. INDEMNIFICATION ...................................................................................................... 10
9.1 Hold Harmless…………………………………………………………………………………………………….. 10
9.2 Survival………………………………………………………………………………………………………………. 10
SECTION 10. NONDISCRIMINATION .............................................................................................. 10
SECTION 11. INSURANCE AND BONDS .......................................................................................... 11
Rev. July 2012
SECTION 12. PROHIBITION AGAINST TRANSFERS .......................................................................... 11
SECTION 13. NOTICES .................................................................................................................... 11
13.1 Method of Notice ………………………………………………………………………………………………..11
13.2 Notice Recipients ................................................................................................. 11
13.3 Change of Address ............................................................................................... 12
14.1 Resolution of Contract Disputes ........................................................................... 12
14.2 Resolution of Other Disputes ............................................................................... 12
14.2.1 Non‐Contract Disputes ……………………………………………………………………………….12
14.2.2 Litigation, City Election ……………………………………………………...........................13
14.3 Submission of Contract Dispute …………………………………………………………………………..13
14.3.1 By Contractor …………………………………………………………………………………………. 13
14.3.2 By City ……………………………………………………………………………………………………. 13
14.4 Contract Dispute Resolution Process ............................................................... …… 13
14.4.1 Direct Negotiation………………………………………………………………………… ………….13
14.4.2 Deferral of Contract Disputes ………………………………………………………………… 14
14.4.3 Mediation ………………………………………………………………………………………………….14
14.4.4 Binding Arbitration ……………………………………………………………………………………15
14.5 Non‐Waiver …………………………………………………………………………………………………………16
SECTION 15. DEFAULT ................................................................................................................... 16
15.1 Notice of Default .................................................................................................. 16
15.2 Opportunity to Cure Default ................................................................................ 16
SECTION 16. CITY'S RIGHTS AND REMEDIES .................................................................................. 16
16.1 Remedies Upon Default ....................................................................................... 16
16.1.1 Delete Certain Servic………………………………………………………...........................16
16.1.2 Perform and Withhold ……………………………………………………………………………. 16
16.1.3 Suspend The Construction Contract ………………………………………………………….16
16.1.4 Terminate the Construction Contract for Default ……………………………………..17
16.1.5 Invoke the Performance Bond ………………………………………………………………….17
16.1.6 Additional Provisions ……………………………………………………………………………….17
16.2 Delays by Sureties ................................................................................................ 17
16.3 Damages to City ................................................................................................... 17
16.3.1 For Contractor's Default …………………………………………………………………………..17
16.3.2 Compensation for Losses ………………………………………………………………………….17
16.5 Suspension by City for Convenience ..................................................................... 18
16.6 Termination Without Cause ................................................................................. 18
Rev. July 2012
16.6.1 Compensation ………………………………………………………………………………………….18
16.6.2 Subcontractors …………………………………………………………………………………………18
16.7 Contractor’s Duties Upon Termination ................................................................. 19
SECTION 17. CONTRACTOR'S RIGHTS AND REMEDIES ................................................................... 19
17.1 Contractor’s Remedies ......................................................................................... 19
17.1.1 For Work Stoppage ………………………………………………………………………………….. 19
17.1.2 For City's Non‐Payment …………………………………………………………………………… 19
17.2 Damages to Contractor ........................................................................................ 19
SECTION 18. ACCOUNTING RECORDS ............................................................................................ 19
18.1 Financial Management and City Access .......................................................... ……. 19
18.2 Compliance with City Requests ........................................................................ …. 20
SECTION 19. INDEPENDENT PARTIES ............................................................................................. 20
SECTION 20. NUISANCE ................................................................................................................. 20
SECTION 21. PERMITS AND LICENSES ............................................................................................ 20
SECTION 22. WAIVER .................................................................................................................... 20
SECTION 23. GOVERNING LAW ..................................................................................................... 20
SECTION 24. COMPLETE AGREEMENT ........................................................................................... 21
SECTION 25. SURVIVAL OF CONTRACT .......................................................................................... 21
SECTION 26. PREVAILING WAGES .................................................................................................. 21
SECTION 27. NON APPROPRIATION .............................................................................................. 21
SECTION 28. GOVERNMENTAL POWERS ........................................................................................ 21
SECTION 29. ATTORNEY FEES ........................................................................................................ 21
SECTION 30. COUNTERPARTS ........................................................................................................ 21
SECTION 31. SEVERABILITY ........................................................................................................... 21
Rev. July 2012
CONSTRUCTION CONTRACT
THIS CONSTRUCTION CONTRACT entered into on March 4, 2013 (“Execution Date”) by and between the
CITY OF PALO ALTO, a California chartered municipal corporation ("City"), and PAR ELECTRICAL
CONTRACTORS, INC., 1416 Midway Road, Vacaville, CA 95688, a Missouri corporation ("Contractor"), is
made with reference to the following:
R E C I T A L S:
A. City is a municipal corporation duly organized and validly existing under the laws of the State of
California with the power to carry on its business as it is now being conducted under the statutes of the
State of California and the Charter of City.
B. Contractor is a corporation duly organized and in good standing in the State of Missouri,
Contractor’s License Number 687343. Contractor represents that it is duly licensed by the State of
California and has the background, knowledge, experience and expertise to perform the obligations set
forth in this Construction Contract.
C. On December 11, 2012, City issued an Invitation for Bids (IFB) to contractors for the
Reconductoring 60 kV from Quarry Substation to Encina (“Project”). In response to the IFB, Contractor
submitted a bid.
D. City and Contractor desire to enter into this Construction Contract for the Project, and other
services as identified in the Bid Documents for the Project upon the following terms and conditions.
NOW THEREFORE, in consideration of the mutual promises and undertakings hereinafter set forth
and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is mutually agreed by and between the undersigned parties as follows:
SECTION 1 INCORPORATION OF RECITALS AND DEFINITIONS.
1.1 Recitals.
All of the recitals are incorporated herein by reference.
1.2 Definitions.
Capitalized terms shall have the meanings set forth in this Construction Contract and/or in the
General Conditions. If there is a conflict between the definitions in this Construction Contract and
in the General Conditions, the definitions in this Construction Contract shall prevail.
SECTION 2 THE PROJECT.
The Project is the construction of the Reconductoring 60 kV from Quarry Substation to Encina ("Project").
SECTION 3 THE CONTRACT DOCUMENTS.
3.1 List of Documents.
The Contract Documents (sometimes collectively referred to as “Agreement” or “Bid Documents”) consist
of the following documents which are on file with the Purchasing Division and are hereby incorporated by
reference.
1) Change Orders
Rev. July 2012
2) Field Change Orders
3) Contract
4) Project Plans and Drawings
5) Technical Specifications
6) Special Provisions
7) Notice Inviting Bids
8) Instructions to Bidders
9) General Conditions
10) Bidding Addenda
11) Invitation for Bids
12) Contractor's Bid/Non‐Collusion Affidavit
13) Reports listed in the Bidding Documents
14) Public Works Department’s Standard Drawings and Specifications dated 2007 and
updated from time to time
15) Utilities Department’s Water, Gas, Wastewater, Electric Utilities Standards dated 2005
and updated from time to time
16) City of Palo Alto Traffic Control Requirements
17) City of Palo Alto Truck Route Map and Regulations
18) Notice Inviting Pre‐Qualification Statements, Pre‐Qualification Statement, and Pre‐
Qualification Checklist (if applicable)
19) Performance and Payment Bonds
20) Insurance Forms
3.2 Order of Precedence.
For the purposes of construing, interpreting and resolving inconsistencies between and among the
provisions of this Contract, the Contract Documents shall have the order of precedence as set forth in the
preceding section. If a claimed inconsistency cannot be resolved through the order of precedence, the City
shall have the sole power to decide which document or provision shall govern as may be in the best
interests of the City.
SECTION 4 THE WORK.
The Work includes all labor, materials, equipment, services, permits, fees, licenses and taxes, and all other
things necessary for Contractor to perform its obligations and complete the Project, including, without
Rev. July 2012
limitation, any Changes approved by City, in accordance with the Contract Documents and all Applicable
Code Requirements.
SECTION 5 PROJECT TEAM.
In addition to Contractor, City has retained, or may retain, consultants and contractors to provide
professional and technical consultation for the design and construction of the Project. The Project requires
that Contractor operate efficiently, effectively and cooperatively with City as well as all other members of
the Project Team and other contractors retained by City to construct other portions of the Project.
SECTION 6 TIME OF COMPLETION.
6.1 Time Is of Essence.
Time is of the essence with respect to all time limits set forth in the Contract Documents.
6.2 Commencement of Work.
Contractor shall commence the Work on the date specified in City’s Notice to Proceed.
6.3 Contract Time.
Work hereunder shall begin on the date specified on the City’s Notice to Proceed and shall be
completed not later than May 30, 2013.
6.4 Liquidated Damages.
6.4.1 Entitlement.
City and Contractor acknowledge and agree that if Contractor fails to fully and
satisfactorily complete the Work within the Contract Time, City will suffer, as a result of
Contractor’s failure, substantial damages which are both extremely difficult and
impracticable to ascertain. Such damages may include, but are not limited to:
(i) Loss of public confidence in City and its contractors and consultants.
(ii) Loss of public use of public facilities.
(iii) Extended disruption to public.
6.4.2 Daily Amount.
City and Contractor have reasonably endeavored, but failed, to ascertain the actual
damage that City will incur if Contractor fails to achieve Substantial Completion of the
entire Work within the Contract Time. Therefore, the parties agree that in addition to all
other damages to which City may be entitled other than delay damages, in the event
Contractor shall fail to achieve Substantial Completion of the entire Work within the
Contract Time, Contractor shall pay City as liquidated damages the amount of $500 per
day for each Day occurring after the expiration of the Contract Time until Contractor
achieves Substantial Completion of the entire Work. The liquidated damages amount is
not a penalty but considered to be a reasonable estimate of the amount of damages City
will suffer by delay in completion of the Work.
6.4.3 Exclusive Remedy.
City and Contractor acknowledge and agree that this liquidated damages provision shall
be City’s only remedy for delay damages caused by Contractor’s failure to achieve
Substantial Completion of the entire Work within the Contract Time.
6.4.4 Other Remedies.
City is entitled to any and all available legal and equitable remedies City may have where
City’s Losses are caused by any reason other than Contractor’s failure to achieve
Substantial Completion of the entire Work within the Contract Time.
Rev. July 2012
6.5 Adjustments to Contract Time.
The Contract Time may only be adjusted for time extensions approved by City and agreed to by
Change Order executed by City and Contractor in accordance with the requirements of the
Contract Documents.
SECTION 7 COMPENSATION TO CONTRACTOR.
7.1 Contract Sum.
Contractor shall be compensated for satisfactory completion of the Work in compliance with the
Contract Documents the Contract Sum of Nine Hundred Sixty One Thousand Four Hundred Sixty
Dollars ($961,460).
7.2 Full Compensation.
The Contract Sum shall be full compensation to Contractor for all Work provided by Contractor
and, except as otherwise expressly permitted by the terms of the Contract Documents, shall cover
all Losses arising out of the nature of the Work or from the acts of the elements or any unforeseen
difficulties or obstructions which may arise or be encountered in performance of the Work until
its Acceptance by City, all risks connected with the Work, and any and all expenses incurred due to
suspension or discontinuance of the Work. The Contract Sum may only be adjusted for Change
Orders issued, executed and satisfactorily performed in accordance with the requirements of the
Contract Documents.
7.3 Compensation for Extra or Deleted Work.
The Contract Sum shall be adjusted (either by addition or credit) for Changes in the Work involving
Extra Work or Deleted Work based on one or more of the following methods to be selected by
City:
1. Unit prices stated in the Contract Documents or agreed upon by City and Contractor,
which unit prices shall be deemed to include Contractor Markup and
Subcontractor/Sub‐subcontractor Markups permitted by this Section.
2. A lump sum agreed upon by City and Contractor, based on the estimated Allowable
Costs and Contractor Markup and Subcontractor Markup computed in accordance
with this Section.
3. Contractor’s Allowable Costs, plus Contractor Markup and Subcontractor Markups
applicable to such Extra Work computed in accordance with this Section.
Contractor Markup and Subcontractor/Sub‐subcontractor Markups set forth herein are the full
amount of compensation to be added for Extra Work or to be subtracted for Deleted Work that is
attributable to overhead (direct and indirect) and profit of Contractor and of its Subcontractors
and Sub‐subcontractors, of every Tier. When using this payment methodology, Contractor
Markup and Subcontractor/Sub‐subcontractor Markups, which shall not be compounded, shall be
computed as follows:
7.3.1 Markup Self‐Performed Work.
10% of the Allowable Costs for that portion of the Extra Work or Deleted Work to be
performed by Contractor with its own forces.
7.3.2 Markup for Work Performed by Subcontractors.
15% of the Allowable Costs for that portion of the Extra Work or Deleted Work to be
performed by a first Tier Subcontractor.
Rev. July 2012
SECTION 8 STANDARD OF CARE.
Contractor agrees that the Work shall be performed by qualified, experienced and well‐supervised
personnel. All services performed in connection with this Construction Contract shall be performed in a
manner consistent with the standard of care under California law applicable to those who specialize in
providing such services for projects of the type, scope and complexity of the Project.
SECTION 9 INDEMNIFICATION.
9.1 Hold Harmless.
To the fullest extent allowed by law, Contractor will defend, indemnify, and hold harmless City, its
City Council, boards and commissions, officers, agents, employees, representatives and volunteers
(hereinafter collectively referred to as "Indemnitees"), through legal counsel acceptable to City,
from and against any and all Losses arising directly or indirectly from, or in any manner relating to
any of, the following:
(i) Performance or nonperformance of the Work by Contractor or its Subcontractors or Sub‐
subcontractors, of any tier;
(ii) Performance or nonperformance by Contractor or its Subcontractors or Sub‐
subcontractors of any tier, of any of the obligations under the Contract Documents;
(iii) The construction activities of Contractor or its Subcontractors or Sub‐subcontractors, of
any tier, either on the Site or on other properties;
(iv) The payment or nonpayment by Contractor to any of its employees, Subcontractors or
Sub‐subcontractors of any tier, for Work performed on or off the Site for the Project; and
(v) Any personal injury, property damage or economic loss to third persons associated with
the performance or nonperformance by Contractor or its Subcontractors or Sub‐
subcontractors of any tier, of the Work.
However, nothing herein shall obligate Contractor to indemnify any Indemnitee for Losses
resulting from the sole or active negligence or willful misconduct of the Indemnitee. Contractor
shall pay City for any costs City incurs to enforce this provision. Nothing in the Contract
Documents shall be construed to give rise to any implied right of indemnity in favor of Contractor
against City or any other Indemnitee.
9.2 Survival.
The provisions of Section 9 shall survive the termination of this Construction Contract.
SECTION 10 NONDISCRIMINATION.
As set forth in Palo Alto Municipal Code section 2.30.510, Contractor certifies that in the performance of
this Agreement, it shall not discriminate in the employment of any person because of the race, skin color,
gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status,
familial status, weight or height of such person. Contractor acknowledges that it has read and understands
the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination
Requirements and the penalties for violation thereof, and will comply with all requirements of Section
2.30.510 pertaining to nondiscrimination in employment.
Rev. July 2012
SECTION 11 INSURANCE AND BONDS.
On or before the Execution Date, Contractor shall provide City with evidence that it has obtained insurance
and Performance and Payment Bonds satisfying all requirements in Article 11 of the General Conditions.
Failure to do so shall be deemed a material breach of this Construction Contract.
SECTION 12 PROHIBITION AGAINST TRANSFERS.
City is entering into this Construction Contract based upon the stated experience and qualifications of the
Contractor and its subcontractors set forth in Contractor’s Bid. Accordingly, Contractor shall not assign,
hypothecate or transfer this Construction Contract or any interest therein directly or indirectly, by
operation of law or otherwise without the prior written consent of City. Any assignment, hypothecation or
transfer without said consent shall be null and void.
The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of
Contractor or of any general partner or joint venturer or syndicate member of Contractor, if the Contractor
is a partnership or joint venture or syndicate or co‐tenancy shall result in changing the control of
Contractor, shall be construed as an assignment of this Construction Contract. Control means more than
fifty percent (50%) of the voting power of the corporation or other entity.
SECTION 13 NOTICES.
13.1 Method of Notice.
All notices, demands, requests or approvals to be given under this Construction Contract shall be given in
writing and shall be deemed served on the earlier of the following:
(i) On the date delivered if delivered personally;
(ii) On the third business day after the deposit thereof in the United States mail, postage prepaid, and
addressed as hereinafter provided;
(iii) On the date sent if sent by facsimile transmission;
(iv) On the date sent if delivered by electronic mail; or
(v) On the date it is accepted or rejected if sent by certified mail.
13.2 Notice Recipients.
All notices, demands or requests (including, without limitation, Claims) from Contractor to City
shall include the Project name and the number of this Construction Contract and shall be
addressed to City at:
To City: City of Palo Alto
City Clerk
250 Hamilton Avenue
P.O. Box 10250
Palo Alto, CA 94303
Copy to: City of Palo Alto
Utilities Engineering
250 Hamilton Avenue
Palo Alto, CA 94301
Attn: Jim Bujtor
Rev. July 2012
In addition, copies of all Claims by Contractor under this Construction Contract shall be provided
to the following:
Palo Alto City Attorney’s Office
250 Hamilton Avenue
P.O. Box 10250
Palo Alto, California 94303
All Claims shall be delivered personally or sent by certified mail.
All notices, demands, requests or approvals from City to Contractor shall be addressed to:
PAR Electrical Contractors, Inc.
1416 Midway Road
Vacaville, CA 95688
13.3 Change of Address.
In the event of any change of address, the moving party shall notify the other party of the change
of address in writing. Each party may, by written notice only, add, delete or replace any
individuals to whom and addresses to which notice shall be provided.
SECTION 14 DISPUTE RESOLUTION.
14.1 Resolution of Contract Disputes.
Contract Disputes shall be resolved by the parties in accordance with the provisions of this Section
14, in lieu of any and all rights under the law that either party have its rights adjudged by a trial
court or jury. All Contract Disputes shall be subject to the Contract Dispute Resolution Process set
forth in this Section 14, which shall be the exclusive recourse of Contractor and City for such
Contract Disputes.
14.2 Resolution of Other Disputes.
14.2.1 Non‐Contract Disputes.
Contract Disputes shall not include any of the following:
(i) Penalties or forfeitures prescribed by statute or regulation imposed by a
governmental agency;
(ii) Third party tort claims for personal injury, property damage or death relating to
any Work performed by Contractor or its Subcontractors or Sub‐subcontractors
of any tier;
(iii) False claims liability under California Government Code Section 12650, et. seq.;
(iv) Defects in the Work first discovered by City after Final Payment by City to
Contractor;
(v) Stop notices; or
(vi) The right of City to specific performance or injunctive relief to compel
performance of any provision of the Contract Documents.
Rev. July 2012
14.2.2 Litigation, City Election.
Matters that do not constitute Contract Disputes shall be resolved by way of an action
filed in the Superior Court of the State of California, County of Santa Clara, and shall not
be subject to the Contract Dispute Resolution Process. However, the City reserves the
right, in its sole and absolute discretion, to treat such disputes as Contract Disputes.
Upon written notice by City of its election as provided in the preceding sentence, such
dispute shall be submitted by the parties and finally decided pursuant to the Contract
Dispute Resolution Process in the manner as required for Contract Disputes, including,
without limitation, City’s right under Paragraph 14.4.2 to defer resolution and final
determination until after Final Completion of the Work.
14.3 Submission of Contract Dispute.
14.3.1 By Contractor.
Contractors may commence the Contract Dispute Resolution Process upon City's written
response denying all or part of a Claim pursuant to Paragraph 4.2.9 or 4.2.10 of the
General Conditions. Contractor shall submit a written Statement of Contract Dispute (as
set forth below) to City within seven (7) Days after City rejects all or a portion of
Contractor's Claim. Failure by Contractor to submit its Statement of Contract Dispute in a
timely manner shall result in City’s decision by City on the Claim becoming final and
binding. Contractor’s Statement of Contract Dispute shall be signed under penalty of
perjury and shall state with specificity the events or circumstances giving rise to the
Contract Dispute, the dates of their occurrence and the asserted effect on the Contract
Sum and the Contract Time. The Statement of Contract Dispute shall include adequate
supporting data to substantiate the disputed Claim. Adequate supporting data for a
Contract Dispute relating to an adjustment of the Contract Time shall include both of the
following:
(i) All of the scheduling data required to be submitted by Contractor under the
Contract Documents to obtain extensions of time and adjustments to the
Contract Time and
(ii) A detailed, event‐by‐event description of the impact of each event on
completion of Work. Adequate data to support a Statement of Contract Dispute
involving an adjustment of the Contract Sum must include both of the following:
(a) A detailed cost breakdown and
(b) Supporting cost data in such form and including such information and
other supporting data as required under the Contract Documents for
submission of Change Order Requests and Claims.
14.3.2 By City.
City's right to commence the Contract Dispute Resolution Process shall arise at any time
following City's actual discovery of the circumstances giving rise to the Contract Dispute.
City asserts Contract Disputes in response to a Contract Dispute asserted by Contractor.
A Statement of Contract Dispute submitted by City shall state the events or
circumstances giving rise to the Contract Dispute, the dates of their occurrence and the
damages or other relief claimed by City as a result of such events.
14.4 Contract Dispute Resolution Process.
The parties shall utilize each of the following steps in the Contract Dispute Resolution
Process in the sequence they appear below. Each party shall participate fully and in good
faith in each step in the Contract Dispute Resolution Process, and good faith effort shall
be a condition precedent to the right of each party to proceed to the next step in the
process.
14.4.1 Direct Negotiations.
Designated representatives of City and Contractor shall meet as soon as possible (but not
later than ten (10) Days after receipt of the Statement of Contract Dispute) in a good
Rev. July 2012
faith effort to negotiate a resolution to the Contract Dispute. Each party shall be
represented in such negotiations by an authorized representative with full knowledge of
the details of the Claims or defenses being asserted by such party in the negotiations,
and with full authority to resolve such Contract Dispute then and there, subject only to
City’s obligation to obtain administrative and/or City Council approval of any agreed
settlement or resolution. If the Contract Dispute involves the assertion of a right or claim
by a Subcontractor or Sub‐subcontractor, of any tier, against Contractor that is in turn
being asserted by Contractor against City (“Pass‐Through Claim”), then the Subcontractor
or Sub‐Subcontractor shall also have a representative attend the negotiations, with the
same authority and knowledge as described above. Upon completion of the meeting, if
the Contract Dispute is not resolved, the parties may either continue the negotiations or
any party may declare negotiations ended. All discussions that occur during such
negotiations and all documents prepared solely for the purpose of such negotiations shall
be confidential and privileged pursuant to California Evidence Code Sections 1119 and
1152.
14.4.2 Deferral of Contract Disputes.
Following the completion of the negotiations required by Paragraph 14.4.1, all
unresolved Contract Disputes shall be deferred pending Final Completion of the Project,
subject to City’s right, in its sole and absolute discretion, to require that the Contract
Dispute Resolution Process proceed prior to Final Completion. All Contract Disputes that
have been deferred until Final Completion shall be consolidated within a reasonable time
after Final Completion and thereafter pursued to resolution pursuant to this Contract
Dispute Resolution Process. The parties can continue informal negotiations of Contract
Disputes; provided, however, that such informal negotiations shall not be alter the
provisions of the Agreement deferring final determination and resolution of unresolved
Contract Disputes until after Final Completion.
14.4.3 Mediation.
If the Contract Dispute remains unresolved after negotiations pursuant to Paragraph
14.4.1, the parties shall submit the Contract Dispute to non‐binding mediation before a
mutually acceptable third party mediator.
.1 Qualifications of Mediator. The parties shall endeavor to select a mediator who
is a retired judge or an attorney with at least five (5) years of experience in
public works construction contract law and in mediating public works
construction disputes. In addition, the mediator shall have at least twenty (20)
hours of formal training in mediation skills.
.2 Submission to Mediation and Selection of Mediator. The party initiating
mediation of a Contract Dispute shall provide written notice to the other party
of its decision to mediate. In the event the parties are unable to agree upon a
mediator within fifteen (15) Days after the receipt of such written notice, then
the parties shall submit the matter to the American Arbitration Association
(AAA) at its San Francisco Regional Office for selection of a mediator in
accordance with the AAA Construction Industry Mediation Rules.
.3 Mediation Process. The location of the mediation shall be at the offices of City.
The costs of mediation shall be shared equally by both parties. The mediator
shall provide an independent assessment on the merits of the Contract Dispute
and recommendations for resolution. All discussions that occur during the
mediation and all documents prepared solely for the purpose of the mediation
shall be confidential and privileged pursuant to California Evidence Code
Sections 1119 and 1152.
Rev. July 2012
14.4.4 Binding Arbitration.
If the Contract Dispute is not resolved by mediation, then any party may submit the
Contract Dispute for final and binding arbitration pursuant to the provisions of California
Public Contract Code Sections 10240, et seq. The award of the arbitrator therein shall be
final and may be entered as a judgment by any court of competent jurisdiction. Such
arbitration shall be conducted in accordance with the following:
.1 Arbitration Initiation. The arbitration shall be initiated by filing a complaint in
arbitration in accordance with the regulations promulgated pursuant to
California Public Contract Code Section 10240.5.
.2 Qualifications of the Arbitrator. The arbitrator shall be approved by all parties.
The arbitrator shall be a retired judge or an attorney with at least five (5) years
of experience in public works construction contract law and in arbitrating public
works construction disputes. In addition, the arbitrator shall have at least
twenty (20) hours of formal training in arbitration skills. In the event the parties
cannot agree upon an arbitrator, the provisions of California Public Contract
Code Section 10240.3 shall be followed in selecting an arbitrator possessing the
qualifications required herein.
.3 Hearing Days and Location. Arbitration hearings shall be held at the offices of
City and shall, except for good cause shown to and determined by the arbitrator,
be conducted on consecutive business days, without interruption or
continuance.
.4 Hearing Delays. Arbitration hearings shall not be delayed except upon good
cause shown.
.5 Recording Hearings. All hearings to receive evidence shall be recorded by a
certified stenographic reporter, with the costs thereof borne equally by City and
Contractor and allocated by the arbitrator in the final award.
.6 Limitation of Depositions. The parties may conduct discovery in accordance
with the provisions of section 10240.11 of the Public Contract Code; provided,
however, that depositions shall be limited to both of the following:
(i) Ten (10) percipient witnesses for each party and 5 expert witnesses per
party.
Upon a showing of good cause, the arbitrator may increase the number of
permitted depositions. An individual who is both percipient and expert shall, for
purposes of applying the foregoing numerical limitation only, be deemed an
expert. Expert reports shall be exchanged prior to receipt of evidence, in
accordance with the direction of the arbitrator, and expert reports (including
initial and rebuttal reports) not so submitted shall not be admissible as
evidence.
.7 Authority of the Arbitrator. The arbitrator shall have the authority to hear
dispositive motions and issue interim orders and interim or executory awards.
Rev. July 2012
.8 Waiver of Jury Trial. Contractor and City each voluntarily waives its right to a
jury trial with respect to any Contract Dispute that is subject to binding
arbitration in accordance with the provisions of this Paragraph 14.4.4.
Contractor shall include this provision in its contracts with its Subcontractors
who provide any portion of the Work.
14.5 Non‐Waiver.
Participation in the Contract Dispute Resolution Process shall not waive, release or compromise
any defense of City, including, without limitation, any defense based on the assertion that the
rights or Claims of Contractor that are the basis of a Contract Dispute were previously waived by
Contractor due to Contractor’s failure to comply with the Contract Documents, including, without
limitation, Contractor’s failure to comply with any time periods for providing notice of requests
for adjustments of the Contract Sum or Contract Time or for submission of Claims or supporting
documentation of Claims.
SECTION 15 DEFAULT.
15.1 Notice of Default.
In the event that City determines, in its sole discretion, that Contractor has failed or refused to
perform any of the obligations set forth in the Contract Documents, or is in breach of any
provision of the Contract Documents, City may give written notice of default to Contractor in the
manner specified for the giving of notices in the Construction Contract.
15.2 Opportunity to Cure Default.
Except for emergencies, Contractor shall cure any default in performance of its obligations under
the Contract Documents within two (2) Days (or such shorter time as City may reasonably require)
after receipt of written notice. However, if the breach cannot be reasonably cured within such
time, Contractor will commence to cure the breach within two (2) Days (or such shorter time as
City may reasonably require) and will diligently and continuously prosecute such cure to
completion within a reasonable time, which shall in no event be later than ten (10) Days after
receipt of such written notice.
SECTION 16 CITY'S RIGHTS AND REMEDIES.
16.1 Remedies Upon Default.
If Contractor fails to cure any default of this Construction Contract within the time period set forth
above in Section 15, then City may pursue any remedies available under law or equity, including,
without limitation, the following:
16.1.1 Delete Certain Services.
City may, without terminating the Construction Contract, delete certain portions of the Work,
reserving to itself all rights to Losses related thereto.
16.1.2 Perform and Withhold.
City may, without terminating the Construction Contract, engage others to perform the Work or
portion of the Work that has not been adequately performed by Contractor and withhold the cost
thereof to City from future payments to Contractor, reserving to itself all rights to Losses related
thereto.
16.1.3 Suspend The Construction Contract.
City may, without terminating the Construction Contract and reserving to itself all rights to Losses
related thereto, suspend all or any portion of this Construction Contract for as long a period of
time as City determines, in its sole discretion, appropriate, in which event City shall have no
Rev. July 2012
obligation to adjust the Contract Sum or Contract Time, and shall have no liability to Contractor
for damages if City directs Contractor to resume Work.
16.1.4 Terminate the Construction Contract for Default.
City shall have the right to terminate this Construction Contract, in whole or in part, upon the
failure of Contractor to promptly cure any default as required by Section 15. City’s election to
terminate the Construction Contract for default shall be communicated by giving Contractor a
written notice of termination in the manner specified for the giving of notices in the Construction
Contract. Any notice of termination given to Contractor by City shall be effective immediately,
unless otherwise provided therein.
16.1.5 Invoke the Performance Bond.
City may, with or without terminating the Construction Contract and reserving to itself all rights to
Losses related thereto, exercise its rights under the Performance Bond.
16.1.6 Additional Provisions.
All of City’s rights and remedies under this Construction Contract are cumulative, and shall be in
addition to those rights and remedies available in law or in equity. Designation in the Contract
Documents of certain breaches as material shall not waive the City’s authority to designate other
breaches as material nor limit City’s right to terminate the Construction Contract, or prevent the
City from terminating the Agreement for breaches that are not material. City’s determination of
whether there has been noncompliance with the Construction Contract so as to warrant exercise
by City of its rights and remedies for default under the Construction Contract, shall be binding on
all parties. No termination or action taken by City after such termination shall prejudice any other
rights or remedies of City provided by law or equity or by the Contract Documents upon such
termination; and City may proceed against Contractor to recover all liquidated damages and
Losses suffered by City.
16.2 Delays by Sureties.
Without limiting to any of City’s other rights or remedies, City has the right to suspend the
performance of the Work by Contractor’s sureties in the event of any of the following:
(i) The sureties’ failure to begin Work within a reasonable time in such manner as to insure
full compliance with the Construction Contract within the Contract Time;
(ii) The sureties’ abandonment of the Work;
(iii) If at any time City is of the opinion the sureties’ Work is unnecessarily or unreasonably
delaying the Work;
(iv) The sureties’ violation of any terms of the Construction Contract;
(v) The sureties’ failure to perform according to the Contract Documents; or
(vi) The sureties’ failure to follow City’s instructions for completion of the Work within the
Contract Time.
16.3 Damages to City.
16.3.1 For Contractor's Default.
City will be entitled to recovery of all Losses under law or equity in the event of
Contractor’s default under the Contract Documents.
16.3.2 Compensation for Losses.
In the event that City's Losses arise from Contractor’s default under the Contract Documents, City
shall be entitled to withhold monies otherwise payable to Contractor until Final Completion of the
Project. If City incurs Losses due to Contractor’s default, then the amount of Losses shall be
deducted from the amounts withheld. Should the amount withheld exceed the amount deducted,
the balance will be paid to Contractor or its designee upon Final Completion of the Project. If the
Losses incurred by City exceed the amount withheld, Contractor shall be liable to City for the
difference and shall promptly remit same to City.
Rev. July 2012
16.4 Suspension by City for Convenience.
City may, at any time and from time to time, without cause, order Contractor, in writing, to
suspend, delay, or interrupt the Work in whole or in part for such period of time, up to an
aggregate of fifty percent (50%) of the Contract Time. The order shall be specifically identified as
a Suspension Order by City. Upon receipt of a Suspension Order, Contractor shall, at City’s
expense, comply with the order and take all reasonable steps to minimize costs allocable to the
Work covered by the Suspension Order. During the Suspension or extension of the Suspension, if
any, City shall either cancel the Suspension Order or, by Change Order, delete the Work covered
by the Suspension Order. If a Suspension Order is canceled or expires, Contractor shall resume
and continue with the Work. A Change Order will be issued to cover any adjustments of the
Contract Sum or the Contract Time necessarily caused by such suspension. A Suspension Order
shall not be the exclusive method for City to stop the Work.
16.5 Termination Without Cause.
City may, at its sole discretion and without cause, terminate this Construction Contract in part or
in whole by giving thirty (30) Days written notice to Contractor. The compensation allowed under
this Paragraph 16.5 shall be the Contractor’s sole and exclusive compensation for such
termination and Contractor waives any claim for other compensation or Losses, including, but not
limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential,
direct, indirect or incidental damages of any kind resulting from termination without cause.
16.5.1 Compensation.
Following such termination and within forty‐five (45) Days after receipt of a billing from
Contractor seeking payment of sums authorized by this Paragraph 16.5, City shall pay the
following to Contractor as Contractor’s sole compensation for performance of the Work :
.1 For Work Performed. The amount of the Contract Sum allocable to the portion
of the Work properly performed by Contractor as of the date of termination,
less sums previously paid to Contractor.
.2 For Close‐out Costs. Reasonable costs of Contractor and its Subcontractors and
Sub‐subcontractors for:
(i) Demobilizing and
(ii) Administering the close‐out of its participation in the Project (including,
without limitation, all billing and accounting functions, not including
attorney or expert fees) for a period of no longer than thirty (30) Days
after receipt of the notice of termination.
.3 For Fabricated Items. Previously unpaid cost of any items delivered to the
Project Site which were fabricated for subsequent incorporation in the Work.
16.5.2 Subcontractors.
Contractor shall include provisions in all of its subcontracts, purchase orders and other contracts
permitting termination for convenience by Contractor on terms that are consistent with this
Construction Contract and that afford no greater rights of recovery against Contractor than are
afforded to Contractor against City under this Section.
Rev. July 2012
16.6 Contractor’s Duties Upon Termination.
Upon receipt of a notice of termination for default or for convenience, Contractor shall, unless the
notice directs otherwise, do the following:
(i) Immediately discontinue the Work to the extent specified in the notice;
(ii) Place no further orders or subcontracts for materials, equipment, services or facilities,
except as may be necessary for completion of such portion of the Work that is not
discontinued;
(iii) Provide to City a description, in writing no later than fifteen (15) days after receipt of the
notice of termination, of all subcontracts, purchase orders and contracts that are
outstanding, including, without limitation, the terms of the original price, any changes,
payments, balance owing, the status of the portion of the Work covered and a copy of
the subcontract, purchase order or contract and any written changes, amendments or
modifications thereto, together with such other information as City may determine
necessary in order to decide whether to accept assignment of or request Contractor to
terminate the subcontract, purchase order or contract;
(iv) Promptly assign to City those subcontracts, purchase orders or contracts, or portions
thereof, that City elects to accept by assignment and cancel, on the most favorable terms
reasonably possible, all subcontracts, purchase orders or contracts, or portions thereof,
that City does not elect to accept by assignment; and
(v) Thereafter do only such Work as may be necessary to preserve and protect Work already
in progress and to protect materials, plants, and equipment on the Project Site or in
transit thereto.
SECTION 17 CONTRACTOR'S RIGHTS AND REMEDIES.
17.1 Contractor’s Remedies.
Contractor may terminate this Construction Contract only upon the occurrence of one of the
following:
17.1.1 For Work Stoppage.
The Work is stopped for sixty (60) consecutive Days, through no act or fault of Contractor, any
Subcontractor, or any employee or agent of Contractor or any Subcontractor, due to issuance of
an order of a court or other public authority other than City having jurisdiction or due to an act of
government, such as a declaration of a national emergency making material unavailable. This
provision shall not apply to any work stoppage resulting from the City’s issuance of a suspension
notice issued either for cause or for convenience.
17.1.2 For City's Non‐Payment.
If City does not make pay Contractor undisputed sums within ninety (90) Days after receipt of
notice from Contractor, Contractor may terminate the Construction Contract (30) days following a
second notice to City of Contractor’s intention to terminate the Construction Contract.
17.2 Damages to Contractor.
In the event of termination for cause by Contractor, City shall pay Contractor the sums provided
for in Paragraph 16.5.1 above. Contractor agrees to accept such sums as its sole and exclusive
compensation and agrees to waive any claim for other compensation or Losses, including, but not
limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential,
direct, indirect and incidental damages, of any kind.
SECTION 18 ACCOUNTING RECORDS.
18.1 Financial Management and City Access.
Contractor shall keep full and detailed accounts and exercise such controls as may be necessary
for proper financial management under this Construction Contract in accordance with generally
Rev. July 2012
accepted accounting principles and practices. City and City's accountants during normal business
hours, may inspect, audit and copy Contractor's records, books, estimates, take‐offs, cost reports,
ledgers, schedules, correspondence, instructions, drawings, receipts, subcontracts, purchase
orders, vouchers, memoranda and other data relating to this Project. Contractor shall retain these
documents for a period of three (3) years after the later of (i) final payment or (ii) final resolution
of all Contract Disputes and other disputes, or (iii) for such longer period as may be required by
law.
18.2 Compliance with City Requests.
Contractor's compliance with any request by City pursuant to this Section 18 shall be a condition
precedent to filing or maintenance of any legal action or proceeding by Contractor against City
and to Contractor's right to receive further payments under the Contract Documents. City many
enforce Contractor’s obligation to provide access to City of its business and other records referred
to in Section 18.1 for inspection or copying by issuance of a writ or a provisional or permanent
mandatory injunction by a court of competent jurisdiction based on affidavits submitted to such
court, without the necessity of oral testimony.
SECTION 19 INDEPENDENT PARTIES.
Each party is acting in its independent capacity and not as agents, employees, partners, or joint ventures’
of the other party. City, its officers or employees shall have no control over the conduct of Contractor or
its respective agents, employees, subconsultants, or subcontractors, except as herein set forth.
SECTION 20 NUISANCE.
Contractor shall not maintain, commit, nor permit the maintenance or commission of any nuisance in
connection in the performance of services under this Construction Contract.
SECTION 21 PERMITS AND LICENSES.
Except as otherwise provided in the Special Provisions and Technical Specifications, The Contractor shall
provide, procure and pay for all licenses, permits, and fees, required by the City or other government
jurisdictions or agencies necessary to carry out and complete the Work. Payment of all costs and expenses
for such licenses, permits, and fees shall be included in one or more Bid items. No other compensation
shall be paid to the Contractor for these items or for delays caused by non‐City inspectors or conditions set
forth in the licenses or permits issued by other agencies.
SECTION 22 WAIVER.
A waiver by either party of any breach of any term, covenant, or condition contained herein shall not be
deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition
contained herein, whether of the same or a different character.
SECTION 23 GOVERNING LAW.
This Construction Contract shall be construed in accordance with and governed by the laws of the State of
California.
Rev. July 2012
SECTION 24 COMPLETE AGREEMENT.
This Agreement represents the entire and integrated agreement between the parties and supersedes all
prior negotiations, representations, and contracts, either written or oral. This Agreement may be amended
only by a written instrument, which is signed by the parties.
SECTION 25 SURVIVAL OF CONTRACT.
The provisions of the Construction Contract which by their nature survive termination of the Construction
Contract or Final Completion, including, without limitation, all warranties, indemnities, payment
obligations, and City’s right to audit Contractor’s books and records, shall remain in full force and effect
after Final Completion or any termination of the Construction Contract.
SECTION 26 PREVAILING WAGES.
This Project is not subject to prevailing wages. The Contractor is not required to pay prevailing wages in the
performance and implementation of the Project, because the City, pursuant to its authority as a chartered
city, has adopted Resolution No. 5981 exempting the City from prevailing wages. The City invokes the
exemption from the state prevailing wage requirement for this Project and declares that the Project is
funded one hundred percent (100%) by the City of Palo Alto.
SECTION 27 NON APPROPRIATION.
This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto
Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the
event that the City does not appropriate funds for the following fiscal year for this event, or (b) at any time
within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds
for this Construction Contract are no longer available. This section shall take precedence in the event of a
conflict with any other covenant, term, condition, or provision of this Agreement.
SECTION 28 AUTHORITY.
The individuals executing this Agreement represent and warrant that they have the legal capacity and
authority to do so on behalf of their respective legal entities.
SECTION 29 ATTORNEY FEES.
Each Party shall bear its own costs, including attorney’s fees through the completion of mediation. If the
claim or dispute is not resolved through mediation and in any dispute described in Paragraph 14.2,
the prevailing party in any action brought to enforce the provision of this Agreement may recover its
reasonable costs and attorney’s fees expended in connection with that action. The prevailing party shall be
entitled to recover an amount equal to the fair market value of legal services provided by attorneys
employed by it as well as any attorney’s’ fees paid to third parties.
SECTION 30 COUNTERPARTS
This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties,
constitute a single binding agreement.
SECTION 31 SEVERABILITY.
In case a provision of this Construction Contract is held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not be affected.
Rev. July 2012
IN WITNESS WHEREOF, the parties have caused this Construction Contract to be executed the
date and year first above written.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
___________________________
Senior Asst. City Attorney
PAR ELECTRICAL CONTRACTORS, INC.
By:___________________________
Name:_________________________
Title:________________________
BID SUMMARY
Invitation For Bid 148111
Title 60kV Reconductoring with ACCR
Date January 16, 2013
List of Bidders (Company Name) Bid Total
1. Cupertino Electric 1,977,639.00$
2. Wilson Construction Company -$ Received Letter Stating No Bid Due to Insufficient Resources
3. PAR Electrical Contractors, Inc.961,460.00$ * Lowest Bidder
City of Palo Alto (ID # 3328)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Council Priority: Environmental Sustainability
Summary Title: Recycled Water Project Contract
Title: Approval of a Water Enterprise Fund Contract with RMC Water and
Environment, Inc. for a Total Not to Exceed Amount of $193,914 to Complete
the Environmental Analysis of Expanding the City's Recycled Water Delivery
System
From: City Manager
Lead Department: Utilities
Recommendation
Staff recommends that Council approve a contract with RMC Water and Environment, Inc.
(RMC) to complete the environmental analysis of an expanded recycled water project to serve
the Stanford Research Park for $176,286, plus a contingency of $17,628, for an amount not to
exceed $193,914. Staff also recommends that Council approve this contract as a “sole source”
exemption from the City’s competitive bidding process under its authority in Palo Alto
Municipal Code Section 2.30.360(d).
Executive Summary
Staff continues to prepare the environmental documents for the proposed project to extend
the recycled water distribution system to customers in the Stanford Research Park area. Due to
unforeseen delays largely related to completion of the project’s environmental impact report
(EIR), the project has extended beyond the consultant’s contract termination date. Staff
requests approval of a new contract with RMC to complete the work. The expiration date for
the new contract is December 2014. Funds remaining from the expired contract will be re-
authorized for the new contract, so there is no funding increase included in this request. A
contract extension will allow the City to capture the remaining grant funds from the Bureau of
Reclamation.
City of Palo Alto Page 2
Background
On April 16, 2007, the City Council authorized the City Manager to execute a contract with RMC
for preparation of a recycled water Facility Plan and associated environmental documents for
Capital Improvement Project WS-07001 (CMR 191:07). RMC completed the Facility Plan for the
project in June 2008, and staff has been working on the Federal and State environmental
documents since then. Since execution of the original contract, Council has approved three
amendments to the contract. The project cost and approval chronology are provided in Table 1
along with actual expenditures to date.
Table 1: RMC Budget and Cost Summary1
Approved Budgeted
Costs
Actual
Expenditures
Original RMC Contract April 16, 2007 (CMR: 191:07) $242,700 $242,700
Amendment No. 1 June 2, 2008 (CMR: 255:08) $25,000 $25,000
Amendment No. 2 Nov. 8, 2008 (CMR: 431:08) $35,000 $35,000
Amendment No. 3 April 12, 2010 (CMR: 207:10) $372,000 $161,848
Total RMC Contract with all amendments $674,700 $464,442
1These are gross costs, and do not include grants. Project costs net of grants are discussed below
Discussion
The recycled water project has experienced significant delays since completion of the Facility
Plan in June 2008, and the RMC contract expired in June 2011. While staff has addressed many
issues regarding a future recycled water project, the replacement of high quality potable water
with recycled water remains a concern for the landscape community and has required staff and
RMC to complete additional work in preparation of the project’s EIR. These additional studies
and consultations were a major factor in pushing the project completion date beyond the
deadline in the RMC contract. Staff has also re-directed efforts on several occasions to
activities unrelated to the preparation of the environmental documents, but critical to position
the recycled water project project for success (i.e. grant funding pursuits). Completion of the
environmental document is essential for securing Federal or State grant or loan funding for the
construction of the project.
City of Palo Alto Page 3
Staff is recommending that Council approve a new contract with RMC to extend the time to
complete the work required. The tasks and scope of work – completion of the environmental
documents - are substantially the same with minor modifications to the deadlines and
individual tasks to ensure they are consistent with current information and the new project
schedule. The scope has also been updated to reflect work already completed and to ensure
that updated NEPA requirements from the US Bureau of Reclamation are included.
The City selected RMC through a competitive bidding process for the original contract. Staff
has consulted with Purchasing and recommends that the Council approve this new contract
with RMC as a sole source contract. This project qualifies for an exception to the competitve
bidding process under Palo Alto Municipal Code Section 2.30.360(d) since there is no adequate
substitute for this consultant’s services given the substantial work done to date on this complex
project. The City has completed significantly more than half of the work required on this
project and has been using the same consultant for these professional services throughout. .
Staff anticipates the remaining funds in the expired RMC contract will be sufficient to complete
both the Federal and State environmental documents.
The project received a $75,000 grant from the State Water Resources Control Board (SRWCB) to
complete the Facility Plan. Since Amendment #3 to the prior contract with RMC, staff applied
for and received an additional planning grant. The new grant is a 50% cost share planning grant
administered by the Federal Bureau of Reclamation (Reclamation) under the Title XVI recycled
water program. Staff has submitted and received reimbursement for approximately 2/3 of the
grant. Table 2 illustrates the net project cost (total projected cost less grants). The total RMC
cost for the expired contract and the new proposed contract has been lowered from $674,700
(as shown in Table 1) to $658,336 (as shown in Table 2) due to a lower contingency amount in
the new contract.
Table 2: Project costs and grants
Staff costs included in CIP Budget $42,300
Total RMC Cost (including new contract) $658,336
Total CIP Budget $700,636
Less SWRCB Planning Grant (State) ($75,000)
Less Bureau of Reclamation Planning Grant (Federal) ($326,000)
Total Net CIP Cost $299,636
The Reclamation grant is a cost share agreement, so the City must first incur the costs in order
to get reimbursement. The City has already received about $219,000 from Reclamation. Once
City of Palo Alto Page 4
the environmental documents are complete, staff will submit invoices to Reclamation for
reimbursement of the remaining grant amount of approximately $107,000. Reclamation has
strict grant administration guidelines, and the new RMC contract is important to ensure staff
can resume progress on the project and capture the remaining grant funds.
Resource Impact
The proposed contract does not require any additional funds to complete all necessary work.
There is approximately $210,000 remaining in Capital Improvement Project WS-07001 funds
originally budgeted for the expired contract to complete the environmental work for the
project. The $193,914 needed for the new contract will be reauthorized in this request, and the
balance will return to the Water Fund reserves. The new contract funding requirement is lower
than that of the expired contract due to a reduction in the contingency amount.
Policy Implications
Executing the proposed contract is consistent with Council policy. This project is consistent
with the Council-adopted Water Integrated Resource Plan Guideline 3: “Actively participate in
development of cost effective regional recycled water plans.” The project is also consistent
with Council direction to reduce imported water supplies and limit or reduce diversions from
the Tuolumne River.
Environmental Review
The project is undergroing Federal and State-mandated environmental review.
Attachments:
Attachment A - Contract (PDF)
Professional Services
Rev. June 2, 2010
CITY OF PALO ALTO CONTRACT NO. C13148958
AGREEMENT BETWEEN THE CITY OF PALO ALTO
AND RMC WATER AND ENVIRONMENT, INC.
FOR PROFESSIONAL SERVICES
This Agreement is entered into on this 4th day of March, 2013, (“Agreement”) by and
between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and
RMC WATER AND ENVIRONMENT, INC., a California corporation, located at 2290 North First
Street, Suite 212, San Jose, CA 95131 ("CONSULTANT").
RECITALS
The following recitals are a substantive portion of this Agreement.
A. CITY intends to study the water quality impacts of irrigation with recycled water
(“Project”) and desires to engage a consultant to prepare a single-issue EIR to address the water
quality impacts with recycled water in connection with the Project (“Services”).
B. CONSULTANT has represented that it has the necessary professional expertise,
qualifications, and capability, and all required licenses and/or certifications to provide the Services.
C. CITY in reliance on these representations desires to engage CONSULTANT to provide the
Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, this
Agreement, the parties agree:
AGREEMENT
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described in
Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The
performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM.
The term of this Agreement shall be from the date of its full execution through December 31, 2014
unless terminated earlier pursuant to Section 19 of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of
Services under this Agreement. CONSULTANT shall complete the Services within the term of this
Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part
of this Agreement. Any Services for which times for performance are not specified in this
Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and
timely manner based upon the circumstances and direction communicated to the CONSULTANT.
Professional Services
Rev. June 2, 2010
CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of
damages for delay if the extension is required due to the fault of CONSULTANT.
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to
CONSULTANT for performance of the Services described in Exhibit “A”, including both payment
for professional services and reimbursable expenses, shall not exceed One Hundred Seventy Six
Thousand Two Hundred Eighty Six Dollars ($176,286). In the event Additional Services are
authorized, the total compensation for services and reimbursable expenses shall not exceed One
Hundred Ninety Three Thousand Nine Hundred Fourteen Dollars ($193,914). The applicable rates
and schedule of payment are set out in Exhibit “C”, entitled “COMPENSATION ” which is attached
to and made a part of this Agreement.
Additional Services, if any, shall be authorized in accordance with and subject to the provisions of
Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed
without the prior written authorization of CITY. Additional Services shall mean any work that is
determined by CITY to be necessary for the proper completion of the Project, but which is not
included within the Scope of Services described in Exhibit “A”.
SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly
invoices to the CITY describing the services performed and the applicable charges (including an
identification of personnel who performed the services, hours worked, hourly rates, and
reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C”). If
applicable, the invoice shall also describe the percentage of completion of each task. The
information in CONSULTANT’s payment requests shall be subject to verification by CITY.
CONSULTANT shall send all invoices to the City’s project manager at the address specified in
Section 13 below. The City will generally process and pay invoices within thirty (30) days of
receipt.
SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be
performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents
that it possesses the professional and technical personnel necessary to perform the Services required
by this Agreement and that the personnel have sufficient skill and experience to perform the Services
assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted,
have and shall maintain during the term of this Agreement all licenses, permits, qualifications,
insurance and approvals of whatever nature that are legally required to perform the Services.
All of the services to be furnished by CONSULTANT under this agreement shall meet the
professional standard and quality that prevail among professionals in the same discipline and of
similar knowledge and skill engaged in related work throughout California under the same or similar
circumstances.
SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and
in compliance with all federal, state and local laws, ordinances, regulations, and orders that may
affect in any manner the Project or the performance of the Services or those engaged to perform
Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all
charges and fees, and give all notices required by law in the performance of the Services.
Professional Services
Rev. June 2, 2010
SECTION 8. ERRORS/OMISSIONS. CONSULTANT shall correct, at no cost to CITY, any and
all errors, omissions, or ambiguities in the work product submitted to CITY, provided CITY gives
notice to CONSULTANT. If CONSULTANT has prepared plans and specifications or other design
documents to construct the Project, CONSULTANT shall be obligated to correct any and all errors,
omissions or ambiguities discovered prior to and during the course of construction of the Project.
This obligation shall survive termination of the Agreement.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works
project, CONSULTANT shall submit estimates of probable construction costs at each phase of
design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%)
of the CITY’s stated construction budget, CONSULTANT shall make recommendations to the
CITY for aligning the PROJECT design with the budget, incorporate CITY approved
recommendations, and revise the design to meet the Project budget, at no additional cost to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing
the Services under this Agreement CONSULTANT, and any person employed by or contracted with
CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an
independent contractor and not an agent or employee of the CITY.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of
CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or
transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations
hereunder without the prior written consent of the city manager. Consent to one assignment will not
be deemed to be consent to any subsequent assignment. Any assignment made without the approval
of the city manager will be void.
SECTION 12. SUBCONTRACTING.
CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement
without the prior written authorization of the city manager or designee.
CONSULTANT shall be responsible for directing the work of any subconsultants and for any
compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning
compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a
subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of
the city manager or his designee.
SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Suet Chau as the
Project Supervisor to have supervisory responsibility for the performance, progress, and execution of
the Services and to represent CONSULTANT during the day-to-day work on the Project. If
circumstances cause the substitution of the project director, project coordinator, or any other key
personnel for any reason, the appointment of a substitute project director and the assignment of any
key new or replacement personnel will be subject to the prior written approval of the CITY’s project
manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do
not perform the Services in an acceptable manner, are uncooperative, or present a threat to the
adequate or timely completion of the Project or a threat to the safety of persons or property.
Professional Services
Rev. June 2, 2010
The City’s project manager is Nicolas Procos, Utilities Department, Resource Division, 250
Hamilton Avenue, Palo Alto, CA 94303, Telephone: (650)329-2214. The project manager will be
CONSULTANT’s point of contact with respect to performance, progress and execution of the
Services. The CITY may designate an alternate project manager from time to time.
SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including
without limitation, all writings, drawings, plans, reports, specifications, calculations, documents,
other materials and copyright interests developed under this Agreement shall be and remain the
exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees
that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested
in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual
property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make
any of such materials available to any individual or organization without the prior written approval
of the City Manager or designee. CONSULTANT makes no representation of the suitability of the
work product for use in or application to circumstances not contemplated by the scope of work.
SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time
during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records
pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and
retain such records for at least three (3) years after the expiration or earlier termination of this
Agreement.
SECTION 16. INDEMNITY.
16.1. To the fullest extent permitted by law, CONSULTANT shall protect,
indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents
(each an “Indemnified Party”) from and against any and all demands, claims, or liability of any
nature, including death or injury to any person, property damage or any other loss, including all
costs and expenses of whatever nature including attorneys fees, experts fees, court costs and
disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or
nonperformance by CONSULTANT, its officers, employees, agents or contractors under this
Agreement, regardless of whether or not it is caused in part by an Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to
require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active
negligence, sole negligence or willful misconduct of an Indemnified Party.
16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not
operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive
the expiration or early termination of this Agreement.
SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant,
term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not
be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of
any subsequent breach or violation of the same or of any other term, covenant, condition, provision,
ordinance or law.
Professional Services
Rev. June 2, 2010
C13148958
SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full
force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D".
CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an
additional insured under any general liability or automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through carriers
with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to
transact insurance business in the State of California. Any and all contractors of CONSULTANT
retained to perform Services under this Agreement will obtain and maintain, in full force and effect
during the term of this Agreement, identical insurance coverage, naming CITY as an additional
insured under such policies as required above.
18.3. Certificates evidencing such insurance shall be filed with CITY concurrently
with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk
Manager and will contain an endorsement stating that the insurance is primary coverage and will not
be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the
Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification,
CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance
are provided to CITY’s Purchasing Manager during the entire term of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be
construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions
of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be
obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as
a result of the Services performed under this Agreement, including such damage, injury, or loss
arising after the Agreement is terminated or the term has expired.
SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole or
in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written
notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately
discontinue its performance of the Services.
19.2. CONSULTANT may terminate this Agreement or suspend its performance of
the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of
a substantial failure of performance by CITY.
19.3. Upon such suspension or termination, CONSULTANT shall deliver to the
City Manager immediately any and all copies of studies, sketches, drawings, computations, and
other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given
to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will
become the property of CITY.
19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid
Professional Services
Rev. June 2, 2010
C13148958
for the Services rendered or materials delivered to CITY in accordance with the scope of services on
or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided,
however, if this Agreement is suspended or terminated on account of a default by CONSULTANT,
CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s
services which are of direct and immediate benefit to CITY as such determination may be made by
the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will
survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25.
19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will
operate as a waiver on the part of CITY of any of its rights under this Agreement.
SECTION 20. NOTICES.
All notices hereunder will be given in writing and mailed, postage prepaid, by
certified mail, addressed as follows:
To CITY: Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Purchasing Manager
To CONSULTANT: Attention of the project director
at the address of CONSULTANT recited above
SECTION 21. CONFLICT OF INTEREST.
21.1. In accepting this Agreement, CONSULTANT covenants that it presently has
no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would
conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the performance of this Agreement,
it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT
certifies that no person who has or will have any financial interest under this Agreement is an officer
or employee of CITY; this provision will be interpreted in accordance with the applicable provisions
of the Palo Alto Municipal Code and the Government Code of the State of California.
21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as
that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT
shall be required and agrees to file the appropriate financial disclosure documents required by the
Palo Alto Municipal Code and the Political Reform Act.
SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section
2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not
discriminate in the employment of any person because of the race, skin color, gender, age, religion,
disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status,
Professional Services
Rev. June 2, 2010
C13148958
weight or height of such person. CONSULTANT acknowledges that it has read and understands the
provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination
Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section
2.30.510 pertaining to nondiscrimination in employment.
SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE
REQUIREMENTS. CONSULTANT shall comply with the City’s Environmentally Preferred
Purchasing policies which are available at the City’s Purchasing Department, incorporated by
reference and may be amended from time to time. CONSULTANT shall comply with waste
reduction, reuse, recycling and disposal requirements of the City’s Zero Waste Program. Zero
Waste best practices include first minimizing and reducing waste; second, reusing waste and third,
recycling or composting waste. In particular, Consultant shall comply with the following zero waste
requirements:
All printed materials provided by Consultant to City generated from a personal
computer and printer including but not limited to, proposals, quotes, invoices,
reports, and public education materials, shall be double-sided and printed on a
minimum of 30% or greater post-consumer content paper, unless otherwise approved
by the City’s Project Manager. Any submitted materials printed by a professional
printing company shall be a minimum of 30% or greater post-consumer material and
printed with vegetable based inks.
Goods purchased by Consultant on behalf of the City shall be purchased in
accordance with the City’s Environmental Purchasing Policy including but not
limited to Extended Producer Responsibility requirements for products and
packaging. A copy of this policy is on file at the Purchasing Office.
Reusable/returnable pallets shall be taken back by the Consultant, at no additional
cost to the City, for reuse or recycling. Consultant shall provide documentation from
the facility accepting the pallets to verify that pallets are not being disposed.
SECTION 24. NON-APPROPRIATION
24.1. This Agreement is subject to the fiscal provisions of the Charter of the City of
Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a)
at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year,
or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of
the fiscal year and funds for this Agreement are no longer available. This section shall take
precedence in the event of a conflict with any other covenant, term, condition, or provision of this
Agreement.
SECTION 25. MISCELLANEOUS PROVISIONS.
25.1. This Agreement will be governed by the laws of the State of California.
25.2. In the event that an action is brought, the parties agree that trial of such action
will be vested exclusively in the state courts of California in the County of Santa Clara, State of
California.
25.3. The prevailing party in any action brought to enforce the provisions of this
Agreement may recover its reasonable costs and attorneys' fees expended in connection with that
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action. The prevailing party shall be entitled to recover an amount equal to the fair market value of
legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third
parties.
25.4. This document represents the entire and integrated agreement between the
parties and supersedes all prior negotiations, representations, and contracts, either written or oral.
This document may be amended only by a written instrument, which is signed by the parties.
25.5. The covenants, terms, conditions and provisions of this Agreement will apply
to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the
parties.
25.6. If a court of competent jurisdiction finds or rules that any provision of this
Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this
Agreement and any amendments thereto will remain in full force and effect.
25.7. All exhibits referred to in this Agreement and any addenda, appendices,
attachments, and schedules to this Agreement which, from time to time, may be referred to in any
duly executed amendment hereto are by such reference incorporated in this Agreement and will be
deemed to be a part of this Agreement.
25.8 If, pursuant to this contract with CONSULTANT, City shares with
CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d)
about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and
appropriate security procedures to protect that Personal Information, and shall inform City
immediately upon learning that there has been a breach in the security of the system or in the
security of the Personal Information. CONSULTANT shall not use Personal Information for direct
marketing purposes without City’s express written consent.
25.9 All unchecked boxes do not apply to this agreement.
25.10 The individuals executing this Agreement represent and warrant that they
have the legal capacity and authority to do so on behalf of their respective legal entities.
IN WITNESS WHEREOF, the parties hereto have by their duly authorized
representatives executed this Agreement on the date first above written.
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CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
__________________________
Senior Asst. City Attorney
RMC WATER AND ENVIRONMENT,
INC.
By:___________________________
Name:_________________________
Title:________________________
Attachments:
EXHIBIT “A”: SCOPE OF WORK
EXHIBIT “B”: SCHEDULE OF PERFORMANCE
EXHIBIT “C”: COMPENSATION
EXHIBIT “D”: INSURANCE REQUIREMENTS
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EXHIBIT “A”
SCOPE OF SERVICES
RMC will prepare a single-issue EIR to address water quality impacts of irrigation with recycled
water. The EIR will be based on the same pipeline alignments and pump station sites as evaluated in
the Initial Study/Mitigated Negative Declaration (IS/MND) published by the City in March 2009.
RMC will, in consultation with the City, determine the alternatives to be analyzed upon reinitiation
of the project. RMC will evaluate the No Project Alternative, Proposed Project, and one other
alternative (e.g. additional treatment). This approach is preliminary; the scope of the CEQA
alternatives analysis would be confirmed and may require revision following the public scoping
period and conclusion of the water quality impact evaluation. RMC will also prepare environmental
documents that meet the Bureau of Reclamation National Environmental Policy Act requirements.
Each task is described below.
Environmental Impact Report
Notice of Preparation and Scoping Meeting
This task has been completed.
Draft EIR Preparation
The Draft EIR will focus on the water quality analysis of impacts of irrigation on landscape plants in
the project area, with particular emphasis on redwood trees. The Initial Study (IS) Checklist, which
includes the analysis for the remaining environmental topic areas, will be included as an appendix.
Other Draft EIR-related sections not specific to an environmental resource area, including the
Summary, Introduction, Project Description, and Alternatives will be presented in the upfront
sections of the EIR. Tasks for completion of the EIR are described below.
Administrative Draft EIR
The RMC team began work on the Project starting April 2010 and had prepared, to varying degrees,
different sections of the Administrative EIR. RMC will resume work on the Administrative Draft
EIR upon completion of the Project Description.
Project Description
RMC previously submitted a draft Project Description to the City. Upon receipt of requested details
and comments by the City, RMC will revise the project description. The City will confirm the
strategy for addressing redwood trees and other vegetation, If necessary, the Adaptive Management
Program that was included in the original project description will be modified to include any
recommendations developed as part of the water quality analysis. RMC will update the project
description that is included in the EIR.
Water Quality Analysis
The Water Quality section will focus only on salinity issues, with particular emphasis on effects on
redwood trees/vegetation. Other topics relating to hydrology and water quality have already been
addressed in the IS, which will be included as an appendix. The EIR will describe the existing
environmental and regulatory setting relevant to evaluation of salinity impacts, state where relevant
the impact significance criteria, describe the impacts of the proposed project, assess their
significance, and develop feasible mitigation measures as applicable to reduce or eliminate identified
impacts. The EIR will identify any cumulative and unavoidable impacts associated with use of
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recycled water for irrigation.
HortScience, Inc. completed an investigation in June 2011 to evaluate impacts on plants of irrigation
with recycled water. The investigation consisted of the following: 1) collecting and sampling of
soils; 2) identifying plant species present and rating their appearance; 3) inspecting and describing
soil profiles within root zones; 4) mapping the 12 locations where such activities occurred; 5)
performing a survey-level soil landscape evaluation; 6) identifying constraints in using recycled
water on plants; and describing the effects of irrigation with recycled water. A summary report was
prepared following the above work activities. The findings of the HortScience report will be
incorporated into the EIR as appropriate.
Initial Study Update
RMC will update the IS/MND to reflect comments made during public review of the March 2009
IS/MND, and to meet new Bay Area Air Quality Management District (BAAQMD) requirements for
quantification of construction-period emissions. A new CNDDB search and a new NWIC search
were conducted in 2011 to determine if new, sensitive biological and cultural resources occur in the
project area. Beside the searches, field work and analysis had been initiated in 2011 on these
subjects, and more than 90 percent of the biological resources work and approximately 20 percent of
the cultural resources work had been done. The City will provide additional details requested in the
Project Description to complete the biological and cultural resources efforts. Due to the delays in the
project, there may be changes in the regulatory environment that warrant new searches be conducted
and revisions to the work already completed. This scope does not include such efforts. The
biological and cultural resources reports previously prepared for SWRCB will be updated as
necessary for submittal to the SWRCB.
Please refer to Exhibits C, D and E regarding the scope and budget for the biological and cultural
resources tasks conducted by Christopher Joseph and Associates (now Environ) and William Self
Associates, respectively.
CEQA Required Analyses
Most of the CEQA required analyses can be based on the analysis contained in the IS/MND. This
section will include evaluation of growth inducing impacts and cumulative impacts, and
identification of any significant irreversible environmental changes or significant unavoidable
adverse impacts. The EIR will also include a summary and evaluation of alternatives, including
identification of the environmentally superior alternative. With the exception of the cumulative
analysis, the other sections will be integrated in the upfront portion of the EIR. The cumulative
analysis will be included in the IS Checklist.
Document Preparation
RMC will prepare a concise, clearly written, and easily understandable Administrative Draft EIR
(ADEIR) summarizing the information developed in the above tasks. RMC will prepare all CEQA
Mandated Sections. RMC will include tangible (i.e., quantifiable) performance objectives for all
identified mitigation to the extent feasible, identification of appropriately timed monitoring,
identification of agency or staff responsible for monitoring, and mitigation or measures to be
implemented should the performance objectives not be met.
RMC will submit the ADEIR to the City for internal review and comment.
Screencheck Draft EIR
The City will provide comments on a single annotated comment copy of the ADEIR that provides
clear direction for revisions. Upon receipt of comments from the City, RMC will hold a meeting to
review comments and discuss the approach for revising the document. RMC will prepare a
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Screencheck Draft EIR incorporating necessary revisions and refinements based upon comments
received from the City on the ADEIR. RMC will ensure that all City comments are addressed
thoroughly.
Deliverables: RMC will submit an ADEIR to the City. City staff will have up to three (3) weeks to
review the ADEIR and provide comments. Following receipt of comments from the City, RMC will
submit a Screencheck Draft within three (3) weeks. The City will have up to one (1) week to review
the Screencheck Draft EIR.
Public Review of Draft EIR
RMC will prepare a Draft EIR, incorporating necessary revisions and refinements based upon the
City’s final edits on the Screencheck Draft EIR. RMC will submit the Draft EIR in hard copy (20
bound copies, one unbound copy, and 20 CD copies) and electronic format ready for posting on the
City’s website. RMC will also submit a draft Notice of Availability and Notice of Completion
(NOC) to the City so that the City can advertise in the local newspaper and file the NOC at the State
Clearinghouse (along with 15 CD copies of the Draft EIR), respectively. RMC will submit 8 hard
copies of the Draft EIR and supporting documentation to the SWRCB. RMC will work with the City
to refine the NOP distribution list to produce a distribution list for the EIR.
RMC will work with the City to plan and conduct a public meeting to answer questions regarding
the Draft EIR. The public meeting may include an open house format to allow the maximum
opportunity for the public to ask questions and get information about the project.
Deliverables: RMC will prepare a Draft EIR within one (1) week of receipt of comments from the
City on the Screencheck Draft EIR. RMC will submit a NOA and NOC to the City. RMC will assist
the City in preparing for and conducting a public review meeting during the EIR public comment
period.
Final EIR and Associated Documents
RMC will meet with the City at the close of the comment period during the final EIR phase to
identify and develop approaches for key issues raised. If appropriate, RMC may use master
responses for topics of greatest interest to local agencies and the surrounding community. The scope
of work assumes 78 hours of staff time to determine with the City the approach to respond to public
comments, bracket the comments, and provide written response to the comments; should the
estimated level of effort for preparing responses exceed the hours assumed, additional work would
need to be authorized through a contract modification.
Draft Final EIR (Response to Comments document), MMRP, and Findings
The Final EIR will consist of the Response to Comments (RTC) document and Public Draft EIR.
RMC will prepare an a RTC document that includes: 1) all letters received on the Draft EIR and
summaries of all substantive comments made on the Draft EIR at the public meeting, 2) responses to
each comment, and 3) text revisions to the Draft EIR shown in errata format. RMC will also prepare
a Draft MMRP, which will consolidate all required and recommended mitigation measures into one
table. In addition, RMC will prepare draft Findings. RMC will submit the Draft Response to
Comments document, Draft MMRP, and Draft Findings to the City for review.
Screencheck Final EIR (RTC document), MMRP, and Findings
RMC will revise the Draft RTC document, Draft MMRP, and Draft Findings per City
recommendations and a screencheck will be submitted for review.
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Final EIR (RTC document), MMRP, and Findings
RMC will submit the Final Response to Comments document, MMRP, and Findings to the City in
electronic format. RMC will provide 20 bound copies and one unbound copy of the final Response
to Comments document. RMC will attend the certification hearing and will be prepared to answer
questions from the City Council. RMC will prepare a Notice of Determination for the City to file
with the State Clearinghouse.
Deliverables: RMC will prepare a Draft Response to Comments document, draft and Final MMRP,
and draft and Final Findings. RMC will also prepare a Notice of Determination. The City will have
up to two (2) weeks to review and provide comments. Following receipt of comments, RMC will
submit a Screencheck Response to Comments Document, MMRP, and Findings to the City within
one (1) week. The City will have one (1) week to review and provide comments. Following receipt
of comments, RMC will submit the Final EIR, MMRP, and Findings within one week.
NEPA Documentation
RMC will assist the City in obtaining NEPA clearance from the U.S. Bureau of Reclamation
(USBR), so that the project can qualify for federal funding. Previously, it was assumed that an EA
would be required for USBR compliance. As such, preparation of the EA had occurred in parallel
with the EIR. However, based on communication with USBR in July 2011, a new strategy has been
identified. USBR recommended preparation of a brief Supplemental Information Document.
Combined with the CEQA EIR, the Supplemental Information Document would lead to a Finding of
No Significant Impact (FONSI). USBR has suggested that the Supplemental Information Document
would be prepared close to the completion of the EIR (during the latter part of the Final EIR
preparation stage), so that all issues have been dealt with adequately in the EIR process. RMC will
complete the tasks identified below. Please refer to Exhibits C, D and E regarding the scope and
budget for the biological and cultural resources tasks conducted by Environ and William Self
Associates, respectively.
Administrative Draft Supplemental Information Document
RMC will prepare Administrative Drafts of a Supplemental Information Document to submit to
USBR. The Supplemental Information Document will be brief (less than 20 pages) and would
include additional topical analysis required by NEPA, including socioeconomics and environmental
justice.
Deliverables: RMC will submit an Administrative Draft Supplemental Information Document to
USBR. It is assumed that USBR staff will require up to four (4) weeks to review and comment on the
Administrative Draft Supplemental Information Document and associated documents.
Screencheck Draft Supplemental Information Document
USBR will provide comments on a single annotated comment copy of the Administrative Draft
Supplemental Information Document that provides clear direction for revisions. Upon receipt of
comments from USBR, RMC will revise the document and prepare a Screencheck Draft
Supplemental Information Document, incorporating necessary revisions and refinements based upon
comments received from USBR on the supplemental document . RMC will ensure that all USBR
comments are addressed thoroughly. Deliverables: Following receipt of comments from USBR,
RMC will submit a Screencheck Draft within three (3) weeks. USBR will have up to one (1) week to
review the Screencheck Draft EA.
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Final Supplemental Information Document
RMC will prepare the Final Supplemental Information Document, incorporating necessary revisions
and refinements based upon USBR final edits on the Screencheck Draft Supplemental Information
Document. RMC will submit the Final Supplemental Information Document to USBR in hard copy
(10 bound copies and one unbound copy) and electronic format.
Deliverables: RMC will prepare a Final Supplemental Information Document within one (1) week
of receipt of comments from USBR on the Screencheck Draft Supplemental Information Documents.
Project Management / Meetings
RMC will coordinate with the City, USBR, RMC’s subconsultants and internal staff on all CEQA
and NEPA items related to the project. This task also includes two conference calls / one meeting
with the City and/or USBR to discuss CEQA / NEPA issues at key junctures of the process. This
task also covers preparation of monthly invoices and progress reports. It should be noted that as the
project timeframe has been extended well beyond the anticipated 10 months (although a portion of
time the project was on hold), and project management tasks (including conference calls and
meetings) were still being conducted to address outstanding issues (e.g., salinity approach), the
remaining budget for this task is limited.
Deliverables: RMC will submit monthly status reports to the City.
Optional Services
The following tasks are optional tasks that will require authorization by the City before can be
initiated. It should be noted that portions of the optional tasks have been authorized for both Environ
and WSA.
NEPA Documentation
USBR may have additional consultation requirements related to Section 7 and Section 106
consultation. The need for and level of consultation have not been determined and will be
determined based on discussions with USBR. The optional tasks include both Sections 7 and 106
consultations. Please refer to Exhibits C, D and E regarding the scope and budget for the biological
and cultural resources tasks conducted by Environ and William Self Associates, respectively. The
current strategy related to Section 7 consultation (to address biological resources effects) is to
include biological resources-related environmental commitments (Avoidance Measures) in the
Project Description so the City can proceed with informal consultation with the USFWS (rather than
formal consultation). We will need the City’s confirmation to commit to these measures. It should be
noted that the final determination for formal or informal consultation has not yet been determined
and will be determined by USFWS.
Assumptions
Additional outreach beyond the EIR preparation is not assumed in this scope of work /
budget.
No new substantive issues (beyond those the City has already encountered during the public
comment phase of the IS/MND) are assumed to arise.
The Project Description is assumed to be generally complete, with the exception of
additional details that will require City input. Once the City responds to the requested
information on the Project Description and provides direction on salinity strategy, the project
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will be reinitiated. Currently, the project is anticipated to reinitiate on March 4, 2013. For the
purposes of the Microsoft schedule the initiation date is assumed to be March 4, 2013.
The City will provide comments (including requested information) on all deliverables
promptly.
Other sections of the EIR that will be developed include: Summary, Introduction,
Alternatives, and Cumulative Impacts. With the exception of the Cumulative Impacts, the
other sections will be included in the upfront portion of the EIR.
One public meeting is assumed during the public comment period for the Public Draft EIR.
RMC will provide support (presentation preparation) and attend the Public Meeting (4 hours
for two staff members). The City will coordinate the meeting planning, present at, and
facilitate the meeting.
ODCs for the Public Draft EIR covers printing, mailing, and travel expenses. Graphics in the
document will be printed in black and white only. A maximum of 28 hard copies will be
printed (which includes 20 copies for the City and 8 copies for SWRCB), a maximum of 50
copies of a CD will be burned if needed (15 will be sent to SCH), and a maximum of 100
notices (NOA) if needed will be printed. The City will be responsible for publishing the
notice in the local newspaper and/or posting the notice at the project sites.
Preparation of the Response to Comments document is based on hours, which may increase
depending on the number of comments received. Should the estimated level of effort exceed
the hours assumed, additional work would need to be authorized through a contingency
release or other appropriate contract modification.
The City will prepare and send response letters to responsible agencies commenting on the
EIR.
The Draft EIR and the Response to Comments (with errata) constitutes the Final EIR
document; RMC will not print an Integrated EIR.
For all deliverables, only one administrative draft and one screencheck are proposed. If
additional deliverables are included, then the work effort will increase.
For all CEQA-related deliverables, we assume one set of consolidated, non-conflicting
comments from the Utilities and Planning Departments.
For all NEPA-related deliverables, we assume they will be reviewed by the USBR only (not
the City). Thus, the hours identified for preparation of NEPA deliverables are based on two
rounds of comments from USBR only, and not additional comments from the City.
For NEPA deliverables, we assume one set of consolidated, non-conflicting comments from
the USBR.
USBR will be responsible for all noticing of NEPA documents.
The City will file the Notice of Determination with the State Clearinghouse.
It is assumed that the NEPA Supplemental Information Document would be published after
the publication of the EIR, such that any issues arising from the EIR will have been resolved.
The EIR, in combination with the Supplemental Information Document, is the basis of the
FONSI.
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Project management includes coordination with the City, USBR, and the internal team. It is
possible that the schedule as shown will be delayed if the initiation date is delayed, the
salinity approach requires further refinement beyond RMC’s control, or the NEPA process
takes longer than expected.
We assume that protocol-level surveys for special-status plants or animal species or formal
delineation of waters and wetlands will not be conducted. The Environ biological team can
conduct such studies if required and requested; however, an expanded scope and cost
estimate would be required for such services.
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EXHIBIT “B”
SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each milestone within the number
of days/weeks specified below. The time to complete each milestone may be increased or
decreased by mutual written agreement of the project managers for CONSULTANT and CITY
so long as all work is completed within the term of the Agreement. CONSULTANT shall
provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt
of the notice to proceed.
Task Name Duration Start Finish
Project Reinitiated / City provides all outstanding items on PD 1 day Mon 3/4/13 Mon 3/4/13
1.2 DEIR Preparation 176 days Tue 3/5/13 Mon 11/11/13
RMC Prepares ADEIR 80 days Tues 3/5/13 Tues 6/25/13
City reviews ADEIR 45 days Wed 6/26/13 Wed 8/28/13
RMC prepares Screencheck DEIR 25 days Thu 8/29/13 Thu 10/3/13
City reviews Screencheck DEIR 25 days Fri 10/4/13 Fri 11/8/13
Meeting with City to discuss City comments on
Screencheck EIR
1 day Mon 11/11/13 Mon 11/11/13
1.3 Public Review of Draft EIR 55 days Tue 11/12/13 Mon 2/3/14
RMC prepares Draft EIR, NOA, and NOC 25 days Tue 11/12/13 Wed 12/18/13
DEIR publication 0 days Wed 12/18/13 Wed 12/18/13
DEIR public review period 47edays Wed 12/18/13 Mon 2/3/14
Public Meeting 0 days Mon 1/13/14 Mon 1/13/14
1.4 Final EIR and Associated Documents 129 days Tue 2/4/14 Wed 8/6/14
Meeting with City to discuss public comments on DEIR 1 day Tue 2/4/14 Tues 2/4/14
RMC prepares Draft RTC, MMRP, Findings 30 days Wed 2/5/14 Wed 3/19/14
City reviews Draft RTC, MMRP, Findings 30 days Thu 3/20/14 Wed 4/30/14
RMC prepares screencheck RTC, MMRP, and Findings 20 days Thu 5/1/14 Thu 5/29/14
City reviews screencheck RTC, MMRP, and Findings 20 days Fri 5/30/14 Thu 6/26/14
RMC prepares Final RTC, MMRP, and Findings 20 days Fri 6/27/14 Fri 7/25/14
EIR Certification/Project Approval (2nd and last Weds of
the month)
1 day Tue 8/5/14 Tue 8/5/14
File NOD 1 day Wed 8/6/14 Wed 8/6/14
2 NEPA Documentation 128 days Fri 6/27/14 Wed 12/31/14
RMC prepares Administrative Draft Supplemental
Information Document
30 days Fri 6/27/14 Fri 8/8/14
USBR reviews Administrative Draft Supplemental
Information Document
30 days Mon 8/11/14 Mon 9/22/14
RMC prepares Screencheck Draft Supplemental
Information Document
20 days Tue 9/23/14 Tue 10/21/14
USBR reviews Screencheck Draft Supplemental
Information Document
20 days Wed 10/22/14 Wed 11/19/14
RMC prepares Final Supplemental Information Document 8 days Thu 11/20/14 Tue 12/2/14
Supplemental Information Document and FONSI
Publication/signatures
20 days Wed 12/3/14 Wed 12/31/14
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EXHIBIT “C”
COMPENSATION
The CITY agrees to compensate the CONSULTANT for professional services performed in
accordance with the terms and conditions of this Agreement, and as set forth in the budget
schedule below. Compensation shall be calculated based on the hourly rate schedule as in
Exhibit C up to the not to exceed budget amount for each task set forth below.
The compensation to be paid to CONSULTANT under this Agreement for all services
described in Exhibit “A” (“Basic Services”) and reimbursable expenses shall not exceed
$176,286. CONSULTANT agrees to complete all Basic Services, including reimbursable
expenses, within this amount. In the event CITY authorizes any Additional Services, the
maximum compensation shall not exceed $193,914. Any work performed or expenses
incurred for which payment would result in a total exceeding the maximum amount of
compensation set forth herein shall be at no cost to the CITY.
CONSULTANT shall perform the tasks and categories of work as outlined and budgeted
below. The CITY’s Project Manager may approve in writing the transfer of budget amounts
between any of the tasks or categories listed below provided the total compensation for Basic
Services, including reimbursable expenses, does not exceed $176,286 and the total
compensation for Additional Services does not exceed $17,628.
BUDGET SCHEDULE NOT TO EXCEED AMOUNT
Task 1 $97,778
(Environmental Impact Report)
Task 2 $31,507
(NEPA Documentation)
Task 3 $8,601
(Project Management)
Task 4 $38,400
(Optional Tasks)
Sub-total Basic Services $176,286
Total Basic Services and Reimbursable expenses $176,286
Additional Services (Not to Exceed) $17,628
Maximum Total Compensation $193,914
REIMBURSABLE EXPENSES
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The administrative, overhead, secretarial time or secretarial overtime, word processing,
photocopying, in-house printing, insurance and other ordinary business expenses are included
within the scope of payment for services and are not reimbursable expenses. CITY shall
reimburse CONSULTANT for the following reimbursable expenses at cost.
All requests for payment of expenses shall be accompanied by appropriate backup
information. Any expense anticipated to be more than $500 shall be approved in advance by
the CITY’s project manager.
ADDITIONAL SERVICES
The CONSULTANT shall provide additional services only by advanced, written
authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request,
shall submit a detailed written proposal including a description of the scope of services,
schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including
reimbursable expense, for such services based on the rates set forth in Exhibit C. The
additional services scope, schedule and maximum compensation shall be negotiated and
agreed to in writing by the CITY’s Project Manage and CONSULTANT prior to
commencement of the services. Payment for additional services is subject to all requirements
and restrictions in this Agreement
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EXHIBIT “D”
INSURANCE REQUIREMENTS
CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT
OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES
WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN
THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW:
REQUIRED TYPE OF COVERAGE REQUIREMENT
MINIMUM LIMITS
EACH
OCCURRENCE AGGREGATE
YES
YES
WORKER’S COMPENSATION
EMPLOYER’S LIABILITY
STATUTORY
STATUTORY
YES
GENERAL LIABILITY, INCLUDING
PERSONAL INJURY, BROAD FORM
PROPERTY DAMAGE BLANKET
CONTRACTUAL, AND FIRE LEGAL
LIABILITY
BODILY INJURY
PROPERTY DAMAGE
BODILY INJURY & PROPERTY DAMAGE
COMBINED.
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES AUTOMOBILE LIABILITY, INCLUDING
ALL OWNED, HIRED, NON-OWNED
BODILY INJURY
- EACH PERSON
- EACH OCCURRENCE
PROPERTY DAMAGE
BODILY INJURY AND PROPERTY
DAMAGE, COMBINED
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
PROFESSIONAL LIABILITY, INCLUDING,
ERRORS AND OMISSIONS,
MALPRACTICE (WHEN APPLICABLE),
AND NEGLIGENT PERFORMANCE
ALL DAMAGES $1,000,000
YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE,
SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT
AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS,
IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL
INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE:
A. A PROVISION FOR A WRITTEN THIRTY DAY ADVANCE NOTICE TO CITY OF CHANGE IN
COVERAGE OR OF COVERAGE CANCELLATION; AND
B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR
CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY.
C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL.
II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE.
III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL
INSUREDS”
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS
AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER
INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.
B. CROSS LIABILITY
Professional Services
Rev June 2, 2010
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL
NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS
ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF
THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER
THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY
AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF
CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT
OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY
WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
NOTICES SHALL BE MAILED TO:
PURCHASING AND CONTRACT ADMINISTRATION
CITY OF PALO ALTO
P.O. BOX 10250
PALO ALTO, CA 94303
City of Palo Alto (ID # 3426)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Crossbore Contract Amendment #1
Title: Approval of Amendment No. 1 to Contract #C12140966 in the Amount
of $500,000 with Hydromax USA, Inc. To Provide Additional Services
Associated with the Cross-Bore Investigation Project, for a Total Not to
Exceed Amount of $4,300,000
From: City Manager
Lead Department: Utilities
Recommendation
Staff recommends that Council approve Amendment Number 1 to Contract #C12140966 in the
amount of $500,000 with Hydromax USA, Inc. to provide additional services associated with the
Cross-Bore Investigation Project for a total revised contract not to exceed amount of
$4,300,000. As part of this Amendment, staff also recommends that Council approve a one year
time extension to December 31, 2013, to allow the Contractor to complete the field
investigations.
Background
On July 11, 2011, Council awarded a contract to Hydromax USA, Inc. for the Cross-Bore
Investigation Project. Council approved a total budget of $3,523,950 and a contingency amount
of $276,050 for this project. The request for proposals for this project was sent to ten vendors
on April 13, 2011. Hydromax USA, Inc. was selected because of its specialization in this line of
work, availability of equipment to complete this project and its demonstrated ability to meet
the City’s critical quality assurance methods.
A cross-bore is the unintentional installation of one utility within another. Typically, this can
occur during trenchless pipe installation.
This contract with Hydromax USA, Inc. included cross-bore investigations of 18,000 existing
sanitary sewer laterals within the City. The project started in late July 2011 and was scheduled
City of Palo Alto Page 2
to be finished within 18 months, or by January 2013. As of the start of January 2013, Hydromax
USA, Inc. has attempted to investigate 13,579 laterals in the existing sanitary sewer system,
which is broken down as follows:
Total inspections in quality control review or completed = 6,563
Total properties requiring additional inspection = 7,016
o Incomplete inspection (needs construction or resolution of other access issues) =
3218
o Field inspection in process = 3,798
Field inspection not yet attempted = 4,421
Since the cross-bore program began, there have been 19 gas cross-bores found and corrected.
This is roughly 1 gas cross-bore per 500 sewer laterals inspected.
As the crossbore investigation progressed, the contractor discovered that there were several
aspects of the required work that were unforeseen and beyond the scope of the original
contract. These unforeseen items include the longer than average lateral length, unforeseen
number of branched laterals camera size limiting the ability to inspect 6” and less sanitary
sewer main sizes and poor conditions of some of the existing laterals. Some of the conditions
encountered include buried cleanouts, roots, offset pipes, and no access in the private and
public parts of the laterals preventing completion of inspections. To complete the inspection of
some of these laterals will require construction work outside of the scope of this contract to
remove the impediments in the laterals that are preventing inspection. This work may be
completed by in-house crews or through existing contract construction crews.
Discussion
After the original contract with Hydromax USA, Inc. was signed and accepted by the City (Staff
Report #1615), conditions not covered in the contract resulted in an increase in work needed
by the Contractor. As a result, the project costs have increased by approximately $500,000 and
the project completion date has been extended approximately one year to December 31, 2013.
The following describes the additional work needed in order to see the project through to
completion:
1. For the private side of some of the existing laterals, along with some of the City’s
existing laterals, it has been problematic to complete video inspections due to the
existing condition of the pipes. The original contract does not include construction on
mains or laterals. It has been found that there are several thousand laterals that require:
A) excavation to locate and raise cleanouts, B) installation of new cleanouts, C) lateral
City of Palo Alto Page 3
spot repair and D) other means to complete the investigation. At this time, outside
Contractors and available City staff are being used to resolve these various construction
issues. Once the construction issues are resolved, Hydromax USA, Inc will return to each
site one more time to complete the crossbore investigation at no additional cost.
2. Per the original contract, the average anticipated lateral length was calculated to be
approximately 65 feet. To date, investigations have determined that the actual average
lateral length is closer to 84 feet, requiring 29% more lateral inspections and coding
than originally anticipated. The increased footage requiring inspection is the result of
finding branched laterals servicing multiple structures on a parcel. In addition to this,
the longer lateral lengths have required an additional camera crew with specialized
equipment at the cleanouts to complete some lateral investigations due to the length
limitations of the cameras launched from the mains.
3. The bid documents did not specify the main footages by size. The contractor assumed
that the similar conditions existed as on other jobs they had performed. In the Palo Alto
system the footages of 6 inch mains was higher than anticipated. Additionally, lined
6”pipe and the amount of 6 inch pipe with issues such as offsets, protruding laterals or
blockages due to tree roots have created a significant increase of work. This increased
the cost because the main-launched camera equipment proved difficult to use in the
City’s 6 inch pipes and could not be used in the lined 6 inch pipes. As a result, extra
camera crews with specialized equipment were needed to return to the site and
perform the inspections.
Because even the most diligent technician and complex verification process can miss a critical
observation in the sanitary sewer lateral, City staff is continuing to recommend that customers
call the City at (650) 329-2579 (Utility Dispatch) first before having their laterals cleaned.
The costs associated with the uncompleted out of scope work described above total $500,000
and bring the total cost of this contract to $4,300,000.
Resource Impact
The attached Amendment Number 1, Attachment A, requests an additional appropriation of
$500,000 for the contract with Hydromax USA, Inc. The funds for this project were included in
the FY 2013 Utilities Operating Budget. No additional City resources will be required to manage
this project.
Policy Implications
City of Palo Alto Page 4
Amendment Number 1 does not represent a change to existing policies. This recommendation
is consistent with the Council-approved Utilities Strategic Plan (Staff Report 1880), especially
Key Strategy #1, “Ensure a high level of system reliability in a cost effective and timely manner.”
Environmental Review
This project is categorically exempt from the California Environmental Quality Act (CEQA)
pursuant to CEQA Guideline Sections 15301 (b) repair, maintenance of existing facilities and
15302 (c) replacement or reconstruction of existing facilities.
Attachments:
Attachment A: PA Amendment One to Contract C12140966 with Hydromax USA (PDF)
City of Palo Alto (ID # 3371)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Maybell Short Term Loan
Title: Adoption of Budget Amendment Ordinance to Provide Additional Loan
to Palo Alto Housing Corporation and Approval of a Short Term Loan to Palo
Alto Housing Corporation in the Amount of $2,600,000 to Palo Alto Housing
Corporation for the Acquisition of 567-595 Maybell Avenue for Purposes of
Developing a Below Market Rate Senior Housing Project
From: City Manager
Lead Department: Planning and Community Environment
Recommendation
Staff recommends that the City Council:
1. Approve and authorize the City Manager or designee to execute in substantially
identical form the Revised and Restated Acquisition and Development Agreement (ADA)
with Palo Alto Housing Corporation (PAHC) to provide a short term loan of $2,600,000
from the Stanford University Medical Center (SUMC) Infrastructure, Sustainable
Neighborhoods and Communities and Affordable Housing Fund; and
2. Authorize the City Manager or designee to execute all other documents required to
implement the ADA and related transaction, including escrow instructions, deed of
trust, subordination agreements, and to administer the provisions of the agreements;
and
3. Adopt the attached Budget Amendment Ordinance (BAO) to amend the Fiscal Year 2013
Operating Budget to increase General Expense by $2.6 million and correspondingly
reduce SUMC reserves.
Executive Summary
Council approval of the recommended actions will provide a short-term $2,600,000 loan from
the SUMC fund to Palo Alto Housing Corporation, Inc. (PAHC) for the acquisition of two parcels,
located at 567-595 Maybell Avenue for the purpose of developing the site into a 60-unit
affordable rental housing project for extremely-low and very-low and low income seniors and a
City of Palo Alto Page 2
15-unit market rate single family residential subdivision. Review of entitlements (zoning and
site design) and site specific environmental review will occur subsequent to the land acquisition
when an application is made and plans are developed for the project.
Background
On June 22, 2012, Palo Alto Housing Corporation (PAHC), entered into a purchase and sale
agreement with Maybell Sambuceto Properties, LLC and Sambuceto Partners, A California
Limited Partnership, to acquire the properties located at 567-595 Maybell Avenue for the
purpose of developing an affordable housing project to be named the Maybell Orchard
Apartments.
Initially, PAHC approached the City seeking $6.5 million of financial assistance for the site
acquisition. As project development costs were further refined, however, the final request
amount was finalized at $5,820,220. Due to limitations of the City’s Housing Fund, the City was
initially able to provide only a $3,220,220 loan. On November 19, 2012, the Council approved a
$3,220,220 long term loan for the acquisition of the Maybell properties and directed staff to
prepare a short-term $2,600,000 loan, using Stanford Medical Center Development Agreement
Funds, to be able to fund the full amount of PAHC’s request.
Discussion
PAHC Purchase Agreement for Site
The Palo Alto Housing Corporation (PAHC) and Maybell Sambuceto Properties, LLC and
Sambuceto Partners, a California Limited Partnership, executed a purchase and sale agreement
detailing the terms of the acquisition of both parcels. Escrow closed on November 30, 2012
and PAHC is the owner of the property.
An appraisal was prepared by Hulberg & Associates, Inc., dated June 26, 2012. The appraised
value for the property was estimated at $15,640,000.
Project Site and Description
The project site is comprised of two parcels (APN # 137-25-109 and -108) located at the corner
of Maybell and Clemo Avenues. The combined lot size is approximately 107,422 sq. ft. (2.46
acres). The larger parcel (93,654 sq. ft.) and the smaller parcel (13,768 sq. ft.) are zoned RM15
and R2, respectively, as shown in Attachment A. Both parcels are within one-quarter of a mile
from El Camino Real with access to VTA bus route 88.
City of Palo Alto Page 3
PAHC plans to subdivide the property and apply for rezoning of the 2.46-acre property. The
affordable rental apartments would be on an one acre parcel and would include (59) 1-
bedroom apartments and (1) 2-bedroom apartment for an onsite manager, common areas such
as a community room with computer lab, laundry room, manager’s office, a resident services
office, as well as outdoor common area space. The affordable apartments would have an
average size of 600 square feet and be affordable to senior households earning 30-60% of the
Area Median Income (AMI). The project would be designed to meet or exceed the City’s green
point rating system.
The market rate units would be located on the remaining 1.46 acres, running adjacent to the
perimeter of the property, bordering Maybell and Clemo Avenues. The 15-unit subdivision
would be fee simple lots of approximately 4,000 square feet with residence sizes between
1,900 -3,200 square feet. In order to avoid parking impacts on Maybell and Clemo Avenue,
garage parking would be provided at the rear of each unit, accessed by an alley in the interior of
the lot. To provide equity for the senior affordable housing development, PAHC anticipates
selling the subdivision to a developer once the entitlements have been obtained rather than
constructing the units themselves and then selling the completed units.
Surrounding Uses
The project site is surrounded by the following land uses:
West- Single-family residences
North - Multi-family residences (Arastradero Park owned by PAHC)
East- Multi-family residences (The Tan Plaza Continental)
South- Briones Park
$2,600,000 Proposed Short-Term Loan
The proposed $2,600,000 short-term loan would be a two year loan with an option of a 1-year
extension. The interest rate would be 3% per annum with payments deferred for the term of
the loan. Staff proposes to revise and restate the existing loan agreement to include the
addition of this short-term loan from the SUMC Infrastructure, Sustainable Neighborhoods and
Communities and Affordable Housing Fund. As various commercial and housing developments
pay their affordable housing in-lieu fees over the next two-years for future residential and
commercial projects, those fees would be used to reimburse the SUMC Infrastructure,
Sustainable Neighborhoods and Communities and Affordable Housing Fund. When the future
in-lieu fees are received by the City, the fees will be added to the long term loan amount and
the short term loan amount will be proportionately reduced. For example, if a $200,000 fee
payment is received, it would be applied towards the long term loan by $200,000 and the short
term loan amount would be reduced by $200,000. The SUMC fund would be reimbursed
City of Palo Alto Page 4
$200,000. Please note, with the future fee payments, it will not increase the City’s overall loan
commitment of $5.8 million. Except for the loan term and method of repayment to the short
term loan, all other provisions and requirements of the approved $3.2 million loan agreement
apply to this loan. All City loan agreements provide the City with remedies to recoup the loan if
the developer defaults or the project does not otherwise move forward (such as securing
sufficient financing for the development or not receiving the necessary land use entitlements
by a certain date).
The PAHC required a total of approximately $5.8 million in loans from the City to close escrow
and to enhance the likelihood of obtaining needed State tax credits for the project. The City did
not have sufficient funds available in the commercial and residential housing funds to lend the
full amount. On November 19, 2012, the Council approved a long term loan of $3,220,220, the
full amount of housing funds available to the project. Council also provided direction to staff to
prepare the $2.6 million loan. An interim letter of credit allowed PAHC to make up the $2.6
million and close escrow on the purchase on November 30. The short-term loan will replace
PAHC’s interim line of credit.
Staff acknowledges that while the loan should be paid back within 2-3 years, the City is likely to
have other demands on the SUMC funds for infrastructure needs during this period, and that
the short-term loan may defer the availability of the full complement of SUMC funding for this
period. This housing project, however, is an opportunity to fulfill City housing goals with a
project comprised of senior housing units expected to have little effect on traffic and school
capacity.
City Financial Commitment per Unit Developed
The commitment of $5.8 million for 60 affordable housing units at this site provides a City
contribution equivalent to approximately $100,000 per unit. For the two most recent City-
funded new construction affordable housing projects, the City’s commitment was
approximately $150,000 per unit for the Tree House Apartments at 488 W. Charleston Road
and $400,000 per unit (including loans and land donation) for the 801 Alma family housing
project.
Rents and Occupancy of the Apartments
In order to succeed in the competition for the State’s tax credit allocation, PAHC needs to
emphasize housing for extremely low-income and very-low income households. The project’s
proposed rent categories and income limits are shown below; actual rents may change
somewhat by the time the project is constructed and ready for occupancy due to changes in the
County median income.
City of Palo Alto Page 5
Maybell Housing Project – Description of Proposed Units and Rental Structure
Rent As A Percent of Median Income 1-Bedroom Units
Extremely Low Income (30% of AMI) 20
Very Low Income (45% of AMI) 6
Very Low Income (50% of AMI) 24
Low Income (60% of AMI) 9
Manager’s Unit 1
Total Units 60
Notes: AMI means the Area Median Income for Santa Clara County, which equals
$105,000 for a household of four persons as published on February 1, 2012.
Development Review
Zoning and site plan review will be required subsequent to the PAHC purchase of the site and
submittal of a development application. The process will include review by the Architectural
Review Board, the Planning and Transportation Commission, and the City Council. On
September 18, 2012, PAHC presented conceptual site and elevation plans for the proposed
project to the City Council for comment and feedback. PAHC plans to incorporate responses to
those comments when it submits an application for land use approvals. However, providing this
loan does not commit the City to any particular course of action related to decisions on the land
use entitlements and the agreement specifically states that the City retains full discretion to
approve or disapprove the site-specific land use approvals.
Resource Impacts
The attached Budget Amendment Ordinance (Attachment A) addresses changes to the expense
budget for the SUMC Fund. To fund the short-term loan, staff proposes to use $2.6 million from
the SUMC Fund.
As part of the SUMC Development Agreement, SUMC agreed to pay approximately $44.3
million in public benefit funds. Of the $44.3 million, approximately $23.2 million has been
earmarked for the SUMC Infrastructure, Sustainable Neighborhoods and Communities and
Affordable Housing Fund. The City has received $32,533,666 in SUMC public benefit funds as of
December 5, 2012 of which $15.5 million was deposited in the SUMC Infrastructure,
Sustainable Neighborhoods and Communities and Affordable Housing Fund.
City of Palo Alto Page 6
Of that amount, $1.7 million was dedicated specifically to affordable housing. Council
committed $1.0 million of this dedicated amount to the Stevenson House rehabilitation and
$0.7 million for the Maybell long-term loan. The attached BAO appropriates money from the
remaining balance of the Infrastructure, Sustainable Neighborhoods and Communities, and
Affordable Housing Fund. The SUMC Parties will pay an additional $11.7M in public benefit
funds upon substantial completion of the Lucile Packard Children’s Hospital expansion,
expected in 2018.
After funding the $3.2 million long-term loan (BAO 5171), the balance in the Residential
Housing In-Lieu Fund is approximately $3.7 million. Approximately $3.6 million in this fund
cannot be spent until the ongoing Sterling Park litigation is resolved. The City’s other housing
fund, the Commercial Housing In-Lieu Fund, has balance of approximately $0.1 million.
The overall development cost for the affordable senior development is approximately $21.6
million. The sale of the market rate home subdivision will help buy down some of the
development costs. PAHC also plans on submitting an application for tax credit financing and
applying for a conventional mortgage. A summary of the sources of funding for the acquisition
of the site and sources and uses for the senior development are included as Attachment B.
Policy Implications
The actions recommended in this report implement the City’s adopted Housing Element
policies and programs supporting the development of very low and extremely low income
housing. Policy H-12 calls for encouraging, fostering and preserving diverse housing
opportunities for very low-, low- and moderate-income households. In addition, Policy H-18
supports housing that incorporates facilities and services to meet the health care, transit, or
social service needs of households with special needs, including seniors and persons with
disabilities. These 60 units will be counted towards the City’s housing production goals for the
2007 to 2014 Housing Element period. The proposed project is a 100% affordable housing
development that will serve individuals who are earning 30 to 60 percent of the area wide
median income. A large percentage of Palo Alto’s seniors are in this targeted income range. This
population is underserved in the City and many cannot afford to pay market rate rents.
State Housing Element law requires that localities provide for their “fair share” of the region’s
housing need. The Association of Bay Area Governments (ABAG) determined that Palo Alto’s
projected need for the period from January 1, 2007 – June 30, 2014 will be 2,860 units, of which
633 units are presently unmet need in the Very Low Income category. This project will also
provide 20 of the 60 units to households below 35% of the AMI, considered Extremely Low
Income, which will help the City address State requirements to assist in meeting housing needs
of this population.
City of Palo Alto Page 7
Environmental Review
By approving this acquisition loan agreement, the City has made no commitment to approve
the project or any particular application for land use approvals on the property. The provision
of financing for acquisition of the property is consistent with the land use element of the City’s
Comprehensive plan and with the City’s affordable housing goals as outlined in the Housing
Element of the Comprehensive Plan, and the approval of this agreement is within the scope of
that program EIR and no new environmental review is required in that no specific plans for
development of the property have been submitted that would create additional environmental
impacts. Site-specific environmental review will be completed when an application for specific
land use approvals is made and plans are developed for the project.
Attachments:
Attachment A: Budget Amendment Ordinance Short term PAHC Loan (DOCX)
Attachment B: Sources and Uses for Maybell Orchard Apartments (PDF)
Attachment C: Loan Agreement (PDF)
ORDINANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR FISCAL YEAR 2013 TO
PROVIDE ADDITIONAL APPROPRIATION OF $2,600,000
FROM THE STANFORD UNIVERSITY MEDICAL CENTER
(SUMC) INFRASTRUCTURE, SUSTAINABLE NEIGHBORHOODS
AND COMMUNITIES, AND AFFODABLE HOUSING FUND TO
AMEND AND INCREASE THE EXISTING LOAN TO PALO ALTO
HOUSING CORPORATION FOR THE ACQUISITION OF TWO
PARCELS
The Council of the City of Palo Alto does ordain as
follows:
SECTION 1. The Council of the City of Palo Alto finds
and determines as follows:
A. Pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto, the Council on
June 18, 2012 did adopt a budget for Fiscal Year 2013; and
B. On November 18, 2012, the Council authorized the
City Manager to issue a long-term loan for Three Million
Two Hundred Twenty Thousand Two Hundred Twenty Dollars
($3,220,220) to the Palo Alto Housing Corporation for the
acquisition of two parcels, located at 567-595 Maybell
Avenue for the purpose of developing the site into a 60-
unit affordable rental housing project for extremely-low
and very-low and low income seniors and a 15 unit market
rate single family residential subdivision; and
C. An additional short-term loan of Two Million Six
Hundred Thousand Dollars ($2,600,000) is needed to complete
the project; and
D. The 2011 Stanford University Medical Center (SUMC)
Development Agreement provided funds for use in connection
with infrastructure, sustainable neighborhoods and
communities, and affordable housing; and
E. The available balance in the Infrastructure,
Sustainable Neighborhoods and Communities, and Affordable
Housing Fund is Fourteen Million One Hundred Seventy Eight
Thousand Eighty-Seven Dollars ($14,178,087); and
F. City Council authorization is needed to amend the
Fiscal Year 2013 Operating Budget as hereinafter set forth.
SECTION 2. The sum of Two Million Six Hundred Thousand
Dollars ($2,600,000) is hereby appropriated to General
Expense in the Planning and Community Environment budget for
the purposes of increasing the existing loan and the
available balance of the SUMC Infrastructure, Sustainable
Neighborhoods and Communities, and Affordable Housing Fund
is hereby reduced to Eleven Million Five Hundred Seventy
Eight Thousand Eighty-Seven Dollars ($11,578,087).
SECTION 3. As specified in Section 2.28.080(a) of the
Palo Alto Municipal Code, a two-thirds vote of the City
Council is required to adopt this ordinance.
SECTION 4. As provided in Section 2.04.330 of the Palo
Alto Municipal Code, this ordinance shall become effective
upon adoption.
SECTION 5. The Council of the City of Palo Alto
hereby 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:
ABSTENTIONS:
ABSENT:
ATTEST: APPROVED:
__________________________ ___________________________
City Clerk Mayor
APPROVED AS TO FORM: ___________________________
City Manager
__________________________ ___________________________
City Attorney Director of Planning and
Community Environment
__________________________
Director of Administrative
Services
ATTACHMENT B
SOURCES AND USES FOR
MAYBELL ORCHARD APARTMENTS
Sources for the Acquisition of the Parcel
ACQUISITION FINANCING PRIOR TO MARKET
RATE LAND SALE
ACQUISITION SOURCES total
-
County Loan $ 2,759,780
LISC Loan $ 3,500,000
LIIF Loan $ 3,500,000
City Loan $ 3,220,220
City Short Term Loan $ 2,600,000
total $ 15,580,000
PAHC estimates the overall development cost for the 60‐unit Maybell project to be
$21.1 million as shown below.
MAYBELL ORCHARD SENIOR HOUSING DEVELOPMENT BUDGET
ACQUISITION
total per unit
Land $ 6,480,000 $ 108,000
Other Acquisition Costs $ 292,550 $ 4,876
Total Acquisition Costs $ 6,772,550 $ 112,876
HARD COSTS
Construction/Rehabilitation $ 8,397,784 $ 139,963
Commercial Costs $ - $ -
Site Work $ 650,000 $ 10,833
General Contractor O&P $ 827,850 $ 13,798
Total Hard Costs $ 9,875,634 $ 164,594
SOFT COSTS
Architectural $ 603,671 $ 10,061
Survey & Engineering $ 325,000 $ 5,417
Construction Interest + Fees $ 798,628 $ 13,310
Financing & Syndication $ 150,439 $ 2,507
Local Permits and Fees $ 260,000 $ 4,333
Legal Fees $ 100,000 $ 1,667
Developer Fee $ 1,400,000 $ 23,333
$ - $ -
Relocation $ - $ -
Reserves $ 135,113 $ 2,252
Other Soft Costs $ 705,000 $ 11,750
Total Soft Costs $ 4,477,851 $ 74,631
TOTAL DEVELOPMENT COSTS $ 21,126,035 $ 352,101
Financing for the development is expected from the following funding sources:
MAYBELL ORCHARD SENIOR HOUSING FINANCING
total per unit
PERMANENT SOURCES
- -
Conventional Mortgage $ 1,228,000 $ 20,467
City Loan $ 3,220,220 $ 53,671
Tax Credit Investor Proceeds $ 11,318,034 $ 188,634
County SAHF loan $ 2,759,780 $ 45,996
City Short Term Loan $ 2,600,000 $ 43,333
total $ 21,126,035 $ 352,101
895\05\1267519.3
1/22/2013
FIRST AMENDED AND RESTATED
ACQUISITION AND DEVELOPMENT LOAN AGREEMENT
AND OPTION TO PURCHASE
by and between
THE CITY OF PALO ALTO
A Chartered City and Municipal Corporation
and
PALO ALTO HOUSING CORPORATION
A California Non-Profit Public Benefit Corporation
For the Real Property Located at:
567-595 Maybell Avenue
(APN: 137-25-108, 137-25-109)
Dated __________, 2013
TABLE OF CONTENTS
Page
895\05\1267519.3
1/22/2013
i
ARTICLE 1 DEFINITIONS AND EXHIBITS 3
Section 1.1 Definitions.........................................................................................................3
Section 1.2 Exhibits. ............................................................................................................7
ARTICLE 2 LOAN PROVISIONS 7
Section 2.1 Loan. .................................................................................................................7
Section 2.2 Interest. ..............................................................................................................8
Section 2.3 Use of Funds. ....................................................................................................8
Section 2.4 Security. ............................................................................................................8
Section 2.5 Subordination. ...................................................................................................9
Section 2.6 Disbursement Requirements – Acquisition Loan. ..........................................10
Section 2.7 Subordination to Construction Financing. ......................................................12
Section 2.8 Subordination to Permanent Financing. ..........................................................14
Section 2.9 Repayment of the City Loan. ..........................................................................14
Section 2.10 Non-Recourse. ..............................................................................................17
ARTICLE 3 PREDEVELOPMENT ACTIVITIES 18
Section 3.1 Predevelopment Activities. .............................................................................18
Section 3.2 Land Use Approvals and CEQA Review........................................................18
Section 3.3 Tax Credit and Other Financing Applications. ...............................................19
Section 3.4 Financing Plan. ...............................................................................................19
Section 3.5 Building Permit. ..............................................................................................20
ARTICLE 4 ONGOING OBLIGATIONS 20
Section 4.1 Periodic Reports. .............................................................................................20
Section 4.2 Information. ....................................................................................................20
Section 4.3 Records. ..........................................................................................................20
Section 4.4 Audits. .............................................................................................................21
Section 4.5 Compliance with Laws; Prevailing Wages. ....................................................21
Section 4.6 Relocation. ......................................................................................................22
Section 4.7 Hazardous Materials. ......................................................................................22
Section 4.8 Maintenance and Damage. ..............................................................................25
Section 4.9 Mechanics Liens, Stop Notices, and Notices of Completion. .........................25
Section 4.10 Fees and Taxes. .............................................................................................26
Section 4.11 Notices. .........................................................................................................26
Section 4.12 Non-Discrimination. .....................................................................................26
Section 4.13 Insurance Requirements. ...............................................................................27
Section 4.14 Transfer. ........................................................................................................27
Section 4.15 Other Indebtedness and Liens. ......................................................................28
Section 4.16 Use as Affordable Housing ...........................................................................28
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF BORROWER 29
TABLE OF CONTENTS
(continued)
Page
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Section 5.1 Representations and Warranties. .....................................................................29
Section 5.2 Survival of Representations and Warranties. ..................................................31
ARTICLE 6 TERMINATION, DEFAULT AND REMEDIES 31
Section 6.1 Termination of Agreement. .............................................................................31
Section 6.2 Events of Default. ...........................................................................................31
Section 6.3 Remedies. ........................................................................................................33
Section 6.4 Option to Purchase, Enter and Possess. .............................................................34
Section 6.5 Right of Contest. .............................................................................................35
Section 6.6 Remedies Cumulative. ....................................................................................35
ARTICLE 7 GENERAL PROVISIONS 35
Section 7.1 Agreement Coordination .................................................................................35
Section 7.2 Relationship of Parties. ...................................................................................36
Section 7.3 No Claims. ......................................................................................................36
Section 7.4 Amendments. ..................................................................................................36
Section 7.5 Entire Understanding of the Parties. ...............................................................36
Section 7.6 Indemnification. ..............................................................................................36
Section 7.7 Non-Liability of CITY and CITY Officials, Employees and Agents. ............37
Section 7.8 No Third Party Beneficiaries. .........................................................................37
Section 7.9 Action by the CITY; Amendments. ................................................................37
Section 7.10 Waivers. ........................................................................................................37
Section 7.11 Notices, Demands and Communications. .....................................................37
Section 7.12 Applicable Law and Venue. ..........................................................................38
Section 7.13 Parties Bound. ...............................................................................................38
Section 7.14 Attorneys' Fees. .............................................................................................39
Section 7.15 Severability. ..................................................................................................39
Section 7.16 Force Majeure. ..............................................................................................39
Section 7.17 Conflict of Interest. .......................................................................................39
Section 7.18 Time of Essence. ...........................................................................................40
Section 7.19 Title of Parts and Sections; Exhibits. ............................................................40
Section 7.20 Multiple Originals; Counterpart. ...................................................................40
Section 7.21 Recording of Memo of Agreement. ..............................................................40
Section 7.22 Further Actions. ............................................................................................40
EXHIBIT A: Legal Description of the Property
EXHIBIT B: Note
EXHIBIT C: Deed of Trust
EXHIBIT D: Estimated Project Costs and Sources of Funds
EXHIBIT E: Schedule of Performance
EXHIBIT F: Assignment of Documents
EXHIBIT G: Insurance Requirements
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FIRST AMENDED AND RESTATED
ACQUISITION AND DEVELOPMENT LOAN AGREEMENT AND OPTION TO
PURCHASE
(Maybell Orchard Apartments, 567-595 Maybell Avenue, Palo Alto, California)
This First Amended and Restated Acquisition and Development Loan Agreement and
Option to Purchase (the "Agreement"), initially executed as of November 28, 2012 (the
"Effective Date"), as fully amended and restated as of __________, 2013, by and between the
CITY OF PALO ALTO, a chartered city and a municipal corporation (the "CITY") and PALO
ALTO HOUSING CORPORATION, a California non-profit public benefit corporation, with
offices at 725 Alma Street, Palo Alto, California 94301 (the "BORROWER").
RECITALS
A. On June 22, 2012, BORROWER entered into a purchase and sale agreement with Maybell
Sambuceto Properties, LLC, a California limited liability company, and Sambuceto Partners,
a California limited partnership, to acquire the property located at 567-595 Maybell Ave.,
Palo Alto, California (the “Property”) for a purchase price of Fifteen Million Five Hundred
Eighty Thousand Dollars ($15,580,000) for the purpose of developing an affordable rental
housing project. A legal description of the Property is attached as Exhibit A.
B. BORROWER proposes to construct approximately sixty (60) residential rental units (the
"Project") on a portion of the Property, of which fifty-nine (59) units would be affordable to
low, very low, and extremely low income senior households earning between thirty percent
(30%) and sixty percent (60%) of area median income as determined by the United States
Department of Housing and Urban Development. BORROWER further desires to sell a
portion of the Property totaling approximately 1.46 acres (the "Market-Rate Parcel") to a
third party for construction of market-rate housing to reduce the acquisition and development
costs related to the Project.
C. CITY has established the Residential In-Lieu Housing Fund (the "In-Lieu Housing Fund")
for the purpose of providing loans to support the development of affordable rental housing.
The expenditure of funds for site acquisition to secure a site for possible use as low income
housing is an eligible activity under the CITY’s adopted Guidelines for use of the Residential
In-Lieu Housing Fund. CITY has further established the Stanford University Medical Center
Infrastructure, Sustainable Neighborhoods and Communities, and Affordable Housing Fund
(the "SUMC Fund") in part to support the development of affordable housing. There is a
severe shortage of rental housing affordable to senior residents with extremely low, very low,
and low incomes in Palo Alto and nearby areas.
D. The CITY made a loan to BORROWER in the amount of Three Million Two Hundred
Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) (the "Original Loan") from
the In-Lieu Housing Fund pursuant to that Acquisition and Development Loan Agreement
and Option to Purchase by and between the CITY and the BORROWER dated November 28,
2012 (the "Original Loan Agreement") and a Promissory Note executed by the BORROWER
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dated November 26, 2012 (the "Original Note"), which was secured by a Deed of Trust with
Assignment of Rents dated November 16, 2012 (the "Original Deed of Trust"). The purpose
of the Original Loan was to assist in the acquisition of the Property. While the BORROWER
was able to acquire the Property in a timely fashion, BORROWER was required to borrow
from other assets. To further assist in the acquisition of the Property for possible use as
affordable housing, BORROWER wishes to borrow an additional Two Million Six Hundred
Thousand Dollars ($2,600,000) from the SUMC Fund. BORROWER and the CITY wish to
amend and restate the Original Loan Agreement to increase the total loan from the CITY to
Five Million Eight Hundred Twenty Thousand Two Hundred Twenty Dollars ($5,820,220)
(the "City Loan").
E. The portion of the City Loan funded from the SUMC Fund ($2,600,000) must be repaid by
January 31, 2015, unless CITY grants an extension of up to one year for repayment. The
amount of the City Loan attributable to the SUMC Fund shall decrease as CITY receives
additional funds designated for the In-Lieu Housing Fund, as further described in Section 2.1
of this Agreement, Only those portions of the City Loan that remain attributable to the
SUMC Fund must be repaid by January 31, 2015 or any extension of that date.
F. Concurrently with execution of this Agreement, the BORROWER will execute a First
Amended and Restated Promissory Note (the "Note", attached as Exhibit B) evidencing the
City Loan, which will be secured by a deed of trust recorded against the Property (the “Deed
of Trust,” attached as Exhibit C). The City Loan will be further secured by an Assignment of
Documents as defined below. As a condition to disbursement of the remaining proceeds of
the City Loan, the CITY will cancel the Original Note and reconvey the Original Deed of
Trust.
G. Through this Agreement, the City has made no commitment to approve the Project nor any
particular application for Land Use Approvals (as defined below) on the Property, and site-
specific environmental review will be completed when such application is made and plans
are developed for the Project. The provision of financing for acquisition of the Property,
without commitment to any specific project, is consistent with the Land Use Element of the
Comprehensive Plan and with the CITY’s affordable housing goals as outlined in the
Housing Element of the Comprehensive Plan. A program Environmental Impact Report on
the CITY'S Comprehensive Plan was certified by the Palo Alto City Council on July 20,
1998. The approval of this Agreement is within the scope of that program EIR, and no new
environmental document is required, in that no specific plans for development of the
Property have been proposed that would create additional environmental impacts.
H. This Agreement amends and restates the Original Loan Agreement in its entirety.
BORROWER and CITY desire to enter into this Agreement to establish certain terms and
conditions relating to the City Loan.
NOW, THEREFORE, in consideration of the mutual covenants and agreements specified herein,
and subject to its terms and provisions, the parties to this Agreement hereby agree as follows.
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AGREEMENT
The foregoing recitals are hereby incorporated by reference and made part of this Agreement.
This Agreement is entered into to assist the BORROWER in the acquisition of the Property and
the development of the Project, which consists of multifamily rental housing reserved for
occupancy by extremely low, very low, and low income households. This Agreement sets forth
the respective duties and responsibilities of CITY and BORROWER regarding the acquisition of
the Property and financing for the development of the Project, establishes a schedule of
performance by BORROWER, and provides for a termination of this Agreement under certain
conditions.
ARTICLE 1
DEFINITIONS AND EXHIBITS
Section 1.1 Definitions.
The following capitalized terms have the meanings set forth in this Section 1.1 wherever used in
this Agreement, unless otherwise provided:
(a) "Agreement" is defined in the first paragraph of this Agreement.
(b) “Annual Operating Expenses” is defined in Section 2.9 below.
(c) "Approved Acquisition Financing" shall mean all of the following loans:
(1) Loan from the Local Initiatives Support Corporation (“LISC”), a
New York not-for-profit corporation with its principal offices located at 501 Seventh
Avenue, 7th Floor, New York, New York 10018, in the approximate amount of Four
Million Dollars ($4,000,000) (including an interest reserve not to exceed Five Hundred
Thousand Dollars ($500,000)), secured by a shared, first priority deed of trust on the
Property (the "LISC Loan");
(2) Loan from the Low Income Investment Fund (“LIIF”), a California
nonprofit public benefit corporation with offices located at 100 Pine Street, Suite 1800,
San Francisco, California 94111, in the approximate amount of Four Million Dollars
($4,000,000) (including an interest reserve not to exceed Five Hundred Thousand Dollars
($500,000)), secured by a shared, first priority deed of trust on the Property (the "LIIF
Loan");
(3) Loan from the County of Santa Clara in the approximate amount of
Two Million Seven Hundred Fifty Nine Thousand Seven Hundred Eighty Dollars
($2,759,780) (the "County Loan").
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(d) "Approved Construction Financing" shall mean the City Loan, the County Loan, and
the following additional financing:
(1) Tax Credit Investor Proceeds in the approximate amount of One
Million One Hundred Thirty Two Thousand Dollars ($1,132,000); and
(2) Construction Loan in the approximate amount of Ten Million One
Hundred Sixty One Thousand Dollars ($10,161,000), on terms reasonably approved by
the CITY.
(e) "Approved Financing" means the Approved Acquisition Financing, the Approved
Construction Financing, and/or the Approved Permanent Financing.
(f) "Approved Permanent Financing" shall mean the City Loan, the County Loan,
and the following additional financing:
(1) Tax Credit Investor Proceeds in the approximate amount of Eleven
Million Three Hundred Eighteen Thousand Dollars ($11,318,000); and
(2) Conventional Mortgage in the approximate amount of One Million
Two Hundred Twenty Eight Thousand Dollars ($1,228,000), on terms reasonable
approved by the CITY.
(g) “Assignment of Documents” is defined in Section 2.4. The form of the
Assignment of Documents is attached hereto as Exhibit F.
(h) "BORROWER" is defined in the first paragraph of this Agreement.
(i) "CEQA" means the California Environmental Quality Act, Public Resources
Code Section 21000 et seq.
(j) "CITY" is defined in the first paragraph of this Agreement.
(k) "City Council" means the City Council of the CITY.
(l) "City Loan" is defined in paragraph D of the Recitals. The City Loan is more
particularly described in Section 2.1 below.
(m) "City Manager" means the City Manager of the CITY or the City Manager's
designee.
(n) "Construction Bond" is defined in Section 2.7 below.
(o) "Construction Closing" means the date upon which all financing necessary for the
construction of the Project on the Property closes, and any deeds of trust related to such
financing are recorded against the Property.
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(p) "Construction Contract" is defined in Section 2.7 below.
(q) "Deed of Trust" is defined in Recital F. The form of the Deed of Trust is attached
hereto as Exhibit C.
(r) "Default" has the meaning set forth in Section 6.2 below.
(s) "Default Rate" has the meaning set forth in Section 2.2 below.
(t) "DIR" is the California Department of Industrial Relations.
(u) "Effective Date" is defined in the first paragraph of this Agreement.
(v) "Financing Plan" has the meaning set forth in Section 3.4 below.
(w) "Force Majeure" is defined in Section 7.16 below.
(x) "General Contractor" is defined in Section 2.7 below.
(y) "Gross Revenue" is defined in Section 2.9 below.
(z) "Hazardous Materials" has the meaning set forth in Section 4.7 below.
(aa) "Hazardous Materials Claim" has the meaning set forth in Section 4.7 below.
(bb) "Hazardous Materials Law" has the meaning set forth in Section 4.7 below.
(cc) "In-Lieu Housing Fund" is defined in Recital C.
(dd) "Land Use Approvals" is defined in Section 3.2 below.
(ee) "Loan Documents" means this Agreement, the Note, the Deed of Trust, the
Assignment of Documents, the Memo of Agreement, the Regulatory Agreement, and any other
document or agreement evidencing the City Loan.
(ff) "Market-Rate Parcel" is defined in Recital B.
(gg) "Memo of Agreement" means the Memorandum of Acquisition and Development
Loan Agreement and Option to Purchase to be recorded against the Property upon acquisition by
BORROWER.
(hh) "Note" is defined in Recital F. The form of the Note is attached hereto as
Exhibit B.
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(ii) "Notice of Exercise" has the meaning set forth in Section 6.4 below.
(jj) "Option to Purchase" is defined in Sections 2.4 and 6.4 below.
(kk) "Original Deed of Trust" is defined in Recital D.
(ll) "Original Loan" is defined in Recital D.
(mm) "Original Loan Agreement" is defined in Recital D.
(nn) "Original Note" is defined in Recital D.
(oo) "Permanent Closing" means the date upon which all financing necessary for the
operation of the Project on the Property closes, and any deeds of trust related to such financing
are recorded against the Property.
(pp) "Predevelopment Activities" means the activities to be performed by
BORROWER during the Term, as further described in Article 3 below.
(qq) "Project" is defined in Recital B.
(rr) "Project Budget" is the pro forma acquisition and construction budget for the
Project, including sources and uses of funds, as approved by the CITY, and attached as Exhibit
D.
(ss) "Project Documents" are defined in Section 2.4(b) below.
(tt) "Property" is defined in Recital A, and is more particularly described in the
attached Exhibit A.
(uu) "Regulatory Agreement" means covenants entered into between the CITY and the
BORROWER, to be recorded prior to Construction Closing, which requires that the Project, if
approved by the CITY, be maintained and operated as housing affordable to extremely low, very
low, and low-income households.
(vv) "Residual Receipts" are defined in Section 2.9 below.
(ww) "Schedule of Performance" is defined in Section 3.1 below, and is more
particularly described in Exhibit E.
(xx) "Senior Lenders" are defined in Section 2.5 below.
(yy) "Senior Loan" is defined in Section 2.5 below.
(zz) "SUMC Fund" is defined in Recital C.
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(aaa) "TCAC" means the California Tax Credit Allocation Committee.
(bbb) "Term" is defined in Section 2.9 below.
(ccc) "Termination Notice" is defined in Section 6.1 below.
(ddd) "Third Party Buyer" is defined in Section 4.14 below.
(eee) "Transfer" has the meaning set forth in Section 4.14 below.
Section 1.2 Exhibits.
The following exhibits are attached to this Agreement and incorporated into this
Agreement by this reference:
EXHIBIT A: Legal Description of the Property
EXHIBIT B: Note
EXHIBIT C: Deed of Trust
EXHIBIT D: Estimated Project Costs and Sources of Funds
EXHIBIT E: Schedule of Performance
EXHIBIT F: Assignment of Documents
EXHIBIT G: Insurance Requirements
ARTICLE 2
LOAN PROVISIONS
Section 2.1 Loan.
(a) Subject to satisfaction of the conditions set forth in Section 2.6, the CITY shall
loan to the BORROWER the City Loan in the total principal amount of Five Million Eight
Hundred Twenty Thousand Two Hundred Twenty Dollars ($5,820,220) for the purposes set forth
in Section 2.3 of this Agreement. The obligation to repay the City Loan shall be evidenced by the
Note in the form attached hereto as Exhibit B.
(b) CITY is funding the principal amount of the City Loan from two sources, not to
exceed a total of Five Million Eight Hundred Twenty Thousand Two Hundred Twenty Dollars
(($5,820,220). As of the date of execution of this Agreement, Three Million Two Hundred
Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) has been disbursed to
BORROWER from the In-Lieu Housing Fund to assist in the purchase of the Property. The
remaining Two Million Six Hundred Thousand Dollars ($2,600,000) shall be funded from the
SUMC Fund.
(c) As CITY receives additional funds designated for the In Lieu Housing Fund,
CITY will increase the outstanding principal balance of the City Loan attributable to the In Lieu
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Housing Fund and will decrease the outstanding principal balance of the City Loan attributable
to the SUMC Fund by the same amount, until the entire outstanding principal balance of the City
Loan that is attributable to the SUMC Fund is zero, or until the date that the unpaid principal
balance attributable to the SUMC Fund must be paid in full pursuant to Section 2.9(b),
whichever comes first. CITY shall document changes to the balances attributable to each fund
and, upon request, shall provide BORROWER with statements detailing such balances. As an
example, if CITY receives $200,000 for the In-Lieu Housing Fund, the outstanding principal
balance of the City Loan attributable to the In-Lieu Housing Fund shall be increased by $200,000
(to $3,420,000) and the outstanding principal balance attributable to the SUMC Fund shall be
decreased by $200,000 (to $2,400,000).)
Section 2.2 Interest.
(a) Subject to the provisions of Section 2.2(b) below, the outstanding principal
balance of the City Loan will bear simple interest at the rate of three percent (3%) per annum
commencing with the date of the Permanent Closing.
(b) In the event of a Default, interest on the City Loan will begin to accrue, as of the
date of Default and continue until such time as the City Loan funds are repaid in full or the
Default is cured, at the default rate of the lesser of eight percent (8%) per annum, compounded
annually (the "Default Rate") and the highest rate permitted by law.
Section 2.3 Use of Funds.
BORROWER shall use the City Loan to fund the acquisition and development of the
Property. BORROWER shall not use the City Loan for any other purpose without the prior
written consent of the CITY.
Section 2.4 Security.
(a) Deed of Trust. The BORROWER shall secure its obligation to repay the City
Loan, as evidenced by the Note, by executing the Deed of Trust, and recording it as a lien against
the Property senior in lien priority to all other deeds of trust recorded against the Property except
the LISC Loan and the LIIF Loan. The BORROWER shall also cause or permit the Memo of
Agreement to be recorded against the Property.
(b) Assignment of Documents. As further consideration and security for the City
Loan, the BORROWER hereby assigns to the CITY its rights and obligations with respect to
certain agreements, plans, specifications, other documents, and approvals (the "Project
Documents"), pursuant to an Assignment of Agreements, Plans and Specifications, and
Approvals (the "Assignment of Documents"), substantially in the form set forth in the attached
Exhibit F. The assignments set forth in the Assignment of Documents shall become effective
immediately upon the occurrence of a Default (as defined below in Section 6.2) or upon
termination as described in Section 6.1. The CITY shall not have any obligation under any
contracts or agreements assigned pursuant to the Assignment of Documents until the CITY
expressly agrees in writing to be bound by such contracts or agreements. Upon Default or
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termination, the CITY may use any of the foregoing assigned documents pursuant to the
Assignment of Documents for any purpose for which the BORROWER could have used them
for development of the Project, and the BORROWER shall cooperate with the CITY to
implement the Assignment of Documents and shall immediately deposit with the CITY for the
CITY'S use all Project Documents that are the subject of the Assignment of Documents.
(c) Option to Purchase. As further consideration and security for the City Loan,
BORROWER hereby grants and gives to the CITY a right to purchase all of BORROWER's
right, title and interest in and to the Property upon Default on the terms set forth in Section 6.4
(the "Option to Purchase").
Section 2.5 Subordination.
The Deed of Trust, Regulatory Agreement, and/or Memo of Agreement may (which
includes the City’s Option to Purchase), shall be subordinated to other loans approved by the
CITY (in each case, a "Senior Loan"), but only on condition that all of the following conditions
are satisfied. The LISC Loan and the LIIF Loan are considered a Senior Loan.
(a) Subordination to Construction Financing. The CITY shall subordinate the Deed of
Trust, Regulatory Agreement, and/or Memo of Agreement to Senior Loans proposed for
Construction Closing if all of the conditions contained in Section 2.7 and in subsection (c) of this
Section have been complied with.
(b) Subordination to Permanent Financing. The City shall subordinate the Deed of
Trust, Regulatory Agreement, and/or Memo of Agreement to Senior Loans proposed for
Permanent Closing if all of the conditions contained in Section 2.8 and in subsection (c) of this
Section have been complied with.
(c) Conditions Applicable to All Subordination Agreements. In addition to
compliance with the requirements of subsection (a) or (b) above, all of the following conditions
must be satisfied in all agreements subordinating the CITY's Loan Documents:
(1) All of the proceeds of the proposed Senior Loan, less any
transaction costs, must be used to provide acquisition, construction, rehabilitation, and/or
permanent financing for the Project;
(2) The proposed lender (each, a "Senior Lender") must be a state or
federally chartered financial institution, a nonprofit corporation or a public entity that is
not affiliated with BORROWER or any of the BORROWER'S affiliates, other than as a
depositor or a lender;
(3) BORROWER must demonstrate to the CITY'S reasonable
satisfaction that subordination of the Deed of Trust, Regulatory Agreement, and/or Memo
of Agreement is necessary to secure adequate acquisition, construction, rehabilitation
and/or permanent financing to ensure the operation of the Project, if approved, as
affordable housing, as required by the Loan Documents. To satisfy this requirement,
BORROWER must provide to the CITY, in addition to any other information reasonably
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required by the CITY, evidence demonstrating that the proposed amount of the Senior
Loan is necessary to provide adequate acquisition, construction, rehabilitation and/or
permanent financing to ensure the viability of the Project, and that adequate financing for
the Project would not be available without the proposed subordination;
(4) The subordination agreement(s) must be structured to minimize the
risk that the Deed of Trust, Regulatory Agreement, and/or Memo of Agreement would be
extinguished as a result of a foreclosure by the Senior Lender or other holder of the
Senior Loan. To satisfy this requirement, the subordination agreement must provide the
CITY with adequate rights to cure any defaults by BORROWER, including: (i) providing
the CITY or its successor with copies of any notices of default at the same time and in the
same manner as provided to BORROWER; and (ii) providing the CITY with a cure
period of at least forty-five (45) days to cure any default;
(5) No subordination may limit the effect of the Deed of Trust,
Regulatory Agreement, and/or Memo of Agreement before a foreclosure, nor require
consent of the holder of the Senior Loan to exercise of any remedies by the CITY under
the Loan Documents, except for limited standstill periods of up to ninety (90) days as
required by the subordination agreements related to the LISC Loan and the LIIF Loan;
(6) The subordination(s) described in this Section 2.5 may be effective
only during the original term of the Senior Loan and any extension of its term or
refinancing approved in writing by the CITY, except as otherwise provided in the
subordination agreements related to the LISC Loan and the LIIF Loan.
Upon a determination by the City Attorney that the conditions in this Section have been
satisfied, the City Manager or his/her designee will be authorized to execute the approved
subordination agreement without the necessity of any further action or approval.
Section 2.6 Disbursement Requirements – Acquisition Loan.
(a) The CITY has previously disbursed Three Million Two Hundred Twenty
Thousand Two Hundred Twenty Dollars ($3,220,220) to BORROWER subject to the following
conditions precedent:
(1) There exists no Default nor any act, failure, omission or condition
that would constitute an event of Default under this Agreement, or under any other
agreement between the CITY and the BORROWER;
(2) BORROWER will close escrow and complete the acquisition of
the Property on or before May 31, 2013. The City Manager may extend the date for close
of escrow pursuant to Section 2.9(a);
(3) BORROWER has delivered to the CITY copies of all of
BORROWER's organizational documents, a certificate of status for the BORROWER
dated within thirty (30) days of the Effective Date, and a copy of a corporate authorizing
resolution authorizing BORROWER's execution of the Loan Documents;
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(4) BORROWER has furnished the CITY with evidence of the
insurance coverage meeting the requirements of Exhibit G
(5) BORROWER has executed and delivered to the CITY the Loan
Documents and any other instruments and policies required under the Loan Documents,
except the Regulatory Agreement;
(6) The Memo of Agreement and Deed of Trust have been, or will be
concurrently with the acquisition of the Property, recorded against the Property in the
Office of the Recorder of the County of Santa Clara in a lien position acceptable to the
CITY;
(7) The BORROWER and all Contractors, as defined in the
Assignment of Documents, have executed and delivered to the CITY the Assignment of
Documents in the form attached as Exhibit F;
(8) BORROWER has executed and delivered to the CITY all other
documents, instruments, and policies required under the Loan Documents;
(9) A title insurer reasonably acceptable to the CITY is
unconditionally and irrevocably committed to issuing an ALTA Lender's Policy of
insurance insuring the priority of the Memo of Agreement and Deed of Trust in the
amount of the City Loan, subject only to such exceptions and exclusions as may be
reasonably acceptable to the CITY, and containing such endorsements as the CITY may
reasonably require; and
(10) The CITY has received a written draw request with complete
documentation of acquisition expenses from the BORROWER, including all closing
costs, demonstrating that the undisbursed proceeds of the City Loan, together with other
funds or firm commitments for funds that BORROWER has obtained in connection with
the Property, are not less than the amount that the CITY determines is necessary to pay
for acquisition of the Property. If CITY determines that the entire City Loan is not
required to pay reasonable and necessary acquisition costs for the Property, CITY may
disburse to BORROWER only those funds required to acquire the Property.
(b) The CITY is not obligated to make any disbursement of the remaining Two
Million Six Hundred Thousand Dollars ($2,600,000) for the acquisition of the Property or take
any other action under the Loan Documents unless all of the following conditions precedent are
satisfied:
(1) There exists no Default nor any act, failure, omission or condition
that would constitute an event of Default under this Agreement, or under any other
agreement between the CITY and the BORROWER;
(2) BORROWER has delivered to the CITY copies of all of
BORROWER's organizational documents, a certificate of status for the BORROWER
dated within thirty (30) days of the Effective Date, and a copy of a corporate authorizing
resolution authorizing BORROWER's execution of the Loan Documents;
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(3) BORROWER has furnished the CITY with evidence of the
insurance coverage meeting the requirements of Exhibit G
(4) BORROWER has executed and delivered to the CITY the Loan
Documents and any other instruments and policies required under the Loan Documents,
except the Regulatory Agreement;
(5) The Memo of Agreement and Deed of Trust have been, or will be
concurrently with the acquisition of the Property, recorded against the Property in the
Office of the Recorder of the County of Santa Clara in a lien position acceptable to the
CITY, and CITY has received executed subordination agreements as required to ensure
that the Deed of Trust remains in the same lien position as the Original Deed of Trust;
(6) The BORROWER and all Contractors, as defined in the
Assignment of Documents, have executed and delivered to the CITY the Assignment of
Documents in the form attached as Exhibit F;
(7) BORROWER has executed and delivered to the CITY all other
documents, instruments, and policies required under the Loan Documents;
(8) A title insurer reasonably acceptable to the CITY is
unconditionally and irrevocably committed to issuing an ALTA Lender's Policy of
insurance insuring the priority of the Memo of Agreement and Deed of Trust in the
amount of the City Loan, subject only to such exceptions and exclusions as may be
reasonably acceptable to the CITY, and containing such endorsements as the CITY may
reasonably require; and
(9) The CITY has received a written draw request with complete
documentation of acquisition expenses from the BORROWER, including all closing
costs, demonstrating that the undisbursed proceeds of the City Loan, together with other
funds or firm commitments for funds that BORROWER has obtained in connection with
the Property, are not less than the amount that the CITY determines is necessary to pay
for acquisition of the Property. If CITY determines that the entire City Loan is not
required to pay reasonable and necessary acquisition costs for the Property, CITY may
disburse to BORROWER only those funds required to acquire the Property.
(c) Following reconveyance of the LISC Loan and the LIIF Loan, if the entire City
Loan was not required to pay reasonable and necessary acquisition costs for the Property,
BORROWER may submit a written draw request to CITY to disburse the remaining portion of
the City Loan for reasonable predevelopment expenses, such as architectural and engineering
fees, upon presentation of signed contracts for such services. The City Manager may authorize
disbursement of any remaining City Loan funds upon BORROWER's compliance with this
subsection (c) and subsections (b)(1) – (3).
Section 2.7 Subordination to Construction Financing.
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The City shall not subordinate the Deed of Trust or Memo of Agreement to Senior Loans
proposed for Construction Closing unless all of the conditions contained in Section 2.5 and in
this Section have been complied with.
(a) BORROWER has executed and delivered to the CITY the Regulatory Agreement,
and the Regulatory Agreement has been, or will be concurrently with the Construction Closing,
recorded against the Property in the Office of the Recorder of the County of Santa Clara in a lien
position acceptable to the CITY.
(b) BORROWER has submitted to the CITY, and CITY has approved, the Financing
Plan as described in Section 3.4, demonstrating that the BORROWER holds sufficient funds
and/or binding commitments for sufficient funds to complete the construction of the Project in
accordance with the plans and specifications for the Project and to subsequently operate and
maintain the Project. The development budget may provide for a developer's fee or a similar fee
or fees based on submittal of the Final Budget to the City. City must approve the Final Budget.
(c) BORROWER has submitted to the CITY a fully executed copy of a legally
binding contract for construction of the Project (the "Construction Contract") which obligates a
reputable and financially responsible general contractor (the “General Contractor”), licensed in
California and experienced in completing the type of Project contemplated by this Agreement, to
commence and complete the construction of the Project, with a guaranteed maximum fixed price
consistent with the Final Construction and Permanent Financing Plan. The Construction Contract
shall provide for construction of the Project at a guaranteed maximum fixed price, subject to
such reasonable adjustments as are customarily allowed with respect to construction contracts.
The Construction Contract shall provide for retention of at least ten (10) percent from each
progress payment until the final payment, and the final payment shall not be paid to the General
Contractor until the occurrence of (1), (2) or (3), below:
(1) The expiration of thirty (30) days if a Unconditional Waiver and
Release has been issued by the General Contractor or the expiration of sixty-five (65)
days from the date of recording by BORROWER, as owner, of a Notice of Completion
for the Project, which BORROWER agrees to record promptly within the times specified
by law for the recording of such Notice; and the settlement and discharge of all liens and
charges claimed by persons who supplied either labor or materials for the construction of
such Project; or
(2) The posting of a bond, acceptable to the CITY in form and amount,
insuring the Property and any interest therein against loss arising from any mechanics’,
laborers’, materialmens’ or other like liens filed against the Property; or
(3) BORROWER shall have provided such other assurances as may
be acceptable to the CITY protecting the Property and any interest therein against loss
arising from any mechanics’, laborers’, materialmens’ or other like liens filed against the
Property.
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(d) The Construction Contract shall require the General Contractor to warrant all
work and materials for at least one year after issuance of a certificate of occupancy for the
Project.
(e) The CITY shall have received satisfactory evidence that the insurance required by
Exhibit G of this Agreement is in effect.
(f) The CITY shall have received a Performance Bond and a Labor and Material
Payment Bond (in the form of AIA form A311 or A312) (the "Construction Bond"), issued by a
surety acceptable to the CITY in the CITY's reasonable discretion, securing the faithful
performance by the General Contractor of the completion of the construction of the Project free
of all liens and claims, within the time provided in the updated Schedule of Performance. The
Construction Bond shall be in an amount equal to one hundred percent (100%) of the
Construction Contract, shall name the CITY as a co-obligee, and shall be issued by a company
acceptable to the CITY and listed in the current United States Treasury Department circular 570
and otherwise within the underwriting limits specified for that company in such circular.
Section 2.8 Subordination to Permanent Financing.
The City shall not subordinate the Deed of Trust, Regulatory Agreement, and/or Memo
of Agreement to Senior Loans proposed for Permanent Closing unless all of the conditions
contained in Section 2.5 and in this Section have been complied with.
(a) Construction of the Project has been completed, as evidenced by a certificate of
occupancy or equivalent certification provided by the CITY and an architect's or engineer's
certificate of completion.
(b) A notice of completion has been timely recorded.
(c) Either the lien period has expired and there are no unreleased mechanics' liens or
stop notices; or lien releases have been recorded for all contractors, subcontractors and suppliers
who provided labor or materials for the Project.
Section 2.9 Repayment of the City Loan.
(a) Term. The "Term" of this Agreement commences as of the Effective Date, and
expires, unless sooner terminated in accordance with this Agreement, on the date that is fifty-five
(55) years after the date of the Permanent Closing.
(b) Due in Full. BORROWER shall pay to CITY any unpaid principal balance of the
City Loan that is attributable to the SUMC Fund (as may be modified pursuant to Section 2.1),
together with any accrued interest thereon, no later than January 31, 2015, except that CITY, at
its sole discretion, may extend the date for repayment for up to one year (to January 31, 2016).
BORROWER shall pay all other outstanding principal and accrued interest on the City Loan, in
full, on the earliest to occur of (i) any Transfer not authorized by the CITY, (ii) a Default, (iii) on
January 31, 2015 or any extension of that date if the Agreement is terminated pursuant to Section
6.1, and (iv) the expiration of the Term. The CITY and the BORROWER shall have the right,
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but not the obligation, to extend the period for repayment of the City Loan or to modify the terms
of the City Loan, including the option to forgive the portion of the City Loan attributable to the
In-Lieu Housing Fund, if desirable to serve the purposes of this Agreement.
(c) Annual Payments. No later than April 30th of each calendar year after Permanent
Closing, the BORROWER shall make repayments of any remaining unpaid principal balance of
the City Loan for that prior calendar year based on the available amount of Residual Receipts (as
defined below in subsection (c)(3)). The CITY shall, in its reasonable discretion, share Residual
Receipts proportionately with other lenders in proportion to their respective loan amounts to the
Project. These payments shall be credited first against accrued interest and then against
outstanding principal of the City Loan, and shall be accompanied by the BORROWER's report
of Residual Receipts (including an independent auditor's report regarding the auditor's review of
Gross Revenue and Annual Operating Expenses). The BORROWER shall provide the CITY
with any documentation reasonably requested by the CITY to substantiate the BORROWER's
determination of Residual Receipts. The following definitions shall apply for the purposes of this
subsection (c):
(1) "Annual Operating Expenses," with respect to a particular calendar
year during the Term, means the following costs reasonably and actually incurred for
operation and maintenance of the Project to the extent that they are consistent with an
annual independent audit performed by a certified public accountant using generally
accepted accounting principles: property taxes and assessments imposed on the Project;
debt service currently due on a non-optional basis (excluding debt service due from
residual receipts or surplus cash of the Project) on permanent loans that are Senior Loans
or part of the Approved Financing; property management fees and reimbursements,
excluding incentive management fees, not to exceed fees and reimbursements which are
standard in the industry; premiums for property damage and liability insurance; utility
services not paid for directly by tenants, including water, sewer, and trash collection;
maintenance and repair; any annual license or certificate of occupancy fees required for
operation of the Project; security services; advertising and marketing; cash deposited into
reserves for capital replacements of the Project in the amount required by Senior Lenders,
or if there are no Senior Lender requirements, an amount consistent with California Tax
Credit Allocation Committee standards; cash deposited into an operating reserve for the
Project in an amount required by Senior Lenders or the investor's limited partner, or if
there are no Senior Lender or limited partner requirements, an amount consistent with
California Tax Credit Allocation Committee standards; extraordinary operating costs
specifically approved by the CITY; payments of deductibles in connection with casualty
insurance claims not normally paid from reserves, the amount of uninsured losses
actually replaced, repaired or restored, and not normally paid from reserves; deferred
BORROWER fees; and other ordinary and reasonable operating expenses approved by
the CITY and not listed above. Annual Operating Expenses shall not include the
following: depreciation, amortization, depletion or other non-cash expenses or any
amount expended from a reserve account.
(2) "Gross Revenue," with respect to a particular calendar year during
the Term, means all revenue, income, receipts, and other consideration actually received
from operation and leasing of the Project. "Gross Revenue" shall include, but not be
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limited to: all rents, fees and charges paid by tenants, Section 8 payments or other rental
subsidy payments received for the dwelling units, deposits forfeited by tenants, all
cancellation fees, price index adjustments and any other rental adjustments to leases or
rental agreements resulting in actual income; proceeds from vending and laundry room
machines; the proceeds of business interruption or similar insurance; subject to the rights
of Senior Lenders, the proceeds of casualty insurance to the extent not utilized to repair
or rebuild the Project (or applied toward the cost of recovering such proceeds) and not
payable to the Senior Lenders; and condemnation awards for a taking of part or all of the
Project for a temporary period. "Gross Revenue" shall also include the fair market value
of any goods or services provided in consideration for the leasing or other use of any
portion of the Project. "Gross Revenue" shall not include tenants' security deposits, loan
proceeds, capital contributions or similar advances.
(3) "Residual Receipts," with respect to a particular calendar year
during the Term, means the amount by which Gross Revenue (as defined above) exceeds
Annual Operating Expenses (as defined above).
(d) Records Regarding Residual Receipts. In connection with the annual payments
required by Section 2.9(c), within one hundred fifty (150) days of the end of the BORROWER's
fiscal year, the BORROWER shall furnish to the CITY an audited statement duly certified by an
independent firm of certified public accountants approved by the CITY, setting forth in
reasonable detail the computation and amount of Residual Receipts during the preceding
calendar year.
(1) The BORROWER shall keep and maintain on the Property, or at
its principal place of business, or elsewhere with the CITY's written consent, full,
complete and appropriate books, records and accounts relating to the Project, including
all such books, records and accounts necessary or prudent to evidence and substantiate in
full detail the BORROWER's calculation of Residual Receipts. Books, records and
accounts relating to the BORROWER's compliance with the terms, provisions, covenants
and conditions of this Agreement shall be kept and maintained in accordance with
generally accepted accounting principles consistently applied, and shall be consistent
with requirements of this Agreement which provide for the calculation of Residual
Receipts on a cash basis. All such books, records, and accounts shall be open to and
available for inspection by the CITY, its auditors or other CITY authorized
representatives at reasonable intervals during normal business hours. Copies of all tax
returns and other reports that the BORROWER may be required to furnish any
governmental agency shall at all reasonable times be open for inspection by the CITY at
the place that the books, records and accounts of the BORROWER are kept. The
BORROWER shall preserve records on which any statement of Residual Receipts is
based for a period of not less than five (5) years after such statement is rendered, and for
any period during which there is an audit undertaken pursuant to subparagraph (d)(2)
below then pending.
(2) The receipt by the CITY of any statement pursuant to this
subsection (d) or any payment by the BORROWER or acceptance by the CITY of any
City Loan repayment for any period shall not bind the CITY as to the correctness of such
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statement or such payment. Within three (3) years after the receipt of any such statement,
the CITY or any designated agent or employee of the CITY at any time shall be entitled
to audit the Residual Receipts and all books, records, and accounts pertaining thereto.
Such audit shall be conducted during normal business hours at the principal place of
business of the BORROWER and other places where records are kept. Immediately after
the completion of an audit, the CITY shall deliver a copy of the results of such audit to
the BORROWER. If it shall be determined as a result of such audit that there has been a
deficiency in a City Loan repayment to the CITY, then such deficiency shall become
immediately due and payable with interest at the non-default rate set forth in the Note
(unless BORROWER's failure, refusal, or repeated failure to correctly calculate and/or
submit the repayment constitutes an event of default, in which case interest shall be paid
at the Default Rate), determined as of and accruing from the date that said payment
should have been made.
(e) Right to Prepay. BORROWER may prepay the City Loan at any time without
premium or penalty. All prepayments shall be credited first applied to accrued interest and then
to outstanding principal. The Deed of Trust shall remain in effect for the entire Term to secure
the Regulatory Agreement, when recorded.
Section 2.10 Non-Recourse.
Except as provided below, neither BORROWER, nor any partner of BORROWER, has
any personal liability for payment of the principal of, and interest on, the City Loan. Following
recordation of the Deed of Trust, the sole recourse of the CITY with respect to the principal of,
or interest on, the Note will be to the property described in the Deed of Trust; provided, however,
that nothing contained in the foregoing limitation of liability limits or impairs the enforcement of
all the rights and remedies of the CITY against all such security for the Note, or impairs the right
of CITY to assert the unpaid principal amount of the Note as demand for money within the
meaning and intendment of Section 431.70 of the California Code of Civil Procedure or any
successor provision thereto. The foregoing limitation of liability is intended to apply only to the
obligation to repay the principal and interest on the Note. Except as hereafter set forth; nothing
contained herein is intended to relieve BORROWER of its obligation to indemnify the CITY
under Sections 4.5, 4.6, 4.7, and 7.6 of this Agreement, or liability for (i) loss or damage of any
kind resulting from waste, fraud or willful misrepresentation; (ii) the failure to pay taxes,
assessments or other charges which may create liens on the Property that are payable or
applicable prior to any foreclosure under the Deed of Trust (to the full extent of such taxes,
assessments or other charges); (iii) the fair market value of any personal property or fixtures
removed or disposed of by BORROWER other than in accordance with the Deed of Trust; and
(iv) the misappropriation of any proceeds under any insurance policies or awards resulting from
condemnation or the exercise of the power of eminent domain or by reason of damage, loss or
destruction to any portion of the Property.
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ARTICLE 3
PREDEVELOPMENT ACTIVITIES
Section 3.1 Predevelopment Activities.
(a) This Article 3 sets forth various Predevelopment Activities that BORROWER
shall seek diligently and in good faith to perform and achieve.
(b) Exhibit E (the "Schedule of Performance") describes the tasks that must be
completed and the dates proposed by BORROWER for their completion. The Schedule of
Performance may be modified in writing by BORROWER and by the City Manager on behalf of
the CITY without formal amendment of this Agreement. However, if the Construction Closing
has not occurred by January 31, 2015, subject to Force Majeure, the CITY may terminate this
Agreement pursuant to Section 6.1 below as applicable, and exercise its remedies pursuant to this
Agreement.
(c) Sections 3.3, 3.4, and 3.5 apply only if CITY grants the Land Use Approvals for
the Project as described in Section 3.2.
Section 3.2 Land Use Approvals and CEQA Review.
(a) Within the time set forth in the Schedule of Performance, BORROWER shall
submit to the CITY a complete application for all discretionary land use entitlements required
from the CITY to construct the Project and to create the Market-Rate Parcel (the "Land Use
Approvals").
(b) BORROWER shall exercise diligent good faith efforts to seek CITY approval of all
Land Use Approvals within the time set forth in the Schedule of Performance, in accordance
with all applicable legal requirements and procedures.
(c) As part of its review of the Land Use Approvals, the CITY shall complete the
environmental documents required for the Land Use Approvals. Nothing in this Agreement shall
be construed to compel the CITY to approve or make any particular findings with respect to such
environmental documents. The BORROWER shall reasonably assist the CITY in its
determination by providing information about the Project as requested.
(d) Nothing in this Agreement shall obligate the CITY to exercise its discretion
regarding the Project in any particular manner. BORROWER acknowledges that execution of
this Agreement by the CITY does not constitute approval by the CITY of any Land Use
Approvals or any required permits, applications, or maps, and in no way limits the discretion of
the CITY in the permit and approval process. BORROWER acknowledges that approval or
disapproval of the Land Use Approvals following completion of the environmental review
process is within the sole discretion of the CITY without limitation by or consideration of the
terms of this Agreement; and that the CITY makes no representation regarding the ability or
willingness of the CITY to approve the Land Use Approvals, including the creation of the
Market-Rate Parcel, nor any representation regarding the imposition of any mitigation measures
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or other conditions of approval. The parties recognize that the CITY has the sole discretion and
right to terminate this Agreement without fault or Default if CITY determines not to approve the
Land Use Approvals for the Project. In addition, the BORROWER acknowledges that other
local, state or federal agencies may require additional entitlements, including environmental
review, and that any approval by the CITY does not bind any other local, state or federal agency.
(e) If the CITY approves the Project following completion of the environmental
review process and such approval is conditioned upon implementation of specified
environmental mitigation measures or other conditions of approval, the BORROWER shall be
responsible for implementing such mitigation measures and conditions as part of the Project.
Section 3.3 Tax Credit and Other Financing Applications.
(a) BORROWER shall submit a timely and complete application to TCAC for a
preliminary reservation of nine percent (9%) tax credits within the time set forth in the Schedule
of Performance.
(b) If BORROWER is not successful in obtaining a reservation of tax credits from
TCAC in its first application, BORROWER shall submit a second application.
(c) BORROWER further agrees to seek construction and permanent funding for the
Project from all available and appropriate sources to ensure that the Project will be financially
feasible and will provide affordable rental housing for extremely low, very low, and low-income
households.
Section 3.4 Financing Plan.
(a) The preliminary Project Budget is shown in Exhibit D. Within the time set forth
in the Schedule of Performance BORROWER shall submit for CITY approval a Final
Construction and Permanent Financing Plan (the "Financing Plan") containing the following:
(1) An updated development budget showing a "sources and uses"
breakdown of the costs of constructing the Project.
(2) An operating pro forma for the first thirty (30) years of operation
of the Project.
(3) Copies of all required funding commitments for construction and
permanent financing for the Project; or proposed funding, as applicable.
(4) Any other information that is reasonably necessary for the CITY to
determine that BORROWER has the financial capability to pay all costs of constructing
and operating the Project.
(b) The CITY shall review the Financing Plan to determine if, in the CITY's
reasonable judgment, BORROWER has the financial capability (taking into account all
committed funds) to pay all realistically established costs of constructing and operating the
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Project. The CITY shall review the Financing Plan and shall either approve or disapprove the
Financing Plan in writing within thirty (30) days of receipt. If disapproved, the CITY shall give
specific reasons in writing for disapproval and the required revisions to the previously submitted
Financing Plan. If the Financing Plan is disapproved, BORROWER shall resubmit, a revised
Financing Plan within thirty (30) days of notification of disapproval. The CITY shall either
approve or disapprove the submitted revised Financing Plan within thirty (30) days of the date
such revised Financing Plan is received by the CITY.
(c) BORROWER shall submit any material revision to an approved Financing Plan to
the CITY for its review and approval. Any proposed revised Financing Plan shall be considered
and approved or disapproved by the CITY in the same manner and according to the same
timeframe set forth in subsection (b) above.
Section 3.5 Building Permit.
(a) Within the time set forth in the Schedule of Performance BORROWER shall
submit a complete application to the CITY for a building permit for the construction of the
Project.
(b) BORROWER shall exercise diligent good faith efforts to obtain the building
permit for the Project within the time set forth in the Schedule of Performance.
ARTICLE 4
ONGOING OBLIGATIONS
Section 4.1 Periodic Reports.
During the performance of the Predevelopment Activities set forth in Article 3,
BORROWER shall on the first day of each month of the Term, and from time to time as
reasonably requested by the CITY, provide the CITY with written progress reports regarding the
status of the performance of the Predevelopment Activities.
Section 4.2 Information.
BORROWER shall provide any information reasonably requested by the CITY in
connection with the ownership of the Property and performance of the Predevelopment
Activities.
Section 4.3 Records.
BORROWER shall maintain on a current basis complete records, including books of
original entry, source documents supporting accounting transactions, service records, a general
ledger, canceled checks, time sheets, and related documents and records to assure proper
accounting of funds and performance of the terms of this Agreement. BORROWER shall furnish
any and all information and reports which may be required by CITY in connection with this
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Agreement. BORROWER shall further permit access to its books, records and accounts by the
representatives and employees of CITY during regular business hours, and with reasonable
notice, for the purpose of investigation or audit to ascertain compliance with all applicable laws,
regulations, rules and orders and for the purpose of evaluating and monitoring BORROWER's
compliance with the provisions of this Agreement. All such records shall be retained by
BORROWER and made available to CITY upon request for review or audit for a period of at
least five (5) years following the expiration or termination of this Agreement.
Section 4.4 Audits.
BORROWER shall provide CITY, during the term of this Agreement, with copies of
audited financial statements of BORROWER, including any management letter comments on the
adequacy of internal or operational controls, within one hundred fifty (150) days of the close of
each fiscal year of the BORROWER. CITY reserves the right, during the term of this Loan
Agreement, to audit the records, including the financial records supporting the aforementioned
financial statements, and other records and documents pertaining to the operations of the Project.
Section 4.5 Compliance with Laws; Prevailing Wages.
(a) BORROWER shall comply with all applicable laws, ordinances, rules and
regulations of federal, state, county or municipal governments or agencies now in force or that
may be enacted hereafter, including (without limitation and where applicable) the prevailing
wage provisions of Sections 1770 et seq., of the California Labor Code and implementing rules
and regulations as set forth below, in owning the Property, performing the Predevelopment
Activities, and constructing the Project on the Property.
(b) This Agreement has been prepared with the intention that CITY assistance under
this Agreement does not require payment of state prevailing wages in connection with
construction work that is paid for in whole or in part out of public funds; provided, however, that
nothing in this Agreement constitutes a representation or warranty by the CITY regarding the
applicability of the provisions of Labor Code Section 1720 et seq., and the hiring of apprentices
pursuant to Labor Code Sections 1777.5 et seq., to the City Loan or Approved Financing. To the
extent applicable, BORROWER shall pay and shall cause the General Contractor and
subcontractors to pay prevailing wages in connection with the construction of the Development,
as those wages are determined pursuant to Labor Code Sections 1720 et seq., to employ
apprentices as required by Labor Code Sections 1777.5 et seq., and the implementing regulations
of the Department of Industrial relations ("DIR"). BORROWER shall and shall cause the
consultants and contractors to comply with the other applicable provisions of Labor Code
Sections 1720 et seq., 1777.5 et seq., and implementing regulations of the DIR. BORROWER
shall cause the contractors to keep and retain such records as are necessary to determine if such
prevailing wages have been paid as required pursuant to Labor Code Sections 1720 et seq., and
apprentices have been employed are required by Labor Code Sections 1777.5 et seq. Copies of
the currently applicable current per diem prevailing wages are available from DIR.
(c) BORROWER shall indemnify, hold harmless and defend (with counsel
reasonably acceptable to the CITY) the CITY against any claim for damages, compensation,
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fines, penalties or other amounts arising out of the failure or alleged failure of any person or
entity (including BORROWER, its contractor and subcontractors) to pay prevailing wages as
determined pursuant to Labor Code Sections 1720 et seq., to employ apprentices pursuant to
Labor Code Sections 1777.5 et seq., and implementing regulations of the DIR or to comply with
the other applicable provisions of Labor Code Sections 1720 et seq., 1777.5 et seq., and the
implementing regulations of the DIR in connection with the Predevelopment Activities or any
other work undertaken or in connection with the Property. The requirements in this subsection
(c) shall survive the repayment of the City Loan and the reconveyance of the Deed of Trust.
Section 4.6 Relocation.
If and to the extent that acquisition and development of the Property will result in the
permanent or temporary displacement of persons or businesses entitled to relocation benefits,
then BORROWER shall comply with all applicable local, state, and federal statutes and
regulations, (including without limitation the Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970, as amended, California Government Code Section 7260 et
seq., and accompanying regulations) with respect to preparation of a relocation plan, relocation
planning, advisory assistance, and payment of monetary benefits. BORROWER shall be solely
responsible for payment of any relocation benefits to any displaced persons and any other
obligations associated with complying with such relocation laws. BORROWER shall indemnify,
defend and hold harmless, (with counsel reasonably acceptable to the CITY), the CITY and its
councilmembers, employees, agents, successors and assigns against any claim for damages,
compensation, fines, penalties, relocation payments or other amounts and expenses (including
reasonable attorneys' fees) arising out of the failure or alleged failure of any person or entity
(including BORROWER, or the CITY) to satisfy relocation obligations related to the acquisition
of the Property. This obligation to indemnify shall survive termination of this Agreement.
Section 4.7 Hazardous Materials.
(a) BORROWER shall keep and maintain the Property in compliance with, and shall
not cause or permit the Property to be in violation of any Hazardous Materials Law (defined
below), including but not limited to, soil and ground water conditions. BORROWER shall not,
and shall not cause or permit the use, generation, manufacture, storage or disposal of on, under,
or about the Property or transportation to or from the Property of (i) any substance, material, or
waste that is petroleum, petroleum-related, or a petroleum by-product, asbestos or asbestos-
containing material, polychlorinated biphenyls, flammable, explosive, radioactive, freon gas,
radon, or a pesticide, herbicide, or any other agricultural chemical, and (ii) any waste, substance
or material defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "toxic materials", "toxic waste", "toxic substances," or words of
similar import under any Hazardous Materials Law (collectively referred to hereinafter as
"Hazardous Materials"). BORROWER shall cause any persons who may come onto the
Property to comply with the foregoing. Notwithstanding the foregoing, Hazardous Materials
shall not include substances routinely used in the development and operations of housing in
accordance with all applicable laws and regulations.
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(b) BORROWER shall immediately notify the CITY in writing if at any time it has
any notice of (i) any and all enforcement, cleanup, removal or other governmental or regulatory
actions instituted, completed or threatened against BORROWER or the Property pursuant to any
applicable federal, state or local laws, ordinances, or regulations relating to any Hazardous
Materials, health, industrial hygiene, environmental conditions, or the regulation or protection of
the environment, and all amendments thereto as of this date and to be added in the future and any
successor statute or rule or regulation promulgated thereto ("Hazardous Materials Law"); (ii) all
claims made or threatened by any third party against BORROWER or the Property relating to
damage, contribution, cost recovery compensation, loss or injury resulting from any Hazardous
Materials (the matters set forth in clauses (i) and (ii) above are hereinafter referred to as
"Hazardous Materials Claims"); and (iii) BORROWER's discovery of any occurrence or
condition on any real property adjoining or in the vicinity of the Property that could cause the
Property or any part thereof to be classified as "border-zone property" under the provision of
California Health and Safety Code, Sections 25220 et seq., or any regulation adopted in
accordance therewith, or to be otherwise subject to any restrictions on the ownership, occupancy,
transferability or use of the Property under any Hazardous Materials Law.
(c) The CITY shall have the right to join and participate in, as a party if it so elects,
and be represented by counsel of its own choice in, any legal proceedings or actions initiated in
connection with any Hazardous Materials Claims, and to have its reasonable attorneys' fees in
connection therewith paid by BORROWER.
(d) BORROWER shall indemnify and hold harmless the CITY and its
councilmembers, directors, officers, employees, agents, successors and assigns from and against
any loss, damage, cost, fine, penalty, judgment, award, settlement, expense or liability, directly
or indirectly arising out of or attributable to: (i) any actual or past or present violation of any
Hazardous Materials Law; (ii) any Hazardous Materials Claim; (iii) any actual or past or present
use, generation, manufacture, storage, release, threatened release, discharge, disposal,
transportation, or presence of Hazardous Materials on, under, or about the Property; (iv) any
investigation, cleanup, remediation, removal, or restoration work of site conditions of the
Property relating to Hazardous Materials (whether on the Property or any other property); and (v)
the breach of any representation of warranty by or covenant of BORROWER in this Section 4.7,
and Section 5.1(h). Such indemnity shall include, without limitation: (i) all consequential
damages; (ii) the costs of any required or necessary investigation, repair, cleanup or
detoxification of the Property and the preparation and implementation of any closure, remedial or
other required plans; and (iii) all reasonable costs and expenses incurred by the CITY in
connection with clauses (i) and (ii), including but not limited to reasonable attorneys' fees and
consultant fees. This obligation to indemnify shall survive termination of this Agreement and
shall not be diminished or affected in any respect as a result of any notice, disclosure,
knowledge, if any, to or by the CITY of Hazardous Materials.
(e) Without the CITY's prior written consent, which shall not be unreasonably
withheld, BORROWER shall not take any remedial action in response to the presence of any
Hazardous Materials on, under or about the Property, nor enter into any settlement agreement,
consent decree, or other compromise in respect to any claims made or threatened by any third
party against BORROWER, any tenant, or the Property relating to damage, contribution, cost
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recovery compensation, loss or injury resulting from any Hazardous Materials, which remedial
action, settlement, consent decree or compromise might, in the CITY's reasonable judgment,
impair the value of the CITY's security hereunder; provided, however, that the CITY's prior
consent shall not be necessary: (i) in relation to those remedial actions initiated by the sellers of
the Property pursuant to SCCo Case No. 06S2W18L03s; and (ii) in the event that the presence of
Hazardous Materials on, under, or about the Property either poses an immediate threat to the
health, safety or welfare of any individual or is of such a nature that an immediate remedial
response is necessary and it is not reasonably possible to obtain the CITY's consent before taking
such action, provided that in such event BORROWER shall notify the CITY as soon as
practicable of any action so taken. The CITY agrees not to withhold its consent, where such
consent is required hereunder, if either (i) a particular remedial action is ordered by a court of
competent jurisdiction, (ii) BORROWER will or may be subjected to civil or criminal sanctions
or penalties if it fails to take a required action; (iii) BORROWER establishes to the reasonable
satisfaction of the CITY that there is no reasonable alternative to such remedial action which
would result in less impairment of the CITY's security hereunder; or (iv) the action has been
agreed to by the CITY.
(f) BORROWER hereby acknowledges and agrees that (i) this Section is intended as
the CITY's written request for information (and BORROWER's response) concerning the
environmental condition of the Property as required by California Code of Civil Procedure
Section 726.5, and (ii) each representation and warranty in this Agreement (together with any
indemnity obligation applicable to a breach of any such representation and warranty) with
respect to the environmental condition of the Property is intended by the Parties to be an
"environmental provision" for purposes of California Code of Civil Procedure Section 736.
(g) In the event that any portion of the Property is determined to be "environmentally
impaired" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(3)) or
to be an "affected parcel" (as that term is defined in California Code of Civil Procedure Section
726.5(e)(1)), then, without otherwise limiting or in any way affecting the CITY's or the trustee's
rights and remedies under the Deed of Trust, the CITY may elect to exercise its rights under
California Code of Civil Procedure Section 726.5(a) to (i) waive its lien on such environmentally
impaired or affected portion of the Property and (ii) exercise (1) the rights and remedies of an
unsecured creditor, including reduction of its claim against BORROWER to judgment, and (2)
any other rights and remedies permitted by law. For purposes of determining the CITY right to
proceed as an unsecured creditor under California Code of Civil Procedure Section 726.5(a),
BORROWER shall be deemed to have willfully permitted or acquiesced in a release or
threatened release of Hazardous Materials, within the meaning of California Code of Civil
Procedure Section 726.5(d)(1), if the release or threatened release of Hazardous Materials was
knowingly or negligently caused or contributed to by any lessee, occupant, or user of any portion
of the Property and BORROWER knew or should have known of the activity by such lessee,
occupant, or user which caused or contributed to the release or threatened release. All costs and
expenses, including (but not limited to) attorneys' fees, incurred by the CITY in connection with
any action commenced under this paragraph, including any action required by California Code of
Civil Procedure Section 726.5(b) to determine the degree to which the Property is
environmentally impaired, plus interest thereon at the rate specified in the Note until paid, shall
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be added to the indebtedness secured by the Deed of Trust and shall be due and payable to the
CITY upon its demand made at any time following the conclusion of such action.
Section 4.8 Maintenance and Damage.
(a) BORROWER shall maintain the Property and the Project in good repair and in a
neat, clean and orderly condition. If there arises a condition in contravention of this requirement,
and if BORROWER has not cured such condition within thirty (30) days after receiving a notice
from the CITY of such a condition, then in addition to any other rights available to the CITY, the
CITY shall have the right to perform all acts necessary to cure such condition, and to establish or
enforce a lien or other encumbrance against the Property.
(b) If any improvement constructed on the Property by BORROWER, now or in the
future, is damaged or destroyed, then BORROWER shall, at its cost and expense, diligently
undertake to repair or restore such improvement consistent with any plans and specifications
approved by the CITY. Such work or repair shall be commenced no later than the later of one
hundred twenty (120) days, or such longer period approved by the CITY in writing, after the
damage or loss occurs or thirty (30) days following receipt of the insurance proceeds, and shall
be complete within one (1) year thereafter. Any insurance proceeds collected for such damage or
destruction shall be applied to the cost of such repairs or restoration and, if such insurance
proceeds shall be insufficient for such purpose, then BORROWER shall make up the deficiency.
Section 4.9 Mechanics Liens, Stop Notices, and Notices of Completion.
(a) If any claim of lien is filed against the Property or a stop notice affecting the City
Loan is served on the CITY or any other lender or other third party in connection with the
Development, then BORROWER shall, within thirty (30) days after such filing or service, either
pay and fully discharge the lien or stop notice, effect the release of such lien or stop notice by
delivering to the CITY a surety bond in sufficient form and amount, or provide the CITY with
other assurance satisfactory to the CITY that the claim of lien or stop notice will be paid or
discharged.
(b) If BORROWER fails to discharge any lien, encumbrance, charge, or claim in the
manner required in this Section, then in addition to any other right or remedy, the CITY may (but
shall be under no obligation to) discharge such lien, encumbrance, charge, or claim at
BORROWER'S expense. Alternately, the CITY may require BORROWER to immediately
deposit with the CITY the amount necessary to satisfy such lien or claim and any costs, pending
resolution thereof. The CITY may use such deposit to satisfy any claim or lien that is adversely
determined against BORROWER.
(c) BORROWER shall file a valid notice of cessation or notice of completion upon
cessation of construction on the Development and take all other reasonable steps to forestall the
assertion of claims of lien against the Property. BORROWER authorizes the CITY, but without
any obligation, to record any notices of completion or cessation of labor, or any other notice that
the CITY deems necessary or desirable to protect its interest in the Property.
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Section 4.10 Fees and Taxes.
BORROWER shall be solely responsible for payment of all fees, assessments, taxes,
charges, and levies imposed by any public authority or utility company with respect to the
Property or the Project to the extent owned by BORROWER, and shall pay such charges prior to
delinquency. However, BORROWER shall not be required to pay and discharge any such charge
so long as (a) the legality thereof is being contested diligently and in good faith and by
appropriate proceedings, and (b) if requested by the CITY, BORROWER deposits with the
CITY any funds or other forms of assurance that the CITY in good faith from time to time
determines appropriate to protect the CITY from the consequences of the contest being
unsuccessful.
Section 4.11 Notices.
BORROWER shall notify the CITY promptly in writing of any and all of the following:
(a) Any litigation known to BORROWER affecting BORROWER, or the Property and
of any claims or disputes that involve a material risk of litigation;
(b) Any written or oral communication BORROWER receives from any
governmental, judicial, or legal authority giving notice of any claim or assertion that the Property
or Project fails in any respect to comply with any applicable governmental law;
(c) Any material adverse change in the physical condition of the Property (including
any damage suffered as a result of fire, earthquakes, or floods);
(d) Any material adverse change in BORROWER's financial condition, any material
adverse change in BORROWER's operations, or any change in the management of
BORROWER;
(e) That any of the statements in Section 5.1(h) regarding Hazardous Materials are no
longer accurate;
(f) Any Default or event which, with the giving of notice or the passage of time or
both, would constitute a Default; and
(g) Any other circumstance, event, or occurrence that results in a material adverse
change in BORROWER's ability to timely perform any of its obligations under any of the Loan
Documents.
Section 4.12 Non-Discrimination.
BORROWER shall not discriminate or segregate in the ownership of the Property, and
performance of the Predevelopment Activities, or operation or construction of the Project on the
basis of race, color, creed, ancestry, national origin, religion, sex, sexual orientation, marital
status, age, disability, medical condition, familial status, source of income or any other arbitrary
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basis. BORROWER shall otherwise comply with all applicable local, state, and federal laws
concerning discrimination.
Section 4.13 Insurance Requirements.
BORROWER, at its sole cost and expense, shall obtain and maintain during the term of
this Agreement, insurance provided by responsible companies authorized to engage in the
offering of insurance services in California in such amounts and against such risks as shall be
satisfactory to CITY’S risk manager, including, without limitation, worker’s compensation,
employer’s liability, commercial general liability, comprehensive automobile liability, personal
injury and property damage insurance, as appropriate, as set forth in Exhibit G, insuring against
all liability of BORROWER and its directors, officers, employees, agents, and representatives
arising out of or in connection with the acquisition, construction and development of the Project
or BORROWER'S performance or nonperformance under this Agreement.
Section 4.14 Transfer.
(a) For purposes of this Agreement, "Transfer" is any sale, assignment, or transfer,
whether voluntary or involuntary, of (i) any rights and/or duties under this Agreement, and/or (ii)
any interest in the Project, including (but not limited to) a fee simple interest, a joint tenancy
interest, a life estate, a partnership interest, a leasehold interest, a security interest, or an interest
evidenced by a land contract by which possession of the Project is transferred and the
BORROWER retains title. "Transfer" shall exclude the leasing of any single unit in the Project to
an occupant and the transfer of an easement interest in the Property for utility purposes. The City
Manager or his/her designee is authorized to execute assignment and assumption agreements on
behalf of the CITY to implement any approved Transfer.
(b) CITY is entering into this Agreement based on the experience, skill, and ability to
perform of BORROWER. The BORROWER recognizes that its qualifications and identity are of
particular concern to the CITY, in view of: (i) the importance of affordable housing to the
general welfare of the community; (ii) the reliance by the CITY upon the unique qualifications
and ability of the BORROWER to ensure the quality of the affordability, use, operation, and
maintenance of the proposed Project, if approved; (iii) the requirement that the Property be used
for affordable housing; and (iv) BORROWER's representation that the Property is not to be
acquired or used for speculation, but only for use by the BORROWER for affordable housing.
(c) No Transfer not specifically authorized in this Section 4.14 shall be permitted
without the prior written consent of the CITY, which the CITY may withhold in its sole
discretion. The City Loan shall automatically accelerate and be due in full upon any Transfer
made without the prior written consent of the CITY.
(d) Sale of Market-Rate Parcel.
(1) BORROWER desires to sell the portion of the Property identified
as the Market-Rate Parcel to a third party (the "Third Party Buyer") for construction of
market-rate housing in order to repay the LIIF Loan and the LISC Loan.
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(2) If BORROWER has received all required Land Use Approvals to
create the Market-Rate Parcel, as described in Section 3.2 and proposes to sell the
Market-Rate Parcel to a Third Party Buyer, BORROWER shall provide written notice to
the CITY at least forty-five days (45) days prior to the consummation of any proposed
sale of the Market-Rate Parcel to a Third Party Buyer.
(3) If BORROWER has received all required Land Use Approvals to
create the Market-Rate Parcel, as described in Section 3.2, CITY hereby approves the
sale of the Market-Rate Parcel to a Third Party Buyer provided that: (i) the LISC Loan
and the LIIF Loan shall be paid off and the deeds of trust for those loans reconveyed
upon sale of the Market-Rate Parcel; and (ii) any proceeds from the sale of the Market-
Rate Parcel remaining after repayment of the LISC and LIFF loans shall either be used
for the Project, if the CITY approves the Land Use Approvals for the Project; or for other
affordable housing purposes, if the City does not approve the Land Approvals for the
Project. On the date of the sale of the Market-Rate Parcel in conformance with this
subsection (d), CITY agrees to release the Memo of Agreement and reconvey the Deed of
Trust from the Market-Rate Parcel.
(4) The provisions of this subsection (d) apply only to sale of a fee
title interest in the Market-Rate Parcel. All other Transfers are subject to the provisions of
subsections (a), (b), (c), and (e) of this Section.
(e) The CITY hereby approves the Transfer of this Agreement to a limited
partnership, of which BORROWER or BORROWER's wholly controlled affiliate is the general
partner.
Section 4.15 Other Indebtedness and Liens.
Except for the Approved Acquisition Financing, BORROWER shall not incur any
indebtedness of any kind or encumber the Property with any liens without the prior written
consent of the CITY.
Section 4.16 Use as Affordable Housing
In consideration for the City Loan to be provided to the BORROWER on below-market
terms, the BORROWER hereby agrees to apply for the use of the Property as affordable housing
and otherwise use its best good faith efforts to comply with the requirements of Article 3 of this
Agreement. If the Project is approved, the use, occupancy and rent restrictions in the Regulatory
Agreement shall be compatible with the restrictions of other Approved Financing.
BORROWER's compliance with this Section 4.16 is of particular importance to CITY and the
main purpose of the City Loan. If the Project is approved, the BORROWER shall record against
the Property, prior to Construction Closing, the Regulatory Agreement.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BORROWER
Section 5.1 Representations and Warranties.
As a material inducement to the CITY's entry into this Agreement, BORROWER hereby
represents and warrants to the CITY as follows and acknowledges, understands, and agrees that
the representations and warranties set forth in this Article 5 are deemed to be continuing during
all times when any portion of the City Loan remains outstanding:
(a) Organization. BORROWER is duly organized, validly existing, and in good
standing under the laws of the State of California and have the power and authority to own their
property and carry on their business as now being conducted.
(b) Authority of BORROWER. BORROWER has full power and authority to execute
and deliver this Agreement and to make and accept the borrowings contemplated hereunder, to
execute and deliver the Loan Documents and all other documents or instruments executed and
delivered, or to be executed and delivered, pursuant to this Agreement, and to perform and
observe the terms and provisions of all of the above.
(c) Authority of Persons Executing Documents. This Agreement and the Loan
Documents and all other documents or instruments executed and delivered, or to be executed and
delivered, pursuant to this Agreement have been executed and delivered by persons who are duly
authorized to execute and deliver the same for and on behalf of BORROWER, and all actions
required under BORROWER's 's organizational documents and applicable governing law for the
authorization, execution, delivery and performance of this Agreement and the Loan Documents
and all other documents or instruments executed and delivered, or to be executed and delivered,
pursuant to this Agreement, have been duly taken.
(d) Valid Binding Agreements. This Agreement and the Loan Documents and all
other documents or instruments which have been executed and delivered pursuant to or in
connection with this Agreement constitute or, if not yet executed or delivered, will when so
executed and delivered constitute, legal, valid and binding obligations of enforceable against it in
accordance with their respective terms.
(e) No Breach of Law or Agreement. Neither the execution nor delivery of this
Agreement and the Loan Documents or of any other documents or instruments executed and
delivered, or to be executed or delivered, pursuant to this Agreement, nor the performance of any
provision, condition, covenant or other term hereof or thereof, will conflict with or result in a
breach of any statute, rule or regulation, or any judgment, decree or order of any court, board,
commission or agency whatsoever binding on BORROWER, or any provision of the
organizational documents of BORROWER, or will conflict with or constitute a breach of or a
default under any agreement to which BORROWER is a party, or will result in the creation or
imposition of any lien upon any assets or property of BORROWER, other than liens established
pursuant hereto.
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(f) Pending Proceedings. BORROWER is not in default under any law or regulation
or under any order of any court, board, commission or agency whatsoever, and there are no
claims, actions, suits or proceedings pending or, to the knowledge of BORROWER, threatened
against or affecting BORROWER or the Property, at law or in equity, before or by any court,
board, commission or agency whatsoever which might, if determined adversely to BORROWER,
materially affect BORROWER's ability to repay the City Loan or impair the security to be given
to the CITY pursuant hereto.
(g) Title to Land. At the time of recordation of the Deed of Trust, BORROWER will
have good and marketable fee title to the Property and there will exist thereon or with respect
thereto no mortgage, lien, pledge or other encumbrance of any character whatsoever other than
liens for current real property taxes and assessments not yet due and payable, and liens in favor
of the CITY or approved in writing by the CITY.
(h) Hazardous Materials. To the best of BORROWER's knowledge, except as
disclosed in writing by BORROWER to the CITY or in the following reports, prior to the date of
this Agreement (Phase I Environmental Site Assessment, dated July 2, 2012; Phase II
Environmental Site Assessment, dated July20, 2012); (i) no Hazardous Material has been
disposed of, stored on, discharged from, or released to or from, or otherwise now exists in, on,
under, or around, the Property, (ii) no aboveground or underground storage tanks are now or
have ever been located on or under the Property, (iii) neither the Property, nor BORROWER, is
in violation of any Hazardous Materials Law; and (iv) neither the Property, nor BORROWER, is
subject to any existing, pending or threatened Hazardous Materials Claims.
(i) Financial Statements. The financial statements of BORROWER and other
financial data and information furnished by BORROWER to the CITY fairly present the
information contained therein. As of the date of this Agreement, there has not been any adverse,
material change in the financial condition of BORROWER from that shown by such financial
statements and other data and information.
(j) Sufficient Funds. BORROWER holds sufficient funds and/or binding
commitments for sufficient funds to complete the acquisition of the Property and perform the
Predevelopment Activities.
(k) Taxes. BORROWER and its subsidiaries have filed all federal and other material
tax returns and reports required to be filed, and have paid all federal and other material taxes,
assessments, fees and other governmental charges levied or imposed upon them or their income
or the Property otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in accordance
with generally accepted accounting principles. There is no proposed tax assessment against
BORROWER or any of its subsidiaries that could, if made, be reasonably expected to have a
material adverse effect upon the Property, liabilities (actual or contingent), operations, condition
(financial or otherwise) or prospects of BORROWER and its subsidiaries, taken as a whole,
which would be expected to result in a material impairment of the ability of BORROWER to
perform under any Loan Document to which it is a party, or a material adverse effect upon the
legality, validity, binding effect or enforceability against BORROWER of any Loan Document.
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Section 5.2 Survival of Representations and Warranties.
All representations and warranties of BORROWER shall survive the making of the City
Loan and have been or will be relied on by the CITY notwithstanding any investigation made by
the CITY.
ARTICLE 6
TERMINATION, DEFAULT AND REMEDIES
Section 6.1 Termination of Agreement.
(a) Failure by the BORROWER to complete the Construction Closing and obtain all
Land Use Approvals and building permits required to construct the Project by January 31, 2015,
subject to Force Majeure, or CITY's determination not to approve the Land Use Approvals
required for the Project, including creation of the Market-Rate Parcel, constitutes a basis for the
CITY to terminate this Agreement, subject to the conditions set forth in subsection (b) below. At
BORROWER's request, CITY may, at its sole discretion, extend the time for performance
contained in this paragraph, provided that BORROWER demonstrates to CITY's reasonable
satisfaction that BORROWER is likely to obtain financing and Land Use Approvals required to
construct the Project within a reasonable period.
(b) Upon the happening of the events described in subsection (a), the City may provide
written notice to BORROWER of its intent to terminate this Agreement within one hundred twenty
(120) days pursuant to this Section 6.1 (the "Termination Notice"). At its sole discretion, the
Termination Notice may indicate CITY's intent to exercise the Option to Purchase pursuant to
Section 6.4 provided that the Notice of Exercise is delivered to BORROWER concurrently with the
Termination Notice. Upon the effective date of the Termination Notice, the outstanding principal
balance of the Note shall be due and payable, and the CITY may exercise all rights pursuant to
the Assignment of Documents; and this Agreement will terminate and neither party shall have any
rights against or liability to the other pursuant to this Agreement except for the provisions that state
they survive termination of this Agreement, and the applicable provisions of this Section 6.1,
Section 6.4, and Section 6.5.
Section 6.2 Events of Default.
Upon the occurrence of Default, as defined in this Section, the CITY will give written
notice to BORROWER. If the Default continues uncured for forty-five (45) days after receipt of
written notice thereof from the CITY to BORROWER or, if a non-monetary breach cannot be
cured within forty-five (45) days, BORROWER diligently undertakes to cure such breach within
forty-five (45) days but such breach remains uncured within ninety (90) days, then CITY may
terminate this Agreement and exercise all remedies available at law or equity; provided,
however, that if a different period or notice requirement is specified under any other provision of
this Article 6, the specific provisions shall control. Each of the following shall constitute a
"Default" by BORROWER under this Agreement:
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(a) Failure to Make Payment. Failure to repay the principal and any interest on the
Loan within fifteen (15) days after receipt of written notice from the CITY that such payment is
due pursuant to the Loan Documents.
(b) Breach of Covenants. Failure of BORROWER to duly perform, comply with, or
observe any of the conditions, terms, or covenants of any of the Loan Documents.
(c) Default Under Other Loans. A default is declared under any other financing for
the Project or acquisition of the Property by the lender of such financing, or BORROWER fails
to make any payment or perform any of its other covenants, agreements, or obligations under any
other agreement with respect to financing for the Project. After the expiration of any cure
periods, the occurrence of any of the events of Default in this paragraph shall act to accelerate
automatically, without the need for any action by the CITY, the indebtedness evidenced by the
Note.
(d) Adverse Financial Condition. A material adverse change in BORROWER's
financial condition, or an event or condition materially impairing BORROWER's intended use of
the Property, or BORROWER's ability to repay the City Loan occurs.
(e) Insolvency. A court having jurisdiction shall have made or entered any decree or
order (1) adjudging BORROWER to be bankrupt or insolvent, (2) approving as properly filed a
petition seeking reorganization of BORROWER or seeking any arrangement for BORROWER
under the bankruptcy law or any other applicable debtor's relief law or statute of the United
States or any state or other jurisdiction, (3) appointing a receiver, trustee, liquidator, or assignee
of BORROWER in bankruptcy or insolvency or for any of their properties, (4) directing the
winding up or liquidation of BORROWER, if any such decree or order described in clauses (1)
to (4), inclusive, shall have continued unstayed or undischarged for a period of ninety (90) days;
or (5) BORROWER shall have admitted in writing its inability to pay its debts as they fall due or
shall have voluntarily submitted to or filed a petition seeking any decree or order of the nature
described in clauses (1) to (5), inclusive. The occurrence of any of the events of Default in this
paragraph shall act to accelerate automatically, without the need for any action by the CITY, the
indebtedness evidenced by the Note.
(f) Assignment; Attachment. BORROWER shall have assigned its assets for the
benefit of its creditors or suffered a sequestration or attachment of or execution on any
substantial part of its property, unless the property so assigned, sequestered, attached or executed
upon shall have been returned or released within ninety (90) days after such event or, if sooner,
prior to sale pursuant to such sequestration, attachment, or execution. The occurrence of any of
the events of default in this paragraph shall act to accelerate automatically, without the need for
any action by the CITY, the indebtedness evidenced by the Note.
(g) Suspension; Dissolution. BORROWER shall have voluntarily suspended its
business or the dissolution of BORROWER.
(h) Liens on Property and the Project. There shall be filed any claim of lien (other
than liens approved in writing by the CITY) against the Project, the Property, or any part thereof,
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or any interest or right made appurtenant thereto, or the service of any notice to withhold
proceeds of the City Loan and the continued maintenance of said claim of lien or notice to
withhold for a period of twenty (20) days without discharge or satisfaction thereof or provision
therefor (including, without limitation, the posting of bonds) satisfactory to the CITY.
(i) Condemnation. The condemnation, seizure, or appropriation of all or the
substantial part of the Property and the Project, except that condemnation by the CITY shall
cause the City Loan to accelerate but shall not be a Default.
(j) Unauthorized Transfer. Any Transfer other than as permitted by Section 4.14.
(k) Representation or Warranty Incorrect. Any representation or warranty of
BORROWER contained in this Agreement, or in any application, financial statement, certificate,
or report submitted to the CITY in connection with any of the Loan Documents, proves to have
been incorrect in any material and adverse respect when made.
(l) Applicability to General Partner. In the event BORROWER is a limited
partnership or limited liability company, the occurrence of any of the events set forth in
subsection (f), subsection (g), or subsection (h) in relation to the general partner of
BORROWER.
Section 6.3 Remedies.
The occurrence of any Default hereunder following the expiration of all applicable notice
and cure periods will, either at the option of the CITY or automatically where so specified,
relieve the CITY of any obligation to make or continue the City Loan and shall give the CITY
the right to proceed with any and all remedies set forth in this Agreement and the Loan
Documents, subject to the terms of the subordination agreements related to the LISC Loan and
the LIIF Loan, including but not limited to the following:
(a) Acceleration of Note. The CITY shall have the right to cause all indebtedness of
BORROWER to the CITY under this Agreement and the Note, together with any accrued
interest thereon, to become immediately due and payable. BORROWER waives all right to
presentment, demand, protest or notice of protest or dishonor. The CITY may proceed to enforce
payment of the indebtedness and to exercise any or all rights afforded to the CITY as a creditor
and secured party under the law including the Uniform Commercial Code, including foreclosure
under the Deed of Trust. BORROWER shall be liable to pay the CITY on demand all reasonable
expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses)
paid or incurred by the CITY in connection with the collection of the City Loan and the
preservation, maintenance, protection, sale, or other disposition of the security given for the City
Loan.
(b) Assignment of Documents. The CITY may exercise all rights under the
Assignment of Documents.
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(c) Specific Performance. The CITY shall have the right to mandamus or other suit,
action or proceeding at law or in equity to require BORROWER to perform its obligations and
covenants under the Loan Documents or to enjoin acts or things which may be unlawful or in
violation of the provisions of the Loan Documents.
(d) Right to Cure at BORROWER's Expense. The CITY shall have the right (but not
the obligation) to cure any monetary default by BORROWER under a loan other than the City
Loan. BORROWER agrees to reimburse the CITY for any funds advanced by the CITY to cure a
monetary default by BORROWER upon demand therefore, together with interest thereon from
the date of expenditure until the date of reimbursement at the Default Rate.
Section 6.4 Option to Purchase, Enter and Possess.
(a) In consideration for the City Loan, BORROWER hereby grants the CITY the
additional right at the CITY's option, to purchase, enter, and take possession of the Property with
all improvements thereon (the "Option to Purchase") upon an uncured event of Default of
BORROWER or upon termination of this Agreement pursuant to Section 6.1.
(b) If the CITY decides to exercise its Option to Purchase the CITY shall provide
BORROWER , LISC, and LIIF with written notice of its intent to do so (the "Notice of Exercise")
within sixty (60) days of CITY's notice to BORROWER of an uncured event of Default pursuant to
Section 6.2 above or concurrently with delivery of a Termination Notice pursuant to Section 6.1
above. The Notice of Exercise will include a date for closing which is the later to occur of the
following: (1) not less than ninety (90) days nor more than one hundred fifty (150) days after the
date of the Notice of Exercise in the event of an uncured event of Default; (2) not less than
ninety (90) days nor more than one hundred fifty (150) days after the effective date of the
Termination Notice; or (3) ten (10) days after BORROWER has done all acts and executed all
documents required for close of escrow.
(c) Upon the CITY's delivery of the Notice of Exercise, BORROWER and the CITY
shall promptly open an escrow account. BORROWER shall execute, acknowledge, and deliver a
grant deed in a form acceptable to the CITY transferring the Property to the CITY, subject only to
the title exceptions that (1) existed at the time of BORROWER’s acquisition of the Property, or
(2) were created with the written consent of CITY or approved in writing by CITY or expressly
contemplated or permitted by this Agreement. Closing costs and title insurance shall be paid by
CITY and BORROWER pursuant to the custom and practice in the County of Santa Clara at the
time of the opening of escrow, or as may be provided otherwise by mutual agreement.
BORROWER agrees to do all acts and execute all documents necessary to enable the close of
escrow and transfer of the Property to the City. The BORROWER shall also provide the CITY all
documents to which the CITY is entitled pursuant to the Assignment of Documents upon the
CITY's exercise of the Option to Purchase.
(d) The purchase price of the Property under the Option to Purchase will be all
amounts due under the City Loan. The CITY shall deem all outstanding amounts due on the City
Loan paid in full upon close of escrow and delivery of all documents to which the CITY is entitled
pursuant to the Assignment of Documents. The City acknowledges that it will take title to the
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Property subject to the liens of the deeds of trust in favor of the Senior Lenders and the County
Loan and the terms and provisions of the documents evidencing the County Loan and the Senior
Loans (except for any modification to such Senior Loan documents that require the approval of
the City pursuant to the applicable subordination agreement and for which such approval was not
obtained).
(e) As used in this Section, the term "City Loan" includes any accrued interest as
calculated pursuant to Section 2.2.
(f) The granting of this Option to Purchase to the CITY shall not impair or limit the
CITY's ability to exercise any other rights or remedies granted to the CITY in this Agreement.
CITY may enforce this Section 6.4 by specific performance.
Section 6.5 Right of Contest.
BORROWER shall have the right to contest in good faith any claim, demand, levy, or
assessment the assertion of which would constitute a Default hereunder. Any such contest shall
be prosecuted diligently and in a manner unprejudicial to the CITY or the rights of the CITY
hereunder.
Section 6.6 Remedies Cumulative.
No right, power, or remedy given to the CITY by the terms of this Agreement or the
Loan Documents is intended to be exclusive of any other right, power, or remedy; and each and
every such right, power, or remedy shall be cumulative and in addition to every other right,
power, or remedy given to the CITY by the terms of any such instrument, or by any statute or
otherwise against BORROWER and any other person or entity. Neither the failure nor any delay
on the part of the CITY to exercise any such rights and remedies shall operate as a waiver
thereof, nor shall any single or partial exercise by the CITY of any such right or remedy preclude
any other or further exercise of such right or remedy, or any other right or remedy.
ARTICLE 7
GENERAL PROVISIONS
Section 7.1 Agreement Coordination
(a) CITY’s City Manager shall represent CITY for all purposes under this
Agreement. CITY’s Director of Planning and Community Environment is designated by the City
Manager as the project manager, and his or her designee shall supervise the progress and
execution of this Agreement.
(b) The Executive Director of BORROWER shall represent BORROWER for all
purposes under this Agreement and, as the project director for BORROWER, shall supervise the
progress and execution of this Agreement.
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(c) Each party may change the party representing it by notice to the other party.
Section 7.2 Relationship of Parties.
Nothing contained in this Agreement shall be interpreted or understood by any of the
parties, or by any third persons, as creating the relationship of employer and employee, principal
and agent, limited or general partnership, or joint venture between the CITY and BORROWER
or BORROWER's agents, employees or contractors, and BORROWER shall at all times be
deemed an independent contractor and shall be wholly responsible for the manner in which it or
its agents, or both, perform the services required of it by the terms of this Agreement.
BORROWER has and retains the right to exercise full control of employment, direction,
compensation, and discharge of all persons assisting in the performance of services under the
Agreement. In regards to the development of the Project, BORROWER shall be solely
responsible for all matters relating to payment of its employees, including compliance with
Social Security, withholding and all other laws and regulations governing such matters, and shall
include requirements in each contract that contractors shall be solely responsible for similar
matters relating to their employees. BORROWER agrees to be solely responsible for its own acts
and those of its agents and employees.
Section 7.3 No Claims.
Nothing contained in this Agreement shall create or justify any claim against the CITY,
by any person BORROWER may have employed or with whom BORROWER may have
contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the
performance of any work or services with respect to the development of the Project, and
BORROWER shall include similar requirements in any contracts entered into for the
development of the Project.
Section 7.4 Amendments.
Any amendment to this Agreement shall be binding upon the parties, provided such
amendment is set forth in a writing signed by the parties. The City Manager is authorized to
execute any amendments to this Agreement after approval by the City Council and to confer any
consents or approvals that may be provided by the City Manager pursuant to this Agreement.
Section 7.5 Entire Understanding of the Parties.
This Agreement constitutes the entire understanding and agreement of the Parties with
respect to the City Loan.
Section 7.6 Indemnification.
Except as directly caused by the CITY's proven gross negligence or willful misconduct,
BORROWER agrees to indemnify, protect, hold harmless and defend (by counsel reasonably
satisfactory to the CITY) the CITY, and its councilmembers, officers and employees, from all
suits, actions, claims, causes of action, costs, demands, judgments and liens directly or indirectly
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arising out of or resulting from: (i) the making of the City Loan; (ii) BORROWER's performance
or non-performance of its obligations under this Agreement; (iii) any act or omission of
BORROWER, any of its agents, employees, licensees, tenants, contractors, subcontractors or
material suppliers, or other person or entity with respect to the City Loan or the Property (iv) the
acquisition, ownership and maintenance of the Property; (v) the development, marketing, rental
and operation of the Project, or (vi) any documents executed by BORROWER in connection
with the Project. The provisions of this Section 7.6 shall survive the repayment and cancellation
of the Note, the release and reconveyance of the Deed of Trust, and termination of this
Agreement.
Section 7.7 Non-Liability of CITY and CITY Officials, Employees and Agents.
No member, official, employee or agent of the CITY shall be personally liable to
BORROWER, or any successor in interest, in the event of any Default or breach by the CITY, or
for any amount which may become due to BORROWER or its successor or on any obligation
under the terms of this Agreement.
Section 7.8 No Third Party Beneficiaries.
BORROWER lacks any authority or power to pledge the credit of CITY or incur any
obligation in the name of CITY. This Agreement shall not be construed or deemed to be an
agreement for the benefit of any third party, and no third party shall have any claim or right of
action hereunder for any cause whatsoever.
Section 7.9 Action by the CITY; Amendments.
Except as may be otherwise specifically provided herein, whenever any approval, notice,
direction, consent, request, extension of time, waiver of condition, termination, or other action by
the CITY is required or permitted under this Agreement, such action may be given, made, or
taken by the City Manager without further approval by the City Council, and any such action
shall be in writing.
Section 7.10 Waivers.
Any waiver by the CITY of any obligation or condition in this Agreement must be in
writing. No waiver will be implied from any delay or failure by the CITY to take action on any
breach or Default of BORROWER or to pursue any remedy allowed under this Agreement or
applicable law. Any extension of time granted to BORROWER to perform any obligation under
this Agreement shall not operate as a waiver or release from any of its obligations under this
Agreement. Consent by the CITY to any act or omission by BORROWER shall not be construed
to be a consent to any other or subsequent act or omission or to waive the requirement for the
CITY's written consent to future waivers.
Section 7.11 Notices, Demands and Communications.
All notices, consents, communications or transmittals required by this Loan Agreement
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shall be made, in writing, and shall be communicated by the United States mail, certified, return
receipt requested or by express delivery or overnight courier service with a delivery receipt, and
shall be deemed given as of the date shown on the delivery receipt as the date of delivery or the
date on which delivery was refused, and shall be addressed to the following addresses, or such
other address as either party may designate, from time to time, by written notice sent to the other
party in like manner:
CITY:
City of Palo Alto
Office of the City Clerk
PO Box 10250
Palo Alto, CA 94303
With a copy to:
City of Palo Alto
Director, Department of Planning & Community Environment
PO Box 10250
Palo Alto, CA 94303
BORROWER:
Palo Alto Housing Corporation
725 Alma Street
Palo Alto, CA 94301
Attn: Executive Director
Such written notices, demands and communications may be sent in the same manner to such
other addresses as the affected party may from time to time designate by mail as provided in this
Section. Receipt shall be deemed to have occurred on the date shown on a written receipt for
delivery or refusal of delivery.
Section 7.12 Applicable Law and Venue.
This Agreement shall be deemed a contract made under the laws of the State of
California, and for the purposes hereof shall be governed and construed by and in accordance
with the laws of the State of California. In the event that suit is brought by either party, the
parties agree that trial of such action shall be vested exclusively in the state court of California in
the City of San Jose, County of Santa Clara, or in the United States District Court for the
Northern District of California in the City of San Jose.
Section 7.13 Parties Bound.
Except as otherwise limited herein, the provisions of this Agreement shall be binding
upon and inure to the benefit of the parties and their heirs, executors, administrators, legal
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representatives, successors and assigns. Any provision of this Loan Agreement which is
characterized as a covenant or a condition shall be deemed both a covenant and a condition. This
Agreement is intended to run with the land and shall bind BORROWER and its successors and
assigns in the Property and the Project for the entire Term, and the benefit hereof shall inure to
the benefit of the CITY and its successors and assigns.
Section 7.14 Attorneys' Fees.
If any lawsuit is commenced to enforce any of the terms of this Agreement, the prevailing
party will have the right to recover its reasonable attorneys' fees and costs of suit from the other
party.
Section 7.15 Severability.
If any term of this Agreement is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the provisions shall continue in full force and effect
unless the rights and obligations of the parties have been materially altered or abridged by such
invalidation, voiding or unenforceability.
Section 7.16 Force Majeure.
In addition to specific provisions of this Agreement, performance by either party shall not
be deemed to be in default where delays or defaults are due to to war, insurrection, strikes, lock-
outs or other labor disturbances, one or more acts of a public enemy, war, riot, sabotage,
blockade, embargo, floods, earthquakes, fires, quarantine restrictions, freight embargoes, lack of
transportation, court order, delays or failures of performance by any governmental authority or
utility company (other than the acts or failure to act of the CITY and so long as the party seeking
the extension has adequately complied with the applicable processing requirements of such
governmental authority or utility company), delays resulting from changes in any applicable
laws, rules, regulations, ordinances or codes, or a change in the interpretation thereof by any
governing body with jurisdiction, or any other cause (other than lack of funds of BORROWER
or BORROWER's inability to finance the construction of the Project) beyond the reasonable
control or without the fault of the party claiming an extension of time to perform or an inability
of performance. An extension of time for any cause will be deemed granted if notice by the party
claiming such extension is sent to the other within ten (10) days from the commencement of the
cause and the party granting the extension agrees to the extension in writing. In no event shall the
CITY be required to agree to cumulative delays in excess of one hundred eighty (180) days.
Section 7.17 Conflict of Interest.
(a) Except for payment of salaries and administrative costs. no person who is an
employee, agent, consultant, officer or official of BORROWER who exercises or has exercised
any functions or responsibilities concerning the activities under this Agreement, or who is in a
position to participate in a decision making process or gain inside information with regard to
such activities, may obtain a personal or financial interest or benefit from any such activity, or
have an interest in any contract, subcontract, or agreement with respect thereto, or the proceeds
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thereunder, either for him or herself or for those with whom he or she has family or business ties,
during his or her tenure or for one year thereafter.
(b) BORROWER further covenants that it presently has no interest and shall not
acquire any interest, direct or indirect, financial or otherwise, which would conflict in any
manner or degree with the performance of the services hereunder. BORROWER also covenants
that, in the performance of this Agreement, no subcontractor or person having such interest shall
be employed by BORROWER. In addition, BORROWER certifies that no one who has or will
have any financial interest under this Agreement is an officer or employee of CITY.
Section 7.18 Time of Essence.
Time is of the essence with respect to the performance of each of the covenants and
agreements contained in this Agreement.
Section 7.19 Title of Parts and Sections; Exhibits.
Any titles of the sections or subsections of this Agreement are inserted for convenience of
reference only and shall be disregarded in interpreting any part of the Agreement's provisions.
All exhibits referred to in this Agreement and any addenda, appendices, attachments, and
schedules which may, from time to time, be referred to in any duly executed amendment hereto
are by such reference incorporated in this Agreement and shall be deemed to be part hereof.
Section 7.20 Multiple Originals; Counterpart.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
Section 7.21 Recording of Memo of Agreement.
The CITY and BORROWER shall cause the Memo of Agreement to be recorded against
the Property in the Official Records of Santa Clara County.
Section 7.22 Further Actions.
The parties agree that they will take such further actions, and execute such further
documents, as may be necessary or appropriate in order to carry out the purposes of this
Agreement.
//
//
//
//
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WHEREFORE, this Agreement has been entered into by the undersigned as of the date
first above written.
APPROVED AS TO FORM:
Senior Assistant City Attorney
APPROVED:
Director of Planning and
Community Environment
Risk Manager
EXHIBITS:
EXHIBIT A: Legal Description of the Property
EXHIBIT B: Note
EXHIBIT C: Deed of Trust
CITY OF PALO ALTO, a chartered city
and municipal corporation
City Manager
BORROWER:
Palo Alto Housing Corporation,
a California nonprofit public benefit
corporation
By: ~---catldiCeR: Gonzalez
Executive Vice President
TaxpayerLD. No.9/-Q.FI73760
EXHIBIT D: Estimated Project Costs and Sources of Funds
EXHIBIT E: Schedule of Performance
EXHIBIT F: Assignment of Documents
EXHIBIT G: Insurance Requirements
Loan Agreement 42
Signature Page
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EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
Real property in the City of Palo Alto, County of Santa Clara, State of California,
described as
follows:
TRACT ONE:
PARCEL ONE:
PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, "MAYBELL
TRACT", WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF
THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, ON JUNE 19, 1905 IN BOOK K
OF MAPS, AT PAGES 88 AND 89, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT A HUB SET AT THE POINT OF INTERSECTION OF THE
SOUTHEASTERLY LINE OF MAYBELL AVENUE WITH THE NORTHEASTERLY LINE OF 10,
AS SAID AVENUE AND LOT ARE SHOWN UPON THE MAP ABOVE REFERRED TO,
RUNNING THENCE SOUTH 28° 48' WEST ALONG THE SAID SOUTHEASTERLY LINE OF
MAYBELL AVENUE 145.00 FEET TO THE TRUE POINT OF BEGINNING OF THE
FOLLOWING DESCRIBED PARCEL OF LAND; THENCE AT RIGHT ANGLES TO SAID
SOUTHEASTERLY LINE OF MAYBELL AVENUE, SOUTH 61° 12' EAST 65.00 FEET;
THENCE RUNNING PARALLEL WITH SAID SOUTHEASTERLY LINE OF MAYBELL AVENUE
SOUTH 28° 48' WEST 111.00 FEET; THENCE NORTH 61° 12' WEST 65.00 FEET TO A
POINT IN SAID SOUTHEASTERLY LINE OF MAYBELL AVENUE; THENCE ALONG SAID
SOUTHEASTERLY LINE OF MAYBELL AVENUE NORTH 28° 48' EAST 111.00 FEET TO
THE POINT OF BEGINNING.
PARCEL TWO:
PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, "MAYBELL
TRACT", WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF
THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, ON JUNE 19, 1905 IN BOOK
"K' OF MAPS, AT PAGES 88 AND 89, AND MORE PARTICULARLY DESCRIBED AS
FOLLOWS:
BEGINNING AT A POINT ON THE SOUTHEASTERLY LINE OF MAYBELL AVENUE,
DISTANT THEREON S. 28° 48' W. 84.83 FEET FROM THE POINT OF INTERSECTION
THEREOF WITH THE NORTHEASTERLY LINE OF LOT 10, AS SAID AVENUE AND LOT
ARE SHOWN UPON THE MAP OF MAYBELL TRACT HEREINABOVE REFERRED TO;
THENCE PARALLEL WITH SAID NORTHEASTERLY LINE OF LOT 10, S. 61° 14' 22" E.
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80.74 FEET; THENCE PARALLEL WITH SAID SOUTHEASTERLY LINE OF MAYBELL
AVENUE, S. 28° 48' W. 169.66 FEET; THENCE PARALLEL WITH SAID NORTHEASTERLY
LINE OF LOT 10, N. 61° 14' 22" W. 15.74 FEET; THENCE PARALLEL WITH THE
SOUTHEASTERLY LINE OF MAYBELL AVENUE N. 28° 48' E. 109.49 FEET; THENCE
PARALLEL WITH SAID NORTHEASTERLY TINE OF LOT 10 N. 61° 14' 22" W. 65 FEET
TO THE SOUTHEASTERLY LINE OF MAYBELL AVENUE; THENCE ALONG SAID
SOUTHEASTERLY LINE, N. 28° 48' E. 60.17 FEET TO THE POINT OF BEGINNING.
TRACT TWO:
PARCEL ONE:
PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, "MAYBELL
TRACT", WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF
THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, ON JUNE 19, 1905 IN BOOK K
OF MAPS, AT PAGES 88 AND 89, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT A HUB SET AT THE POINT OF INTERSECTION OF THE
SOUTHEASTERLY LINE OF MAYBELL AVENUE WITH THE NORTHEASTERLY LINE OF
LOT 10, AS SAID AVENUE AND LOT ARE SHOWN UPON THE MAP ABOVE REFERRED
TO; RUNNING THENCE SOUTH 28° 48' WEST ALONG THE SAID SOUTHEASTERLY LINE
OF MAYBELL AVENUE 339.32 FEET TO AN IRON PIPE SET AT THE INTERSECTION
THEREOF WITH THE SOUTHWESTERLY LINE OF SAID LOT 10; RUNNING THENCE
SOUTH 61° 12' EAST ALONG SAID LAST NAMED LINE 96. 14 FEET TO AN IRON PIPE
AT THE WESTERNMOST CORNER OF THAT CERTAIN 0.94 ACRE TRACT OF LAND
DESCRIBED IN THE DEED FROM MARTHA A. CHRISTESON TO GEO M. ANTHONY,
DATED MARCH 5, 1937 RECORDED MARCH 26, 1937 IN BOOK 814 OF OFFICIAL
RECORDS, PAGE 434, SANTA CLARA COUNTY RECORDS; RUNNING THENCE NORTH
28° 48' EAST ALONG THE NORTHWESTERLY LINE OF SAID 0.94 ACRE TRACT 99.68
FEET TO AN IRON PIPE AT THE NORTHERNMOST CORNER THEREOF; RUNNING
THENCE SOUTH 57° 27' 38" EAST ALONG THE NORTHEASTERLY LINE OF THE SAID
0.94 ACRE TRACT 221.17 FEET TO AN IRON PIPE; THENCE LEAVING SAID LAST
NAMED LINE AND RUNNING NORTH 28° 48' EAST AND PARALLEL WITH THE SAID
SOUTHEASTERLY LINE OF MAYBELL AVENUE 254.14 FEET TO AN IRON PIPE SET ON
THE SAID NORTHEASTERLY LINE OF LOT 10; RUNNING THENCE NORTH 61° 14' 22"
WEST ALONG SAID LAST NAMED LINE 316.84 FEET TO THE POINT OF BEGINNING.
CONTAINING APPROXIMATELY 2 ACRES, SURVEYED AND MONUMENTED IN JANUARY
1951 BY GEO S. NOLTE, CIVIL ENGINEER AND LAND SURVEYOR.
EXCEPTING THEREFROM THAT CERTAIN PARCEL OF LAND DESCRIBED AS FOLLOWS:
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PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, "MAYBELL
TRACT", WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF
THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, ON JUNE 19, 1905 IN BOOK K
OF MAPS, AT PAGES 88 AND 89, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT A HUB SET AT THE POINT OF INTERSECTION OF THE
SOUTHEASTERLY LINE OF MAYBELL AVENUE WITH THE NORTHEASTERLY LINE OF
LOT 10, AS SAID AVENUE AND LOT ARE SHOWN UPON THE MAP ABOVE REFERRED
TO; RUNNING THENCE SOUTH 28° 48' WEST ALONG THE SAID SOUTHEASTERLY LINE
OF MAYBELL AVENUE 145.00 FEET TO THE TRUE POINT OF BEGINNING OF THE
FOLLOWING DESCRIBED PARCEL OF LAND; THENCE AT RIGHT ANGLES, TO SAID
SOUTHEASTERLY LINE OF MAYBELL AVENUE, SOUTH 61° 12' EAST 65.00 FEET;
THENCE RUNNING PARALLEL WITH THE SOUTHEASTERLY LINE OF MAYBELL AVENUE
SOUTH 28° 48' WEST 111.00 FEET; THENCE NORTH 61° 12' WEST 65.00 FEET TO A
POINT IN SAID SOUTHEASTERLY LINE OF MAYBELL AVENUE; THENCE ALONG SAID
SOUTHEASTERLY LINE OF MAYBELL AVENUE NORTH 28° 48' EAST 111.00 FEET TO
THE TRUE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM:
PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, "MAYBELL
TRACT", WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF
THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA ON JUNE 19, 1905 IN BOOK K
OF MAPS, AT PAGES 88 AND 89, AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT ON THE SOUTHEASTERLY LINE OF MAYBELL AVENUE,
DISTANT THEREON S. 28° 48' W. 84.83 FEET FROM THE POINT OF INTERSECTION
THEREOF WITH THE NORTHEASTERLY LINE OF LOT 10, AS SAID AVENUE AND LOT
ARE SHOWN UPON THE MAP OF MAYBELL TRACT HEREINABOVE REFERRED TO;
THENCE PARALLEL WITH SAID NORTHEASTERLY LINE OF LOT 10, S. 61° 14' 22" E.
80.74 FEET; THENCE PARALLEL WITH SAID SOUTHEASTERLY LINE OF MAYBELL
AVENUE, S. 28° 48' W. 169.66 FEET; THENCE PARALLEL WITH SAID NORTHEASTERLY
LINE OF LOT 10, N. 61° 14' 22" W. 15.74 FEET; THENCE PARALLEL WITH THE
SOUTHEASTERLY LINE OF MAYBELL AVENUE N. 28° 48' E. 109.49 FEET; THENCE
PARALLEL WITH SAID NORTHEASTERLY TINE OF LOT 10 N. 61° 14' 22" W. 65 FEET
TO THE SOUTHEASTERLY LINE OF MAYBELL AVENUE; THENCE ALONG SAID
SOUTHEASTERLY LINE, N. 28° 48' E. 60.17 FEET TO THE POINT OF BEGINNING.
ALSO EXCEPTING THEREFROM:
PORTION OF LOT 10, MAP OF MAYBELL TRACT, FILED JUNE 19, 1905, BOOK K OF
MAPS AT PAGE 88, SANTA CLARA COUNTY RECORDS, DESCRIBED AS FOLLOWS:
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BEGINNING AT THE INTERSECTION OF THE SOUTHEAST LINE OF MAYBELL AVENUE
AND THE NORTHEAST LINE OF CLEMO AVENUE, FORMERLY PARK AVENUE; THENCE
FROM SAID POINT OF BEGINNING N. 28° 48' E. ALONG SAID LINE OF MAYBELL
AVENUE 13.00 FEET; THENCE LEAVING SAID LINE S. 61° 12' E. 10.00 FEET; THENCE
5. 28° 48' W 3.00 FEET; THENCE ON THE ARC OF A TANGENT CURVE TO THE LEFT
WITH A RADIUS OF 10 FEET, THROUGH A CENTRAL ANGLE OF 90°, AN ARC DISTANCE
OF 15.71 FEET TO SAID NORTHEASTERLY LINE OF CLEMO AVENUE; THENCE ALONG
SAID LINE N. 61° 12' W. 20.00 FEET TO THE POINT OF BEGINNING.
PARCEL TWO:
BEGINNING AT A POINT IN THE SOUTHWESTERLY LINE OF LOT 10, DISTANT
THEREON N. 61° 12' W. 271.16 FEET FROM THE MOST SOUTHERLY CORNER OF SAID
LOT 10 IN THE NORTHWESTERLY LINE OF ARASTRADERO ROAD, AS SAID LOT AND
ROAD ARE SHOWN UPON THE MAP OF MAYBELL TRACT HEREINAFTER REFERRED TO;
THENCE LEAVING SAID SOUTHWESTERLY LINE AND RUNNING N. 28° 48' E., 85.35
FEET, MORE OR LESS, TO A POINT IN THE NORTHEASTERLY LINE OF THAT CERTAIN
0.94 ACRE TRACT DESCRIBED IN THE DEED FROM MARTHA A. CHRISTESON TO
GEORGE M. ANTHONY, DATED MARCH 5, 1937 AND RECORDED MARCH 26, 1937 IN
BOOK 814 OF OFFICIAL RECORDS PAGE 434, SANTA CLARA COUNTY RECORDS; SAID
POINT BEING THE MOST WESTERLY CORNER OF THAT CERTAIN PARCEL OF LAND
DESCRIBED IN THE DEED FROM CURTIS DAY, ET UX, TO SCOBLE, INC., A
CORPORATION DATED APRIL 29, 1958 AND RECORDED MAY 12, 1958 IN BOOK 4072
OF OFFICIAL RECORDS, PAGE 110, SANTA CLARA COUNTY RECORDS; THENCE
RUNNING ALONG THE SAID NORTHEASTERLY LINE OF THE 0.94 ACRE PARCEL OF
LAND N. 57° 26' W. 221.17 FEET TO THE MOST NORTHERLY CORNER OF SAID 0.94
ACRE PARCEL; THENCE RUNNING ALONG THE NORTHWESTERLY LINE OF SAID 0.94
ACRE PARCEL, S. 28° 48' W., 99.68 FEET TO THE MOST WESTERLY CORNER
THEREOF; THENCE RUNNING ALONG THE SOUTHWESTERLY LINE OF THE SAID 0.94
ACRE PARCEL, SAID LINE ALSO BEING THE SAID SOUTHWESTERLY LINE OF LOT 10
HEREINABOVE REFERRED TO, S. 61° 12' E., 220.70 FEET TO THE POINT OF
BEGINNING, AND BEING A PORTION OF LOT 10, AS SHOWN UPON THAT CERTAIN
MAP ENTITLED, "MAYBELL TRACT, MAYFIELD SANTA CLARA CO.", WHICH MAP WAS
FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SANTA
CLARA, STATE OF CALIFORNIA ON LIME 19, 1905 IN BOOK "K" OF MAPS, PAGE 88
AND 89.
APN: 137-25-108-00 and 137-25-109-00
895\05\1267519.3
1/22/2013
EXHIBIT B
SCHEDULE OF PERFORMANCE
This Schedule of Performance summarizes the schedule for various activities under the
Acquisition and Development Loan Agreement and Option to Purchase (the "Agreement") to
which this exhibit is attached. The description of items in this Schedule of Performance is meant
to be descriptive only, and shall not be deemed to modify in any way the provisions of the
Agreement to which such items relate.
Whenever this Schedule of Performance requires the submission of plans or other
documents at a specific time, such plans or other documents, as submitted, shall be complete and
adequate for review by the CITY or other applicable governmental entity within the time set
forth herein. Prior to the time set forth for each particular submission, BORROWER shall
consult with CITY staff informally as necessary concerning such submission in order to assure
that such submission will be complete and in a proper form within the time for submission set
forth herein.
As provided in Section 3.1 of this Agreement, this Schedule of Performance may be modified
by agreement of the City Manager on behalf of the CITY and the BORROWER.
Action Date
1. Application – Land Use Approvals.
BORROWER shall submit a complete
application for the CITY Land Use
Approvals, including CEQA review.
By January 15, 2013.
2. Receipt – Land Use Approvals.
BORROWER shall obtain the CITY Land
Use Approvals.
By July 1, 2013.
3. Application – Tax Credits.
BORROWER shall submit an application
to TCAC for a preliminary reservation of
9% tax credits.
July 2013 (if Land Use Approvals are
approved)
4. Application – Building Permit.
BORROWER shall apply for a building
permit from CITY.
September 15, 2013
5. Receipt – Tax Credits. BORROWER
receives approval for tax credit allocation.
October 31, 2013
895\05\1267519.3
1/22/2013
Action Date
6. Receipt – First Building Permit.
BORROWER shall obtain the first
building permit from City.
October 31, 2013
7. Submission – Final Construction and
Permanent Financing Plan. BORROWER
shall prepare and submit the Construction
Financing Plan for CITY approval.
Within 30 days after receipt of tax credit
allocation from TCAC.
8. Construction Loan Closing.
BORROWER shall satisfy all conditions
in Section 2.7 and commence construction.
November 31, 2013 to close construction
loans.
TCAC deadline to start construction April
2014.
9. Permanent Loan Closing and Complete
Rent-Up and Occupancy.
April 30, 2015.
City of Palo Alto (ID # 3375)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: On-Call Transportation Consultant Contracts
Title: Approval of On-Call Transportation Consultant Contract with TJKM
Transportation Consultants for a Total of $281,820 to Implement Bicycle &
Pedestrian Transportation Plan and to Provide Project Support Services
From: City Manager
Lead Department: Planning and Community Environment
Recommendation
Staff recommends that Council approve and authorize the City Manager or designee to execute
contract with TJKM Transportation Consultants (Attachment A) in the amount of $281,820 for
On-Call Traffic Engineering & Transportation Planning Services.
Background
The City adopted the Palo Alto - Bicycle & Pedestrian Transportation Plan 2012 in July 2012 and
has made implementation of the Plan a priority. The plan identifies future bicycle and
pedestrian transportation facilities, including bicycle boulevards, enhanced bikeways, off-road
trail opportunities, etc. Subsequent to completion of a Request for Proposals (RFP) process, the
City identified two firms to complete several key projects and to provide on-call traffic
engineering & transportation planning services. Hexagon Transportation Consultants was
awarded a contract through a City Manager authorization process, as the contract amount was
less than $85,000. This staff report requests approval of a contract with TJKM Transportation
Consultants, to complete three specific projects and provide project support services focused
on the implementation of the Bicycle & Pedestrian Transportation Plan 2012.
The City has identified five immediate projects to complete for the on-call work:
1. High Street One-Way to Two-Way Conversion Traffic Study (Hexagon)
This traffic study includes evaluating the conversion of High Street between Lytton
Avenue and Homer Avenue from a one-way to two-way street, or for select blocks of
that segment. The active 801 Homer Street development project on the corner of Alma
City of Palo Alto Page 2
Street and Homer Street, when completed, will provide a contraflow bicycle lane
between Alma Street and High Street. The City is responsible for studying bicycle routes
beyond the contraflow bicycle lane facility to support access into the Downtown; the
conversion of High Street to a two-way street between Forest Avenue and Homer Street
will provides the Downtown link.
2. Wilkie Way Bicycle & Pedestrian Path Connection Project (Hexagon)
The City has an active Capital Improvement Program (CIP) project to build a pedestrian
and bicycle path from Wilkie Way to the Summer Hill development at El Camino Real &
Deodar Street to provide connectivity to the public park located within the community.
This project was identified in the Bicycle and Pedestrian Plan 2012 and consists of a 10
feet wide by 130 feet long path with fencing and landscaping. The purpose of this traffic
study is to determine the impacts in terms of pedestrian and bicycle traffic diversion to
this new path and to measure changes in the parking occupancy rate on Wilkie Way.
3. Embarcadero Road Traffic Improvements (El Camino Real to Palo Alto High School Ped
Xing) (TJKM)
This traffic study includes identifying civil engineering improvement opportunities along
Embarcadero Road to improve roadway operations between El Camino Real and the
Palo Alto High School Pedestrian Crossing, including the Town & Country Shopping
Center Driveway. This segment of Embarcadero Road is the focus of frequent
community requests for improvement. Palo Alto High School is in the process of
implementing on-site improvements to the campus and there may be opportunities to
reroute on-site trails on the campus to help eliminate the need for one of the signalized
intersections on Embarcadero Road to improve efficiency. The City will also be studying
options to improve signal coordination with the Embarcadero Road & El Camino Real
intersection operated and maintained by the State of California – Department of
Transportation, Caltrans.
4. Embarcadero/Newell Roads School-Focused Traffic Signal Timing Study (TJKM)
This study includes studying the intersection of Embarcadero Road & Newell Road for
time-of-day pedestrian-only signal intervals consistent with those already in place at
Embarcadero Road & Middlefield Road. This is a recommended improvement from the
Fairmeadow School – Safe Routes to School evaluation and supports school-commute
activities to both Fairmeadow School and JLS Middle School. Pedestrian-only signal
intervals will be considered between 7:30AM-8:30AM and 2:00PM-3:00PM.
5. Maybell Avenue-Donald Drive-Georgia Avenue Bicycle Boulevard (TJKM)
Maybell Avenue is identified as an existing Bicycle Boulevard in the City’s Bicycle &
Pedestrian Transportation Plan 2012 between El Camino Real and Donald Drive between
Arastradero Road and Georgia Avenue and Georgia Avenue between Donald Drive and
the Palo Alto High School Trail entry. Staff intends to prepare a set of improvement
plans to improve the Maybell Avenue Bicycle Boulevard and implement the new bicycle
City of Palo Alto Page 3
boulevards treatments on Donald Drive and Georgia Avenue. The three streets together
serve predominantly student bicyclists attending Gunn High School, Terman Middle
School, and Juana Briones Elementary School. This study will develop new concept
signage and striping improvement plans for the consideration of the community.
Discussion
The City received five proposals in response to the RFP solicitation for the On-Call Traffic
Engineering and Transportation Planning services project. Three of the firms were selected for
interviewing and two selected for award of contracts consistent with the RFP. A contract with
Hexagon Transportation Consultants was awarded seperately by the Purchasing Manager, and
this staff report is for Council approval of a contract with TJKM Transportation Consultants.
The solicitation and selection process is outlined below.
City of Palo Alto Page 4
Summary of Solicitation Process
Proposal Description/Number On-Call Traffic Engineering & Transportation Planning
Project
Proposed Length of Contract: 1 year (with additional 1 yr renewal option)
Total Days to Respond to RFP: 25 days
Pre-proposal Meeting Date: August 29, 2012 via Teleconference
Number of Proposals Received: 5
Proposals Received from: Location (City, State) Selected for
oral interview?
TJKM Pleasanton, CA Yes
Fehr & Peers San Jose, CA Yes
Hexagon San Jose, CA Yes
AECOM San Jose, CA No
Hatch Mott MacDonald Gilroy, CA No
The proposals were judged by the following criteria:
Quality and effectiveness of proposed solutions,
Qualifications and experience of the staff assigned to the project,
Proposal quality and completeness,
Response time and ability to perform the work, and
Fee
The City released an (RFP) for the design of the On-call Traffic Engineering & Transportation
Planning Project on August 24, 2012. A pre-bidders teleconference was held on August 29,
2012 to help provide background regarding the projects. Five proposals were received in
response to the RFP. An evaluation committee consisting of Public Works, Utilities Electrical
Operations and Transportation staff reviewed the proposals and recommended the short-listing
of three consultant teams based on proposal content and criteria identified in the RFP.
City of Palo Alto Page 5
Three firms were invited to participate in oral interviews held on October 23, 2012. Two
consultants, Hexagon and TJKM, were selected for the projects because they demonstrated
superior knowledge of traffic engineering and the ability to complete the projects in a timely
fashion.
Hexagon Consultants was chosen to complete the High Street One–Way to Two-Way
Conversion Study and the Wilkie Way Bicycle & Pedestrian Path Project. Staff feels that
Hexagon Consultants demonstrated successful completion of various traffic studies and will
provide staff with the necessary data required to complete the assessment of the projects.
TJKM Consultants were chosen to complete the studies at Embarcadero Road, the Maybell-
Donald-Georgia Avenue Bicycle Boulevard project and the Project Support Services role for the
Transportation Department. TJKM demonstrated strong skills in completing similar traffic
engineering projects. The proposed candidate for the Project Support Services role
demonstrated strong skills in AutoCad and Microstation for the development of signing and
striping plans that would include innovative bicycle and pedestrian facility design.
The contract with Hexagon Transportation Consultants for the studies at Wilkie Way and High
Street is for a total amount of $61,425 and does not require Council approval for execution.
The Contract with TJKM Transportation Consultants for the traffic studies at Embarcadero
Road, Maybell-Donald- Georgia and project support services is for a total of $281,820 and is
addressed in this Staff Report.
Timeline
Immediately upon execution of a contract, staff will meet with the Consultant teams to get
them started on each of the projects described above. The study phase of these projects also
includes multiple community meetings as well as public hearing with the Planning and
Transportation Commission and City Council. Staff estimates all studies, with the exception of
the Project Support Services role, will be completed within one year.
Resource Impact
Funding in the amount of $343,245 for the traffic studies is included in the Capital
Improvement Program through various transportation-focused projects, including PL-00026
(Safe Routes to School), PL-04010 (Bicycle & Pedestrian Transportation Plan – Implementation
Project), PL-12000 (Parking & Transportation Improvements), and the General Fund –
Transportation Division Staffing.
City of Palo Alto Page 6
Policy Implications
The City’s Comprehensive Plan recommends that the City strive to accommodate all modes of
travel in its street system. Consistent with this Comprehensive Plan goal, the proposed traffic
studies ensure that “Goal T-4: An efficient Roadway Network is provided for all users, including
motor vehicles, transit vehicles, bicyclists and pedestrians” is effectuated.
Program T-18: “Develop and periodically update a comprehensive bicycle plan”
was also amended by Council in July 2012 to include the updated Bicycle and Pedestrian
Transportation Plan, which updates and supersedes the 2003 Plan.
Environmental Review
No environmental review is required for the proposed traffic studies. The findings of each
study though may be used to complete future enviromnetal studies.
Attachments:
Attachment A: Contract with TJKM Consultants (PDF)
Attachment B: Correspondence Received (PDF)
CITY OF PALO ALTO CONTRACT NO. C13147610
AGREEMENT BETWEEN THE CITY OF PALO ALTO
AND
TJKM TRANSPORTATION CONSULTAl~TS
FOR PROFESSIONAL SERVICES
This Agreement is entered into on this day of March, 2013, ("Agreement") by
and between the CITY OF PALO ALTO, a California chartered municipal corporation ("CITY"),
and TJKM TRANSPORTATION CONSULTANTS, a California corporation, located at 4305
Hacienda Drive, Suite 550, Pleasanton, CA. 94588, Telephone (925) 463-0611 ("CONSUL TANT").
RECITALS
The following recitals are a substantive portion of this Agreement.
A. CITY intends to begin implementation of the recently adopted Bicycle & Pedestrian
Transportation Plan 2012 and other traffic engineering projects as required. ("Project") and desires
to engage a consultant to provide traffic engineering and transportation planning services in
connection with the Project ("Services").
B. CONSULTANT has represented that it has the necessary professional expertise,
qualifications, and capability, and all required licenses and/or certifications to provide the Services.
C. CITY in reliance on these representations desires to engage CONSULTANT to provide the
Services as more fully described in Exhibit "A", attached to and made a part of this Agreement.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, this
Agreement, the parties agree:
AGREEMENT
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described in
Exhibit "A" in· accordance with the terms and conditions contained in this Agreement. The
performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM .
. The term of this Agreement shall be from the March, 212013 through September 31,2014 unless
terminated earlier pursuant to Section 19 of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of
Services under this Agreement. CONSULTANT shall complete the Services within the term ofthis
Agreement and in accordance with the schedule set forth in Exhibit "B", attached to and made a part
of this Agreement. Any Services for which times for performance are not specified in this
Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and
Professional Services
Rev June 2, 2010
timely manner based upon the circumstances and direction communicated to the CONSULT ANT.
CITY's agreement to extend the term or the schedule for performance shall not preclude recovery of
damages for delay if the extension is required due to the fault of CONSULTANT.
The applicable rates and schedule of payment are set out in Exhibit "C-l ", entitled "HOURLY
RATE SCHEDULE," which is attached to and made a part ofthis Agreement.
Additional Services, if any, shall be authorized in accordance with and subject to the provisions of
Exhibit "C" . CONSULTANT shall not receive any compensation for Additional Services performed
without the prior written authorization of CITY. Additional Services shall mean any work that is
determined by CITY to be necessary for the proper completion of the Project, but which is not
included within the Scope of Services described in Exhibit "A".
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to
CONSULTANT for performance of the Services described in Exhibit "A", including both
payment for professional services and reimbursable expenses, shall not exceed Two Hundred
Eighty One Thousand Eight Hundred Twenty Dollars ($281,820.00). In the event Additional
Services are authorized, the total compensation for services and reimbursable expenses shall not
exceed Two Hundred Eighty One Thousand Eight Hundred Twenty Dollars ($281,820.00). The
applicable rates and schedule of payment are set out in Exhibit "C-I ", entitled "HOURL Y RATE
SCHEDULE," which is attached to and made a part of this Agreement.
Additional Services, if any, shall be authorized in accordance with and subj ect to the provisions of
Exhibit "C". CONSULTANT shall not receive any compensation for Additional Services performed
without the prior written authorization of CITY. Additional Services shall mean any work that is
determined by CITY to be necessary for the proper completion of the Project, but which is not
included within the Scope of Services described in Exhibit "A".
SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly
invoices to the CITY describing the services performed and the applicable charges (including an
identification of personnel who performed the services, hours worked, hourly rates, and reimbursable
expenses), based upon the CONS ULT ANT's billing rates (set forth in Exhibit "C-I "). If applicable,
the invoice shall also describe the percentage of completion of each task. The information in
CONSULTANT's payment requests shall be subject to verification by CITY. CONSULTANTshall
send all invoices to the City's project manager at the address specified in Section 13 below. The
City will generally process and pay invoices within thirty (30) days of receipt.
SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be
performed by CONSULTANT or under CONSULTANT's supervision. CONSULTANT represents
that it possesses the professional and technical personnel necessary to perform the Services required
by this Agreement and that the personnel have sufficient skill and experience to perform the Services
assigned to them. CONSULTANT represents that it, its employees and subconsultants, ifpermitted,
have and shall maintain during the term of this Agreement all licenses, permits, qualifications,
insurance and approvals of whatever nature that are legally required to perform the Services.
All of the services to be furnished by CONSULTANT under this agreement shall meet the
professional standard and quality that prevail among professionals in the same discipline and of
Professional Services
Rev June 2, 2010
similar knowledge and skill engaged in related work throughout California under the same or similar
circumstance~.
SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and
in compliance with all federal, state and local laws, ordinances, regulations, and orders that may
affect in any manner the Project or the performance of the Services or those engaged to perform
Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all
charges and fees, and give all notices required by law in the performance of the Services.
SECTION 8. ERRORS/OMISSIONS. CONSULTANT shall correct, at no cost to C~TY, any and
all errors, omissions, or ambiguities in the work product submitted to CITY, provided CITY gives
notice to CONSULTANT. If CONSUL TANT has prepared plans and specifications or other design
documents to construct the Proj ect, CONSULTANT shall be obligated to correct any and all errors,
omissions or ambiguities discovered prior to and during the course of construction of the Project.
This obligation shall survive termination of the Agreement.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works
project, CONSULTANT shall submit estimates of probable construction costs at each phase of
design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%)
of the CITY's stated construction budget, CONSULTANT shall make recommendations to the CITY
for aligning the PROJECT design with the budget, incorporate CITY approved recommendations,
and revise the design to meet the Project budget, at no additional cost to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing
the Services under this Agreement CONSULTANT, and any person employed by or contracted with
CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an
independent contractor and not an agent or employee of the CITY.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of
CONSULTANT are material considerations for this Agreement. CONSULT ANT shall not assign or
transfer any interest in this Agreement nor the performance of any of CONSULTANT's obligations
hereunder without the prior written consent of the city manager. Consent to one assignment will not
be deemed to be consent to any subsequent assignment. Any assignment made without the approval
ofthe city manager will be void.
SECTION 12. SUBCONTRACTING. Notwithstanding Section 11 above, CITY agrees that
subconsultants may be used to complete the Services. The sub consultants authorized by CITY to
perform work on this Project are:
National Data and Surveying Services
8370 Wilshire Blvd. STB 205
Beverly Hills CA. 90211
Bicycle Solutions
450 Silver Ave. #3
San Francisco, CA. 94112
Professional Services
Rev June 2,2010
Fehr & Peers
100 Pringle Avenue, Suite 600
Walnut Creek, CA. 94596
CONSULTANT shall be responsible for directing the work of any subconsultants and for any
compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning
compensation. CONSULTANT shall be :fully responsible to CITY for all acts and omissions of a
sub consultant. CONSULTANT shall change or add subconsultants only with the prior approval of
the city manager or his designee.
SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Chris Kinzel as the
Principal-in-Charge to have supervisory responsibility for the performance, progress, and execution
of the Services and Christopher Thnay as the Project Manager to represent CONSULTANT during
the day-to-day work on the Project. If circumstances cause the substitution of the project director,
project coordinator, or any other key personnel for any reason, the appointment of a substitute
project director and the assignment of any key new or replacement personnel will be subject to the
prior written approval of the CITY's project manager. CONSULTANT, at CITY's request, shall
promptly remove personnel who CITY fInds do not perform the Services in an acceptable manner,
are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat
to the safety of persons or property.
The City's project manager is Jaime Rodriguez, Planning & Community Environmental Department,
Planning Transportation Division, 245 Hamilton Avenue, Palo Alto, CA 94303, Telephone (650)
329-2136, email The Project Manager will be
CONSULTANT's point of contact with respect to performance, progress and execution of the
Services. The CITY may designate an alternate project manager from time to time.
SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including
without limitation, all writings, drawings, plans, reports, specifIcations, calculations, documents,
other materials and copyright interests developed under this Agreement shall be and remain the
exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees
that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested
in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectUal
property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make
any of such matcrials available to any individual or organization without the prior written approval
of the City Manager or designee. CONSULTANT makes no representation ofthe suitability ofthe
work product for use in or application to circumstances not contemplated by the scope of work.
SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during
the term of this Agreement and for three (3) years thereafter, CONSULTANT's records pertaining to
matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such
records for at least three (3) years after the expiration or earlier termination of this Agreement.
SECTION 16. INDEMNITY.
16.1. To the :fullest extent permitted by law, CONSLlLTANT shall protect,
indenmify, defend and hold harmless CITY, its Council members, officers, employees and agents
Professional Services
Rev JUlJe 2, 2010
(each an "Indemnified Party") from and against any and all demands, claims, or liability of any
nature, including death or injury to any person, property damage or any other loss, including all costs
and expenses of whatever nature including attorneys fees, experts fees, court costs and
disbursements ("Claims") that arise out of, pertain to, or relate to the negligence, rec1dessness, or
willful misconduct of the CONSULTANT, its officers, employees, agents or contractors under this
Agreement, regardless of whether or not it is caused in part by an Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to
require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active
negligence, sole negligence or willful misconduct of an Indemnified Party.
16.3. The acceptance of CONSULTANT's services and duties by CITY shall not
operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive
the expiration or early termination of this Agreement.
SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant,
term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not
be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of
any subsequent breach or violation (lfthe same or of any other term, covenant, condition, provision,
ordinance or law.
SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full
force and effect during the term ofthis Agreement, the insurance coverage described in Exhibit "D".
CONSUL TANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an
additional insured under any general liability or automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through carriers
with AM Best's Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to
transact insurance business in the State of California. Any and all contractors of CONSULTANT
retained to perform Services under this Agreement will obtain and maintain, in full force and effect
during the term of this Agreement, identical insurance coverage, naming CITY as an additional
insured under such policies as required above.
18.3. Certificates evidencing such insurance shall be filed with CITY concurrently
with the execution of this Agreement. The certificates will be subject to the approval of CITY's Risk
Manager and will contain an endorsement stating that the insurance is primary coverage and will not
be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the
Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification,
CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance
are provided to CITY's Purchasing Manager during the entire term of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be
construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions
of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be
obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as
a result of the Services performed under this Agreement, including such damage, injury, or loss
arising after the Agreement is terminated or the term has expired.
Professional Services
Rev June 2, 2010
SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole or
in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written
notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately
discontinue its performance of the Services.
19 .2. CONSULTANT may terminate this Agreement or suspend its performance of
the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a
substantial failure of performance by CITY.
19.3. Upon such suspension or termination, CONSULTANT shall deliver to the
City Manager immediately any and all copies of studies, sketches, drawings, computations, and other
data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to
CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will
become the property of CITY.
19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid
for the Services rendered or materials delivered to CITY in accordance with the scope of services on
or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided,
however, if this Agreement is suspended or terminated on account of a default by CONSULTANT,
CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT's
services which are of direct and immediate benefit to CITY as such determination may be made by
the City Manager acting in the reasonable exercise ofhislher discretion. The following Sections will
survive any expiration or termination ofthis Agreement: 14, 15, 16, 19.4,20, and 25.
19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will
operate as a waiver on the part of CITY of any of its rights under this Agreement.
SECTION 20. NOTICES.
All notices hereunder will be given in writing and mailed, postage prepaid, by
certified mail, addressed as follows:
To CITY: Office of the City Clerk
. City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Purchasing Manager
To CONSULTANT: Attention of the project director
at the address of CONSULTANT recited above
SECTION 21. CONFLICT OF INTEREST.
21.1. In accepting this Agreement, CONSULTANT covenants that it presently has
no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would
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conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the peliormance of this Agreement,
it will not employ sub consultants, contractors or persons having such an interest. CONSULTANT
certifies that no person who has or will have any financial interest under this Agreement is an officer
or employee of CITY; this provision will be interpreted in accordance with the applicable provisions
of the Palo Alto Municipal Code and the Government Code of the State of California.
21.3. If the Project Manager determines that CONSULTANT is a "Consultant" as
that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT
shall be required and agrees to file the appropriate fmancial disclosure documents required by the
Palo Alto Municipal Code and the Political Reform Act.
SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section
.2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not
discriminate in the employment of any person because of the race, skin color, gender, age, religion,
disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status,
weight or height of such person. CONSULTANT acknowledges that it has read and understands the
provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination
Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section
2.30.510 pertaining to nondiscrimination in employment.
SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE
REQUIREMENTS. CONSULTANT shall comply with the City's Environmentally Preferred
Purchasing policies which are available at the City's Purchasing Department, incorporated by
reference and may be amended from time to time. CONSULTANT shall comply with waste
. reduction, reuse, recycling and disposal requirements of the City's Zero Waste Program. Zero Waste
best practices include frrst minimizing and reducing waste; second, reusing waste and third,
recycling or compo sting waste. In particular, Consultant shall comply with the following zero waste
requirements:
• All printed materials provided by Consultant to City generated from a personal
computer and printer including but not limited to, proposals, quotes, invoices,
reports, and public education materials, shall be double-sided and printed on a
minimum of 30% or greater post-consumer content paper, unless otherWise approved
by the City's Project Manager. Any submitted materials printed by a professional
printing company shall be a minimum of3 0% or greater post-consumer material and
printed with vegetable based inks.
• Goods purchased by Consultant on behalf of the City shall be purchased in
accordance with the City's Environmental Purchasing Policy including but not
limited to Extended Producer Responsibility requirements for products and
packaging. A copy of this policy is on file at the Purchasing Office.
• Reusable/returnable pallets shall be taken back by the Consultant, at no additional
cost to the City, for reuse or recycling. Consultant shall provide documentation from
the facility accepting the pallets to verify that pallets are not being disposed.
SECTION 24. NON-APPROPRIATION
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24.1. This Agreement is subject to the fiscal provisions of the Charter ofthe City of
Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty ( a)
at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year,
or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of
the fiscal year and funds· for this Agreement are no longer available. This section shall take
precedence in the event of a conflict with any other covenant, term, condition, or provision of this
Agreement.
SECTION 25. MISCELLANEOUS PROVISIONS.
25.1. This Agreement will be governed by the laws of the State of California.
25.2. In the event that an action is brought, the parties agree that trial of such action
will be vested exclusively in the state courts of California in the County of Santa Clara, State of
California.
25.3. The prevailing party in any action brought to enforce the provisions of this
Agreement may recover its reasonable costs and attorneys' fees expended in connection with that
action. The prevailing party shall be entitled to recover an amount equal to the fair market value of
legal services provided by attorneys employed by it as well as any attorneys' fees paid to third
parties.
25.4. This document represents the entire and integrated agreement between the
parties and supersedes all prior negotiations, representations, and contracts, either written or oral.
This document may be amended only by a written instrument, which is signed by the parties.
25.5. The covenants, terms, conditions and provisions of this Agreement will apply
to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the
parties.
25.6. If a court of competent jurisdiction finds or rules that any provision of this
Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this
Agreement and any amendments thereto will remain in full force and effect.
25.7. All exhibits referred to in this Agreement and any addenda, appendices,
attachments, and schedules to this Agreement which, from time to time, may be referred to in any
duly executed amendment hereto are by such reference incorporated in this Agreement and will be
deemed to be a part of this Agreement.
25.8 If, pursuant to this contract with CONSULTANT, City shares with
CONSULTANT personal inforination as defmed in California Civil Code section 1798.81. 5( d) about
a California resident ("Personal Information"), CONSULTANT shall maintain reasonable and
appropriate security procedures to protect that Personal Information, and shall inform City
immediately upon learning that there has been a breach in the security of the system or in the
security of the Personal Information. CONSULTANT shall not use Personal Information for direct
marketing purposes without City's express written consent.
25.9 All unchecked boxes do not apply to this agreement.
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IN WITNESS WHEREOF, the parties hereto have by their duly authorized
representatives executed this Agreement on the date first above written.
CITY OF PALO ALTO TJKM TRANSPORTATION
CONS~~TA.NTSIDr~~
By: \..:.:.---..... City Manager
Name: tJ C\.~a\J\ A'f\J'...\~
APPROVED AS TO FORM: 'P r-e <6.lde..tI\ \-
Senior Deputy City Attorney
Attachments:
EXHIBIT "A":
EXHIBIT "B":
EXHIBIT "C":
EXHIBIT "C-l":
EXHIBIT "D":
SCOPE OF WORK
SCHEDULE OF PERFORMANCE
COMPENSATION
SCHEDULE OF RATES
INSURANCE REQUIREMENTS
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25.10 The individuals executing this Agreement represent and warrant that they
have the legal capacity and authority to do so on behalf of their respective legal entities.
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TASK I:
EXHIBIT "A"
SCOPE OF SERVICES
EMBARCADERO ROAD TRAFFIC IMPROVEMENTS
CONSULT ANT shall evaluate the Embarcadero Road corridor and determine what civil or traffic
signal operation modifications are necessary to improve traffic operations along the corridor
between EI Camino Real and Palo Alto High School (Paly High) Pedestrian Crossing (Xing)
intersections.
CONSULTANT shall collect 12-hour turning movement counts (including separately banked
bicycle and pedestrian data) for the following three intersections:
1. Embarcadero RoadlEl Camino Real
2. Embarcadero RoadITown and County Shopping Center
3. Embarcadero RoadlPalo Alto High School Pedestrian Xing
CONSULTANT shall collect 24-hour counts on each approach of Embarcadero Road and each of
the project driveways for seven days. Upon completion of the data collection process,
CONSULTANT shall validate the data and develop Synchro model to evaluate existing conditions.
CONSULTANT shall develop base maps for the corridor and develop corridor improvements
alternatives (including but not limited to: signal modifications, removal or reconfiguration of the
intersections) in consultation with the City staff. Upon completion of development of corridor
improvements, CONSULTANT shall evaluate alternatives using Synchro model. Results of the
evaluation shall be compared to determine the effectiveness of each alternatives or combination of
alternatives to improve traffic operations along the study corridor.
CONSULTANT shall develop Concept Plan Line improvements for recommended alternative
identifying limits of civil, roadway markings and traffic signal improvements.
Upon completion of the development of Concept Plan Line, CONSULTANT shall develop Draft
Study Report summarizing the data collected, evaluation of existing conditions and future conditions
including the Concept Plan Line and submit to City staff for review and comment. Upon receipt of
comments from the City, the Study Report shall be revised to incorporate the comments and Final
Study Report shall be submitted to the City for approval.
CONSULTANT shall attend four community meetings as part of this project at City's request.
TASK II: ElVIBARCADERO ROAD SCHOOL-FOCUSED TRAFFIC SIGNAL
TIMING STUDY
CONSULTANT shall evaluate the feasibility of implementing a similar all-pedestrian signal interval
at the intersection of Embarcadero RoadlNewell Road and develop optimized signal timing plans for
the two intersections.
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The timing plan development process shall involve a collection of roadway, signal control, traffic
flow data, construction and calibration of a model, testing & final optimization of the model, and
implementation & refinement of the timing plans. CONSULTANT shall coordinate the effort
closely with City staff. CONSULTANT shall develop an in depth knowledge of existing traffic
conditions in the City, short-and long-term plans for transportation system improvements, and local
coordination/management priorities should be used to guide the development and operation of the
computer model and the model's ultimate application to develop the timing plans.
CONSlJLT MIT'S approach to preparing signal timing plans shall consist of the following sequence
of responsibilities:
• Conduct Field Visit • Develop Optimized Signal
• Define Network Timings
• Collect Data • Prepare a Simulation Model
• Conduct Before Study • Implement Timing Plans
• Develop Existing Model • Fine Tune Timing Plans
• Calibrate Existing Model • Conduct After Study
• Refine Signal Groupings • Prepare Project Report
CONSULTANT'S engineers shall consider a number of factors, such as:
Controlling Intersections and Locations -The following conditions shall require special attention
and a customized analysis using both computerized, off-the-shelf optimization software and manual
adjustments based on engineering experience: a) close signal spacing, which may require shorter
cycle lengths and/or metering of upstream traffic to prevent queue spill back from the downstream
signals and blockage of through lanes by left-turning vehicles; b) freeway interchanges, which often
result in unbalanced lane utilization; c) lane drop and dual left-turn lane locations; d) intersections of
major streets, which may require coordination along both arterials and may dictate the choice of
cycle length for both systems; and e) over-saturated intersections, which may operate better as
isolated, fully-actuated intersections. All of these conditions shall be recognized early on, since they
typically impose constraints on the treatment of other intersections in a system.
Pedestrian Timing -The minimum pedestrian timing may control cycle lengths. In situations where
pedestrian timing clearly affects the choice of coordination plans, additional analyses shall be
conducted to determine ways of reducing the adverse impacts on coordination of pedestrian timings.
Phasing An efficient coordination plan consists not only of the appropriate cycle lengths and
splits, but also the appropriate signal phasing. CONSULTANT shall investigate various alternatives
for lead-lag left-turn phasing, right-turn overlap phasing, and consider the adverse impacts of split
phasing on cycle length.
Critical Movements -In developing optimum timing plans, CONSULTANT shall give attention to
critical movements that could cause difticulties in signal operation. These critical movements shall
be identified in this task. An example is heavy left-turns without sufficient storage capacity. Another
example is heavy left turns from a side street feeding into a downstream signal that is only a short
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distance away. In other words, movements with greater coordination requirement may not be the
through movements in special cases. In addition, certain movements might be given higher priority.
For example, on heavy commute routes, the City may want to give the heavier direction as large a
band width as possible, even if the opposite direction is penalized. Considering these movements and
priorities in the timing plans is a matter of practicality.
Timing Parameters -A complete review of the existing phase timing data shall be conducted. Due
to the study signals ofthe actuated type, many ofthe timing parameters, such as minimum green (or
initial), unit extension ( or gap), and pedestrian walk and clearance intervals, could significantly
impact the efficiency of the coordinated timing plans, particularly with respect to allowable cycle
length and split. This review effort shall identifY modifications that shall improve signal
coordination as well as isolated signal operatio~. In exceptional cases, modification of the signal
phasing might be worthy of consideration. The CONSULTANT'S Team shall present all signal
operation related modifications to the City for review and approval.
CONSULTANT shall collect 12-hour (7:00 AM -,7:00 PM) turning movement counts at the
intersections of Embarcadero RoadlMiddlefield Road and Embarcadero Road/Newell Road. In
addition, CONSULTANT shall also collect queue lengths in the field while collecting turning
movement counts so that the Synchro model can be calibrated for existing conditions.
Upon completion of data collection, CONSULTANT shall develop Synchro model for existing
conditions. Synchro model shall be calibrated and validated to existing conditions based on the data
collected. Calibrated Synchro model shall be used to determine the feasibility of implementing all-
pedestrian signal interval at the intersection of Embarcadero Road/N ewell Road. If it is determined
the implementation is feasible and it can result in improved traffic and pedestrian operations
CONSULTANT shall develop optimized signal timing plans for the two intersections with all-
pedestrian signal interval. The optimized signal timing plans shall be submitted to City for review
and approvaL Upon approval from City staff CONSULTANT shall develop timing sheets in City
preferred format.
CONS UL TANT shall develop Draft Study Report for the proj ect, summarizing the data collection,
evaluation of existing conditions and evaluation of proposed conditions. The Draft Study Report
shall also include timing sheets for optimized signal timings at the two study intersections. Upon
receipt of comments from City staff, the report shall be revised to incorporate the comments and the
Final Study Report shall be submitted to the City for approval.
Task III: MAYBELL-DONALD-GEORGIA BIKE BOIlLEVARD
Maybell Avenue is an existing bicycle boulevard that provides a connection between El Camino
Real and west Palo Alto parallel to Arastradero Road. This corridor serves students at Gunn High
School, Terman Middle School, and Juana Briones Elementary School. Existing traffic calming
improvements along Maybell Avenue include speed humps, center lines and striped medians, and a
short section of striped bike lanes, which help to manage vehicle speeds so the speed differential
between bicyclists and drivers is reduced, reducing the risk of and severity of potential bicycle-
related collisions. The purpose of this project is to improve the Maybell A venue Bike Boulevard,
and extend a bike boulevard to Donald Drive and Georgia Avenue to connect to Gunn High School,
the Gunn High School Bike Path, and other local destinations. The City has a separate ongoing'
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citywide Safe Routes to School project to develop a Walk and Roll to School map for the area
surrounding these schools.
Data Compilation
CONSULTANT shall request available traffic volume, speed surveys and bicycle and pedestrian
counts from the City on each of the three streets: Maybell Avenue, Donald Drive, and Georgia
Avenue. No new traffic counts are proposed as part of this task. In addition, field visits during the
morning school arrival and afternoon school dismissal shall be conducted to review existing bicycle
facilities and observe pedestrian, bicyclist, and driver travel patterns, behavior, and interactions. The
data and summary of CONSULTANT'S field observations shall be compiled for presentation during
the first community meeting.
Develop Preliminary Concept Plans
Three key design and operational issues require to be addressed in planning and design of bicycle
boulevards. CONSULTANT shall address the following:
1. Appropriate volume and speed: Shall the streets require additional measures to reduce
the speed and volume of vehicles?
2. Number of bicycle stops required: Stopping and starting requires significant energy
and bicyclists often ignore stop signs when they perceive them as unnecessary. Are
there
opportunities to remove stop signs (flip signs or remove and replace with traffic circles
for example) to reduce delay for cyclists on the bike boulevard?
3. Crossing arterials: Bike boulevards are often one-street off of an arterial (in this
case, Arastradero Road), the crossings of perpendicular arterials can be challenging.
Shall the subject bike boulevard require enhanced crossing treatments at arterials?
A base map ofthe study area shall be developed using available aerial photography. CONSULTANT
shall prepare Concept Plans to depict preliminary improvement options for Maybell A venue, Donald
Drive, and Georgia Avenue. The City anticipates potential improvements to include traffic calming
enhancements, signing and striping, geometric modifications at intersections, and potential
landscape and streetscape improvements along the corridor. Additional bicycle crossing treatments
at the E1 Camino ReallMaybell A venue-EI Camino Way intersection shall be developed (such as
bicycle signals, skip-striping through the intersection, bicycle turn lanes, and/or bike boxes).
CONSULT ANT shall coordinate this task with the Safe Routes to School program to ensure
improvements identified are consistent with the Walk and Roll to School maps. Administrative draft
concept plans shall be reviewed with City staff, and feedback shall be incorporated into the draft
plans. CONSULTANT shall present draft plan during the first community meeting to gather public
input. Modifications based on the public feedback shall be incorporated into the revised draft plans.
Develop Final Concept Plans
CONSUL T ANT shall take the revised plan back to the second community meeting to review
changes to the plans. Input from the community shall be incorporated before the administrative final
plans are taken to the public hearings.
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Community Meetings
CONSULTANT shall attend five community meetings as part of this project. These meetings
include:
• Two Community Meetings -first to gather input on key issues and draft concept
plans, second to review revised draft plans
• Palo Alto Bicycle Advisory Committee (P ABAC) meeting
• Planning & Transportation Committee me.eting
• City Council meeting
Project Team Meetings
CONSULTANT shall meet with City staff, at minimum, twice during the conduction of the study.
There shall be an initial project start-up meeting between CONSULTANT and City, prior to data
collection and a meeting to discuss preliminary concept plans.
Documentation
CONSULTANT shall prepare a memorandum report that summarizes the data compilation,
community feedback, and recommended concepts. CONSULTANT shall submit a draft report to the
City for review and comments. CONSULTANT shall have up to eight (8) hours of staff time to
respond to any comments on the draft and prepare a final version of the memorandum.
Task IV: PROJECT SUPPORT SERVICES
The CONSULTANT shall include as part of their team an Assistant Engineer-equivalent team
member that can provide staff project support to the City's Transportation Division. The
CONSULTANT'S team member shall have at least 3-5 years of working experience in the
development of signage & striping plans that include innovative bicycle and pedestrian facility
design. The team member shall be well-versed in AutoCAD or Microstation to be able to develop
one's improvement plans without the need for coordination by a CAD technician.
CONSULTANT shall provide a detailed resume that highlights the proposed team members
experience and include fully-burdened hourly rate structure. CONSULT ANT shall identify hourly
rates for additional positions that may be utilized to provide support to city projects as required
including graphic design, CAD technician, and community meeting facilitator. The City expects the
proposed CONSULTANT'S team member to be able to develop simple graphics on their own and to
develop CAD-based improvement plans independently without substantial training needs by the
City. The use of additional CONSULTANT'S team resources must be authorized by City project
manager.
The CONSULTANT'S team member shall meet with the City's project manager twice weekly to
receive assignments and review work The City shall provide a work area with computer and phone
access for use during these visits. Travel time for the CONSULTANT'S team member to arrive on-
site to Palo Alto shall not be considered as reimbursable expenditures as part of this task
The City accepts the CONSULTANT'S proposed candidate Travis Richards, P.E., Transportation
Engineer, to provide staff project support to the Palo Alto Planning Community Environment
Department, Transportation Division. In the event Travis Richards cannot perform his duties or
vacates the position CONSULTANT shall supply the City with an alternate candidate per the
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specifications stated above. The City reserves the right to select or reject any or all possible
candidates.
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EXHIBIT "B"
SCHEDULE OF PERFORMANCE
CONSULTANT shall perfonn the Services so as to complete each milestone within the number
of days/weeks specified below. The time to complete each milestone may be increased or
decreased by mutual written agreement of the project managers for CONSULTANT and CITY
so long as all work is completed within the tenn of the Agreement. CONSULT ANT shall
provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt
of the notice to proceed.
Milestones
L TASKI
EMBARCADERO ROAD TRAFFIC
IMPROVEMENTS
2. TASKII
EMBARCADERO ROAD SCHOOL-
FOCUSED TRAFFIC SIGNAL
TIMING STUDY
3. TASKID
MA YBELL-DONALD-GEORGIA
BIKE BOULEVARD
4. TASKIV
PROJECT SUPPORT
SERVICES
Completion
No. of Days/Weeks
FromNTP
48 WEEKS
10 WEEKS
36 WEEKS
18 MONTHS
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EXIllBIT "C"
COMPENSATION
The CITY agrees to compensate the CONSULTANT for professional services performed in
accordance with the terms and conditions of this Agreement, and as set forth in the budget
schedule below. Compensation shall be calculated based on the hourly rate schedule attached
as exhibit C-l up to the not to exceed budget amount for each task set forth below.
The compensation to be paid to CONS1JLTANT under this Agreement for all services
described in Exhibit "A" ("Basic Services") includmg reimbursable expenses shall not exceed
$281,820.00. CONSULTANT agrees to complete all Basic Services and reimbursable
expenses within this amount. In the event CITY authorizes any Additional Services, the
maximum compensation shall not exceed $281,820.00. Any work performed or expenses
incurred for which payment would result in a total exceeding the maximum amount of
compensation set forth herein shall be at no cost to the CITY.
CONSULTANT shall perform the tasks and categories of work as outlined and budgeted
below. The CITY's Project Manager may approve in writing the transfer of budget amounts
between any of the tasks or categories listed below provided the total compensation for Basic
Services, including reimbursable expenses, does not exceed $281,820.00 and the total
compensation for Additional Services does not exceed $281,820.00.
BllDGET SCHEDULE
5. TASK I
(EMBARCADERO ROAD TRAFFIC
IMPROVEMENTS)
6. TASK II
(EMBARCADERO ROAD SCHOOL-
FOCUSED TRAFFIC SIGNAL
TIMING STUDY)
7. TASK III
(MA YBELL-DONALD-GEORGIA
BIKE BOULEVARD)
8. TASK IV
(pROJECT SUPPORT
SERVICES)
NOT TO EXCEED AMOUNT
$46,760.00
$15,030.00
$60,030
$157,000.00
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Sub-total Basic Services
Total Basic Services
Reimbursable Expenses
Additional Services (Not to Exceed)
Maximum Total Compensation
REIMBURSABLE EXPENSES
$278,820.00
$3000.00
$0.00
$278,820.00
$281,820.00
The administrative, overhead, secretarial time or secretarial overtime, word processing,
photocopying, in-house printing, insurance and other ordinary business expenses are included
within the scope of payment for services and are not reimbursable expenses. CITY shall
reimburse CONSULT ANT for the following reimbursable expenses at cost. Expenses for
which CONSULTANT shall be reimbursed are:
A. Travel outside the San Francisco Bay area, including transportation and meals, will be
reimbursed at actual cost subject to the City of Palo Alto's policy for reimbursement of travel
and meal expenses for City of Palo Alto employees.
B. Plotting (per Sheet)
All requests for payment of expenses shall be accompanied by appropriate backup
information. Any expense anticipated to be more than $0.00 shall be approved in advance by
the City's project manager.
ADDITIONAL SERVICES
The CONSULTANT shall provide additional services only by advanced, written
authorization from the CITY. The CONSULTANT, at the CITY's Project manager's request,
shall submit a detailed written proposal including a description of the. scope of services,
schedule, level of effort, and CONSULTANT's proposed maximum compensation, including
reimbursable expense, for such services based on the rates set forth in Exhibit C-l. The
additional services scope, schedule and maximum compensation shall be negotiated and
agreed to in writing by the CITY's Project Manager and CONSULTANT prior to
commencement ofthe services. Payment for additional services is subject to all requirements
and restrictions in this Agreement
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Principal
Principal Associate
Senior Associate
Associate
Senior Engineer
Engineer
Contracts Director
Assistant Engineer
Assistant Planner
Senior Designer
Graphics Designer
Designer
Technical Staff
Technical Staff II
Administrative Staff
Production Staff
EXIDBIT "C-1"
HOURLY RATE SCHEDULE
StaffProiect Support (T. Richard)
Plotting: ($18.00 Per Sheet)
$220
$200
$190
$160
$140
• $130
$120
$115
$85
$100
$100
$85
$80
$35
$80
$55
$110
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EXIUBIT "D"
INSURANCE REQIDREMENTS
CONTRACTORS TO THE CTIY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT
OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES
WITHAMBEST'S KEY RATING OFA-:VII,ORHIGHER,LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN
THE STATE OF CALlF'ORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY'S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW:
I REQUIRED
MINIMUM LIMITS
TYPE OF COVERAGE REQUIREMENT EACH AGGREGATE OCCURRENCE
YES
YES
YES
YES
YES
YES
WORKER'S COMPENSATION STATUTORY
EMPLOYER'S LIABILITY STATUTORY
BODILY INJURY $1,000,000 $1,000,000
GENERAL LIABILITY, INCLUDING
PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE $1,000,000 $1,000,000
PROPERTY DAMAGE BLANKET
CONTRACTUAL, AND FIRE LEGAL BODILY INJURY & PROPERTY DAMAGE $1,000,000 $1,000,000
LIABILTIY COMBINED.
BODILY INJURY $1,000,000 $1,000,000
-EACH PERSON $1,000,000 $1,000,000
-EACH OCCURRENCE $1,000,000 $1,000,000
AUTOMOBILE LIABILITY, INCLUDING
ALL OWNED, HIRED, NON-OWNED PROPERTY DAMAGE $1,000,000 $1,000,000
BODILY INJURY AND PROPERTY $1,000,000 $1,000,000
• DAMAGE COMBINED
PROFESSIONAL LIABILITY, INCLUDING,
ERRORS AND OMISSIONS,
MALPRACTICE (WHEN APPLICABLE),
AND NEGLIGENT PERFORMANCE ALL DAt"\1AGES $1,000,000
THE CITY OF P AI,O ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE,
SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT
AGREEMENT,THEINSURANCECOVERAGEHEREINDESCRIBED,INSURINGNOTONLYCONTRACTORANDITSSUBCONSULTANTS,
IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS' COMPENSATION, EMPLOYER'S LIABILITY AND PROFESSIONAL
INSURANCE, NAMING AS ADDmONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE;
A. A PROVISION FOR A WRITTEN TIllRTY DAY ADVANCE NOTICE TO CITY OF CHANGE IN
COVERAGE OR OF COVERAGE CANCELLATION; AND
B. A CONTRACTUAL llABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR
CONTRACTOR'S AGREEMENT TO INDEMNIFY CITY.
C. THE CITY'S RISK MANAGEMENT DEPARTMENT WILL ACCEPT A PROFESSIONAL LIABILITY
INSURANCE DEDUCTABLE AMOUNT OF $35,000.00. OR LESS.
II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE.
III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO "ADDITIONAL
INSUREDS"
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS
AFFORDED BY TillS POllCY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRlBUTING WITH ANY OTHER
INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.
B. CROSS LIABILITY
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POllCY SHALL
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NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF TIlE INSURED AGAINST ANOTImR, BUT THIS
ENDORSEMENT, AND TIlE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF
THE COMPANY UNDER TIllS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRA110N DATE FOR ANY REASON OTHER
THAN THE NON-PAYMENT OF PREMIUM, THE ISSVING COMPANY SHALL PROVIDE CITY
AT LEAST A THIRTY (30) DAY WlUTTEN NOTICE BEFORE THE EFFECTNE DATE OF
CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT .
OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY
WRITTEN NOTICE BEFORE THE EFFECTNE DATE OF CANCELLATION.
NOTICES SHALL BE MAILED TO:
PURC.gASING AND CONTRACT ADMINISTRATION
CITY OF PALO ALTO
P.O. BOX 10250
PALO ALTO, CA 94303
Professional Services
Rev June 2, 2010
CITY OF PALO ALTO OFFICE OF THE CITY ATTORNEY
March 4, 2013
The Honorable City Council
Palo Alto, California
Request for Authorization to (1) Increase the Contract with Moscone
Emblidge Sater & Otis in the Amount of $220,000 for a Total Not to
Exceed Amount of $455,000 for Legal Services and (2) Enter into
Contracts with Project Controls and Forensics, LLC in an amount not
to exceed $100,000 and with David Neagley, AIA in an amount not to
exceed $275,000 for Expert Consultant Services Related to Public
Works Construction Matters
The Office of the City Attorney requests authorization to increase the compensation of
an existing legal services agreement and to contract with two expert consultants for work
relating to the Mitchell Park Library and Community Center. Currently, the City contracts with
the law firm of Moscone Emblidge Sater & Otis (formerly Otis & Iriki), Attorneys at Law, for
legal services, including expert consultants. The Office of the City Attorney is requesting
authorization to increase the not to exceed amount of the contract by an additional $220,000
for a total not to exceed amount of $455,000.
In addition, the Office of the City Attorney is requesting authorization to enter into
contracts with Project Controls and Forensics, LLC for an amount not to exceed $100,000 and
with David Neagley, AIA in an amount not to exceed $275,000. Both firms provide expert
consultant services to the City relating to the Mitchell Park Library and Community Center.
Funding for these contracts does not require additional budgetary authority as it is a
proper expense against the Library bond funds.
Department Head: Molly Stump, City Attorney
Page 2
City of Palo Alto (ID # 3555)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Contract extension with Cardiac Therapy Foundation of the
Mid-Peninsul
Title: Staff Recommends That Council Approve the Short Form Agreement for
Revenue Contracts (Attachment A) Extending the Joint Venture Between the
City of Palo Alto and the Cardiac Therapy Foundation of the Mid-Peninsula,
Inc. (CTF) through December 31, 2014.
From: City Manager
Lead Department: Community Services
RECOMMENDATION
Staff recommends that the Council approve the Short Form Agreement for Revenue Contracts
(Attachment A) extending the Joint Venture between the City of Palo Alto and the Cardiac
Therapy Foundation of the Mid-Peninsula, Inc. (CTF) through December 31, 2014.
The purpose of this Joint Venture is to continue current classes, programs and services related
to the CTF program at the Cubberley Community Center (Cubberley) for the benefit of resident
and non-resident doctor-referred participants afflicted with cardiovascular disease and other
medically related conditions. The term of this agreement will expire at the same time as the
City’s lease with the Palo Alto Unified School District (PAUSD) for the use of Cubberley, on
December 31, 2014.
BACKGROUND
For almost 40 years, CTF has been serving adults with cardiovascular disease or diabetes. It is
the only non-hospital-based program on the Peninsula that provides these kinds of therapeutic
and educational services for persons who are at risk for heart attacks. In December 2001, the
City and PAUSD entered into a property exchange agreement (Exchange) whereby the City
obtained title to eight-acres of Cubberley site in exchange for the City's release of its interest in
the Terman Community Center site to PAUSD. CTF sub-leased office and program space
through the Jewish Community Center (JCC) at the Terman Community Center site before
moving, along with the JCC, to Cubberley, when Terman was converted back to a public middle
City of Palo Alto Page 2
school in 2003. In September 2009, the JCC relocated from Cubberley to its new campus on
Fabian Way. CTF has expressed its desire to remain at Cubberley due to the suitability of
facilities and because the City could offer availability of gym space at times that would continue
current therapy classes and programs. On September 27, 2010 the Council approved a Joint
Venture agreement with CTF so it could continue to operate its program at Cubberley through
August 2013.
DISCUSSION
The agreement is a renewal of the existing agreement with CTF; the following are key changes:
a. A 16-month term – September 1, 2013 to December 31, 2014; and
b. Revenue to the City will increase by 2.5%.
The term of this agreement will expire at the same time as the City’s lease with PAUSD for the
use of Cubberley, namely, December 31, 2014. At this time it is unknown whether a new lease
between the City and PAUSD will be negotiated for community use of Cubberley and what the
terms and conditions of a possible new lease will be. Therefore, any commitments to partner
organizations providing services at Cubberley cannot extend beyond December 2014.
The Community Services Department values the services CTF has provided the Palo Alto
community since 1970. The program has over 200 regular participants who exercise weekly at
Cubberley under the supervision of doctors and a skilled nursing staff.
In addition to the many health benefits this program provides, it also serves a very positive
social benefit, which is almost as important for the participants as the physical benefits. Each
participant shares a common challenge that bonds them in a special way. This bond helps
motivate members to keep healthy through physical activity. Countless friendships have
developed over the 40 years, improving the quality of life for thousands of people. This in part
is because the CTF program is not provided in a hospital setting but rather in a community
center, making it much more appealing for many of the participants.
The Community Services Department has been a longtime supporter of the CTF and its
programs. City staff wishes to ensure the CTF program continues to serve individuals that have
suffered from cardiovascular disease and other medically-related conditions in Palo Alto at
Cubberley.
City of Palo Alto Page 3
The renewal of this agreement is consistent with the provisions in the Council-adopted
Public/Private Partnership Policy (Attachment B). The Joint Venture option in the Public/Private
Partnership Policy is applied as CTF is an independent non-profit organization that offers much
needed and appreciated services for the senior population in Palo Alto. In return the City
provides CTF with gym space during low demand hours at a reduced rate.
RESOURCE IMPACT
Revenue to the City for the 16-month term from CTF would be $31,920.00 for gymnasium use
during low demand hours at Cubberley and $8,640 for CTF’s use of office space at Cubberley at
a rate of $540/month per the 2013 approved Municipal Fee Schedule.
ENVIRONMENTAL REVIEW
Approval of the Joint Venture does not require review under the California Environmental
Quality Act (CEQA), as such action does not meet the definition of "project" pursuant to
California Public Resources Code Section 21065.
ATTACHMENTS
Attachment A: Short Form Agreement for Revenue Contracts
Exhibit A: Scope of Services
Exhibit B: General Conditions
Exhibit C: Insurance Requirements
Exhibit D: Non-Discrimination
Exhibit E: Gym Use and Allocation Policy
Attachment B: Public/Private Partnership Policy
Attachments:
Attachment A - Cardiac Therapy Short Form Agreement (DOCX)
Exhibits - Cardiac Therapy Exhibits (2) (DOCX)
Attachment B - Public-Private Partnership Policy (PDF)
PURCHASING GUIDE – APPENDIX L 0073419 PAGE 1 OF 5
ATTACHMENT A
Appendix L:
Short Form Agreement for
Revenue Contracts
See next page for Forms and Instructions:
PURCHASING GUIDE – APPENDIX L 0073419 PAGE 2 OF 4
Short Form Agreement for Revenue Contracts
Contract #:
THIS AGREEMENT IS MADE AND ENTERED INTO ON _________________, 2013, BY AND BETWEEN THE CITY
OF PALO ALTO (the “CITY”) AND THE CARDIAC THERAPY FOUNDATION OF THE MIDPENINSULA, INC.
(“CONTRACTOR”), 4000 Middlefield Road, Suite G-8, Palo Alto, CA 94303-4739; (650) 494-1300; IN
CONSIDERATION OF THEIR MUTUAL COVENANTS, THE PARTIES HERETO AGREE AS FOLLOWS:
CONTRACTOR SHALL PROVIDE OR FURNISH THE SERVICES AS SPECIFIED IN THE EXHIBITS IDENTIFIED
BELOW:
EXHIBITS: THE FOLLOWING EXHIBITS ARE HEREBY ATTACHED AND MADE PART OF THIS AGREEMENT:
AGREEMENT IS NOT COMPLETE UNLESS ALL EXHIBITS ARE ATTACHED
A. Scope of Services
B. General Conditions
C. Insurance Requirements
D. Certificate of Nondiscrimination
E. Gym Use and Allocation Policy
F. Will Contractor be working with minors? Yes___ No _X_
If YES, include Eligible to Hire form and proof of negative TB test.
TERM: THE SERVICES FURNISHED UNDER THIS AGREEMENT SHALL COMMENCE ON SEPTEMBER 1, 2013
AND SHALL BE COMPLETED ON OR BEFORE DECEMBER 31, 2014.
COMPENSATION FOR THE FULL PERFORMANCE OF THIS AGREEMENT AND THE PROVISION OF
FACILITIES AND SERVICES:
CONTRACTOR SHALL PAY CITY: the total sum of $40,560 for a 16-month term (at $2,535 per month or $30,420 per year), which
monthly payment is due and payable, in advance, within five (5) business days of the first day of each month; this includes (A) the
sum of $1,995.00 per month for a 16-month term total of $31,920 (or 12-month total of $23,940) for use of low demand space and
hours at the Cubberley Community Center, and (B) the sum of $540.00 per month for a 16-month term total of $8,640 (or 12-month
total of $6,480) for rental of office space at Cubberley.
PAYMENT RECORD (DEPARTMENT USE PAGE 3)
CITY ACCOUNT NUMBER:
COST CENTER GL ACCT
PROJECT /INTERNAL ORDER PHASE NO.
DOLLAR AMOUNT
GENERAL TERMS AND CONDITIONS ARE INCLUDED ON ALL PAGES OF THIS AGREEMENT.
.
HOLD HARMLESS. CONTRACTOR shall indemnify, defend and hold harmless the CITY, its Council Members, officers, employees, and agents from
any and all demands, claims or liability of any nature, including wrongful death, caused by or arising out of CONTRACTOR’S, its officers’, directors’,
employees’ or agents’ negligent acts, errors, or omissions, or willful misconduct, or conduct for which the law imposes strict liability on CONTRACTOR in
the performance of or failure to perform this Agreement by CONTRACTOR.
ENTIRE AGREEMENT. This Agreement and the exhibits represent the entire Agreement between the parties with respect to the services that are the
subject of this Agreement. All prior agreements, representations, statements, negotiations and undertakings whether oral or written are superseded hereby.
PURCHASING GUIDE – APPENDIX L 0073419 PAGE 3 OF 4
THIS AGREEMENT SHALL BECOME EFFECTIVE UPON ITS APPROVAL AND EXECUTION BY THE CITY. IN WITNESS THEREOF, THE PARTIES HAVE EXECUTED THIS AGREEMENT THE DAY, MONTH, AND YEAR FIRST WRITTEN ABOVE.
PROJECT MANAGER AND REPRESENTATIVE CONTRACTOR
FOR THE CITY
NAME Rob de Geus BY _________________________________
DEPT Recreation, Community Services Dept. TITLE _____________________________________________
P.O, BOX 10250 SOCIAL SECURITY
PALO ALTO, CA 94303 OR I.R.S. NUMBER __________________________________
Telephone 650-329-2639
PAYMENTS SEND ALL PAYMENTS TO THE CITY, ATTN: PROJECT MANAGER
CITY OF PALO ALTO APPROVALS: (ROUTE FOR SIGNATURES ACCORDING TO NUMBERS IN APPROVAL BOXES BELOW)
CITY DEPARTMENT Funds Have Been
Budgeted
(1)
PURCHASING & CONTRACT
ADMINISTRATION INSURANCE
REVIEW
(2)
APPROVAL OVER $25,000
(3) PURCHASING MANAGER
APPROVAL OVER $25,000 APPROVAL OVER $85,000
CITY OF PALO ALTO
BY:_____________________________________
CITY ATTORNEY
ATTEST:
BY:________________________ _______________________
MAYOR CITY CLERK
PURCHASING GUIDE – APPENDIX L 0073419 PAGE 4 OF 4
CITY OF PALO ALTO
GENERAL TERMS AND CONDITIONS
A. ACCEPTANCE. This Agreement consists of and includes the terms and
conditions in the pages of this Short Form Agreement for Revenue Contracts
and any exhibits referenced herein.
B. GOVERNING LAW. This Agreement shall be governed by the laws of
the State of California.
C. INTEREST OF CONTRACTOR. It is understood and agreed that this
Agreement is not a contract of employment between the CITY and
CONTRACTOR. At all times CONRACTOR shall be deemed to be an
independent contractor and CONTRACTOR is not authorized to bind the CITY
to any contracts or other obligations. In executing this Agreement,
CONTRACTOR certifies that no one who has or will have any financial
interest under this Agreement is an officer or employee of the CITY.
D. INSURANCE. CONTRACTOR agrees to provide the insurance specified
in the “Insurance Requirements” form, attached hereto as Exhibit C, or such
other insurance as is acceptable to the CITY as evidenced by a Certificate of
Liability Insurance provided by CONTRACTOR's insurance carrier or broker.
In the event CONTRACTOR is unable to secure a policy endorsement naming
the City of Palo Alto as an additional insured under any comprehensive general
liability or comprehensive automobile policy or policies, CONTRACTOR shall
at a minimum, and subject only to the written approval of the CITY’s Risk
Manager or designee, cause each such insurance policy obtained by it to
contain an endorsement, providing that the insurer waives all right of recovery
by way of subrogation against the CITY, its officers, agents, and employees in connection with any damage, claim, liability personal injury, or wrongful death
covered by any such policy that is the sole fault of CONTRACTOR or its
directors, officers, employees or agents. Each such policy obtained by
CONTRACTOR shall contain an endorsement requiring thirty (30) days' prior
written notice from the insurer to the CITY before cancellation or reduction in
the coverage or limits of such policy shall become effective. CONTRACTOR
shall provide certificates of such policies or other evidence of coverage
satisfactory to the CITY's Risk Manager, together with evidence of payment of
premiums, to the CITY at the commencement of this Agreement, and upon the
renewal of the policy, or policies, not later than twenty (20) days before the
expiration of the terms of any such policy.
E. TERMINATION/SUSPENSION. The City Manager may suspend the
performance of this Agreement, in whole or in part, or terminate this
Agreement, by giving thirty (30) days’ prior written notice thereof to CONTRACTOR, but any such notice will be given only for an uncured breach
of any material obligation hereunder by CONTRACTOR, after a commercially
reasonable time has been provided to CONTRACTOR to cure such breach
following written notification thereof to CONTRACTOR. Except as provided
in Exhibit B, at least six (6) months’ notice will be provided by the CITY for
any change of schedule or space availability for morning (non-prime time)
classes and programs, provided further, however, that no change in evening
(prime time) or morning (non-prime time) scheduling can be made by the
CITY during the term of the Agreement. The CITY does not guarantee to
provide CONTRACTOR with any notice beyond any notice that is
provided for the regular annual space allotment for evening (prime-time)
classes and programs. Upon receipt of such notice, CONTRACTOR shall
discontinue its performance as of the date of scheduling change that complies
with the above notification period and the compensation to the CITY as set
forth herein shall be decreased in proportion to the reduction in CONTRACTOR's prime-time and/or non-prime time scheduling. The rights
of the CITY under this section to suspend or terminate this Agreement shall be
in addition to any and all rights or remedies the CITY may have available to it
under the law, in the case of a breach of this Agreement by CONTRACTOR.
F. ASSIGNMENT. This Agreement shall not be assigned or transferred
without the written consent of the CITY, acting in its sole discretion. No
changes or variations of any kind are authorized without the written consent of
the City Manager or his or her designee.
G. AUDITS. CONTRACTOR agrees to permit the CITY to audit, at any
reasonable time during the term of this Agreement and for three (3) years
thereafter, CONTRACTOR'S records pertaining to matters covered by this
Agreement. CONTRACTOR further agrees to maintain such records for at
least three (3) years after the term of this Agreement has expired or is
terminated.
H. NO IMPLIED WAIVER. No payment, partial payment, acceptance, or
partial acceptance by the CITY shall operate as a waiver on the part of the
CITY of any of its rights under this Agreement.
I. CITY'S PROPERTY. Title to the CITY’s property, if any, that are
furnished to CONTRACTOR shall remain in the CITY. CONTRACTOR shall not alter or use any such property for any purpose, other than as specified by
the CITY, or for any other person without the prior written consent of the
CITY. CONTRACTOR shall store, protect, preserve, repair and maintain such
property in accordance with sound professional practice, all at
CONTRACTOR’s sole cost and expense.
J. NON-DISCRIMINATION. No discrimination shall be made in the
employment of persons under this Agreement on account of the race, color,
national origin, age, ancestry, religion, sex or other specified attributes or
characteristics of such person. CONTRACTOR agrees to meet all requirements
of the Palo Alto Municipal Code pertaining to nondiscrimination in
employment, including completing and signing the Certificate of
Nondiscrimination, attached hereto as Exhibit D.
K. WORKERS’ COMPENSATION. CONTRACTOR, by executing this
Agreement, certifies that it is aware of the provisions of the California Labor
Code, which may require every employer to be insured against liability for
workers’ compensation or to undertake self-insurance in accordance with the
provisions of that code, and certifies that it will comply with such provisions
before commencing the performance of the work of this Agreement.
L. PRICE TERMS.
Extra charges, invoices and payment. No extra charges of any kind will be
allowed, unless they are specifically agreed to, in writing, by the CITY, except
as required by the CITY’s Municipal Fee Schedule or other applicable laws.
All state and federal excise, sales and use taxes shall be stated separately on the
invoices.
M. SCHEDULES OR DELIVERY. Time is of the essence of this
Agreement. CONTRACTOR agrees to comply with the specific schedule
provided by the CITY or agreed upon herein without delay and without
anticipating the CITY’S requirements. CONTRACTOR also agrees not to
make material commitments or scheduling arrangements in excess of the
required amount or in advance of the time necessary to meet the schedule(s) of
this Agreement, if any.
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EXHIBIT A - SCOPE OF SERVICES
CONTRACTOR SHALL:
As a formally declared “joint venture” partner of the CITY, CONTRACTOR shall provide classes,
programs and services related to its program for the benefit of resident and non-resident doctor-
referred participants having cardiovascular disease and other medically-related conditions. In the
provision of these therapeutic services, CONTRACTOR shall:
(1) Abide by the policies/procedures established by the CITY and the CITY’S Recreation Division
of the Department of Community Services for the use of the CITY’s facilities, equipment, furniture,
and other Gym A and Gym Activity Room elements. These shall include, but are not limited to, the
City of Palo Alto Injury and Prevention program, Operations Manual, Safety Procedures and
Guidelines, and Building Emergency Procedures.
(2) Obtain, supervise, and pay all necessary related fees for the services of all professional
assistance needed to produce such programs operated by it.
(3) Pay all fees and costs for materials, supplies and other fees and expenses connected with said
programs.
(4) Collect from program participants fees set by CONTRACTOR for all services rendered by it.
CONTRACTOR shall set its own fee schedule and shall provide the CITY with a copy of its
program and class fee schedule.
(5) Be solely responsible for the control and supervision of all program activities and personnel
connected therewith and shall notify all personnel of their obligations and responsibilities pertaining
to their program area. CONTRACTOR will have primary responsibility for building security when
CONTRACTOR is occupying the CITY’s facilities.
(6) Accommodate other uses of the Gym facility and Gym Activity Room, including, but not
limited to, Gym A and the lobby during periods of non-use of the programs. The CITY shall notify
CONTRACTOR of such other uses. CONTRACTOR shall provide personnel for any moving of
CONTRACTOR’S equipment.
(7) Also designate as its Project Director or his/her designee (the “Project Director”) for the term or
duration of this Agreement an employee or subcontractor to manage or supervise on behalf of
CONTRACTOR, including production, and served as CONTRACTOR’S liaison with the CITY’s
Project Manager or his/her designee (the “Project Manager”) in all matters relating to the CITY in
any manner.
(8) Exercise safe practices in the use of the CITY’s facilities and equipment, maintain and clear
work areas, and within 24 hours of an incident, report in a form to be provided by the CITY, such
information regarding the incident. Immediately report to the Project Manager on the same form
any breakage, malfunction, deterioration or loss of any of the CITY’S resources. CONTRACTOR
shall not attempt to repair any of the CITY’s equipment used by CONTRACTOR in accordance
with this Agreement. CONTRACTOR shall immediately discontinue any activity whenever an
unsafe or dangerous condition is deemed to exist. CONTRACTOR shall train and supervise its staff
and volunteers on safe practices and adhere to the CITY’S safety procedures and guidelines. If, in
the opinion of any duly authorized CITY employee, CONTRACTOR is conducting an activity in an
unsafe manner, CONTRACTOR or its agents shall be informed and shall immediately discontinue
such activity until such activity is able to be conducted in a safe manner approved by the CITY’s
staff.
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(9) Promote and publicize all of its programs, and shall print in all publicity, including, but not
limited to, publications, mailings, flyers, posters, brochures, programs, and paid or public service
advertising, the statement, “In cooperation with the City of Palo Alto Community Services
Department.” In conformance with the Americans with Disabilities Act of 1990 (ADA) guidelines
and requirements, CONTRACTOR shall bear responsibility for providing appropriate auxiliary aids
and services where they are necessary to achieve an equal opportunity to participate in and enjoy
the benefits of classes and programs of CONTRACTOR under this Agreement. Newly printed
programs shall include the following statement required by the ADA: “Persons with disabilities who
require information on auxiliary aids or services in using City facilities, services, or programs or
who would like information on the City’s compliance with the Americans with Disabilities Act
(ADA) of 1990, may contact: ADA Coordinator, City of Palo Alto, 650-329-2550 (Voice) or
adacityofpaloalto.org (Internet).”
(10) Continue to exist as an independent, non-profit corporation under the laws of the United States
and the State of California. Any changes in CONTRACTOR’s Articles of Incorporation, By-Laws,
or tax- exempt status shall be reported by CONTRACTOR immediately to the Project Manager. Not
more than twenty-five percent (25%) of the persons serving on the governing board of
CONTRACTOR may be interested persons. An “interested person” means any person currently
being compensated by CONTRACTOR for services rendered to it, whether as a full or part-time
employee, independent contactor or otherwise, but excluding any reasonable compensation paid to a
director for services rendered in the capacity of a director.
(11) Submit all new signs or displays to be located on the Cubberley premises to the Project
Manager for approval. Inside the Gym and Gym Activity Room, no display materials may be
permanently placed by CONTRACTOR upon walls. A display may only be placed in a manner that
all fasteners thereto can be removed at the time that any such display will be taken down.
(12) Assure that Gym A and the Gym Activity Room, hallways and outdoor areas adjacent to the
Gym will be cleared and clean, and that scenery, properties, and other program equipment will be
disassembled and stored, to the Project Manager’s satisfaction, within 30 minutes after the end of
the last class of the day or in accordance with a time schedule mutually agreed upon by the parties’
designated representatives. The Gym and Gym Activity Room shall always be returned to its basic
set-up as established by the Project Manager, unless there is a mutual understanding with the
incoming group, which agrees to perform this duty, which has been approved by the Project
Manager.
(13) Leave all spaces clear, clean and orderly at the end of each use. The Gym, foyer and Gym
Activity Room are to be cleared of all materials, except Gym equipment, after each daily use. Trash
and recycling are to be removed from all areas daily. Recyclables are to be put in the recycling carts
near the trash dumpster and garbage and trash are to be put into the dumpster. CONTRACTOR is
required to reduce waste, reuse and recycle per the CITY’s Zero Waste Plan. Office space and
hallways are to be kept continually clear, clean and orderly and neither space shall be used for the
purpose of equipment storage. Materials may not be left or stored any place out-of-doors overnight
or when unattended by CONTRACTOR personnel.
(14) Enforce current regulations as established by the CITY with regard to any smoking, eating and
drinking in the CITY’s facilities. CONTRACTOR shall provide staff and/or volunteers, who will
enforce such regulations. Smoking is not permitted inside any CITY facility. Except as may be
permitted by applicable law, no person shall bring any animal into the Gym or Gym Activity Room.
This regulation shall not apply to service animals assisting individuals with disabilities or to animals
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in training to become service animals. CONTRACTOR shall clean up all food and drink containers
daily after use.
(15) Observe all provisions of this Agreement when it is using the CITY’s facilities, including Gym
A and the Gym Activity Room. This shall include cleaning the rooms, returning tables and chairs to
their initial locations, and depositing all trash and recycling in the appropriate receptacles.
(16) Comply with the CITY’s TB test requirement for employees and volunteers of
CONTRACTOR at any time the CITY’s Risk Manager deems it necessary for minors.
(17) Comply with the CITY’s sound ordinance levels for any outdoor activities.
(18) Pay Building Attendant fees as set forth in the Municipal Fee Schedule for any Attendants who
may be required for the use of the CITY’s facilities. All building use policies must be adhered to for
any CITY facility use by CONTRACTOR.
(19) In accordance with the terms of the CITY’s Gym Use and Allocation Policy (Exhibit E),
CONTRACTOR shall abide by the following class schedule in Gym A (non-prime time use):
Monday 7:00 am to 12:00 pm (Classes 7:30 am to 11:45 am)
Tuesday 6:30 am to 8:30 am (Classes 7:00 am to 8:00 am)
Wednesday 7:00 am to 12:00 pm (Classes 7:30 am to 11:45 am)
Thursday 6:30 am to 12:00 pm (Classes 7:00 am to 11:45 am)
Friday 7:00 am to 9:00 am (Classes 7:30 am to 8:30 am)
Saturday 6:30 am to 8:30 am (Classes 7:00 am to 8:00 am)
In addition, CONTRACTOR shall abide by the following class schedule in the Gym Activity
Room:
Monday 5:00 pm to 7:00 pm (Classes 5:30 pm to 6:30 pm)
Tuesday 5:00 pm to 7:00 pm (Classes 5:30 pm to 6:30 pm)
Wednesday 5:00 pm to 7:00 pm (Classes 5:30 pm to 6:30 pm)
Thursday 5:00 pm to 7:00 pm (Classes 5:30 pm to 6:30 pm)
This schedule shall be inclusive of all time necessary to set-up and to take-down the equipment
necessary to run the class or program and for necessary clean-up.
The CITY anticipates CONTRACTOR may operate its classes and programs 52 weeks per year. If
CONTRACTOR does not intend to use any of the CITY’s facilities during any portion of the year,
the Project Director shall inform the Program Manager of any planned vacation or other non-use
period relating to the CITY facilities.
(20) Provide staff oversight for every class or program whenever the public is in attendance.
CONTRACTOR shall permit only persons who have been trained in medical emergency, safety and
use procedures to supervise cardiac therapy programs. Staff must be available to assist participants
under all circumstances and must be aware of and able to assist disabled persons. The Project
Director must also be available to assist in emergency situations throughout the entire program until
participants have left the premises. Staff must ensure that wheelchairs, walkers, etc. are not
blocking any of the aisles or exits.
(21) CONTRACTOR-owned materials will remain the property of CONTRACTOR, and shall be
removed from Gym A and the Gym Activity Room at the conclusion of the program in which the
materials and equipment are used. The Project Manager may, on a case-by- case basis, authorize
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exceptions, in writing, for that occasion only, except as may be otherwise stated. All office
equipment and/or exercise equipment purchased and owned by CONTRACTOR will remain the
private property of CONTRACTOR, and the CITY assumes no responsibility or liability for the loss
or maintenance of such materials. All equipment, instruments and any other materials rented,
borrowed or owned by any subcontractor, agent or person for CONTRACTOR is the responsibility
of CONTRACTOR and/or its subcontractors, and the CITY assumes no responsibility or liability
for its maintenance or loss.
(22) Be required to replace or have repaired by factory authorized technicians CITY-owned
equipment or materials identified by the Project Manager as property that is lost, damaged or
destroyed by an agent of CONTRACTOR while the same was in the possession of
CONTRACTOR. A written report must be made by CONTRACTOR on a CITY form, whenever
CITY equipment is lost, damaged, or destroyed by CONTRACTOR.
(23) May use Gym facilities and equipment and Gym Activity Room only for productions
expressly covered under this Agreement. Exceptions may be considered by the Project Manager
upon the receipt of CONTRACTOR’s written request at least fifteen (15) days prior to the date
needed and, if granted, will be approved, in writing, by the Project Manager.
(24) Shall not in any way modify the CITY’s facilities and may not install or attach anything in, to
or on the CITY’s facilities without having first submitted a written request to, and obtained the
approval of, the Project Manager. Any violation shall result in CONTRACTOR being charged for
all repairs necessary to restore the facility to its original condition and any additional costs
pertaining to the restoration of the CITY’s property.
(25) Shall immediately report to the City of Palo Alto police any incidents of a criminal or
suspicious nature occurring on the CITY’s property and notify the Project Manager within 12 hours.
If the initial notification is given verbally, then it must also be submitted, in writing, to the Project
Manager on the form provided.
(26) The doors to Gym A and foyer and the Gym Activity Room, as well as any other exterior
access doors to any area of the Cubberley Gym, shall not be left open, unlocked or with the locking
mechanism disabled at any time, when the immediate area secured by the door is unoccupied by
CONTRACTOR.
(27) Must fill out a CITY Report of Accident/Property Damage report for any and all accidents,
injuries or property damage, if a CITY employee is not present to fill out the report.
(28) Shall avoid the use of “disposables” containers and refrain from using StyrofoamTM and other
plastic containers that are used for food/beverage service. Reusable food/beverage service ware
should be utilized by CONTRACTOR to the maximum extent practicable. Where a reusable
food/beverage service option is not available, CONTRACTOR shall choose items that are
recyclable.
(29) CONTRACTOR shall comply with all applicable federal, state and local laws at all times
during the term of this Agreement.
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EXHIBIT B - GENERAL CONDITIONS
THE CITY SHALL:
(1) Allow CONTRACTOR the use of Gym A and the Gym Activity Room as scheduled in Exhibit
A, Subsection 19 for the preparation and presentation of CONTRACTOR’s classes and programs to
be performed under this Agreement. Any use of the CITY’s facilities other than that those listed in
this Agreement that are necessary to carry out CONTRACTOR’s rights under this Agreement must
be scheduled through and approved in advance by the Project Manager.
No class shall begin earlier than 7:00 a.m. or shall end later than 6:30 p.m. In no event shall
CONTRACTOR conduct other activities, or otherwise occupy the CITY’s facilities outside of the
designated hours, unless the prior written permission of the Project Manager is obtained.
CONTRACTOR shall observe all facility security rules and regulations as established by the CITY.
The City will provide lighting, door locks and supervision of facilities to help ensure the safety and
security of used gyms, walkways and other facilities.
(2) Additional use may be provided, as specified in Exhibit A above, however, priority use of the
Gym will always be given to programs and classes that are covered by contracts with the CITY. The
CITY will not be responsible for obtaining additional space, but it may assist in locating other CITY
spaces and may act as co-sponsor for use of the CITY’s facilities under appropriate circumstances.
The CITY reserves the right to allow other uses of space that are not in actual, scheduled use by
CONTRACTOR.
(3) Allow CONTRACTOR to use all operational equipment in the CITY’S Gym A and Gym
Activity Room inventory as requested by CONTRACTOR and approved by the CITY.
CONTRACTOR accepts the CITY’s equipment in their “as is” condition, and CONTRACTOR will
be responsible for ensuring that such equipment is used and maintained in a safe condition and is
returned in working condition, normal wear and tear excepted, at the conclusion of its use or of the
program.
(4) Monitor all aspects of the program relative to safety. If the Project Manager deems that any
procedure to be followed by CONTRACTOR is unsafe, then the Project Manager has the authority
to immediately cause CONTRACTOR to stop implementing such procedure. The CITY shall not
interfere, however, with the medical management or supervision of any program participant.
(5) Provide maintenance of the CITY’s facilities and equipment. The CITY shall respond with
reasonable speed to make necessary repairs hereunder. The CITY retains the right to close the
building for maintenance or repairs, including, but not limited, to the refinishing of floors, with
adequate notice to the Project Director. The CITY will be responsible for providing maintenance of
the fixtures, lights, and other appliances for the use of CONTRACTOR and program participants.
The CITY will also be responsive to reports of broken locks, doors, windows, heating equipment or
water fountains for the security and safety of CONTRACTOR and program participants. The CITY
will provide janitorial services necessary to clean facilities and restrooms for the benefit of the
program participants.
(6) Have the right to, without notice, suspend this Agreement in the event of a force majeure or
otherwise if the CITY’s Gym A, Gym Activity Room or other building should be declared
uninhabitable for reasons of safety by the proper authorities (e. g., if the building should be
damaged in an earthquake and be declared unsafe for occupancy). If there is an outbreak of
pandemic flu or other medical emergency and places of public gatherings are closed, the CITY will
not assume any financial responsibility for loss of revenue by CONTRACTOR. If the Gym A, Gym
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Activity Room and ancillary facilities are not available for use due to earthquake, other disaster, or
safety related issues, the CITY will not assume any financial responsibility for loss of revenue by
CONTRACTOR.
PROGRAM FEES
(1) CONTRACTOR shall set fees for their classes, will collect the fees directly from program
participants, and shall retain all proceeds from the class and program fees.
(2) CONTRACTOR may request the CITY’s permission to add classes and programs, consistent
with the constraints, express or implied, of the Gym Use and Allocation Policy, in response to
public need. CONTRACTOR shall be required to pay regular hourly rates and pay for any and all
added classes and/or programs at fees set forth in the CITY’S Municipal Fee Schedule (Regular
weekly, non-profit rate is subject to a discount that may be authorized by the Director of the
Community Services Department).
GENERAL UNDERSTANDINGS
(1) CITY. The Division Manager, Recreation Division is designated as the Project Manager for the
CITY, who shall render overall supervision of the progress and performance of this Agreement by
the CITY. All services to be performed by the CITY under this Agreement shall be managed under
the overall supervision of the Project Manager. CONTRACTOR shall collaborate with the Project
Manager in all matters dealing with the CITY’s policies, facilities, equipment and other CITY
departments outside of the Cubberley Community Center.
(2) CONTRACTOR. CONTRACTOR shall assign a Project Director, who shall have overall
responsibility for the progress and execution of this Agreement by CONTRACTOR. Should
circumstances or condition subsequent to the execution of this Agreement require a substitute
Project Director, CONTRACTOR shall notify the CITY immediately of such occurrence. The
Project Director shall be responsible for all actions of CONTRACTOR, including its staff. The
Project Director shall also be responsible for all communications and information that are delivered
to and obtained from the CITY and CONTRACTOR’S personnel.
(3) ACCESS. CONTRACTOR shall not prevent the Project Manager, facility maintenance
personnel, and others specifically designated by the Project Manager from gaining unfettered access
to the Gym and Gym Activity Room facilities. The Project Manager and others specifically
designated by the Project Manager shall attempt to coordinate such access, if possible.
(4) SPECIFIC SERVICES. CONTRACTOR shall provide all specified services as set forth herein,
for the production of classes and programs as listed in and on the dates specified in Exhibit A.
(5) The term “fiscal year” shall mean July 1 to June 30, although CONTRACTOR is not required to
use the same period for its own record-keeping and reporting purposes.
(6) The term “days” shall mean calendar days.
(7) CONTRACTOR represents that it is qualified to furnish its services as described in this
Agreement, and it shall be responsible for the performance of this Agreement.
FISCAL RESPONSIBILITIES OF CONTRACTOR
(1) Fiscal Agent. CONTRACTOR shall appoint a fiscal agent, who shall be responsible for the
financial and accounting activities of CONTRACTOR, including the receipt and disbursement of
CONTRACTOR’s funds. CONTRACTOR shall provide the CITY with the name of a fiscal agent
and notify the Project Manager within 24 hours of any changes occurring during the term of this
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Agreement. CONTRACTOR shall have sole responsibility for the safekeeping of its class and
program receipts and monies.
(2) Financial Record. In support of its system of accounts, CONTRACTOR shall maintain
complete and accurate records of all financial transactions, including, but not limited to, contracts,
invoices, time cards, cash receipts, vouchers, canceled checks, and bank statements. These records
shall be made available to the CITY upon request subject to applicable laws relating to the privacy
rights of program participants.
PROGRAM REPORTS AND RECORDS
(1) Production Reports. CONTRACTOR shall keep accurate records of and shall file with Project
Manager any and all Program Reports within thirty (30) days following the end of each class term
period, listing the number of classes and/or programs, and the number of program participants
(identified separately as resident and non-resident participants). CONTRACTOR shall make every
reasonable effort to supply such other information as the Project Manager and/or City Auditor may
request subject to applicable laws relating to the privacy rights of program participants. On
reasonable notice and with reasons specified, CONTRACTOR shall grant the Project Manager
and/or City Auditor access to all of CONTRACTOR’s records relating to this Agreement, including
program records, data, statements, and reports.
(2) Evaluation of services. CONTRACTOR shall furnish all data, statements, records, information,
and reports requested by the CITY to monitor, review, and evaluate the performance of
CONTRACTOR’S services hereunder.
(3) A copy of CONTRACTOR’S most recently filed California State Tax Form 199, “California
Exempt Organizations Annual Information Return,” must be filed with the Project Manager within
fifteen (15) days of the date on which it is required to be submitted to the State of California, and it
shall also be attached to this Agreement prior to final approval of this Agreement.
CORRECTIVE ACTION REQUIREMENT
Notwithstanding the requirements of this Agreement, in the event the CITY should determine from
any source, including, but not limited to, reports submitted by CONTRACTOR under this
Agreement or any evaluation report from any source, that there is a condition which requires
correction, the CITY may forward to CONTRACTOR a request for corrective action. Such request
shall indicate the nature of the condition(s) or issue(s), which require(s) corrective action and may
include a recommendation as to appropriate corrective action. Within fifteen (15) days of the
CITY’S request, CONTRACTOR shall submit its response which shall include its position on the
matter and proposed action, if any. Upon the request of either party, the parties shall meet within
five (5) days thereafter to discuss the CONTRACTOR’s position and proposed corrective action.
CONTRACTS WITH OTHER AGENCIES
CONTRACTOR agrees not to enter into any contract with another person or agency that will
materially interfere with or inhibit the full performance of the services to be provided by
CONTRACTOR under this Agreement. CONTRACTOR agrees to terminate as soon as legally
feasible any contract which will materially interfere with or inhibit the full performance of the
services to be provided by CONTRACTOR to the CITY under this Agreement. Nothing herein is
intended to prohibit CONTRACTOR from applying for, and receiving, supplementary funding from
other than CITY sources, provided that any agreement required for such funding does not materially
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interfere with or inhibit the full performance of the services to be provided by CONTRACTOR
under this Agreement.
SUBCONTRACTORS AS EMPLOYEES
CONTRACTOR shall be responsible for employing or engaging all persons necessary to perform
the services of CONTRACTOR hereunder. No subcontractor of CONTRACTOR will be
recognized by the CITY as an independent contractor, as such subcontractor shall be deemed to be
an employee of CONTRACTOR, and CONTRACTOR agrees to be responsible for their
subcontractor’s performance. CONTRACTOR shall give its personal attention to the fulfillment of
the provisions of this Agreement by all of its employees, participants, volunteers, and
subcontractors, if any, and shall keep the work under its control.
INTOXICATION
CONTRACTOR shall be responsible for any injuries, liabilities, loss or damage caused by any of its
employees, agents, subcontractors, or volunteers who are present on CITY property and are under
the influence of alcohol, drugs, hallucinogens or narcotics, whether or not legally prescribed.
CONTRACTOR as well as the CITY shall not permit any of CONTRACTOR’S employees, agents,
subcontractors, or volunteers discovered to be under the influence as described above from
remaining in and using any CITY facility contemplated by this Agreement. The CITY reserves the
right to deny any such person the right to enjoy further participation in contracted activities. The
consumption of alcoholic beverages and the use of illegal drugs by any person working for
CONTRACTOR, whether that person is paid or is a volunteer, shall be expressly prohibited. This
includes all staff of CONTRACTOR while they are present at the Cubberley Community Center or
any other CITY facility in connection with this Agreement.
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EXHIBIT C – INSURANCE REQUIREMENTS
CONTRACTOR, AT ITS SOLE EXPENSE, SHALL DURING THE TERM OF THIS AGREEMNET OBTAIN AND MAINTAIN
INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH A
BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE
BUSINESS IN THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH THE CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED,
BELOW OR AS OTHERWISE ACCEPTED BY THE CITY'S RISK MANAGER:
REQUIRED TYPE OF COVERAGE REQUIREMENT
MINIMUM LIMITS
EACH
OCCURRENCE AGGREGATE
YES
NO
WORKER’S COMPENSATION
AUTOMOBILE LIABILITY (NO
VEHICLES OWNED OR OPERATED)
STATUTORY
STATUTORY
YES
COMPREHENSIVE GENERAL
LIABILITY, INCLUDING PERSONAL
INJURY, BROAD FORM PROPERTY
DAMAGE BLANKET CONTRACTUAL,
AND FIRE LEGAL LIABILITY
BODILY INJURY
PROPERTY DAMAGE
BODILY INJURY & PROPERTY DAMAGE
COMBINED.
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
NO COMPREHENSIVE AUTOMOBILE
LIABILITY, INCLUDING, OWNED,
HIRED, NON-OWNED
BODILY INJURY
- EACH PERSON
- EACH OCCURRENCE
PROPERTY DAMAGE
BODILY INJURY AND PROPERTY DAMAGE,
COMBINED
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES
PROFESSIONAL LIABILITY,
INCLUDING, ERRORS AND
OMISSIONS, MALPRACTICE (WHEN
APPLICABLE), AND NEGLIGENT
PERFORMANCE
ALL DAMAGES $1,000,000
YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: PROPOSER, AT ITS SOLE COST AND EXPENSE,
SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT
AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY PROPOSER AND ITS
SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY
AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSURES CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS,
AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE:
A. A PROVISION FOR A WRITTEN THIRTY DAYS’ ADVANCE NOTICE TO CITY OF CHANGE IN
COVERAGE OR OF COVERAGE CANCELLATION; AND
B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR
CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY
II. SUBMIT CERTIFICATE(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE, OR COMPLETE THIS
SECTION AND IV THROUGH V, BELOW.
A. NAME AND ADDRESS OF COMPANY AFFORDING COVERAGE (NOT AGENT OR BROKER):
B. NAME, ADDRESS, AND PHONE NUMBER OF YOUR INSURANCE AGENT/BROKER:
C. POLICY NUMBER(S): ___________________________________________________________________________________
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D. DEDUCTIBLE AMOUNT(S) (DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR
APPROVAL):
III. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AND PROPOSER’S
SUBMITTAL OF CERTIFICATES OF INSURANCE EVIDENCING COMPLIANCE WITH THE REQUIREMENTS
SPECIFIED HEREIN, EXCEPT TO THE EXTENT SUCH LOSS OR DAMAGE IS CAUSED BY THE CITY, ITS
OFFICERS, AGENTS OR EMPLOYEES.
IV. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS”
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE
AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH
ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSURES.
B. CROSS LIABILITY
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS AN INSURED UNDER THE
POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST
ANY OTHER PERSON, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL
NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER
THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY
AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF
CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT
OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY
WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
V. THE CITY'S RISK MANAGER HAS HAD THE OPPORTUNITY TO REVIEW CONTRACTOR'S GENERAL LIABILITY
INSURANCE COVERAGE AND HAS FOUND THAT, AS OF THE DATE HEREOF, IT MEETS THE ABOVE
REQUIREMENTS:
THE INFORMATION HEREIN IS CERTIFIED CORRECT BY SIGNATURE(S) BELOW. SIGNATURE(S)
MUST BE SAME SIGNATURE(S) AS APPEAR(S) ON SECTION II, ATTACHMENT A, PROPOSER’S
INFORMATION FORM.
Firm: _________________________________________________________
Signature: _________________________________________________________
Name: _________________________________________________________
(Print or type name)
Signature: _________________________________________________________
Name: _________________________________________________________
(Print or type name)
NOTICES SHALL BE MAILED TO: PURCHASING AND
CONTRACT ADMINISTRATION
CITY OF PALO ALTO
P.O. BOX 10250
PALO ALTO, CA 94303.
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EXHIBIT D- CERTIFICATE OF NONDISCRIMINATION
As suppliers of goods or services to the City of Palo Alto, the firm and individuals listed below
certify that they do not discriminate in employment of any person because of race, skin color,
gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital
status, familial status, weight or height of such person; that they are in compliance with all Federal,
State and local directives and executive orders regarding nondiscrimination in employment.
1. If Proposer is INDIVIDUAL, sign here:
Date:______________ _____________________________________________
Proposer’s Signature
_____________________________________________
Proposer’s typed name and title
2. If Proposer is PARTNERSHIP or JOINT VENTURE, at least (2) Partners or each of
the Joint Venturers shall sign here:
________________________________________________
Partnership or Joint Venture Name (type or print)
Date:______________ _____________________________________________
Member of the Partnership or Joint Venture signature
Date:______________ _____________________________________________
Member of the Partnership or Joint Venture signature
3. If Proposer is a CORPORATION, the duly authorized officer(s) shall sign as follows:
The undersigned certify that they are respectively:
______________________________________ and _______________________________
Title Title
Of the corporation named below; that they are designated to sign the Proposal Cost Form by
resolution (attach a certified copy, with corporate seal, if applicable, notarized as to its
authenticity or Secretary’s certificate of authorization) for and on behalf of the below named
CORPORATION, and that they are authorized to execute same for and on behalf of said
CORPORATION.
________________________________________________________________
Corporation Name (type or print)
0073276 12
By:______________________________________ Date: _________________
Title:__________________________________________
By:______________________________________ Date: _________________
Title:_________________________________________
0073276 13
EXHIBIT E – GYM USE AND ALLOCATION POLICY
The City of Palo Alto adopts the Cubberley Community Center Gymnasium Use Policy (and the procedures adopted
hereunder, collectively, the “Policy”) in order to ensure that the City-owned, -maintained and -managed gym facilities
located at the Cubberley Community Center (the “Center”), which include the Pavilion, Gym A and Gym B (the
“Gyms”), are utilized for recreational, athletic, cultural, educational, social and community service functions meeting
the needs and interests of the community, and ensure that permitted users are fully informed as to the City’s guidelines
that govern the use of the Gyms.
Purpose:
To strive to provide Palo Alto residents with an opportunity to participate in their activities of choice.
To establish policies and procedures governing the use of the Gyms.
To ensure Palo Alto residents have priority access to the Gyms.
To provide diverse activities reflecting the recreational preferences of Palo Alto residents.
To contribute a proportionate amount of the Gyms’ usage time to regional organizations in which Palo Alto
residents participate.
To collect fees for the use of the Gyms in support of their ongoing maintenance and repairs.
To ensure that decisions regarding the Gyms are used in the best interests of the neighborhoods, recreational
organizations, and residents of Palo Alto.
To ensure that appropriate activities are permitted in the appropriate gym facility.
A Facility Use Permit is required for any and all organized use of any of the Gyms. The use of any of the Gym facilities
requires the making of an advance reservation and is subject to fee, security deposit and insurance requirements.
See Exhibit A for the details of the various Gyms at the Center.
I. Gym Use Permits:
A permit to use any of the Gyms will be considered according to the annual Gym Use permit application processing
schedule. Gym space usage will be awarded on a priority basis. After the requests are processed on a priority basis, the
Gyms then will be made available for use to non-priority basis requests. To apply for a Gym Use permit, an applicant
must submit a Facility Use Application and Permit to the Center’s staff for approval. The Facility Use Application and
Permit form can be obtained online at www.cityofpaloalto.org/cubberley or it may be obtained in person at the Center,
located at: 4000 Middlefield Rd. #T2, Palo Alto, CA.
II. Facility Use Permit Filing Deadline:
The Facility Use Application and Permit form must be submitted to the Center by March 1st of each year in
order to be considered for the right to use any of the Gyms, commencing during the following academic year:
September to August.
III. Prime Time Hours/Non-Prime Time Hours:
“Prime Time” hours are defined as Monday – Thursday, 3:00 p.m. to 9:00 p.m.; Saturday, 8:30 a.m. to 5:00
p.m.; and Sunday, 9:00 a.m. to 4:00 p.m.
“Non–Prime Time” hours are defined as all hours that are not defined as “Prime Time” hours.
City of Palo Alto
Cubberley Community Center
Gymnasium Use Policy
0073276 14
IV. Eligibility for Prime Time Hours Usage:
The following are the Gyms’ use priority guidelines for awarding gym space use during prime time hours for sports and
recreational activities at the start of each school year:
1. City-sponsored sports, recreational activities and programs; Tenants with gym leased space at Cubberley;
2. Palo Alto resident, youth, non-selective membership*, non-profit organizations or leagues (at least 75% are
Palo Alto residents);
3. Palo Alto resident, youth, non-profit organizations or leagues (at least 51% residents)
4. Palo Alto resident, adult, non-selective membership*, non-profit organizations or leagues (at least 51%
residents);
5. Palo Alto resident, adult, non-profit organizations or leagues (at least 51% residents);
6. Non-resident, non-profit organizations;
7. For-profit youth organizations;
8. For-profit adult organizations; and
9. Organizations that have previously violated the terms of the Facility Use Policy.
In the event of a determination that more than one organization are equally eligible, priority use will be given to the
organization with the highest percentage of total membership who are Palo Alto residents at the time the request for a
Facility Use Permit is made.
To qualify for non-profit rates, a non-profit organization must provide with its application a copy of its letter confirming
its non-profit status, issued by the Internal Revenue Service, together with its non-profit ID number indicated thereon, if
this responsibility has been delegated, a separate letter on organization letterhead will also be required. Payment of fees
with the non-profit organization’s check or charge card is required. The name of the non-profit organization stated in the
Facility Use Application and Permit must be identical to the name imprinted on the check or charge card.
An adult group is any group whose membership is limited to persons 18 years of age and older.
Organizations that currently have gym space during prime-time hours may not be given priority during non-prime time
hours.
*Non-selective membership allows all applicants to participant regardless of ability without tryouts.
V. Eligibility for Non-Prime Time Hours Usage:
Priority for Non-Prime Time usage will be given to those activities that satisfy all or most of the following criteria.
1. City-sponsored sports and recreational activities and programs; [Tenants with gym leased space at Cubberley,
or
2. Long-Term Year-Round existing renters, or
3. Programs that serve a vulnerable population, or
4. Programs that serve seniors or youth, or
5. Serves the greatest percentage of membership comprised of Palo Alto residents, or
6. Activities that provide culturally diverse programs, or
7. Repeat annual events,
VI. Gym Use Allocations:
The Gyms will be permitted for uses and the activities that the each of the Gyms are primarily intended for, designed
for, classified as, or for activities conducted in a manner that does not compromise public safety or gym quality and
integrity.
Youth Volleyball and Basketball organizations that qualify for categories referred to in IV.2 and IV.3
above will be allocated gym usage, as follows:
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1. Three (3) practice slots* per organization per week during prime-time hours defined as:
Monday through Thursday, 3:00 p.m. to 9:00 p.m. and Saturday, 8:30 a.m. to 12:30 p.m.
Organizations that eligible under categories described in IV.4 and IV.5 will be allocated space for
adult league play on weekends, during non-priority hours.
*Slot length and hours will vary to allow for setup/cleanup time between users.
VII. Residency:
A resident is a person residing within the city limits of the City of Palo Alto. Any person owning and paying taxes on
real property in Palo Alto, but who is not living in the City, and any person having only a Palo Alto business address,
will not be considered a resident for gym use application purposes. Children attending Palo Alto Unified School
District schools are considered residents for enrollment purposes. The City will require identification or documentation
of residency to be considered for priority use. In the event proof of residency cannot be established, the person will be
charged the non-resident rates or will be limited by restrictions applicable only to non-residents.
VIII. Residency Verification:
A master league roster is required to be submitted with the application in order to verify residency; that roster will
include the players’ first and last names in alphabetized order, address, phone number, City of Palo Alto Utility account
numbers and, as applicable, the real property owner’s name(s). Renters may submit in the alternative any of their utility
bills, such as a cell phone bill, which proves the renter’s residence in Palo Alto or a copy of their driver’s license, which
provides a Palo Alto address.
Any group or organization found to be misrepresenting its residency status will have its permit revoked for the year in
which the gym use application is directed; such group will be assigned the lowest priority usage for gym use scheduling
for the immediately following year. In addition, any group or organization found to be reserving gym use for any time
period for another organization (that would otherwise have a lower priority for gym use scheduling) will be penalized
by the revocation of its permit for the year for which the permit is issued and that group or organization will be assigned
the lowest priority usage for gym use scheduling for the immediate following year.
IX. Fees
All fees are due and payable as stated on the user’s permit following the submission of the Facility Use Application and
Permit. The fees and charges for gym usage are established by the City Council in the Municipal Fee Schedule and are
not negotiable. The following provisions are applicable:
1. Each Gym has an individual per-hour rental rate; a late fee will be charged for late payments, and all fees are
subject to change. For a detailed list of fees, refer to the facilities schedule for rates.
2. Non-profit organization discounts will apply to organizations who have submitted an IRS Letter of non-profit
Section 501(c)(3) status with their application. The Facility Use Application and Permit must be signed by an
authorized person in order to be eligible to receive the non-profit discount. If this responsibility has been
delegated, a separate letter concerning the delegation and printed on organization letterhead will also be
required.
3. Certain events may require staff to be on duty at the user’s expense to provide set-up, clean-up, and to monitor
events for safety and compliance with city policies. See facility schedule for rates.
X. Deposits
1. A refundable cleaning and damage deposit up to $2,000 may be collected. Any additional fees such as those
incurred for space cleaning, damages, staff time, and room time will be deducted from the cleaning/damage
deposit before the balance is returned. Any charges incurred to return the gym facility to its condition existing
prior to the permittee’s usage will be deducted from the cleaning/damage deposit. This deposit may be
forfeited for violations of any rental conditions named on the reverse side of the Facility Use Application and
Permit.
2. If the additional fees due and payable exceed the amount of any deposit, the permit holder will be billed for the
balance due. Payment will be due and payable within thirty (30) days of the date of invoice. Fees that are not
paid will be assigned for collection to a collections agency and the user group will be ineligible to apply for
gym use until the unpaid amount is settled in full.
0073276 16
Note: Users are responsible for damages or extra fees incurred due to guest’s actions or behaviors.
XI. Insurance Liability
A valid insurance certificate is required for the use of any of the Gyms. The insurance certificate must afford one
million dollars ($1,000,000.00) of general liability coverage per occurrence and contain the following information:
General liability coverage (property and bodily injury) as evidenced by an insurance certificate with
an endorsement naming the City of Palo Alto as ADDITIONAL INSURED, and guaranteeing 30
days’ prior notice to change or cancellation of the policy.
Use of any gym will not be allowed unless insurance requirements are satisfied no later than thirty (30) business days
prior to the first scheduled date of use of the gym. .
1. The permit holder shall be responsible for any and all damage to the Gyms, equipment and/or property covered
by the permit. If additional maintenance is deemed required (in excess of normal services/time) to restore the
premises, equipment and/or property to reasonable use by others, the permit holder shall be charged
accordingly.
2. The City disclaims responsibility for any accident, injury, liability, loss or damage to person or property as a
result of unauthorized Gym use.
3. The permit holder will be responsible for all actions and omissions that result in damages that are caused by
their attendees.
XII. Permit Rules & Regulations
1. Permits are not transferrable.
2. Permit holders must pick up and remove any trash generated by their activity.
3. Permit holders are responsible to observe any and all alcohol restrictions and/or policies.
4. The misuse of any Gym or the failure to conform to facility regulations, established policies and procedures or
any other Federal, State, or local law, rule regulation or ordinance shall be sufficient grounds for the immediate
revocation of the permit and/or the denial of any future applications. No refund will be granted.
5. A permit holder shall restrict its use to only the Gym space that is specifically reserved and paid for, as
designated in the permit. Other Gym space facilities may be scheduled by other groups and may not be
available. A permit holder must be in possession of its Facility Use Permit in case there is a need to address
the question of who has approved use for the facility in question. If the permit holder cannot use a facility due
to unauthorized use by another party, the permit holder should contact the Cubberley facility management staff
(650-329-2418)
6. Complaints from surrounding neighborhood residents as to the user’s activity noise level, litter and debris,
and/or disregard of parking regulations could lead to the cancellation of the permit or reservation, the forfeiture
of the deposit, and the denial of facility use in the future. See Good Neighbor Policy
XIII. General Rules & Regulations
All City of Palo Alto Municipal Codes/Regulations apply to all City Facilities.
1. The City reserves the right to cancel an approved reservation due to maintenance needs, overuse of facility,
unsafe conditions, or due to a conflict with a City event. In these cases, all attempts will be made to provide a
minimum of 15 days’ advance notice and to provide an alternate location. In the event of an emergency, when
only on-short notice or no notice can be provided, groups must cooperate with the request to not use the facility
or risk loss of current permit and denial of future use. If there are no alternate facilities available, the City is
not obligated to provide an alternate facility. In case of such event, a full refund will be given.
2. For Cubberley Community Center facility hours of operations, see Appendix B.
3. The City encourages partnerships and volunteerism to improve gym quality and maintenance; however, in the
absence of a written agreement, donations and/or contributions of time does not give any organization priority
at any facility. Groups wishing to make alterations to facilities must submit these improvement requests in
advance to the City. No groups will be allowed to make any alteration to any facility without first obtaining
the City’s approval.
0073276 17
XIV. Cancellations
The City and the permit applicant, respectively, each has the right to cancel an event or the issuance of the permit by
giving written notice 30 days prior to the event or prompt notice, if the permit has been issued. Refunds will be honored
for cancellations made, in writing, and received 30 days before the event. Cancellations made in writing and received
less than 30 days before the event are entitled to a refund of the cleaning and damage deposit only. If the City cancels a
facility use permit, at no fault of the user, a full refund will be made.
XV. Good Neighbor Policy
The purpose of this policy is to ensure that decisions regarding the use of the Gyms are used in the best interests of the
neighborhoods, sports organizations, and citizens of Palo Alto. The City has established the following rules and
regulations to govern the use of the Gyms for the safe and pleasant enjoyment of participants and neighbors. Every
person shall abide by these rules or be subject to forfeiture of the security deposit and/or loss of the privilege of future
use of the facilities.
All litter and debris that may occur as a result of your event must be picked up and deposited into trash or
recycling receptacles, where provided, or removed from the premises.
All groups are responsible for the condition in which they leave the facility. Any excessive clean-up required
by City crews following your use will be cause for forfeiture of all or part of your damage deposit.
Amplified music, use of musical instruments, radios, or Public Address Systems must conclude by 9:00 p.m.,
Sunday through Thursday, and by 11:00 p.m., Friday and Saturday, and is allowed by permit only.
Complaints from surrounding neighborhood residents as to noise level, litter and debris, and disregard for use
of parking regulations could result in cancellation of your reservation, forfeiture of security deposit, and denial
of future facility use.
The Cubberley Community Center has established the Gym Use Policy to provide gym space to more organizations
under specific guidelines and rules and regulations. The objective is to make the reservation process fair and
transparent.
Staff will collaborate with Gym use permit holders over the next year to evaluate the effectiveness of the Gym Use
Policy as well as provide a status report to the Parks and Recreation Commission after one year of implementation.
Adopted: July 27, 2009
CITY OF PALO ALTO: CERTIFICATION OF NONDISCRIMINATION
POLICY AND PROCEDURES 1-25/MGR
REVISED: AUGUST 2007
1
PUBLIC/PRIVATE PARTNERSHIPS
POLICY STATEMENT
The City of Palo Alto encourages the formation of public/private partnerships for the benefits
the community receives. For the purposes of this policy, “public/private” also encompasses
“public/nonprofit” partnerships.
Definitions
Public/private partnership: A public/private partnership is an agreement between the City and
a nonprofit or private organization to provide services or to assist in funding of public facilities
and programs. Such partnerships may take various forms, including:
• Acceptance of or solicitation of service or facility proposals
• Facilitation of such proposals through the City's regulatory process
• Waiver of City General Fund fees to help reduce project costs.
• Contributions of City matching funds for construction of facilities to be owned and
controlled or operated by the City.
• Provision of facilities to the private partner at no charge or at a subsidized rent.
Public/private partnerships typically fall into one of three categories: co-sponsorship, alliances
or joint ventures.
Co-Sponsorships: This is the most common type of public/private partnership. An
organization furthers the mission of the City by supporting a City activity or program in
conjunction with pursuit of that organization’s own mission or program. Co-sponsorships can
take the form of one-time events or annual agreements. Some examples of co-sponsorships
include the Palo Alto Tennis Club use of City courts to provide a youth tennis program and
American Youth Soccer Organization’s use of space in a City facility to train referees. Co-
sponsorships are entered into by staff and normally have no or minimal financial impact.
Alliances: This type of public/private partnership involves organizations that have been
created for the sole purpose of supporting a City program or an array of City programs. The
organization does not expect to receive any direct financial benefit or to alter City policy
and/or operations, but undertakes to work closely and cooperatively with staff to implement
City goals. Alliance organizations include the Recreation Foundation, the Art Center
Foundation (Project Look or Cultural Kaleidoscope), the Friends of the Children’s Theatre (the
Magic Castle), the Library Foundation and the Friends of the Palo Alto Library (financial
assistance with the renovation and expansion of the Children’s Library). Alliances are
approved by the Council if there are any staffing or budgetary implications to the partnership.
POLICY AND PROCEDURES 1-25/MGR
REVISED: AUGUST 2007
2
Joint Ventures: This type of partnership involves organizations which have programs or
missions independent of the City and involve the City entering into a contractual relationship
with the public or nonprofit organization with both parties contributing to the partnership for
their mutual benefit. Each joint venture is uniquely negotiated by the staff and approved by
the City Council. Examples of Joint Ventures include TheatreWorks, Palo Alto Players and
West Bay Opera’s use of the Community Theatre and use of the former police station by older
adult service provider, Avenidas.
PROCEDURES
Initiation of partnerships: Public/private partnerships may be initiated in one of three
ways:
• By staff: Staff identifies an opportunity for such a partnership and undertakes
an informal or formal request for proposal process to identify partners.
• By Council: The City Council directs staff to work with a private or nonprofit
organization to develop such a partnership.
• By a private or nonprofit organization: An organization makes a partnership
proposal to the staff or City.
City Manager Review: If the partnership proposal involves more than one City
department, the City Manager’s Office will appoint a team with representatives of all
City departments who are stakeholders in the partnership proposal. The team will
analyze the proposal and inform the City Manager of the resource implications of the
proposal, including staffing and monetary commitments. This would include proposed
fee waivers. If the proposal will require a re-ordering of department priorities that have
already been approved by the Council in setting its annual priorities or in the budget
process, Council approval will be required prior to commitment to the partnership.
Council approval will also be required if the partnership requires a new or adjusted
allocation of operating or capital funding. Note: Co-sponsorships usually only involve a
single department and do not necessitate the formation of an interdepartmental
committee, the involvement of the City Manager’s Office or the approval of the City
Council.
City-Initiated Partnerships: Such partnerships will be guided by existing policies and
procedures governing purchasing and outsourcing, using “requests for proposals” and/or
bid processes as the method of initiating a partnership. A City-initiated partnership may
incorporate incentives including naming rights, waiver of non-enterprise fund building
and planning fees, reduced lease rates, free use of space, subsidies, and staff resources.
All incentives may be negotiated on a case-by-case basis.
POLICY AND PROCEDURES 1-25/MGR
REVISED: AUGUST 2007
3
Evaluation of Viability of Partnering Organization: Staff will provide the City Manager
and/or City Council with its assessment of the viability of the proposed partnership, based
on the partnering organization’s possession of sound organizational, administrative and
fiscal management, and its demonstrated experience to achieve and sustain project tasks,
such as fundraising and building community support. For proposed facility improvement
or expansion initiatives, the nonprofit or private organization should have the ability and
commitment to make a substantial pledge to the project’s cost.
Facilities Proposals:
• If a City facility is to be renovated, expanded or otherwise be directly affected by
the partnership, the Infrastructure Management Plan will have to be adjusted
appropriately.
• Long-term staffing, operational and maintenance costs must be identified in the
proposal. The project’s applicable costs and funding sources for furnishings,
fixtures and equipment will be identified.
• The parties will negotiate the joint or separate financial responsibility for any
project cost overruns on a project-by-project basis.
• Staff may recommend that any standard City processing or use fee authorized
under the Municipal Fee Schedule, excluding fees and charges levied by City of
Palo Alto Utilities or other City enterprise fund programs, should be waived as a
condition of the City's participation. Waiver of fees may be granted by the Council
and limited to those fees associated with a construction or capital improvement
project which, upon its completion, results in a new or improved public facility,
building or park, or some portion thereof, that will be solely owned or controlled
by the City. In the event that only a portion of a construction or capital
improvement project will result in a new or improved City facility, building or
park, or portion thereof, then the Council may waive only that portion of any
associated fee directly relating to the construction, improvement or enhancement
of the City facility, building or park. As appropriate, the summary and
recommendation in the report to the Council will include a staff recommendation
on waiving fees which the Council can approve or reject.
• The City will determine whether the nonprofit or private organization shall use or
may forego a formal or informal competitive selection process in the hiring of
professionals who will perform the management, design and/or construction
phases of the project. The City shall review and approve the requirements for and
the performance of all phases of design, planning and construction work for the
project.
CITY OF PALO ALTO OFFICE OF THE CITY ATTORNEY
March 4, 2013
The Honorable City Council
Palo Alto, California
Adoption of an Ordinance Reducing the Size of the Library Advisory
Commission from Seven to Five Commissioners and Amending the
Frequency of Regular Meetings to Bi-Monthly
Background
In July 2012, Library Advisory Commissioner Noel Bakhtian resigned from the Library Advisory
Commission. After City Clerk staff were unsuccessful in recruiting a replacement commissioner,
on October 22, 2012, the City Council requested a study into the viability of the Library Advisory
Commission. In particular, the Council was concerned with whether the Commission was still
viable given the lack of applicants and whether there were any impediments to work on the
Commission.
On December 3, 2012, the Library Advisory Commission submitted an informational report to
the Council explaining the work that the Commission had done in the past year and explaining
the continuing need for an advisory body. The Council discussed the report at its January 22,
2013 meeting. Staff explained that, in addition to the vacancy created by Commission
Bakhtian’s resignation, three terms were set to expire on January 31, 2013. Staff further
explained that although Section 2.24 of the Municipal Code provides that the Commission shall
meet at least once quarterly, the Commission had in fact been meeting on a bi-monthly or
monthly basis.
The Council directed staff to draft an ordinance reducing the number of Library Advisory
Commissioners from seven to five, and changing the meeting schedule provided in the
Municipal Code to a bi-monthly schedule to provide applicants with a more accurate
representation of the Commission’s meeting schedule.
Discussion
Consistent with Council’s direction, the proposed ordinance reduces the number of Library
Advisory Commissioners from seven to five. The ordinance also contains a number of related
changes, namely: changes to the definition of a quorum; and changes to the number of
commissioners who are appointed each year to staggered terms. Although the Council also
directed that the terms of the three commissioners whose terms expired on January 31, 2013
be extended by three months to allow for the recruitment process, such an extension is already
Page 2
contemplated under the existing ordinance. Municipal Code section 2.24.030 currently
provides: “the term of office of each library advisory commission member shall be three years
or until his or her successor is appointed.” (emphasis added.) The proposed ordinance also
adds language providing that terms of office shall expire on January 31 of the third year, so that
the beginning and end dates of future terms remain aligned.
The proposed ordinance also amends the language governing the frequency of regular
meetings to read: “The library advisory commission shall establish a regular time, date and
place of meeting and shall ordinarily hold meetings bi-monthly.” This language differs from the
code provisions governing meetings of most other City of Palo Alto Commissions, which
generally provide a minimum frequency of meetings (i.e. “the Commission shall hold at least
one regular meeting per month.”). By contrast, the language in the proposed ordinance allows
the Library Advisory Commission to hold a greater or lesser number of meetings as necessary.
Staff recommends that the Council adopt the proposed ordinance.
ATTACHMENTS:
Ordinance Re Library Commission (PDF)
Department Head: Molly Stump, City Attorney
NOT YET APPROVED
130211 sh 0140082 1
ORDINANCE NO. _____
Ordinance of the Council of the City of Palo Alto Amending Chapter 2.24
(Library Advisory Commission) of the Palo Alto Municipal Code to
Decrease the Number of Library Advisory Commission Members from
Seven to Five and Provide for Bi-Monthly Meetings
The Council of the City of Palo Alto does ORDAIN as follows:
SECTION 1. Section 2.24.010 of Chapter 2.24 of the Palo Alto Municipal Code is
hereby amended to read as follows:
2.24.010 Membership.
There is created a library advisory commission composed of seven five (5) members
who shall be appointed by and shall serve at the pleasure of the city council, but who shall not
be councilmembers, officers or employees of the city of Palo Alto. Each member of the
commission shall have a demonstrated interest in public library matters. All members of the
commission shall at all times be residents of Palo Alto. All members of the commission shall
take an oath of office before commencing their service on the commission.
SECTION 2. Section 2.24.030 of Chapter 2.24 of the Palo Alto Municipal Code is
hereby amended to read as follows:
2.24.030 Term of office.
Except as hereinafter provided, the term of office of each library advisory
commission member shall be three years or until his or her successor is appointed.
Commencing January 1, 1999, or as soon thereafter as practicable, the initial terms of four
members shall be three years, and the initial terms of three other members shall be two years,
as determined by the City Council. Thereafter, the commission Commission appointments shall
be staggered so that in each three-year cycle three two (2) members are appointed in 2013 and
every three years thereafter, and to serve during the first year, four three (3) members are
appointed in 2014 and every three years thereafter. to serve during the second year, and no
members are appointed to serve during the third year. Terms of office commence on February
1 and expire on January 31 of the third year. If a successor is unavailable, a member may
remain in office until his or her successor is appointed.
SECTION 3. Section 2.24.040 of Chapter 2.24 of the Palo Alto Municipal Code is
hereby amended to read as follows:
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NOT YET APPROVED
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130211 sh 0140082
2.24.040 Officers.
Each year, at the first regular meeting of the library advisory commission, the
commission shall nominate and elect one of its members as the chairperson. The chairperson
shall hold office for one year and or until his or her successor is elected, unless his or her term
as a member of the commission expires earlier.
SECTION 4. Section 2.24.060 of Chapter 2.24 of the Palo Alto Municipal Code is
hereby amended to read as follows:
2.24.060 Meetings.
(a) The library advisory commission shall establish a regular time, date and place of
meeting and shall ordinarily hold meetings bi-monthly at least one regular meeting per
calendar quarter.
(b) Four Three (3) of the seven five (5) members shall constitute a quorum.
(c) The commission may establish rules and procedures governing the conduct of its
meetings in accordance with Robert's Rules of Order.
(d) The commission shall be subject to the Ralph M. Brown Act, California
Government Code Section 54950, et seq.
SECTION 5. The Council finds that the provisions of this Ordinance do not
constitute a project under the California Environmental Quality Act because it can be seen with
certainty that no significant environmental impact will occur as a result of the amended
Ordinance.
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NOT YET APPROVED
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130211 sh 0140082
SECTION 6. This ordinance shall be effective on the thirty-first day after the date of
its adoption.
INTRODUCED:
PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
____________________________ ____________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
____________________________ ____________________________
City Attorney City Manager
____________________________
Director of Administrative
Services
City of Palo Alto (ID # 3406)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Friends of Palo Alto Children's Theatre Agreement
Title: Approval of the Mutual Cooperation and Support Agreement between
the City of Palo Alto and the Friends of Palo Alto Children's Theatre
From: City Manager
Lead Department: Community Services
Recommendation
Staff recommends that Council approve an updated public-private partnership
agreement between the City of Palo Alto and the Friends of the Palo Alto Children’s
Theatre (Attachment A).
Background
The Friends of the Palo Alto Children’s Theatre have played an integral role in the
support and operation of the Palo Alto Children’s Theatre ever since the 1970’s. The
construction of the Magic Castle in the early 1990’s was the first public-private
partnership with the City. Their financial contributions substantially benefit the
Children’s Theatre programs and facilities. Most recently, these contributions included
cash contributions, speakers and microphones for the Magic Castle, remodeling of a
storage room into a revenue-generating dance studio, scholarships, transportation
grants and support for teen programming.
Discussion
In order to enhance its efforts as a support organization the Friends seek to enter into
a written agreement with the City. By being more engaged in the decision-making
processes (as evidenced by meeting with a Council liaison and helping interview key
staff recruitments), the Friends’ board and staff believe the potential for their successful
securing of private funding is increased. A higher degree of accountability by the
Friends Board of Directors to the Children’s Theatre will benefit both parties and
achieves parity with such existing agreements between the City and the Junior Museum
and Zoo and Art Center, respectively, and their nonprofit boards.
City of Palo Alto Page 2
Resource Impact
No additional City resources are required. This partnership will lead to enhanced
program and capital funding over the life of the Agreement.
Policy Implications
This partnership is categorized as a Joint Venture under the City’s Public/Private
Partnership Policy.
Environmental Review
This is not a project for purposes of the California Environmental Quality Act (CEQA)
guidelines. Therefore, no environmental assessment is required.
Attachments:
Attachment A - Mutual Cooperation and Support Agreement between the City of Palo
Alto and the Friends of Palo Alto Children's Theatre (DOCX)
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Contract No. _______________
MUTUAL COOPERATION AND SUPPORT AGREEMENT
BETWEEN THE CITY OF PALO ALTO AND THE
FRIENDS OF THE PALO ALTO CHILDREN’S THEATRE
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TABLE OF CONTENTS
SectionDescription ____ Page
1 Term; Extension; Termination 3
2 Responsibilities of the Parties 4
3 General License to the Friends 6
4 Indemnity 6
5 Waiver 7
6 No Property Rights 9
7 Assignment 9
8 Independent Contractor 7
9 Nondiscrimination 7
10 Notices 8
11 Miscellaneous 8
Exhibit “A” Development Plan for the Friends of Palo Alto Children’s Theatre
Exhibit “B” Long-term Strategic Plan for the Palo Alto Children’s Theatre
Exhibit “C” Certification of Nondiscrimination
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MUTUAL COOPERATION AND SUPPORT AGREEMENT
BETWEEN THE CITY OF PALO ALTO AND THE
FRIENDS OF THE PALO ALTO CHILDREN’S THEATRE
This MUTUAL COOPERATION AND SUPPORT AGREEMENT (the
“Agreement”), dated, for convenience, ____________________, 2013 (the “Effective Date”), is
made by and between the CITY OF PALO ALTO, a California chartered municipal corporation
(the "City"), and the FRIENDS OF THE PALO ALTO CHILDREN’S THEATRE, a California
public benefit corporation organized under the California Nonprofit Public Benefit Corporation
Law (the "Friends") (individually, a “Party” and, collectively, the “Parties”), in reference to the
following facts and circumstances:
RECITALS:
A. The City owns and operates the Palo Alto Children’s Theatre (the “Theatre”),
located at 1305 Middlefield Road, Palo Alto, CA 94301. The Theatre’s program is administered
by the City’s Community Services Department (the “Department”) and exists within the
Department’s Arts and Sciences division.
B. The Friends have assisted the Theatre’s staff in supporting and advocating on
behalf of the Theatre’s operations, programs and activities over the past forty-two years. The
Friends intend to benefit the City government and the Palo Alto community by providing certain
services and funds, which the Parties intend to be rendered in accordance with the general scope
of the City’s policy on Public/Private Partnerships. By this Agreement, the Friends will, at the
request of the City Manager, or designee, support the operations, programs, activities, and
opportunities offered by or occurring within the Theatre premises.
C. The Parties wish to more closely collaborate and mutually cooperate and support
each other in the future, to improve, enhance and sustain the capacity of the Theatre to develop
and provide educational opportunities and related services to the Palo Alto community.
AGREEMENT:
NOW, THEREFORE, in consideration of Recitals A, B and C, which are a substantive
part of this Agreement, and the following covenants, terms, conditions and provisions of this
Agreement, the Parties agree:
SECTION 1. TERM; EXTENSION; TERMINATION
1.1 This Agreement will commence on the Effective Date, and the initial term is three
(3) years (the “Term”), unless it is earlier terminated by a Party as herein provided.
1.2 The Term may be extended by the Parties for one (1) additional term of three (3)
years (the “Extension Term”); provided, however, the City may require the Council’s approval
121212 dm 00710148 4
of the Extension Term.
1.3 A Party may terminate for convenience this Agreement, in whole or in part, by
giving the other Party not less than ninety (90) days’ prior written notice.
1.4 This Agreement is subject to the fiscal provisions of the Charter of the City of
Palo Alto and the Palo Alto Municipal Code (the “PAMC”). This Agreement will terminate
without penalty: (A) at the end of any fiscal year in the event that funds are not appropriated for
the following fiscal year; or (B) at any time within a fiscal year in the event that funds are
appropriated for a portion of the fiscal year and funds for this Agreement are no longer available.
This Section 1.4 will take precedence in the event of a conflict with any other covenant, term,
condition or provision of this Agreement and the Exhibits. Nothing in this Section 1.4 is intended
to affect the Friends’ rights and remedies as may be available under applicable laws.
SECTION 2. RESPONSIBILITIES OF THE PARTIES
2.1 The responsibilities of the City include:
A. The management of the Theatre’s facilities and programs and the City’s staff
employees, including any and all City-hired contractors, subcontractors, consultants and
volunteers. The City will hire, supervise, evaluate and otherwise exercise supervision and
control of its employees. The City may permit the Friends’ duly authorized representatives to
participate in the interview process for the hiring of the permanent director of the Theatre (the
“Manager”).
B. The care, maintenance and repair of the Theatre’s facilities and equipment as well
as the furnishing of external landscaping and utility services to the Theatre’s facilities and
premises.
C. The selection of one or more individuals to serve as the City’s liaison(s) to the
Friends’ board of directors and/or any board committees (the “Board”), including (1) a Council
Member, who will serve as the official liaison of the City to the Board, and (2) the Manager,
whose duties may include providing assistance to the Friends, including its Board, in selected
fundraising activities, as may be approved by the City Manager, or designee.
D. The review of all community-related activities that the Friends may propose for
inclusion in the Theatre’s programs. All activities of the Friends will be pre-approved by the
Manager, or designees.
E. Develop and provide educational programs relating to the performing arts,
produce theatrical presentations, and supervise community volunteers in connection therewith.
G. Any other obligation(s) that the City or the Department may undertake in
accordance with this Agreement, upon reasonable notice to the Friends; provided, however, any
such undertaking will be memorialized, in writing, by an amendment to this Agreement, in order
that such undertaking will be made binding upon the City.
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2.2 The responsibilities of the Friends include:
A. The supervision and management of its directors, officers, employees, volunteers,
contractors, subcontractors and consultants, while they, and each of them, are performing
obligations on behalf of the Friends pursuant to this Agreement.
B. The rendering of assistance to the Manager (through the Board and/or staff), at
their request, including voluntary attendance and contribution at staff meetings of the Manager.
C. The provision and staffing of programs to educate the public about the Theatre
and its programs and amenities, and the mobilization of volunteers for the Theatre’s projects and
programs.
D. The creation and implementation of a development plan for the Theatre (the
“Development Plan”), as described in Exhibit “A,” that is consistent with the Theatre’s strategic
plan (the “Strategic Plan”). The Development Plan will include donor acknowledgment and
activities consistent with the City’s written policies and practices.
E. The rendering of other services beyond those spelled out in the annual
Development Plan and related to the preservation, protection and enhancement of the Theatre,
will be approved, in writing, by the Manager.
2.3 The responsibilities of the Parties, acting separately and/or jointly, include:
A. Under the direction of the Manager, develop and evaluate, annually, the long-term
Strategic Plan to enhance and improve the vision of the Theatre’s program, as described in
Exhibit “C.”
B. Under the direction of the Friend’s leadership, working collaboratively with the
Manager, develop the Development Plan that is consistent with the Strategic Plan, on an annual
basis, effective July 1 of each fiscal year, and establish budget, fundraising and operational
priorities and activities for each fiscal year of operations. The Development Play will delineate
the rights and obligations of the Parties and identify each Party’s duly authorized representative.
The Development Plan will include, without limitation, specific cash handling procedures
followed by the City and the dispute resolution procedures for informally resolving differences
of opinion of each Party regarding the substances and/or implementation of the Development
Plan.
C. In regard to the Development Plan, the Parties will review, on a quarterly basis,
any progress made in reaching and/or exceeding the goals of the Development Plan, including
budget goals, and annually, evaluate the Development Plan.
2.4 The responsibility of either Party or the Parties in regard to any capital
improvement project (“CIP”) for the Theatre will not be established by this Agreement. The
Parties agree to reserve for future consideration any existing or future CIP for the Theatre’s
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facilities and premises, including the scope of a capital fundraising program and the
responsibilities of each Party in regard to the Theatre. The provision of any CIP may be
addressed by amendment to this Agreement, as determined by the Parties.
2.5 To the extent this Section 2 does not specifically identify the Party who will be
primarily responsible for any action or decision in regard to the Theatre, the Parties agree that the
City will be the party to assume all rights and obligations in connection with such decision.
SECTION 3. GENERAL LICENSE TO THE FRIENDS
3.1 The City hereby grants the Friends, its directors, officers, employees, contractors,
subcontractors and consultants a nonexclusive license to enter upon and use the Theatre’s
premises and facilities in connection with the Friends’ execution of its individual and/or joint
responsibilities established by the Development Plan, including organizing board meetings,
selling concessions at theatre productions, conducting fundraising events, and administering
related programs. Any use of the Theatre’s facilities will be approved by the Manager in regard
to program scheduling, space availability, and the functionality of shared Theatre spaces for staff
use.
SECTION 4. INDEMNITY
4.1 Except as provided under Section 4.2, the Friends hereby waive all claims,
liability and recourse against the City, including the right of contribution for loss or damage of or
to persons or property arising from, growing out of, or in any way connected with or related to
this Agreement. The Friends will protect, indemnify, hold harmless and defend the City, its
officials, officers, employees, representatives and agents, from and against any and all claims,
losses, liability, demands, damages, costs, expenses or attorneys' fees, caused by or arising out of
the Friends’ negligent acts or omissions, or willful misconduct, in the performance or
nonperformance of its obligations under the covenants, terms, conditions and provisions of this
Agreement. The preceding sentence notwithstanding, no personal liability will attach to any
Board member under the provisions of this Section 4 for any negligent action or inaction. In the
event the City is named as co-defendant, the Friends will notify, in writing, the City, to the
attention of the City’s city attorney (the “City Attorney”), of such fact and it will represent the
City in such legal action, unless the City undertakes to represent itself as co-defendant in such
legal action, in which event the Friends will pay to the City its reasonable litigation costs and
expenses, including reasonable attorneys' fees.
4.2. The City will protect, indemnify, hold harmless and defend the Friends, its
directors, officers, employees and agents, against any and all claims, losses, liability, demands,
damages, costs, expenses or reasonable attorneys' fees arising out of the City's negligent
performance or nonperformance of its obligations under the terms of this Agreement.
SECTION 5. WAIVER
5.1 The waiver by either Party of any breach or violation of any covenant, term, or
condition of this Agreement or of the provisions of the PAMC or other City law, rule or
121212 dm 00710148 7
regulation, will not be deemed to be a waiver of any such covenant, term, condition, or provision
or of any subsequent breach or violation of the same or any other covenant, term, condition, or
provision. The subsequent acceptance by either Party of any consideration which may become
due or payable hereunder will not be deemed to be a waiver of any preceding breach or violation
by the other Party
SECTION 6. NO PROPERTY RIGHTS
6.1 The Parties agree that this Agreement will not confer any property right upon the
Friends, its directors, officers, employees, volunteers, contractors, subcontractors or consultants.
Any work performed for the benefit of the Theatre and any improvements placed or constructed
at the Theatre will conform to the City’s standards and approved by the City Manager, or
designee, and will, upon acceptance, become the property of the City.
SECTION 7. ASSIGNMENT
7.1 Neither Party may assign, transfer, or convey this Agreement or any interest that
it may have in this Agreement without the other Party’s express consent or approval. Any
attempted assignment without the required consent or approval will be void and will confer no
right, title, or interest in or to this Agreement, or part thereof. In the event of an unauthorized
assignment, at the option of the Party not making the assignment, this Agreement may be
terminated upon reasonable notice to the Party making the assignment.
SECTION 8. INDEPENDENT CONTRACTOR
8.1 In the exercise of its rights and responsibilities under this Agreement, the Friends
act at all times as an independent contractor and not as an employee of the City. Nothing in this
Agreement will be construed to establish a partnership, joint venture, group, pool, syndicate or
agency between the Parties. No provision contained herein will be construed as authorizing or
empowering either Party to assume or create any obligation or responsibility whatsoever, express
or implied, on behalf, or in the name of, the other Party in any manner, or to make any
representation, warranty or commitment on behalf of the other Party. In no event will either
Party be liable for (a) any loss incurred by the other Party in the course of its performance
hereunder, or (b) any debts, obligations or liabilities of the other Party, whether due or to become
due.
SECTION 9. NONDISCRIMINATION
9.1 The PAMC prohibits discrimination in the employment of any individual under
this Agreement because of race, skin color, gender, age, religion, disability, national origin,
ancestry, sexual orientation, housing status, marital status, familial status, weight or height of
that person. The Friends acknowledges that it has read and understands the provisions of PAMC
Chapter 2.30 relating to nondiscrimination in employment and the penalties for violations
thereof, and it agrees to comply with all requirements of PAMC Chapter 2.30 pertaining to
nondiscrimination in employment, including the completion, execution and submission to the
City of the Certification of Nondiscrimination, as described in Exhibit “C.”
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SECTION 10. NOTICES
11.1 Any notice, request, consent or approval by a Party that is required to be
furnished by this Agreement, will be given, in writing, and delivered by personal service, the
United States Postal Service, mailed, first class, postage prepaid, or by facsimile transmission, to
the following:
To CITY: To FRIENDS:
City Clerk President
City of Palo Alto Friends of the Palo Alto Children’s Theatre
P.O. Box 10250 1305 Middlefield Road
Palo Alto, CA 94303 Palo Alto, CA 94303-4304
with a copy to:
Manager
Palo Alto Children’s Theatre
1305 Middlefield Road
Palo Alto, CA 94301
SECTION 11. MISCELLANEOUS
11.1 This Agreement will be governed by and construed in accordance with the laws of
the State of California, the Charter of the City of Palo Alto, and the Palo Alto Municipal Code.
The Parties will comply with all applicable federal, state and local laws in the exercise of their
rights and the performance of their obligations under this Agreement.
11.2 All covenants, terms, conditions, and provisions of this Agreement, whether
covenants or conditions, will be deemed to be both covenants and conditions.
11.3 This Agreement represents the entire agreement between the Parties and
supersedes all prior negotiations, representations and contracts, written or oral. This Agreement
may be amended by an instrument, in writing, signed by the Parties. This Agreement may be
executed in any number of counterparts, each of which will be an original, but all of which
together will constitute one and the same instrument.
11.4 All exhibits referred to in this Agreement are by such references incorporated in
this Agreement and made a part hereof. The following exhibits are (or will be) made a part of
this Agreement:
Exhibit “A” Development Plan for the Friends of the Palo Alto Children’s Theatre
Exhibit “B” Long-Term Strategic Plan for the Children’s Theatre
Exhibit “C” Certification of Nondiscrimination.
12.5 At the request of the City, the Friends will furnish to the City Attorney for the
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City’s review and approval copies of its articles of organization, operating agreement, and other
information relating to its organization status.
12.6 The Parties agree that the normal rule of construction to the effect that any
ambiguity is to be resolved against the drafting party will not be employed in the interpretation
of this Agreement, the Exhibits, or any amendment thereto.
12.7 In the event that an action is brought, the Parties agree that trial of such action
will be vested exclusively in the state courts of California or in the United States District Court
for the Northern District of California in the County of Santa Clara, State of California.
12.8 The prevailing Party in any action brought to enforce the provisions of this
Agreement may recover its reasonable costs and attorneys' fees expended in connection with that
action.
12.9 If a court of competent jurisdiction finds or rules that any provision of this
Agreement, the Exhibits, or any amendment thereto, is void or unenforceable, the unaffected
provisions of this Agreement, the Exhibits, or any amendment thereto, will remain in full force
and effect.
//
//
//
//
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IN WITNESS WHEREOF, the Parties by their duly authorized representatives have
executed this Agreement as of the Effective Date.
APPROVED AS TO FORM: CITY OF PALO ALTO
______________________________ ___________________________________
Senior Asst. City Attorney City Manager
APPROVED: FRIENDS OF THE PALO ALTO CHILDREN’S
THEATRE
______________________________ ___________________________________
Director of Administrative Services Member
______________________________ ___________________________________
Director of Community Services Member
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EXHIBIT “A”
DEVELOPMENT PLANS FOR THE FRIENDS
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EXHIBIT “B”
LONG-TERM STRATEGIC PLAN FOR THE THEATRE
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EXHIBIT “C”
CERTIFICATION OF NONDISCRIMINATION
City of Palo Alto (ID # 3558)
City Council Staff Report
Report Type: Action Items Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Public Hearing: Finding Main Library Substantially Complex
Title: Public Hearing: Adoption of Finding that the Main Library Expansion
and Renovation Project (CIP PE-11000) is "Substantially Complex" under
Public Contract Code Section 7201 and Direction to Increase the Retention
Schedule from 5% to 10%
From: City Manager
Lead Department: Public Works
Recommendation and Draft Motion:
Draft Motion: I move that Council:
1.Find the proposed Main Library Expansion and Renovation Project
“substantially complex”under Public Contract Code Section 7201,and
2.Allow this project to be advertised with a retention amount of ten (10)
percent.
Executive Summary
A new state law requires that the City is limited to five (5) percent retention on
public works projects unless the City Council makes a formal finding that the
project is “substantially complex.” This finding must be made before the project
can be advertised for bid. The City is prepared to issue the formal Invitation for
Bids (IFB) for the Main Library Project immediately following Council’s finding that
the project is substantially complex.
City of Palo Alto Page 2
Background
As of January 1, 2012,a new section of the Public Contract Code Section 7201
requires that public agencies limit contract retention on public works projects to
5%, unless the project is found to be a “substantially complex project”. A
retention is a contractual withholding of money by the City to cover any
unexpected expenses,such as liens or poor workmanship, that may occur before
the project is completed and accepted. Prior to January 1, 2012, the City’s
standard retention amount for most public works contracts was 10%. The
standard procedure is to return the retention once the following occurs: work is
completed, the Contractor provides the Maintenance Bond, the City accepts the
project,and the lien period expires.
Public Contract Code Section 7201(b) provides,in part,that “retention proceeds
withheld from any payment by a public entity from the original contractor…shall
not exceed 5 percent of the payment.” This section further provides that “…in no
event shall the total retention proceeds withheld exceed 5 percent of the contract
price.” However, Section 7201(b)(4) provides, in part, that an awarding agency
may withhold in excess of five percent (5%) on specific projects where the
governing body has approved a finding during a properly noticed and normally
scheduled public hearing and prior to bid that the project is substantially complex
and therefore requires a higher retention amount than 5 percent. The awarding
entity must include both this finding and the actual retention amount in the bid
documents.
Discussion
The Main Library is a prominent and historic public building designed by Edward
Durell Stone and built in 1957. The expansion and renovation project is part of
the $76 million Measure N bond passed by Palo Alto voters in 2008. The bond
also included the renovation of Downtown Library and the new Mitchell Park
Library and Community Center.
The Main Library construction cost is estimated to be approximately $16 million,
and involves significant upgrades to the historic building’s structural, electrical
City of Palo Alto Page 3
and mechanical systems; construction of a new Teen Room;and Americans with
Disabilities Act (ADA) upgrades. These improvements will occur while preserving
the integrity of the original architect Edward Durrell Stone’s iconic design. A new
addition includes a program room and additional restrooms to extend the
services of this heavily used branch. The project targets Leadership in Energy and
Environmental Design (LEED) certification.
The Historic Resources Board (HRB) and the Architectural Review Board (ARB)
both approved this project in July 2012. The plans include site integration
features to create a more unified campus with the Art Center. This includes a
connection pathway to link the Art Center parking lot with the Main Library
parking lot.
The contractor will be required to subcontract for numerous specialty trades
including well drilling for over 45 geothermal heat exchange boreholes to 350 feet
deep. The entire concrete floor of the western half of the library will be replaced
and radiant floor heating will be installed. The project also includes sealing of the
basement walls, installation of new electrical equipment,abatement of asbestos-
containing material, and the addition of approximately 4,000 square feet of new
building space. The project will require the coordination of multiple construction
disciplines while maintaining public access to the adjacent Art Center and public
garden area. The large amount of work required, the preservation of historic
features,and the measures to obtain LEED certification make this project
“substantially complex”.
The finding of a “substantially complex” project is based on the various disciplines
and trades involved in the construction of this project, and coordination with
adjacent active facilities. The Main Library Expansion and Renovation was
determined to be substantially complex based on the project scope described
above. The City Clerk has published the required notice of this hearing in the Palo
Alto Weekly starting on February 15, 2013.
The retention will be released as described in the City of Palo Alto’s standard
contract General Conditions Section 9.8.1 which states, “Upon receipt of notice
City of Palo Alto Page 4
from Contractor that the Work is ready for final inspection, City will make such
inspection. The City will file a Notice of Completion (NOC) with the County Clerk
within ten (10) days after acceptance by the City. Thirty (30) Days after filing the
NOC, the City may release the final retention provided the requirements in this
paragraph are met.”
Timeline
Staff expects to issue an IFB soon after Council’s finding that the project is
substantially complex. Main Library will be closed for renovation on April 30,
2013. A small temporary library will be opened in the adjacent Art Center
Auditorium on May 3, 2013. Main Library is expected to reopen in fall 2014.
Resource Impact
There are no resource impacts associated with finding the project “substantially
complex”. The project is funded as part of a $76 million Measure N bond within
the Capital Improvement Program Project (CIP)PE-11000 Main Library New
Construction and Improvements.
Policy Implications
The proposed action is consistent with City policy.
Environmental Review
On July 21, 2008, the Council confirmed the Director of Planning and Community
Environment’s approval of a 2007 Addendum to the 2002 final Environmental
Impact Report for the Main Library.
City of Palo Alto (ID # 3574)
City Council Staff Report
Report Type: Action Items Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Edgewood Plaza Update
Title: Update and Direction to Staff Regarding Development Process for
Edgewood Plaza
From: City Manager
Lead Department: Planning and Community Environment
Recommendation and Draft Motion:
Draft Motion: I move that Council direct staff to:
1. Proceed with preparation of a Supplemental Environmental Impact Report (SEIR) to
address Building #1 historic resources issues (at the applicant’s expense);
2. Return to Council with the SEIR and an amendment to the PC zoning (including
modification to the proposed “public benefits”) following review by the Historic
Resources Board and Planning and Transportation Commission.
3. Prohibit any construction of Building #1 and any development of housing (including site
preparation for the housing) until the SEIR is completed and an amendment to the
approved Planned Community (PC) zone is considered by the Council;
4. Allow continued development of the grocery store (Building #3) as the remainder of the
project moves forward;
5. Allow the rehabilitation of Building #2 to commence subject to a City designated historic
peer review and on-site monitor;
6. Allow offsite improvements to proceed, including off-site traffic improvements; and
7. Allow the installation of the historic sign and other incidental related work.
Executive Summary
The Edgewood Plaza Planned Community (PC) Zoning was approved on March 19, 2012 to allow
the redevelopment of an existing vacant and historic shopping center, including the relocation
of one of the three retail buildings, the addition of ten homes and a new 0.20 acre park. The PC
Zoning required that the two historically significant retail buildings be preserved as a primary
City of Palo Alto Page 2
public benefit: Building #2 was to be rehabilitated in place, while Building #1 was proposed to
be disassembled, relocated on site and rehabilitated. Work also began on the grocery store
building, another key public benefit of the zoning.
Subsequent to the issuance of a permit to disassemble Building #1 and contrary to the
requirements of the PC Zoning and what was shown in the building permit plans, however, the
applicant demolished the building without notifying or receiving approval from the City. The
Planning Director issued a stop work order on September 9, 2012, following complaints of the
unauthorized demolition. Following the issuance of the stop work order, the applicant, Sand Hill
Property Company, initiated discussions with the City regarding next steps. The applicant was
allowed to continue construction on the grocery store in Building #3, the one non-historic
building, and any work related to the operation of the grocery store. Since the project no
longer preserves one of the two historic buildings, however, a Supplemental Environmental
Impact Report (SEIR) must be prepared before Building #1 can be rebuilt, and amendment to
the PC zoning may be required to define adequate “public benefits,” a process that is likely to
take 4 to 6 months. Staff recommends that, in the interim, on-site work be limited to
construction of the grocery store (Building #3), rehabilitation of Building #2 (with additional
limitations and historic resource inspections), and installation of the historic monument sign.
Staff recommends that no work on Building #1 and the housing component of the project move
forward until completion of the SEIR and consideration of an amendment to the Planned
Community zoning, including potential additional public benefits.
Background
This item was continued from the Council’s January 22, 2013 calendar. Responses to questions
submitted by Councilmember Holman are included as Attachment E to the staff report.
Edgewood Plaza is a commercial shopping center built between 1956 and 1958 by Joseph
Eichler/Eichler Homes and A. Quincy Jones of Jones and Emmons. The property is bounded to
the south by Channing Avenue, by West Bayshore Road to the east, Saint Francis Drive to the
west and an office building and gas station to the south. Embarcadero Road is located south of
the site. The center was originally built with the existing grocery building (1957), two retail
buildings (1958), an office building that formerly housed the office of Eichler Homes (1959), and
a gas station (1957). The office building (Maharishi School of Vedic Science of California/1101
Embarcadero Road) and gas station (A.U. Energy LLC/1161 Embarcadero Road) sites are owned
by different property owners and are not part of this project. The 3.58-acre commercial site is
located at adjacent to the Duveneck/Saint Francis neighborhood, which is part of the Green
Gables subdivision.
Planned Community Zoning and Environmental Review
City of Palo Alto Page 3
The Edgewood Plaza Planned Community Zoning (Attachment A) was approved on March 19,
2012 to allow the redevelopment of an existing vacant and historic shopping center, including
the relocation of one of the three retail buildings, the addition of ten homes and a new 0.20
acre park. The site plan is provided as Attachment D for reference. Two of the existing
commercial buildings, Buildings #1 and #2 have been deemed historic resources. Building 3,
the former market building proposed to house the new Fresh Market, is not considered a
historic resource. Building #1 was approved to be disassembled, relocated on site and
rehabilitated. Building #2 was approved to be rehabilitated in place. The primary public
benefits for the Edgewood Plaza project consist of 1) the preservation of historic resources and
2) the construction and operation of the grocery store. An Environmental Impact Report (EIR)
was prepared and certified by the City Council to provide environmental clearance in
accordance with the California Environmental Quality Act (CEQA) for the rezoning. The EIR was
certified based on the assumption that historic impacts for the relocation of Building #1 would
be mitigated to a less than significant impact because the building would be rehabilitated in
accordance with the Secretary of the Interior’s Rehabilitation Standards. Specifically, the
character defining features of the building, such as the wood window frames, glu-lam beams,
concrete block wall, cornice and wood paneling, would be retained. The CEQA findings adopted
by the Council are provided in Attachment B.
Building #1 Demolition and Stop Work
Subsequent to the City Council approval, the applicant submitted building permits to repair
Building #3 (grocery store), disassemble and rehabilitate Building #1 and to rehabilitate Building
#2, in compliance with the PC Zoning. The applicant submitted building permit plan sets that
were prepared under review by the applicant’s historic consultant, Page and Turnbull, following
the requirements of the project’s EIR. The building permit plan sets included specific notes for
a review process to ensure that the disassembly of Building #1 would be completed in
conformance with the Secretary of the Interior’s Rehabilitation Standards. Shortly after the
building permits were issued, however, Building #1 was completely demolished. Once staff was
notified, a Stop Work Order was issued immediately to stop all virtually all work at the
Edgewood Plaza.
Shortly after the issuance of the Stop Work Order, the applicant met with City staff to discuss
the situation. Staff also requested a written explanation of the unauthorized demolition. A
copy of the applicant’s explanation has been provided to the Council in Section II of Attachment
C. The explanation, written by the applicant’s historic consultant, stated that the building
materials were in a condition that was not salvageable. However, the applicant failed to follow
the approved review process and disposed of the building material without notifying the City or
obtaining City approval. Staff observed that although significant site improvement work had
commenced, Building #2 remained largely untouched. Improvements to Building #3 (grocery
store) were in process.
City of Palo Alto Page 4
Other Work on Site
Although all work had stopped, the applicant requested the ability to proceed with other
components of the project. The key component was the ability to proceed with the
construction of the grocery building, which was one of the primary public benefits of the PC
adopted by Council. The Planning Director allowed the grocery store and any related work
needed to make the site operational for Fresh Market to move forward since a) the new market
was a public benefit and there were no environmental impacts identified with its development,
b) the building was not a historic resource, c) there were no violations identified for this part of
the project and d) the commercial portion of the project was subject to an earlier lot merger
and was consistent with both the earlier PC zone and the new PC zone. The applicant
submitted a phasing plan that showed that this work could be completed without affecting the
site of Building #1, Building #2 or the location where the ten homes would be located. The
grocery store work complies with the PC zoning requirements. The related work included
parking lot improvements and utilities and was allowed to proceed. Staff also permitted a few
other incidental activities that were allowed. Staff allowed the foundation to be poured at the
new location of Building #1 to protect work that already had been done prior to the issuance of
the Stop Work Order. The applicant was made to understand that any work on Building #1
would be subject to future review and requirements, and that the foundation pour was allowed
at the applicant’s risk that a final resolution may require a modified location for Building #1
(though staff doesn’t believe that’s likely). Staff also allowed temporary roof protection to be
installed on Building #2 to protect the interior. The applicant is targeting May as a grand
opening date for the grocery store.
PC Amendment
The applicant has filed an amendment to the original PC application to permit the
reconstruction of Building #1 in accordance with a modified Secretary of Interior Standards for
Reconstruction. The modified standards would closely comport to the building plans previously
approved by the City. It is also expected that the project would contain additional historic
enhancements that would further unify the three Eichler commercial buildings.
Discussion
Staff has brought the Edgewood Plaza project forward to assure that Council is supportive of
the direction of the process of rectifying the project violations of Building #1 and the associated
environmental review (EIR). Staff anticipates that the components of the subsequent action
will include: 1) an amendment to the Planned Community Zoning, 2) preparation of a
Supplemental Environmental Impact Report (SEIR), and 3) determination as to which elements
(if any) of the project may proceed in the interim, pending final Council actions.
Planned Community Zoning Amendment
City of Palo Alto Page 5
The original Planned Community Zoning approval included the relocation and rehabilitation of
Building #1, with the retention of the character defining features of the Eichler building. The
rehabilitation of the building was considered a “public benefit” of the project justifying the
rezoning. Since Building #1 has been demolished and will need to be completely reconstructed,
the Planned Community Zoning must be amended before work may commence on Building #1.
The applicant has submitted a letter request to amend the zoning. The applicant proposes to
rebuild Building #1 as approved, but with all new material rather than retaining some portion of
the prior building materials. The revised application will be required to be reviewed by the
Historic Resources Board (HRB) and the Planning and Transportation Commission (PTC).
Subsequent to the HRB and PTC recommendations, the application would be brought back to
the City Council for final approval. Architectural Review Board review will be required if
significant changes to the elevations are proposed. However, the applicant has indicated that
such changes are unlikely. Staff has informed the applicant that the rebuilding of Building #1 is
likely to require certain enhancements in response to the loss of the historic building. The
enhancements may include the requirement for the exact reproduction of the wood windows
found in Building #2 or better replications of other components that had previously been
altered over the years. The PC amendment will address the “public benefits” issue to define
whether comparable historic benefits may be provided or whether additional benefits may be
required to compensate for those lost by the demolition of Building #1.
Supplemental Environmental Impact Report (SEIR)
As required by the California Environmental Quality Act (CEQA), the Environmental Impact
Report (EIR) for Edgewood Plaza was prepared to serve as a disclosure document to provide
information to the public and decision making bodies as they consider pending applications.
Specifically CEQA requires agencies to not only disclose the significant environmental effects of
proposed projects, but the feasible alternatives or mitigation measures that could help avoid or
reduce the environmental impacts. The site has been determined to be a historic resource in
accordance with CEQA.
The project’s EIR was certified based on the assumption that historic impacts for the relocation
of Building #1 would be mitigated to a less than significant impact because the building would
be rehabilitated in accordance with the Secretary of the Interior’s Rehabilitation Standards.
Because Building 1 has been demolished, the Rehabilitation Standards are no longer applicable
and a substituted mitigation measure or a statement of overriding considerations is required.
Given that the project condition for Building #1 has changed, a Supplemental Environmental
Impact Report (SEIR) is required to analyze the historic impacts of the demolition and to
identify substitute mitigation measures for the loss of Building #1. Staff has engaged the
original environmental consultant, David J. Powers and Associates, to prepare the SEIR, at the
applicant’s expense. The SEIR will focus on the range of potential substituted mitigation
measures for the loss of Building #1. The applicant is proposing to reconstruct Building #1 with
all new material, but to replicate the prior approved design. A Notice of Preparation for the
City of Palo Alto Page 6
SEIR has been published and mailed to responsible agencies requesting comments by March 4,
2013. A draft SEIR will be prepared to outline potential mitigation measures or alternatives
and/or findings that would be required to allow for the loss of a significant historic resource.
The draft SEIR will be available to the public and will be reviewed by the Planning and
Transportation Commission prior to consideration of the amendment to the PC zoning and any
modification of “public benefits” for the project. The Council will then consider the Final SEIR
and the PC amendment following recommendations from the HRB and PTC. Staff expects that
the EIR and PC amendment process will take approximately 4-6 months.
Next Steps and Staff Recommendation
The applicant understands that work on Building #1 cannot commence without Council
approval of a PC Zoning amendment or a certified SEIR. However, the applicant has requested
permission to proceed with the rest of the project. Staff recommends allowing the applicant to
proceed with the commercial aspects of the development that comply with the prior PC
ordinance as well as the contemplated PC ordinance. However, staff does not recommend
allowing the housing to proceed as the status of the existing PC ordinance is in flux given the
removal of a key community “public benefit.”
Work on Commercial Buildings #2 and #3
The applicant has requested to continue work on the grocery store (Building #3) and to begin
work on Building #2, the one remaining historic building, because he believes it will be possible
to rehabilitate the building in place as previously approved. Staff’s primary concern with these
requests is to ensure that unauthorized work will not be an issue and that staff will be fully
aware of any potential issue or change. To address the concern, staff has requested that the
applicant’s historic consultant, Page and Turnbull, provide an explanation of the previous
events that led to the unauthorized demolition and how the applicant intends to comply with
the requirements for the rehabilitation of Building #2. Page and Turnbull has prepared and
provided a narrative (Attachment C) explaining the process that led to the demolition of
Building #1 and a protocol for Building #2 to ensure compliance with the Secretary of the
Interior’s Rehabilitation Standards.
The protocol, which has been reviewed by the City’s Historic Preservation Planner, establishes a
procedure for the documentation, notification, salvage, protection and approval needed for the
successful rehabilitation of the historic building. Staff believes the protocol establishes a clear
process to ensure compliance to supplement the process identified in the original building
permit plans submitted for Building #1. However, the protocol will likely need to be refined as
more information is discovered through the construction process. To further aid in the
assessment of Building #2, the City authorized limited reconnaissance (with City staff on hand)
to assess the building’s condition. Very small spot openings were created in the non-historically
significant interior walls to allow viewing of the exterior walls. Although it was discovered that
City of Palo Alto Page 7
much of the building has been replaced over time, the historic integrity of the building is still
intact because the character-defining features that establish the historic fabric of the building
were maintained. To ensure compliance throughout the entire construction process, staff
recommends that the applicant also pay for a City-hired consultant to provide a historic peer
review of the plans and construction site observation to ensure that the project is implemented
as required.
Staff also believes that the relocation and rehabilitation of the historic sign can be done in a
way that will not further damage the historic integrity of the site. An Architectural Review
permit would be required for the historic sign and would be reviewed by both the Historic
Resources Board and the Architectural Review Board. Additionally, staff would also like the
applicant to proceed with the following transportation related improvements required in the
PC zoning as they directly relate to pedestrian and vehicular safety: a) median island
modifications at Embarcadero Rd. and West Bayshore Road, b) signal modification at
Embarcadero Road and St. Francis Drive, and c) two-way left turn restriping on Embarcadero
Road from St. Francis Drive to Wildwood Lane. The goal would be to have these improvements
in place when the grocery store opens. A team of City staff for the Edgewood Plaza project has
been created and engaged to ensure regular communication and monitoring of the project. City
staff has also been communicating with neighborhood resident groups to keep the
neighborhood informed.
Residential Development
The applicant has also expressed interest in being allowed to process the Final Subdivision Map
and at least prepare the housing sites and possibly construct a few model homes of the ten
approved home sites, while the SEIR is prepared and the PC amendment is reviewed. Staff has
objected to that approach, as the loss of the community benefit puts the current PC in flux and
staff is not able to make the necessary findings to subdivide the residential lots at this time.
Alternatives
Council may, in lieu of staff’s recommendation, choose any of the following alternatives (or
others):
1. Stop all work, including the grocery store, until the SEIR and PC amendment are
presented to Council.
The applicant would be required to cease all work immediately. The grocery store and
related work would be placed on hold, perhaps jeopardizing the lease with the grocery
tenant and substantially delaying the rehabilitation of the center. The site would remain
completely vacant until the SEIR and PC Amendment are brought before the Council. The
deferral of the housing provides some financial consequence and leverage to encourage
City of Palo Alto Page 8
the applicant to move expeditiously on other components of the project, particularly
relative to Building #1.
2. Stop all work other than the grocery store, until the SEIR and PC amendment are
presented to Council.
The applicant would be allowed to complete work only on the grocery store and related
site work, as currently allowed. This would include the parking lot, utility, signage and
traffic improvements. The remainder of the site, including Building 2 and the housing,
would have to remain untouched and fenced off until the SEIR and PC Amendment are
brought to the Council for a decision. This would result in construction adjacent to the
grocery store after the store opens, which would be disruptive to the store, and would
delay somewhat the rehabilitation of the center. Deferral of the housing again serves as
leverage to assure compliance throughout the remainder of the construction.
3. Allow the housing or a portion of the housing to proceed at applicant’s risk while the
SEIR and PC amendment are under development, and assess a fine for the demolition of
Building #1. This would also allow for approval of the final map.
This alternative would allow the applicant to proceed with the construction of Building #2
and some or all of the housing. If the housing moves forward, staff believes the City has
somewhat reduced leverage to assure compliance and cooperation for the construction of
the remainder of the project. If Council determines to allow the housing to proceed, staff
recommends two additional provisions: a) no final inspection and issuance of a certificate
of occupancy should be permitted until Council certification of the SEIR and approval of
the PC amendment; b) applicant proceeds at his own risk in the event the amended
project is not approved by the Council; and c) a penalty should be assessed for the
unpermitted demolition of Building #1. Staff recommends a fine of $10,443.17 if such a
penalty is levied (see discussion below).
In order to construct the housing units, the applicant must comply with the PC Ordinance and
EIR mitigation measures. Because the rehabilitation of Building #1, which was a major public
benefit of the original PC approval and a required mitigation measure in the EIR, is no longer
possible, construction of housing would not be in compliance with the PC conditions of
approval and the EIR mitigation measures. Amending the PC ordinance and substituting a
mitigation measure is a discretionary action which triggers a SEIR. Staff believes that options
that avoid preparation of an SEIR and PC amendment are not legally viable. However,
alternatives #1 and #2 would allow construction of the project components that are still in
compliance with the PC Zoningand therefore do not require a SEIR and PC amendment.
Penalties for Non-Compliance
The project applicant has violated the conditions of approval for the PC zoning and the historic
resources mitigation measures required. The City could impose financial penalties related to
the violation. The applicant, however, has cooperated with staff’s subsequent direction, admits
City of Palo Alto Page 9
culpability (though not intent) and concurs with staff’s recommendations in this report. The
applicant will (and has to some extent already) incur substantial costs associated with a) delay
in construction of the various components of the project, b) costs for the additional
environmental review and staff work, c) additional onsite monitoring and peer review of the
historic building (Building 2), and d) modifications to the project “public benefits,” to be
determined subsequently by Council. Of particular note, staff believes that deferral of the
housing component of the project is a substantial penalty for the developer and provides
significant leverage for the City to assure the project complies fully as it moves forward.
Nevertheless, the City Council may ultimately determine a penalty is required upon review of
the amended PC zoning or presently.
The Municipal Code allows the City to fine applicants for a variety of code violations. The Code
provides that, for construction without a permit, an amount equal to the building permit fee
(“double permit fees”) may be assessed. The building permit fee is based on the valuation of
the construction cost and the scope of work for all trades (i.e. lighting, plumbing, etc.). The
building permit fee that was charged for Building 1 was $9443.17. Accordingly, the City could
use this rationale to fine the applicant an additional $9,443.17 for the illegal demolition.
Additionally, given the special circumstance of the demolition of an historic structure, an
additional fine may be warranted. There is a specific fine of $1,000 authorized in the City Code
for demolition of a downtown historic structure. If a similar fine were added to the building
permit fee, a total of $10,443.17 could be assessed. Given the discretionary nature of the
Planned Community consideration, Council may assess a lesser or greater penalty.
Resource Impacts
The cost of additional review and preparation of the Supplemental Environmental Impact
Report will be borne by the applicant. The resource impacts of the Planned Community zoning
are not likely to change given the project modifications and the amended zoning. The grocery
store is proceeding with construction, so that its economic benefits should be realized in a
timely manner.
Environmental Review
Environmental review is addressed earlier in the report, as a Supplemental Environmental
Impact Report (SEIR) will be required and is under preparation.
Attachments:
Attachment A: PC Ordinance #5150 (Edgewood Plaza) (PDF)
Attachment B: CEQA Resolution for Edgewood Plaza (PDF)
Attachment C: February 4, 2013 Page and Turnbull Letter re: Historic Resources (PDF)
Attachment D: Site Plan (PDF)
City of Palo Alto Page 10
Attachment E: Response to Council Questions (DOCX)
Attachment F: Public Correspondence (PDF)
· Resolution No. 9239
Resolution Of The Council Of The City Of Palo Alto Certifying
The Adequacy Of The Final Environmental Impact Report For The
Edgewood Plaza Project Pursuant To The California Environmental
Quality Act And Adopting The Mitigation Monitoring And
Reporting Program
The Council of the City of Palo Alto does RESOLVE as follows:
SECTION 1. Introduction and Certification.
(a) The City Council of the City of Palo Alto ("City Council"), in the exercise of its
independent judgment, makes and adopts the following findings to comply with the requirements
ofthe California Environmental Quality Act ("CEQA"; Pub. Resources Code, §§ 21000 et seq.),
and Sections 15091, 15092, and 15093 of the CEQA Guidelines (14 Cal. Code Regs., § 15000 et
seq.). All statements set forth in this Resolution constitute formal findings of the City Council,
including the statements set forth in this paragraph. These findings are made relative to the
conclusions of the City of Palo Alto Edgewood Plaza Project Final Environmental Impact Report
(State Cleari11ghouse No. 2011022030) (the "Final EIR") , which includes the Draft
Environmental Impact Report ("Draft EIR"), Public Comments, and Responses to Comments.
The Final EIR addresses the environmental impacts of the implementation of the Edgewood
Plaza Project (the "Project", as further defined in Section 2(b) below) and is incorporated herein
by reference. These findings are based upon the entire record of proceedings for the Project.
(b) Mitigation measures associated with the potentially significant impacts of the
Project will be implemented through the Mitigation Monitoring and Reporting Program
described below, which is the responsibility of the City.
(c) The City of Palo Alto is the Lead Agency pursuant to Public Resources Code
section 21067 as it has the principal responsibility to approve and regulate the Project. Sand Hill
Property Company is the Project applicant.
(d) The City exercised its independent judgment in accordance with Public Resources
Code section 20182.1(c), in retaining the independent consulting firm David J. Powers &
Associates, Inc. ("Powers & Associates") to assist with preparation of the Final EIR under the
supervision and at the direction of the City's Director of Planning and Community Environment.
(e) The City, with assistance from David J. Powers & Associates, initially prepared
the Draft EIR and circulated it for review by responsible and trustee agencies and the public and
submitted it to the State Clearinghouse for review and comment by state agencies, for a comment
period which ran from September 30, 2011, through November 14, 2011. As noted above, the
Final EIR includes the Draft EIR, copies of all comments on the Draft EIR submitted during the
comment period, the City's responses to those comments, and changes made to the Draft EIR
following its public circulation.
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(f) The City's Planning and Transportation Commission has reviewed the Final EIR
and a draft of these findings and has provided its recommendations to the City Council regarding
certification of the Final EIR. The City Council has independently reviewed the Final EIR and
has considered the Planning and Transportation Commission's recommendations in making these
findings.
(g) Based upon review and consideration of the inforn1ation contained therein, the
City Council hereby certifies that the Final EIR was completed in compliance with CEQA, and
reflects the City of Palo Alto's independent judgment and analysis. The City Council has
considered evidence and arguments presented during consideration of the Project and the Final
EIR. In determining whether the Project may have a significant impact on the environn1ent, and
in adopting the findings set forth below, the City Council certifies that it has complied with
Public Resources Code sections 21081, 21081.5, and 21082.2.
(h) Section 6 of the Final EIR and the First Amendment to the Final EIR shows all
revisions which the Final EIR made to the Draft EIR. All references to the Draft EIR in these
findings include references to all revisions to the Draft EIR made in the Final EIR (as amended).
Having reviewed this section and the Final EIR as a whole, the City Council hereby finds,
determines, and declares that no significant new information has been added to the Final EIR so
as to warrant recirculation of all or a portion of the Draft EIR. Likewise, the City· Council has
considered all public comments and other information submitted into the record since publication
of the Final EIR, and further finds that none of that additional information constitutes significant
new information requiring recirculation of the Final EIR.
SECTION 2. Project Information.
The following Project information is supplied to provide context for the discussion and
findings that follow, but is intended as a summary and not a replacement for the information
contained in the Draft EIR, Final EIR, or Project approvals.
(a) Project Objectives
The Project Objectives of the Project applicant are set forth in Section 2.4 of the Draft
EIR, which is incorporated herein by reference.
(b) Project Description
The proposed Project is the renovation of three existing commercial buildings at the
Edgewood Shopping Center containing approximately 38,400 square feet of retail uses, and the
redevelopment of the northern portion of the site with ten single-family residences and an
approximately 0.20 acre park.
The three buildings currently on site are arranged in an L-shaped plan, with the grocery
store to the east, and the two one-story retail buildings to the west. The grocery store and the
retail buildings are wood-framed with elements of stucco and concrete block, and have flat roofs.
One of the existing retail buildings (Building 1) would be relocated to the north and west
of its current location on the site to allow for a modified configuration of parking for the grocery
store. This building and the other building to remain in place (Building 2) would be renovated
120402 dm 0120533 2
for continued retail use. Building 1 would be disassembled, and significant elements with
distinctive design qualities, such as the walls and walkway overhangs would be retained. The
building would be reconstructed to the north and west of the current Building 1 location, and
visible historic building elements from the existing building would be rehabilitated and installed
on a new building structure.
The grocery building would remain in place and be renovated to allow for use as a small-
scale grocery store.
A conceptual site plan ofthe proposed Project is shown on Figure 4. A breakdown ofthe
proposed development areas and building square footage are shown in Table 2.3-1. Conceptual
elevations of the commercial buildings are shown on Figures 5-10, and conceptual residential
elevations are shown on Figure 11. (All references to figures and tables are to those appearing in
the Draft ErR, as modified where applicable in the Final ElR.)
A complete description of the Project as proposed by the Project applicant is set forth
in Section 2.3 of the Draft ErR, as modified in the Final ErR.
( c) Required Approvals
The approvals required by the City as lead agency for implementation of the Project
include:
A. Planned Community Zoning
B. Tentative Subdivision Map
C. Final Subdivision Map
D. Lot Line Adjustments
E. Tree Removal Permits
SECTION 3. Record of Proceedings.
(a) For purposes of CEQ A, CEQA Guidelines section 15091(e), and these
findings, the Record of Proceedings for the Project includes, but is not limited to, the following
documents:
(1) The Final ErR, which consists of the Edgewood Plaza Project Draft
Environmental Impact Report, published and circulated for public review and
comment by the City from September 30, 2011 through November 14,2011 (the
"Draft EIR") , and the Edgewood Plaza Project Final Environmental Impact
Report, published and made available on February 17, 2012, a First Amendment
to the Final ElR and made available on February 29, 2012 and all appendices,
reports, documents, studies, memoranda, maps, testimony, and other materials
related thereto;
(2) All public notices issued by the City in connection with the Project and the
120402 dm 0120533 3
preparation of the Draft EIR and the Final EIR, including but not limited to public
notices for all public workshops held to seek public comments and input on the
Project and the Notice of Preparation, Notice of Completion, Notice of
Availability;
(3) All written and oral communications submitted by agencies or interested members
of the general public during the public review period for the Draft EIR, including
oral communications made at public hearings or meetings held on the Proj ect
approvals;
(4) The Mitigation Monitoring and Reporting Program;
(5) All findings and resolutions adopted by the City Council in connection with the
Project, and all documents cited or referred to therein;
(6) All final reports, studies, memoranda, maps, staff reports, or other planning
documents relating to the Project prepared by the City of Palo Alto and
consultants with respect to the City of Palo Alto's compliance with the
requirements of CEQ A, and with respect to the City of Palo Alto's actions on the
Project, including all staff reports and attachments to all staff reports for all public
meetings held by the City;
(7) Minutes and/or verbatim transcripts of all public meetings and/or public hearings
held by the City of Palo Alto in connection with the Project;
(8) Matters of common knowledge to the City of Palo Alto, including, but not limited
to, federal, state, and local laws and regulations;
(9) Any documents expressly cited in these findings, in addition to those cited above;
and
(10) Any other materials required to be in the record of proceedings by Public
Resources Code section 21167.6(e).
(b) The custodian of the documents comprising the record of proceedings is the
Director of Planning and Community Environment, City of Palo Alto, 250 Hamilton Avenue,
Palo Alto, California, 94301.
( c) Copies of all of the above-referenced documents, which constitute the record of
proceedings upon which the City of Palo Alto's decision on the Project is based, are and have
been available upon request at the offices of the Planning and Community Environment
Department, City of Palo Alto, 250 Hamilton Avenue, Palo Alto, California, 94301, and other
locations in the City of Palo Alto.
(d) The City of Palo Alto has relied upon all of the documents, materials, and
evidence listed above in reaching its decision on the Project.
(e) The City Council hereby finds, determines and declares that the above-referenced
documents, materials, and evidence constitute substantial evidence (as that term is defined by
120402 dm 0120533 4
section 15384 of the CEQA Guidelines) to support each ofthe findings contained herein.
SECTION 4. Mitigation Monitoring and Reporting Program.
(a) CEQA requires the lead agency approving a project to adopt a Mitigation
Monitoring and Reporting Program (MMRP) for the changes made to the project that it has
adopted in order to mitigate or avoid significant effects on the environment. An MMRP has been
prepared and is recommended for adoption by the City Council concurrently with the adoption of
these findings to ensure compliance with mitigation measures during Project implementation. As
required by Public Resources Code section 21081.6, the MMRP designates responsibility and
anticipated timing for the implementation of the mitigation measures recommended in the Final
EIR. The MMRP will remain available for public review during the compliance period.
(b) The City Council hereby adopts the MMRP for the Project attached hereto and
incorporated by reference, and finds, determines, and declares that adoption of the MMRP will
ensure enforcement and continued imposition of the mitigation measures recommended in the
Final EIR, and set. forth in the MMRP, in order to mitigate or avoid significant impacts on the
environment.
SECTION 5. Potentially Significant Impacts.
By these Findings, the City Council ratifies and adopts the Final EIR' s conclusions for
the following significant environmental impacts which, based on the analyses in the Final EIR,
this City Council determines will be less than significant after the implementation of the
mitigation measures described below. All citations to the Draft EIR chapters and sections below
include reference to all revisions to those chapters and sections contained in the Final EIR.
Section 3.2.5.3 Historic Resources Impacts in the Draft EIR included summaries of the expert
opinion of two qualified historic resources consultants, Page &Turnbull and Carey & Company.
The City Council finds the opinion of Page & Turnbull to be valid and agrees with their
conclusions regarding the significance of project impacts on historic resources. The significance
conclusions for Impact CR-2 and Impact CR-3 below reflect a revision of the impact statements
in the Final EIR made available on February 17, 2012, based upon the City Council's
independent judgment of the two analyses by experts presented in the EIR.
5.1 Cultural Resources
Impact CR-l: Unknown subsurface archeological or paleontological resources could be
present on the site, and could be disturbed during Project construction.
a) Potential Impact. The impact identified above is described and discussed in
Sections 3.2.1 and 3.2.5.2 of the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures CR-1.1 and CR-1.2.
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c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring that all
construction activities be halted within a radius of fifty (50) feet of any potentially significant
archeological or paleontological resources encountered during construction; (ii) requiring that
such resources be examined by qualified professionals; and (iii) following the recommendation
of the qualified professional to preserve, collect, record and/or analyze the resources, thereby
ensuring that significant archeological and paleontological resources are not inadvertently
destroyed and are appropriately preserved and/or recorded. The above-noted measures will also
reduce the severity of this potentially impact to a less-than-significant level by: (i) requiring that
all construction activities be halted in the event that any human remains are encountered during
construction; (ii) requiring that such remains be examined by the County Coroner to determine
whether or not the remains are Native American; (iii) to contact the California Native American
Heritage Commission and COlmty Coordinator of Native American Affairs if the remains are
determined to be Native American; and (iv) by prohibiting any further disturbance of the site
except as authorized by the County Coordinator as provided by state law, thereby ensuring that
any Native American remains encountered are not inadvertently destroyed and handled
appropriately.
Based upon the expert opinion of Page & Turnbull presented in the Draft EIR, the City Council
finds that the following impact statement (Impact CR-2) regarding impacts to historic resources
reflects its independent judgment.
Impact CR-2: The Edgewood Plaza site is considered historically significant under
federal, state and City of Palo Alto criteria. Although relocation of Building 1 on the site would
alter the site design and characteristics of Edgewood Plaza, this change in spatial relationship
would not result in a significant impact to the historic character of the buildings. The physical
relocation of Building 1 and renovation of Buildings 1 and 2, however, could result in
modifications to the historic design and integrity of the buildings.
a) Potential Impact. The impact identified above is described and discussed in
Section 3.2.5.3 of the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures CR-2.1, CR-2.2 and CR-2.3.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) documenting the exterior of
Buildings 1 and 2 and their settings in accordance with Historic American Buildings Survey
Level III docunlentation requirements, as described in greater detail in Section 6 of the Final
EIR, and preserving such documentation with the Palo Alto Historic Resources Preservation
Officer; (ii) creating a display illustrating the history of the Edgewood Plaza as built by Eichler
Homes prior to approval of final occupancy; (iii) requiring that the distinctive and defining
architectural features, finishes and construction techniques of Buildings 1 and 2, including
windows, frames, and eaves, be retained to the extent feasible during the relocation and
reconstruction of Building 1 and the rehabilitation of Building 2, subject to verification by
qualified professionals that work on these resources is completed in conformance with applicable
120402 dm 0120533 6
federal standards; and (iv) requiring review and approval of the final design and materials to be
used in the renovation of these buildings by the City of Palo Alto Planning and Community
Environment Department; thereby ensuring that this Impact is mitigated to a less-than-significant
level. While the Draft and Final EIRs conservatively identified this impact as significant and
unavoidable based upon conflicting expert opinion, the City Council agrees with the conclusions
of the experts, as reflected in the record, that this impact can, in fact, be mitigated.
Based upon the expert opinion of Page & Turnbull presented in the Draft EIR, the City Council
finds that the following impact statement (Impact CR-3) regarding impacts to historic resources
reflects its independent judgment.
Impact CR-3: The Edgewood Plaza site is considered historically significant under
federal, state and City of Palo Alto criteria. While construction of ten new single-family houses
on the site would alter the overall site design and characteristics of Edgewood Plaza, this
construction would not result in a significant impact to historic resources.
5.2 Air Quality
Impact AQ-l: Construction of the proposed Project could result in temporary air quality
impacts associated with dust and particulate matter generation at nearby residential uses.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.3.2.3 of Appendix C the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder ofthese findings:
Mitigation Measure AQ-l.l.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by requiring the applicant to
implement numerous construction practices determined by the Bay Area Air Quality
Management District to significantly reduce the adverse air quality effects of construction
activities. These practices include watering all exposed surfaces, covering all haul trucks,
regularly removing all mud, dirt and debris from public roads, limiting vehicle speeds on the
construction site, paving all appropriate surfaces as soon as possible, limiting idling times of
construction vehicles and equipment, properly maintaining all construction equipment, and
publicly posting contact information for public complaints regarding construction activities, all
as described in greater detail in Section 4.3.2.3 of the Appendix C of the Draft EIR.
Implementing these measures will minimize the extent to which dust and particulate matter
generated by Project construction activities is dispersed to nearby residential uses and other
sensitive receptors.
5.3 Biological Resources
Impact BIO-l: Excavation during construction of the proposed Project could result in
disturbance to active rapt or nests.
120402 elm 0120533 7
a) Potential Impact. The impact identified above is described and discussed in
Section 4.4.2.1 of Appendix C of the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measure BIO-l.I.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by requiring the applicant to
implement numerous several measures, pursuant to the requirements of the federal Migratory
Bird Treaty Act and the California Department of Fish and Game, designed to reduce adverse
effects on raptors and their nests. These measures include having a qualified ornithologist
complete pre-construction surveys to identify active nests that might be disturbed by Project
activities, postponing all tree removal and pruning activities for trees containing active raptor
nests and establishing buffer or exclusion zones around such trees, and monitoring such trees and
nests and prohibiting construction activities within the buffer/exclusion zones until the young
raptors have fledged from the nests. Implementing these measures will ensure that active raptor
nests are not unduly disturbed by construction activities, thereby avoiding and reducing the
potential adverse effects of the Project on raptors and their nests to less-than-significant levels.
5.4 Hazardous Materials
Impact HAZ-l:
construction workers and
soil and groundwater.
Construction of the proposed Project could expose
others to residual hazardous materials contamination III
a) Potential Impact. The impact identified above is described and discussed in
Section 4.8.3.2 of Appendix C ofthe Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures HAZ-1.l, 1.2, 1.3, 1.4 and 1. 5.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring the applicant to
prepare and implement a Soil Management Plan, to be reviewed and approved by the City of
Palo Alto and in compliance with all applicable federal, state and local regulations and in
conformance with applicable industry standards, to govern the handling of contaminated soil and
other hazardous materials encountered during Project construction activities; (ii) requiring each
contractor working on the site to prepare a health and safety plan that addresses the health and
safety hazards that may affect each phase site operations due to potential exposures to hazardous
materials, which plan includes requirements and procedures to ensure protection for each
contractor's employees, in compliance with all applicable federal, state and local regulations and
in conformance with applicable industry standards,; and (iii) requiring soil and groundwater
sampling and, if appropriate, soil vapor sampling, from under 2125 st. Francis Drive to ensure
120402 dm 0120533 8
that soil exceeding applicable tetrachloroethene levels (PCE-affected soils) is not present within
five (5) feet of the ground surface, requiring removal and disposal of any PCE-affected soils by
qualified professionals using appropriate protective gear in accordance with applicable federal,
state and local requirements, requiring an excavation base confirmation sample to confirm that
sufficient PCE-affected soils have been removed, and requiring that documentation of all PCE-
affected soils be provided to the City of Palo Alto and appropriate oversight agencies prior to
installation of pavement in the parking lot area; (iv) requiring characterization of all excavated
soils prior to off-site disposal or on-site reuse; requiring that contaminated soils be disposed of at
a licensed facility in accordance with all applicable local, state and federal regulations; (v)
requiring that all excavated soil characterizations, storage, transportation and disposal be in
conformance with all applicable federal, state and local procedures and requirements; and
(vi) requiring the applicant to prepare a contingency plan prior to the beginning of Project
construction to address any previously unknown sumps, hydraulic hoists, or tanks that may be
present in the work area. Implementation of these measures will ensure that the risks associated
with exposure to contaminated soils and other hazardous materials are reduced to a less-than-
significant level.
Impact HAZ-2: Renovation and relocation of Project buildings could expose
construction workers and sensitive receptors, including the surrounding residential uses, to lead-
based paint and/or asbestos-containing materials (ACMs).
a) Potential Impact. The impact identified above is described and discussed in
Section 4.8.3.2 of Appendix C ofthe Draft ElR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures HAZ-2.1, 2.2 and 2.3.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring surveys by
qualified professionals of all structures proposed for renovation on the site to determine the
presence of asbestos and lead-based paint, prior to commencing any work on such structures; (ii)
requiring that a registered asbestos abatement contractor by retained to remove and dispose of all
potential friable asbestos-containing materials, in accordance with applicable federal and state
laws, regulations, guidelines and requirements, prior to any relocation or renovation activities
that may disturb such materials; and (iii) requiring that all building materials containing lead-
based paint be removed and disposed of in accordance with applicable federal, state and local
standards, which include requirements relating to employee training, air monitoring and dust
control. Implementation of these measures will reduce the risks associated with potential
exposures to asbestos-containing materials and lead-based paint to less-than-significant levels.
5.5 Hydrology and Water Quality.
Impact HYDRO-I: Construction of the proposed residential units on the Project site
may expose people or structures to flooding risks.
a) Potential Impact. The impact identified above is described and discussed in
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Section 4.9.3.1 of Appendix C ofthe Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures HYDRO-I. 1 and 1.2.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring that all
construction activities on the site comply with the City of Palo Alto Flood Hazard Ordinance,
including elevation of habitable spaces above anticipated flood levels; (ii) requiring that all
Project plans show the base flood elevations on all applicable elevations, sections, and details,
and otherwise comply with all other requirements listed in the Ordinance; and (iii) requiring that
all construction activities on the site also comply with all applicable requirements of the Federal
Emergency Management Agency for flood hazard areas. Implementation of these measures will
ensure that structures on the site are constructed to minimize to the extent feasible risks
associated with flooding on the site and that this potentially significant impact is reduced to a
less-than-significant level.
Impact HYDRO-2: Construction activities could temporarily increase pollutant loads in
storm water runoff.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.9.3.5 of Appendix C ofthe Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures HYDRO-2.l and 2.2.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring the implementation
of certain erosion and sediment control measures based upon Best Management Practices
recommended by the Regional Water Quality Control Board (RWQCB), including installing
stormwater inlet protection around all storm drain inlets, watering all exposed surfaces,
suspending all dust-producing activities during periods of high winds, covering and watering
stockpiles of soil and other materials, covering all haul trucks, regularly sweeping and removing
all mud, dirt and debris from all paved access roads, parking areas and staging areas, and
replanting all vegetation in disturbed areas as soon as possible, as described in greater detail in
Section 4.9.3.5 of the Appendix C of the Draft EIR; (ii) requiring that an erosion and
sedimentation control plan be submitted to the City of Palo Alto Public Works Department for
review and approval prior to the issuance of any grading or building permits; and (iii) requiring
certain post-construction measures based on RWQCB Best Management Practices, including
providing roofs on all trash enclosures on site, providing onsite treatment of stormwater runoff
from the site prior to discharge to the City of Palo Alto stormwater system, preparing and
submitting to the City of Palo Alto Public Works Department an annual post-construction
maintenance agreement prior to the Issuance of grading or building permits, requiring
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commercial development on the site to implement regular maintenance activities to prevent soil
and litter from accumulating on the site, and requiring that landscaping and landscape
maintenance on the site employ minimal pesticide use. Implementation of these measures will
mitigate the Project's potential impacts relating to pollutant loads in stormwater runoff to less-
than-significant levels.
5.6 Noise
Impact NOISE-I: Future residential uses on the site could be exposed to noise levels
above City of Palo Alto standards for residential uses.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.12.2.2 of Appendix C ofthe Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures NOISE-I. 1, 1.2, 1.3, 1.4 and 1.5.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring that sound-rated
windows, doors, and exterior wall assemblies be used in residential buildings; (ii) requiring
acoustical test reports of all sound-rated windows and doors, to be reviewed by a qualified
professional and compared with traffic noise spectrums, prior to approval; (iii) requiring
ventilation or air conditioning systems in all residential units that provide habitable interior
environments, so that windows need not be relied upon to provide ventilation; (iv) requiring six
(6) foot tall noise barriers in specific locations; (v) requiring that residential mechanical
equipment be selected and located to meet the properly line limits in the City of Palo Alto Noise
Ordinance, and additional measures such as equipment barriers and enclosures if determined to
be necessary by the acoustical test and review described above, all as described in greater detail
in Section 4.12.2.2 of Appendix C of the Draft EIR. Implementation of these measures will
reduce the severity of potential noise impacts on future residents on the Project site to less-than-
significant levels.
Impact NOISE-2: Commercial activities on the site could result in significant noise
impact at the proposed residential units.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.12.2.4 of Appendix C of the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measures NOISE-2.1 and 2.2.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring that measures be
120402 dm 0120533 11
included in the renovation of the commercial buildings on the site to reduce noise impacts at
nearby residences, in conformance with the City of Palo Alto Noise Ordinance, which measures
may include installing solid noise barriers along the north and east sides of the loading dock
combined with a shed roof, and lining roofs and walls with sound absorbing materials; and (ii)
limiting all truck deliveries to the site to daytime hours (7 a.m. to 10 p.m.), communicating to
vendors that their drivers will be operating close to residences so that they will limit noise, and
providing a full disclosure statement to the owners of residential Lots Nos. 9 and 10 regarding
potential truck noise, which statement shall be incorporated into the deeds for these residential
properties. Implementation of these measures would reduce the severity of this potential Impact
to a less-than-significant level.
Impact NOISE-3: Noise from rooftop mechanical equipment for the retail buildings
may exceed the noise standards at adjacent residential properties on the Edgewood Plaza site.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.12.2.4 of Appendix C ofthe Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measure NOISE-3 .1.
c) Findings. The above-noted mitigation measures will reduce the severity of this
potentially significant impact to a less-than-significant level by: (i) requiring that mechanical
equipment to be installed and used on the Project site be selected, designed and located to
minimize noise impacts on adjacent and nearby residential uses; (ii) using solid rooftop screens
or noise barriers as determined by a qualified professional to be necessary to meet applicable
City of Palo Alto noise standards at the residential property lines; and (iii) providing for review
and approval of mechanical equipment plans by the City of Palo Alto Building Department prior
to the issuance of building permits; all as described in greater detail in Section 4.12.2.4 of
Appendix C of the Draft EIR. Implementation of this mitigation measure will reduce the
severity of this Impact to a less-than-significant level.
5.7 Transportation
Impact TRANS-1: Project traffic would cause a significant impact at the Wildwood
Land-North California Avenue and Embarcadero Road unsignalized intersection.
a) Potential Impact. The impact identified above is described and discussed in
Section 4.16.2.2 of Appendix C of the Draft EIR.
b) Mitigation Measures. The following mitigation measures will be adopted and
will be implemented as provided in the Mitigation Monitoring and Reporting Program, and as
further described in the remainder of these findings:
Mitigation Measure TRANS-I.l.
c) Findings. The above-noted mitigation measures will reduce the severity of this
120402dm0120533 12
potentially significant impact to a less-than-significant level by: (i) restriping Embarcadero Road
to create a left turn receiving lane; and (ii) installing a left turn lane receiving area at the
Embarcadero RoadiSt. Francis Drive intersection at Wildwood Lane. Installation of these
improvements will facilitate left turns and reduce left turn delays, thereby mitigating this Impact
to a less-than-significant level.
SECTION 6. Findings Regarding Project Alternatives.
Public Resources Code section 21002 prohibits a public agency from approving a project if
there are feasible alternatives or feasible mitigation measures available which would substantially
lessen the significant environmental effects of the project. When a lead agency finds, even after the
adoption of all feasible mitigation measures, that a project will still cause one or more significant
environmental effects that cannot be substantially lessened or avoided, it must, prior to approving the
project as mitigated, first determine whether there are any project alternatives that are feasible and
that would substantially lessen or avoid the project's significant impacts. Under CEQA, "feasibility"
includes "desirability" to the extent that it is based on a reasonable balancing of the relevant
economic, environmental, social, and technological factors, and an alternative may be deemed by the
lead agency to be "infeasible" if it fails to adequately promote the project applicant's and/or the lead
agency's primary underlying goals and objectives for the project. Thus, a lead agency may reject an
alternative, even if it would avoid or substantially lessen one or more significant environmental
effects of the project, if it finds that the alternative's failure to adequately achieve the objectives for
the project, or other specific and identifiable considerations, make the alternative infeasible.
The City Council certifies that the Final EIR describes a reasonable range of alternatives to
the Project, which could feasibly obtain the basic objectives of the Project, and that the City Council
has evaluated the comparative merits of the alternatives. As explained in the findings set forth above,
the Project will not result in any significant effect on the environment that cannot be mitigated
through the mitigation measures which are hereby being adopted and imposed on the Project.
Therefore, the Council need not make any additional findings regarding the feasibility of any Project
alternative.
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120402 dm 0120533 13
INTRODUCED AND PASSED: MARCH 19,2012
AYES: BURT, ESPINOSA, HOLMAN, KLEIN, PRICE, SCHARFF, SCHMID,
SHEPHERD,YEH
NOES:
ABSENT:
ABSTENTIONS:
APPROVED AS TO FORM:
Asst. City Attorney
Director of Planning & Community Environment
120402 dm 0120533 14
February 4, 2013
Elena Lee
City of Palo Alto
Development Center
285 Hamilton Ave
Palo Alto, CA 94301
RE: Edgewood Shopping Center – Report to the Palo Alto City Council for February 11, 2013
Dear Elena,
This report is written to provide the Palo Alto City Council a summary analysis of the historic
Building 1 and Building 2, beginning with permitted construction plans and continuing
chronologically through the conditions of Building 1 and the grocer building, recent
reconnaissance on Building 2, proposed revisions to the historic building elevations, and
concluding with the protocol for proceeding with the construction of the historic buildings and
project. The primary consideration for formulating our proposal in this letter is to ensure best
efforts and outcomes by the project sponsor and its team that will allow completion of this
very important community facility.
EXECUTIVE SUMMARY
! We reviewed the Building 1 and Building 2 construction drawings for historic
conformance and the City-issued demolition and construction permits.
! During construction, we assessed Building 1 and concluded that much of the material
used in its construction was not repairable, was not in good condition, and would need to
be replaced with new materials to match the material, configuration, character and finish
of the original.
! All three walls of the grocery building that were intended to be retained were discovered
during renovation to be in too poor condition and had to be replaced with compatible new
materials. The grocery building was determined by the City to be no longer a historic
resource due to extensive alterations.
! Building 2 was recently discovered to have 23.5% of its original 1957 exterior wall
surfaces remaining including two sections of concrete block, two sections of storefront
glass and wood frames, and most of the original transom windows and window frames.
Most wall surfaces have been replaced at an undetermined date prior to the project
sponsor’s ownership. The window frames were extensively replaced with similar but not
identical wood window frames and are compatible but not as distinctive in design as the
original window frames.
Lee, page 2
! Tenants and official neighborhood leaders request minor revisions to the permitted
elevations, making the buildings appear more in keeping with the “Eichler” style.
! The project sponsor has put into place special protocol and specifications to ensure that
the reconstruction of Building 1 and the rehabilitation of Building 2 can be completed
efficiently and within the parameters of the City’s permitting process and the
requirements of the EIR. We believe that this will result in the successful rehabilitation of
the Edgewood Shopping Center.
SUMMARY ANALYSIS OF BUILDING 1 AND BUILDING 2
I. Construction Plans Permitted by the City of Palo Alto on August 9, 2012
Prior to permitting, Page & Turnbull reviewed the construction drawings that were
prepared by Little Architects and concluded that the proposed project was in keeping with
the historic buildings’ original design and with the Secretary of the Interior’s Standards for
Rehabilitation #5, 6, 7, and 9 as recommended by City staff and the Historic Resources
Board. We issued a letter dated June 14, 2012 to the City of Palo Alto confirming this
review and analysis.
At that time, the construction drawings showed that distinctive materials and architectural
features, finishes and construction techniques would be retained to the extent possible.
The drawings that we reviewed also indicated that deteriorated features proposed for
removal and replacement would be reviewed by Page & Turnbull and approved by the
Director of Planning.
As discussed during Palo Alto Historic Resources Board meetings in 2011, we believed
that adjustments would be made to the exterior of building Buildings 1 and 2 out of a ‘kit
of parts’* that would be compatible with the massing, size, scale, and architectural
features of the original buildings. Item MM CR 2.3 of the EIR anticipated some alteration
of existing character-defining features to accommodate accessibility, public safety and
building code concerns. In addition, the EIR clarified that “the existing building
components may be constructed out of new building materials that match the character
and form of the existing, if reuse of existing building components is not feasible.” For
reference, following is the complete Item MM CR 2.3 of the EIR,
“Distinctive materials and defining architectural features, finishes, and construction
techniques of Buildings 1 and 2 including windows, frames and eaves will be retained
to the extent possible, as the building elements will require some alterations due to
* A ‘kit of parts’ is the concept where four distinct wall materials - concrete masonry block,
wood framed glass storefront, vertical wood siding, and plaster finish - are the ‘parts’ that
variously combine into a ‘kit’ to create the historic Eichler buildings’ characteristic style.
Lee, page 3
ADA compliance, public safety, building code compliance, or deteriorated condition.
The existing building components may be constructed out of new building materials
that match the character and form of the existing, if reuse of existing building
components is not feasible. Prior to the relocation and reconstruction of Building 1
and the rehabilitation of Building 2, a qualified historic preservation architect shall
review the plans for the remodeled buildings and verify that the work on these
buildings is in keeping with the building’s original design and applicable Secretary of
Interior’s Standards for Rehabilitation, such as Standards #5, 6, 7, and 9. The final
design and materials to be used in the renovation of these buildings will be reviewed
and approved by the Director and Historic Resources Planner of the City of Palo Alto
Planning and Community Environment Department.”
It should be noted that the structural drawings of the permitted plans indicate new
concrete block shear walls and Glulam beams to replace the structurally deficient
concrete block walls and beams in Building 1, and new concrete block shear walls to
replace the structurally deficient concrete block walls in Building 2.
II. Conditions of Building 1 and the Grocery Building
On March 5, 2012 and September 10, 2012, a representative from Page & Turnbull
visited the site with the project sponsor, construction manager and contractor to review
the condition of existing materials in Building 1 and Building 2 and to review the
contractor’s attempts to salvage building material as it was removed from Building 1.
During the September site visit, the project sponsor expressed to the team that the
structural engineer had reservations about the structural integrity of the existing Glulam
beams in Building 1 and preferred that they be replaced. Page & Turnbull confirmed that
many of the existing Glulam beams were in poor condition and were splitting and
delaminating.
During the same site visit, the contractor showed that the existing Redwood siding was
splintering as it was removed from the building for salvage and future reinstallation. Page
& Turnbull learned during this site visit that some of the existing wood siding was
replacement siding - - not original siding - - and that in some places, original shiplap
Redwood siding had been replaced with strips of painted plywood.
While we believe that exploratory demolition and testing on the historic buildings should
have been completed prior to the development of construction drawings, that likely would
not have changed our determination that much of the material used in the construction of
Building 1 was not repairable, was not in good condition, and would need to be replaced
with new materials to match the material, configuration, character and finish of the
original.
Lee, page 4
It was also discovered during the recent renovation of the grocery building that it too was
in poor condition and three of its walls which were intended to remain had to be replaced
in their entirety. Its south concrete block wall was comprised of substandard concrete
footings with inadequate steel reinforcing, and its north and west wood framed walls were
highly compromised from dry rot and termite damage. The grocery building had
previously been determined by the City to be ineligible for the California Register due to
extensive alteration, and, therefore it was no longer a historic resource under CEQA.
III. Reconnaissance to Assess the Condition of Historic Building 2 Exterior Walls
On January 10, 2013, the Director of Planning authorized City Planner Elena Lee and
City Historian Dennis Backlund to tour Building 2 with the project sponsor, construction
manager and contractor to observe its condition. Soon thereafter, the City granted
permission to perform very limited reconnaissance consisting of small openings in its
non-character defining interior walls so that the building’s historic exterior skin could be
viewed from inside and its condition assessed.
On January 15, 2013, it was discovered during reconnaissance that only a limited amount
of original exterior wall material remains unaltered for Building 2. The total area of
exterior wall surface is 3,604 square feet and after studying the building’s exterior and
interior small openings, Dennis Backlund concluded that two sections of concrete block
along the building’s south and east walls, totaling 227 square feet (6.3%), two sections of
storefront glass and wood frames along its west wall, totaling 143 square feet (4.0%), and
most of the original transom windows and window frames, totaling 476 square feet
(13.2%), collectively 23.5%, are what remain of the original 1957 exterior. This loss of
original material is not surprising given that there likely have been dozens of tenant
turnovers having different exterior requirements during the building’s 55 years.
That the Building 2 project is a rehabilitation of a building that will not need to be moved
helps in being able to retain more of its remaining original materials. Although our
reconnaissance did not include detailed investigation of the Glulam beams, steel
columns, concrete slab and roof purlins and sheathing for Building 2, we still believe
those components can be re-used and reinforced as necessary per the previously
permitted plans.
The conditions that were discovered in Building 1 prior to its demolition were similar to
Building 2. In addition to losses of original material, Building 1 was generally in worse
condition due, we believe, to its superior visibility and location within the center which
contributed to a more intensive use. This locational advantage not only attracted more
tenant turnover but also tenants that generated higher traffic and heavier use compared
to those in the less visible Building 2.
Lee, page 5
We have researched files of the City of Palo Alto Building Department and other archives
for information about original construction. With the knowledge gained from
reconnaissance of Building 1 and Building 2, it has become clear that Building 1 and
Building 2 appear to have been primarily glass enclosed structures with a wooden or
concrete block wall segment, typically not exceeding 16 feet in width, located midpoint
along each wall.
IV. Tenants and Official Neighborhood Leaders, the Architectural Control Committee,
Propose Exterior Revisions to the Historic Buildings
During the City entitlement process, the buildings’ elevations were only approximated
since future tenant requirements were unknown. With leasing now underway, tenant
space requirements are adjusting exact door locations, and where interior visibility is not
desired segments of wooden walls may replace glass storefront with Neighborhood
Architectural Control Committee (“ACC”) support. Such adjustments conform to the ‘kit
of parts’ composition approved by the Historic Resources Board. These adjustments are
also desired by the neighborhood ACC who believe the proposed revisions will make the
buildings appear more in keeping with the “Eichler” style. We have reviewed the
proposed revisions and endorse them. We understand the Secretary’s Standards for
Rehabilitation must continue to be met, which we judge to be the case with the revisions.
These proposed revisions are shown clouded in the attached exhibits. Along the west
wall of Building 1 the ACC requests replacing the five metal exit and utility doors with
glass storefront doors and transom windows above. And along the south and east walls
of Building 2, Chase Bank’s requirements propose to replace segments of glass
storefront with wood in Eichler style. Unknown future tenant needs may warrant similar
further adjustment to the buildings, all to be endorsed by the ACC and Page & Turnbull
and approved by the City of Palo Alto before any are implemented.
Due to the losses of original building material in Building 2, we propose to preserve an
original 16 feet wide concrete block wall located mid-point along its east wall. This wall is
structurally deficient and per the permitted plans was to be replaced with one having
identical appearance. However, we can retain the original material and character of this
Eichler wall. We will construct a new structural wall to the north and conceal this new
wall behind one of the proposed glass-to-wood exterior revisions described above.
V. Proceeding with Construction of the Historic Buildings and Project
Since the previously approved construction procedure for Building 2 has not been
compromised, a rehabilitation approach under the Secretary’s Standards will continue to
be taken on Building 2. The scope of work described in previously approved permit
drawings will be adhered to following our receiving City and ACC approvals.
Lee, page 6
We recommend that the existing elevations in the previously approved permit set be
updated to indicate areas of removal and replacement of existing materials, and in
accordance with any approved revisions. All proposed removal and replacement should
be clearly indicated on red mark-up, revised permit elevations, reviewed by Page &
Turnbull and approved by the City and ACC before the contractor proceeds. All removed
and salvaged materials will be sorted and stored on site to give Page & Turnbull and the
City officials an opportunity to inspect the materials.
The permitted plans indicate that all existing Building 2 structural elements including
columns, footings, and Glulam beams are intended to remain in place, and reinforced as
necessary. As changes are made during construction to accommodate the existing
conditions, we recommend that the contractor and project sponsor consult with Page &
Turnbull and the City of Palo Alto before proceeding with any work that does not conform
to the permit set.
On November 5, 2012, Page & Turnbull submitted the enclosed Protocol and
Specifications for Salvage, Selective Demolition and Protection to the City that details the
procedure for the documentation, notification, salvage, protection, selective demolition,
and approvals by the City and Page & Turnbull necessary to move forward with the
construction of the historic buildings. On January 10, 2013, Dennis Backlund
recommended approval of the Protocol and Specifications to the Director of Planning.
If the measures described above are adhered to, we are confident that the reconstruction
of Building 1 and the rehabilitation of Building 2 can be completed efficiently and within
the parameters of the City’s permitting process and the requirements of the EIR. We
believe that this will result in the successful rehabilitation of the Edgewood Shopping
Center.
Sincerely,
J. Gordon Turnbull, FAIA
Principal
Enclosure: Protocol and Specifications for Salvage, Selective Demolition and Protection
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
1
PROTOCOL AND SPECIFICATIONS FOR
SALVAGE, SELECTIVE DEMOLITION AND PROTECTION
PART 1. GENERAL
Purpose: The rehabilitation of Building 2 and the reconstruction of Building 1 under the Secretary of the
Interior’s Standards for Rehabilitation.
Preface: These specifications are submitted to owner Ho Holdings No. 1, LLC (the “Owner”) and Owner’s
contractor (the “Contractor”) as guidelines for ongoing reconstruction and rehabilitation work on Buildings
1 and 2 of Edgewood Plaza Shopping Center in Palo Alto, California (the “Project”).
As Owner’s consultant, Page & Turnbull (the “Historic Preservation Consultant”) has reviewed the
Project’s permit drawings but is not a part of the Project’s architectural team that prepared the drawings and
is not submitting these specifications as formal construction documents. These specifications are for
guidance only. The City of Palo Alto requires the project applicant to incorporate these specifications into
all construction documents.
Section 1.4(B) of these specifications pertains to both Buildings 1 and 2. All other Sections of these
specifications pertain only to Building 2.
In general, any proposed construction activity for Buildings 1 and 2 that is not in compliance with the
permit plans should be reported by the Contractor or Owner to the Historic Preservation Consultant and the
City of Palo Alto for review and approval prior to commencing work.
All directions for Building 2 are set forth in permit plan sheet T0.4 “ARB Conditions of Approval” and
sheet A4.2.1 “Retail Bldg. #2 Exterior Elevations.” If any proposed construction activity for Building 2 is
not in compliance with sheets T0.4 or A4.2.1 then the Contractor shall receive written approval from the
Historic Preservation Consultant and the City of Palo Alto prior to commencing work.
1.1 SUMMARY
This Section includes the following:
A. Demolition and removal of selected portions of building or structure as shown on the permit
plan drawings.
B. Salvage of existing items to be reused as shown on the drawings.
1.2 REFERENCES
U.S. Department of the Interior, National Park Service: The Secretary of the Interior’s Standards
for the Treatment of Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring
& Reconstructing Historic Buildings.
1.3 DEFINITIONS
Historic Fabric: Architectural and structural materials and finishes constructed during the
buildings’ Period of Significance. Most, but not all, historic fabric is identified on the permit plan
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
2
drawings. It is the intent of this Section and this Project to maintain and restore as much historic
fabric as possible.
1.4 SUBMITTALS
A. Photographs of Existing Conditions of Building 2
Prior to commencement of selective salvage, demolition and protection work for Building
2, submit photographs of existing damage on surfaces that might be misconstrued as
damage related to selective salvage, demolition and protection operations.
B. Samples and Mock-ups
1. Samples of exterior materials for Buildings 1 and 2: Clearly label samples of all
replacement exterior materials and submit photographs and samples as required by
the Historic Preservation Consultant for approval prior to their installation. Such
exterior materials may include concrete block, windows and window frames, new
storefronts, plaster and stucco finish, Glulam beams, wood wainscot, and any other
exterior replacement materials.
2. Mock-ups of Buildings 1 and 2: After acceptance of the exterior materials and
proposed method of reconstruction, repair or refinishing, a representative sample
area shall be reconstructed, repaired or refinished. Obtain acceptance of the mock-up
from the Historic Preservation Consultant before proceeding with remainder of the
procedure.
C. Quality Control
If alternative methods and materials to those indicated on the permit plans are proposed for
any phase of work, provide written description to Historic Preservation Consultant and City
of Palo Alto for review and approval prior to commencing work.
1.5 PROJECT CONDITIONS
A. Required Care in Selective Salvage, Demolition and Protection operations
1. The work seeks to preserve historic fabric and to protect, salvage and reuse selected
building materials.
2. Building materials shall be considered fragile and must be removed, restored,
modified and handled with care. Historic materials damaged during selective salvage
and demolition operations may not be available for replacement; to remedy such
damage repair and restoration shall be required. Protection of existing materials and
items is of great importance.
3. Contractor shall be responsible for restoration of materials and finishes damaged
during selective salvage and demolition activities. Where damaged materials and/or
finishes are beyond repair or restoration, Contractor shall be responsible for
replacement in kind. The City of Palo Alto shall be notified of damage to materials
and finishes and the plan for replacement prior to the removal of damage materials
and finishes.
B. Selective Removal and Salvage
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
3
1. Materials or items indicated on the permit plans to be salvaged shall be removed
with care and stored in a designated storage area or facility. The City shall approve
any materials or items proposed to be removed.
2. Each material or element indicated to be salvaged shall be carefully crated and
packed to prevent damage during transportation and storage. No salvaged materials
shall be removed from the site or altered without City approval.
C. Protection
1. Protection: Construct temporary barricades and other forms of protection as may be
necessary to fully protect existing building and all existing materials and items to
remain.
2. Cover and protect existing materials when demolition work is performed in areas
where existing materials have not been removed.
3. Cease operations and notify Owner and Historic Preservation Consultant
immediately if safety of structure appears to be endangered; take precautions to
properly support structure. Do not resume operations until safety is restored.
D. Existing Conditions
Notify Historic Preservation Consultant and City of Palo Alto of discrepancies between
existing conditions and Drawings before proceeding with selective demolition.
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
4
PART 2. PRODUCTS
2.1 MATERIALS
A. Verify with Historic Preservation Consultant and the City of Palo Alto the extent of
materials to be retained prior to beginning selective demolition.
B. Maintain possession of materials being removed unless otherwise noted.
C. Carefully remove, store, and protect materials indicated for reinstallation; where stored
materials are damaged, repair to original condition or replace with new undamaged
materials. Notify City of Palo Alto prior to discarding and replacing any damaged
materials.
2.2 STORAGE AND HANDLING
A. Every effort must be made to use and reuse materials that are original to the structure.
When removed from their rightful place, these materials must be stored under cover inside
the building or on the site where they cannot be damaged.
B. Salvaged materials and items shall be stored under cover inside the building or on the site
where they cannot be damaged.
C. If salvage material is to be reused, treat it as new or original material with regard to its
storage.
2.3 PROTECTION AND SALVAGE MATERIALS
A. All necessary precautions shall be taken to protect all parts of the building not being
repaired from effects of the work.
B. Provide protection against the spread of dust, debris and water at or beyond the work area
by suitable enclosures of sheeting and tarpaulins.
C. Provide masking or covering on adjacent surfaces. Secure coverings without the use of
adhesive type tape or nails. Impervious sheeting that produces condensation should not be
used.
D. Scaffolding, ladders and working platforms, required for the execution of this work should
not be attached to the building.
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
5
PART 3. EXECUTION
3.1 EXAMINATION
A. Survey existing conditions and correlate with requirements indicated to determine extent of
selective demolition required.
B. Inventory and record the condition of items to be removed and reinstalled and items to be
removed and salvaged.
3.2 PROTECTION
A. Protect all elements that are to remain and are exposed during selective salvage, demolition
and rehabilitation operations.
B. Construct temporary protection at existing elements indicated to remain, to prevent damage
to or marring of materials and items. Protection shall be of required size and thickness to
withstand impact from falling debris, rolling equipment and objects; residue and droppings
from all construction related activities.
C. Protective materials shall not be anchored directly to the item being protected. Prevent
direct contact between protective assemblies and existing elements or materials by use of
spacers, corrugated cardboard, quilted pads, kraft paper, non-moisture retentive padding, or
other adequate means.
For Plaster, Stucco and Wainscot: provide hard barrier protection to prevent damage from
construction activities.
3.3 SALVAGE AND REMOVAL
A. Salvage and Removal: Where indicated on permit plan drawings to be ‘removed, salvaged
and reinstalled’ and ‘removed and salvaged,’ carefully remove indicated materials and
items, and store under cover inside the building or on the site where they cannot be
damaged, or pack or crate for transport to storage area. Maintain any storage area for the
duration of the Project. Storage areas and methods of storage shall be approved by the
City.
B. Removal and Demolition: Demolish and remove existing construction as indicated only
after protection, catalog, documentation and salvage operations have been completed. Use
methods required to complete work within limitations of governing regulations and as
follows:
1. Proceed with selective salvage, demolition and protection systematically.
2. Neatly cut openings and holes plumb, square, and true to dimensions required. Use
cutting methods least likely to damage construction to remain or adjoining
construction. To minimize disturbance of adjacent surfaces, use hand or small power
tools designed for sawing or grinding, not hammering and chopping. Temporarily
cover openings to remain.
3.4 SELECTIVE DEMOLITION
A. General: Demolish and remove existing construction only to the extent required by new
construction as indicated on permit drawings. Use methods required to complete the work
within limitations of governing regulations and as follows:
Page & Turnbull Edgewood Plaza
January 9, 2013 Salvage, Protection, Demolition
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1. Neatly cut openings and holes plumb, square, and true to dimensions required. Use
cutting methods least likely to damage construction to remain or adjoining
construction. Use hand tools or small power tools designed for sawing or grinding,
not hammering and chopping, to minimize disturbance of adjacent surfaces.
Temporarily cover openings to remain.
2. Do not use cutting torches until work area is cleared of flammable materials. At
concealed spaces, such as duct and pipe interiors, verify condition and contents of
hidden space before starting flame-cutting operations. Maintain portable fire-
suppression devices during flame-cutting operations.
3. Locate selective demolition equipment and remove debris and materials so as not to
impose excessive loads on supporting walls, floors, or framing.
B. Removed and Salvaged Items:
1. Clean salvaged items.
2. Store under cover inside the building or on the site where they cannot be damaged.
C. Removed and Reinstalled Items:
1. Clean and repair items to functional condition adequate for intended reuse.
2. Store under cover inside the building or on the site where they cannot be damaged.
3. Protect items from damage during transport and storage.
4. Reinstall items in locations indicated. Comply with installation requirements for
new materials and equipment. Provide connections, supports, and miscellaneous
materials necessary to make item functional for use indicated.
D. Existing Items to Remain: Protect construction indicated on permit plan drawings to
remain against damage and soiling during selective demolition. When permitted by
Historic Preservation Consultant, items may be removed to a suitable, protected storage
location during selective demolition and reinstalled in their original locations after selective
demolition operations are complete.
3.5 REPAIR
Repair damage to adjacent construction caused as a result of selective demolition work.
END OF SPECIFICATIONS
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Existing Grocery Service Yard
FFE (13.31)
(Existing Retail)
FFE (13.50)
(Relocated Existing Retail)
FFE (13.33)
BLDG 1
BLDG 2
Vedic Center
BAYS
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Signature
Date
Renewal Date
06-30-13
North
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Scale: 1" = 20'
10 20 40
2
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2
Edgewood Plaza Update
Attachment E
Please see below responses to Councilmember Holman’s questions regarding Edgewood
Plaza.
-----Original Message-----
From: Karen Holman [mailto:kcholman@sbcglobal.net]
Sent: Sunday, February 10, 2013 9:16 PM
To: Tucker, Sheila; Williams, Curtis
Cc: Keene, James; Stump, Molly
Subject: Item 12 - Edgewood questions
I have the following questions on this item:
1) In the Draft Motion, #4 it states "Allow continued development of the grocery store (Bldg 3)
as the remainder of the project moves forward.”
Can staff please explain/clarify what this means?
Staff Response: Staff is proposing to allow the grocery store to be fully constructed and to open
while the SEIR and PC amendment are being processed.
2) Draft Motion #5: Why is staff recommending the commencement of work on BLDG 2 as it
would seem that some compensation for the demo of BLDG 1 could potentially be a higher level
of preservation than previously identified?
Staff Response: Staff believes that Building 2 can be rehabilitated as previously approved,
subject to special protocols and inspections. A protocol for work on Building 2 has been
developed by the applicant to guide work and to prevent what had happened with Building
1. Staff is also already working with the applicant to provide a higher level of historic
preservation/enhancement, such as the installation of wood windows that replicate the very
specific style of the existing windows on Building 2. The building would not be finaled until the
FEIR and PC amendment are approved, but staff does not believe that extensive changes to the
building can be accomplished unless it is demolished, which of course is to be avoided. The
Council may direct otherwise, however.
3) Preparation of the SEIR: the staff report states that the original DEIR consultant is being
engaged. Why is not Carey & Company being engaged since the primary concerns on the site are
historic resources with which Carey & Co. is most familiar as they were the historic consultants
for the original DEIR?
Staff Response: Carey & Company was hired as a subconsultant by Powers & Associates, the
City’s CEQA consultant, to provide a peer review of the historic report on the shopping center
that was prepared by the applicant’s historic consultant Page & Turnbull. Carey & Company has
not been brought back as a subconsultant because the primary CEQA consultant has the
technical expertise to prepare the SEIR with information submitted by Page & Turnbull. The
analysis for this project is more straightforward because the building in question was
demolished. There is no difference in opinion as there was previously about the historic
significance of Building 2. If issues arise and Powers and Associates feels that further assistance
is needed, Carey & Company or another consultant could be authorized as a subconsultant.
4) Has a peer reviewer been identified and if so is it Carey & Co. given the above reference?
4a) Has Carey & Co been consulted and provided any advisory on potential outcomes to date?
Staff Response: Staff has not yet identified a peer reviewer and has not contacted Carey &
Co. Carey & Co. will be one of the firms considered. Staff will select a consultant if the City
Council authorizes construction of Building 2. A key component of the peer reviewer’s duties
will be onsite monitoring. The chosen firm will be the one that can provide both the peer
review of plans and monitoring, which may be a historic architect rather than a historic
resources consultant.
5) Draft Motion #6: might there not be additional traffic improvements that could be included in
addition to what was originally provided?
I think there may have been additional conditions that the PTC had recommended that were not
incorporated. Please advise.
Staff Response: The approved Planned Community Ordinance required two additional traffic
related improvements: 1) preservation of the vehicular access/driveway between the adjacent
gas station and the project site and 2) modification of the traffic signal on Embarcadero Road at
Saint Francis Drive to provide left turn signal phasing. The applicant is still required to provide
those improvements. Staff is proposing that those improvements be constructed with the
grocery store work to ensure safe circulation once the grocery store is in operation. Staff is not
at this time proposing additional traffic improvements because there are no changes to the
project that would create changes in traffic impact. The project as approved fully mitigates all
potential traffic impacts. The only new environmental impact is the loss of the historic Building
1, so staff’s focus has been on potential historic impact mitigations. However, if additional
traffic improvements are desired, it can be discussed and considered as part of the public
benefits discussion of the PC Amendment process.
6) Draft motion #7: The relocation of the iconic and historic sign. Might not one compensation
for the demo be to retain the sign in its original location, thus altering the site plan and historic
integrity to a lesser degree?
Staff Response: The approved relocation of the historic sign did not result in a significant
historic impact. The new location, proposed for better visibility, is within a few feet of the
original location in the same island and the applicant is proposing to preserve the historic
elements of the sign. Historic Resources Board and Architectural Review Board review would be
required for the final design of the sign face. The new location was approved as part of the PC
ordinance. The City Council can require that the sign be placed back in the original location as
part of the PC Amendment. However, staff believes that placing the sign back in its original
location would not provide substantive compensation and would have negative impacts on
visibility for the shopping center.
By the way, I was by the site this afternoon, and the sign was down. It was still in place when last
I noticed just a week or so ago. Has any authorization been given to move ahead and take the
sign down esp given the inclusion of this consideration is on the agenda Monday night?
Staff Response: The applicant was allowed to take down the sign for site improvements related
to the grocery store following extensive discussion with staff, including the historic preservation
planner. The applicant is required to retain and protect the sign onsite per the PC
zoning. Architectural Review Board and Historic Resources Board hearings would be required
prior to the installation of the rehabilitated sign. As stated in the staff report, the applicant has
been allowed to proceed with site improvements needed for the grocery store construction and
operation.
7) Would considerations referenced in questions 2, 5, & 6 above be part of the SEIR and thus
giving the go ahead at this time be out of sequence?
Staff Response: In accordance with CEQA, the SEIR is required for changes to the project that
may result in new environmental impacts. The only change that will create new environmental
impacts to the project is the demolition of Building 1, because the change will be a new building
rather than a rehabilitated building. There are no changes currently proposed to Building 2, the
sign or traffic impacts. Council certainly has the discretion to direct staff to hold back on other
project elements if desired, but that is not staff’s recommendation.
8) The staff report references "mitigations" in a couple of places but there is no mitigation
possible for the demolition of an historic building. Is staff referring to the demolition or to the
situation?
Staff Response: Although a demolished building cannot be mitigated, possible measures to
mitigate the loss of the building will be studied and determined through the SEIR process. There
may be additional measures that will strengthen the historic integrity of the site, although
mitigation may still require a statement of overriding considerations for the loss of the historic
structure.
9) The staff report indicates that the applicant has experienced costs due to their violations of
the array of previous approvals and conditions and seems not to support imposing penalties due
to this. How much have the violations cost the City in terms of staff time devoted to rectifying
the situation to date and going forward?
How far would the financial penalties go to cover the costs the City has experienced and is likely
to experience...in other words, what is the level of financial penalty that can be imposed?
Staff Response: Staff has spent a considerable amount of time on this project following the
issuance of the Stop Work Order. As a PC amendment, all staff costs are charged to the
applicant. The applicant will also fund the preparation of the SEIR and the additional review
required for the historic buildings. If it is deemed that additional penalties are warranted, the
City Council may require them. Options will be outlined in the staff report, but typical penalties
relate to either double permit fees for re-permitting the building or fines for removal of a
historic building (though the fee schedule only includes such a fine for demolishing historic
buildings downtown).
10) The staff report indicates the array of violations: CEQA, approved plans, the PC zone and
public benefits. Why has this not come to Council for direction and/or comment previously as
the violations took place in September? All of the approvals required Council approval, so I am
trying to understand how/why staff has been authorized to allow continuation of work on the
site prior to coming to Council for direction.
Staff Response: The project was not brought to the Council earlier to allow staff to work with
the applicant to develop a full and accurate picture of what had happened and why, as well as to
outline a potential path forward. Staff has allowed the applicant to proceed with work on the
grocery store and related site work because the new market was not a historic resource, the
market is a key public benefit, and there were no violations associated with this building. Staff
has tried to balance the need to stop and evaluate the historic consequences of the Building 1
demolition with the community’s desire to see the site redeveloped in a timely fashion.
Thank you.
Karen
City of Palo Alto (ID # 3455)
City Council Staff Report
Report Type: Action Items Meeting Date: 3/4/2013
City of Palo Alto Page 1
Summary Title: Cal Ave Roadway Design and Lighting Options
Title: Update of California Avenue Transit Hub Corridor Streetscape
Improvements Project Roadway Design and Consideration of Street Lighting
Options
From: City Manager
Lead Department: Planning and Community Environment
Recommendation
Staff recommends that the City Council review and provide direction on whether to include
street lighting improvements for the California Avenue Transit Hub Corridor Streetscape
Project.
Executive Summary
The proposed California Avenue Transit Hub Corridor Improvements project provides for
streetscape improvements along California Avenue between El Camino Real and the California
Avenue Caltrain Station, including place-making identity markers, traffic calming treatments,
streetscape elements, parking enhancements, and improvements to the Park Boulevard Plaza.
The project includes sidewalk replacement in many areas to accommodate wider pedestrian
walking and dwelling areas. A number of community (primarily merchant) requests for
improvements as part of the project have been included in the project, including preferences
for specific streetscape furniture placement. The primary outstanding request for improvement
not included within the current project includes the replacement of (or supplement to) street
lighting. Street lighting is not required for the project and was not an original component of the
project, but if Council is interested in including street light improvements, this is an appropriate
time to provide that direction to both take advantage of construction activities for the project
and to avoid future disruption of new improvement to accommodate later construction.
City of Palo Alto Page 2
The addition or replacement of street lighting can more easily be accommodated from a
financial and construction standpoint during sidewalk replacement, rather than when sidewalk
reconstruction is complete. However, the street light improvements costs were not included in
the original budget (or grant) as they are not a necessary improvement, and therefore would
require additional funding to respond to community interest.
The California Avenue Transit Hub Corridor Improvement is on schedule for design completion
this Spring and consideration for Council Authorization to Bid by Summer. Policy approval for
the addition of street lighting is required now to ensure this schedule is not delayed.
Construction of the project is anticipated in Fall.
Staff has developed two conceptual street light design options in response to community
requests: 1) full replacement, or 2) addition of pedestrian-scaled street lighting for sidewalks
with retention of the existing streetlights for the roadway. These options are discussed in more
detail in the Discussion section of this report.
Background
The City initiated the California Avenue Transit Hub Corridor Streetscape Project in the Fall
2010. The design contract was then awarded to the RBF/David Gates & Associates consultant
team in the Spring 2011. Sidewalk widening and additional landscaping opportunities were
requested by the City Council during initiation of the project and a preferred street alignment
was approved on July 23, 2012. In Fall 2012, a total of five community outreach meetings were
held, focusing on the alignment and on placement of streetscape furniture such as seat walls,
bicycle parking facilities, newsracks, trash/recycle bins, commercial loading zones, etc. Four of
the five community outreach meetings were merchant-focused meetings, including a day-long
workshop at Mollie Stone’s Market. Several minor street alignment modifications were made as
a result of the community outreach meetings to help respond to merchant requests for
improved customer access and overall corridor circulation.
On January 30, 2013, the Planning and Transportation Commission reviewed the street lighting
options at a study session and appeared supportive generally of the replacement lighting
option, but were concerned about the increased costs at this juncture.
Discussion
A copy of the updated California Avenue Transit Hub Corridor Improvement Project – Street
Alignment Plan is provided in Attachment A. The Plan balances Council’s request for increased
sidewalk and streetscape opportunities, while also responding to community requests received
over the Fall for additional outdoor dining space, preservation of on-street parking, and
City of Palo Alto Page 3
corridor circulation. The street alignment design blends the street with elements included in
the Park Boulevard Plaza to ensure a continuous pedestrian experience from end-to-end of the
project.
The proposed placement of streetscape furniture such as seating walls, benches, bicycle racks
and corrals, tree and planting species, media racks and color palette selection are included in
Attachment B for reference. The palette of streetscape furniture was also reviewed by the
reviewed Architectural Review Board (ARB) on February 21, 2013 as a Study Session item. Staff
will continue to provide opportunities for public review and input as the streetscape palette
design and placement is finalized through the Formal ARB process. The Council’s decision
regarding street lighting improvements would allow street light standards and lighting design, if
desired, to also be finalized concurrent with other streetscape features.
Street Lighting Improvement Options
Throughout the project outreach phase, business owners and some community members have
repeatedly requested that street lighting enhancements be included in the project budget.
Street light replacement is not required for the project, however replacement of the streetlight
is best accommodated during sidewalk reconstruction. Because of the strong community
interest for replacement of street lighting with more pedestrian-scaled lighting treatments,
staff has developed these options and policy direction is being requested.
If policy direction is received to include street lighting as an element of the California Avenue
Transit Hub Corridor Improvement Project, staff will continue to pursue outside funding source
opportunities. Although these outside funding sources could potentially be obtained, funding
would still need to be advanced from the Capital Improvement Program (CIP) – Infrastructure
Reserve program in the short term. If no additional outside funding is found before the award
of the project, the street lighting improvements would remain funded from the CIP
Infrastructure Reserve Program.
The existing street lights on California Avenue were built in the 1970’s and are reflective of
major arterial street lighting design with tall streetlight pole standards spaced widely apart. In
the early 1960’s California Avenue was blocked off at the Caltrain tracks to accommodate
construction of the Oregon Expressway corridor. The underground conduits and wiring of the
streetlights are aged but can be left alone and remain in place to accommodate the current
streetscape design. Staff does not believe that there is a safety concern with the existing lights,
however the aesthetics of the streetscape would be enhanced with a more pedestrian-scaled
lighting approach. Replacement and installation of new pole foundations, if desired, can be best
accommodated while sidewalk reconstruction is taking place.
City of Palo Alto Page 4
Street Lighting Design Options
Staff has developed two conceptual street light design options for consideration (a third option
is to leave the existing lighting as is):
Option 1 – Retrofit Existing Streetlight Fixtures & Add Pedestrian-Scaled Lighting
A retrofit of the existing street lights can be accomplished by adding new lamp fixtures onto the
existing streetlight pole standards. Under this option, existing conduits and wiring would
remain in place but pedestrian-scale streetlight poles would be added in between the existing
streetlight poles. A total of 37 pedestrian-scaled pole standards would be added, not including
12 streetlights planned at the Park Boulevard Plaza. There are 37 existing street light pole
standards. Therefore, under this option, up to 72 street lights would illuminate the California
Avenue corridor. The existing streetlight poles would be painted to match the color of the new
pedestrian-scaled streetlight poles to help blend the two pole standards together.
The color and style of the proposed pedestrian scale lights are shown in Attachment C. If
directed by Council, staff would work with the Architectural Review Board for their review and
input on the style and photometric requirements for both the streetlight and pedestrian scale
lights. The proposed cost for this option is up to $800,000. This option would not provide for
receptacles to support festive lighting treatments at existing street lights.
Option 2 – New Streetlight and Poles Construction
Option 2 would include removing and replacing all existing street lights with new decorative
street light poles and replacing all underground conduits and wiring. A combination of
standard-height roadway height poles and pedestrian-scaled light standards would be used.
The total cost for this option is up $1,200,000 depending on whether the existing street light
spacing is maintained ($1,000,000) or narrowed to better illuminate the street ($1,200,000).
Staff believes the existing spacing works best to meet the objectives of the improving sidewalk
illumination but additional poles may be required ensure a consistent illumination so a budget
of up to $1,200,000 should be specified if this option is desired by Council.
This option includes elements for receptacles at all streetlight poles to accommodate festive
lighting or special event uses. Proposed decorative street light standard types are provided in
Attachment C.
Staff recommends that, if Council authorizes new lighting, then approval of Option 2 – New
Streetlight Construction is preferred. Replacing all of the existing street lighting ensures the
best roadway illumination for California Avenue and ensures that costly repairs do not damage
the new streetscape. Replacing the street lights also ensures that pole standards on the
City of Palo Alto Page 5
roadway comply with current wind load rating requirements by the State of California –
Department of Transportation (Caltrans) at 100-MPH. The existing poles, built in the 1960’s
include a lower wind rating that does not meet current design standards, when older poles are
replaced they must be replaced to current design standards.
Planning and Transportation Commission Review and Recommendations:
Staff presented the street lighting options to the Planning and Transportation Commission on
January 30, 2013, for their review and input. Minutes of this meeting are included in
Attachment D of this report. The PTC generally supported staff recommendation that full
replacement of street lighting should be pursued as part of the project and that the appropriate
streetlight spacing be identified as part of the design process. There were concerns expressed,
however, as to how the lighting would be funded and why this item was not identified earlier in
the process.
Construction Staging and Business Marketing Plan
Upon policy direction of the street lighting improvements, staff will hold additional community
outreach meetings to develop construction staging plans. An initial meeting with the Business
Association of California Avenue was held on Thursday, February 14th. The City’s Economic
Development Manager will work with merchants to develop an Advertising and Marketing Plan
to help encourage patronage to the California Avenue Business District during construction
activities. The project budget currently includes a $30,000 allocation for a business protection
plan through construction, including use of the City Shuttle Program to accommodate off-site
parking for customers. Additional mitigation plan strategies may include banner advertising and
online advertising, sponsoring events during construction, phasing and hours of operation, and
extensive signage to direct customers to stores and restaurants and drivers to parking lots.
The City anticipates both daytime and nighttime construction activities to expedite the
construction schedule and to minimize business impacts from the project. The City plans to
maintain vehicle and pedestrian access to the project area at all times during construction.
Policy Implications
The City’s Comprehensive Plan recommends that the City enhance the California Avenue
streetscape by upgrading the visual quality of the street to attract additional business and
visitors to the area. Consistent with those Comprehensive Plan goals, the proposed streetscape
and place-making improvements along California Avenue should ensure continued vitality of
the California Avenue Business District. The Comprehensive Plan also encourages a mix of
residential and non-residential uses at a scale of development that is comfortable for
pedestrian use. The Plan encourages improving the appearance of the street while preserving
its “hometown” character. Also, Program L-18 specifically calls for street improvements that
City of Palo Alto Page 6
could make a substantial contribution to the character of Commercial Centers, including
narrowing travel lanes.
Resource Impact
Project Funding Status
City staff has identified several funding sources for the California Avenue Transit Hub Corridor
Improvement Project from outside grant and from local funding sources. Currently, the
estimated project design and construction cost is $3,442,000, not including the optional
streetlight improvements.
Table 1
California Avenue Transit Hub Corridor Cost Estimate
No. Fund Source Amount
1 Original Construction Project Estimate $1,375,000
2 RBF Design Contract $350,000
3 Street Resurfacing $550,000
4 Preliminary Sidewalk Widening Estimate $700,000
5 Revised Sidewalk Widening Estimate $317,000
6 RBF Design Contract Amendment $150,000
$3,442,000
The updated cost for Sidewalk Widening Treatments includes additional work requested as part
of the community outreach process over the Fall and updated cost estimates prepared through
the design process, which resulted in a $317,000 increase above the original staff estimate of
$700,000 from last summer. Council will also consider a design contract amendment for RBF
Engineers in April that includes additional design work related to the enhanced sidewalk
treatments since the initiation of the original RBF contract; the contract amendment will also
include the cost of design of the street lighting improvements.
Table 2
California Avenue Transit Hub Corridor Fund Sources
No. Fund Source Amount
1 VTA CDT Grant* $1,100,000
City of Palo Alto Page 7
2 Initial City Grant Local Match $550,000
3 Street Resurfacing $550,000
4 VTA Vehicle Registration Free (VRF) $700,000
Total Project Construction Funding: $2,900,000
*The VTA Grant has been lowered from $1,175,200 to $1,100,000 because of the delays resulting from the
litigation.
With the street alignment improvements added in as part of the recent community outreach
meetings, the project currently is estimated at $3.4M, including a 10% construction
contingency. The current project budget is $2.9M, resulting in a $542,000 gap. The City has
retained an outside construction management firm, Ghirardelli & Associates, to conduct a value
engineering analysis of the current design starting this Spring to identify construction methods
and material cost-savings opportunities.
Both the CIP – Infrastructure Reserve and the new One Bay Area Grant (OBAG) – Guaranteed
Funds Program are potential fund sources to close the current $542,000 gap. If streetlight
improvements are included as part of the project, up to an additional $1,200,000 will be
required. The City may also continue to pursue outside funding for the project, including
developer funding opportunities as community benefit improvements.
Currently, the balance in the Infrastructure Reserve (IR) is $14,003,570. Staff is in the process
of developing the FY 2014 Proposed Capital Improvement Program. Preliminarily, the
estimated drawdown on the IR for 2014 projects is $4,106,098. The expected remaining
balance at the end of FY 2014 is $13,645,257. This information is provided as context for
Council’s decision on streetlight improvements and given the City’s numerous infrastructure
improvement challenges.
Timeline
The City anticipates continuing the detailed design phase of the project through the Spring
2013, to allow opportunities for community feedback and allow for formal review by the
Architectural Review Board and Parks & Recreation Commission for the design of the Park
Boulevard Plaza.
Project design should be completed by the Spring 2013. Staff will return to PTC and Council late
spring for final approval prior to advertising the project for bids. The City anticipates advertising
the project for competitive bids in the Summer 2013 with construction beginning in the Fall
2013.
City of Palo Alto Page 8
Environmental Review
A preliminary Initial Study and the Negative Declaration - CEQA (California Environmental
Quality Act) checklist for the project were completed, circulated for public review in December
2010 and approved by Council on February 14, 2011. The Negative Declaration concluded that
the project will not result in any significant environmental impacts and may be reviewed online
at www.cityofpaloalto.org/calave. Litigation challenging the timing of that review was filed
shortly thereafter, and the Santa Clara County Superior Court ruled in Fall 2011 that the City
should have completed CEQA review prior to submitting the application for VTA grant funds.
The City corrected this by rescinding and reapproving the environmental review and associated
approvals in the proper order. In February 2012, the Court found that the City complied with
CEQA. The trial court’s decision is currently pending before the Court of Appeal. The
replacement of street lights will have no additional environmental effect as the new lights will
simply replace the existing lighting. In addition, the pedestrian scaling of the lighting is in line
with the overall streetscape elements discussed in the Negative Declaration.
Attachments:
Attachment A: California Avenue - Street Alignment Plan (PDF)
Attachment B: California Avenue Proposed Streetscape Elements (PDF)
Attachment C: Proposed Decorative Street and Pedestrian Lighting (PDF)
Attachment D: January 30, 2013 Draft PTC Minutes (PDF)
CALIFO RNIA A VEN UE TRANS IT HUB PAL O ALTO , CA DECEMBER 2O12
PROPOSED CONCEPT PLAN
0 10 20 40
SCULPTURAL ELEMENT WITH
SEAT ROCKS SURROUNDING
HOLIDAY TREE
LOW COLOR PLANTING
BENCHES
EX. TREES TO REMAIN
SEATWALLS
SEATWALLS
FLOWERING TREES WITH
BOLD FOLIAGE
& COLOR PLANTING
AS UNDERSTORY
BIKE RACKS
INTEGRAL COLOR CONCRETE
PAVING PANELS WITH
CONTRASTING BANDS
CARPINUS BETULUS
PEDESTRIAN LIGHT
GREEN SCREEN
AT K RAIL
POTENTIAL BIKE SHARE
CHITALPA TASHKENTENSIS
BIKE ROUTE
EX. TUNNEL
POTENTIAL
SHADE CANOPPY
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Mollie
Stone's
Market
Montage
Jewelry
Beauty Spa
By Ereeda
Farmer's
InsuranceTrue
Salon
Heshmat
Pain
Mana gement
California
Avenue
Norge Village
Cleaners
Keeble &
Shuchat
Photography
(Vacant)Blossom
Birth
Printers
Cafe
Copy
America
Culture
Frozen
Yogurt
La Jo lie
Nail Spa
Cigar
House
Avalon Art &
Yoga Center
Accent
Arts
Palo Alto Sol
La
Bodeguita
del Medio
Palo Alto
Central
BaumeCho's
Dim Sum
Restaurant
Kinkos'/
FedEx
Solid
Electric Inc.
Illusions
Dining &
Entertainment
Keeble &
Shuchat
Photography
Village
Stationers
Starbucks
The
Counter
Tandoori
Oven
Palo Alto
Baking
Company
Szechwan
Cafe
Bank of the
West
Joanie's
Cafe
Know
Knew
Books
Subway
Vin, Vino,
Wine
Cafe
Brioche
Country Sun
Natural
Foods
Hairshaper's
ClubChristian
Science
Reading
Room
Izzy's
Brooklyn
Bagels
California
Avenue
OptometryRadio
Shack Techcu
Citibank
Legar
Salon
Zen
Garden
Nail Spa
Leaf & Petal
Bistro &
Bakery
(vacant)Jinsho
Eye Works
Plaza
Antonio's
Nut House
Menlo
Equities
Bookshare
Benetech
Lee
Aldinger
Inc.
Ivy
Tutor
Center
European
Cobblery
Massage
Therapy
Center
Gallery
House
Palo Alto
Acupuncture
& Herbal
Medicine
California
Print Co.
Mahin
& Co.
Zara
Restaurant
Vincent
Sevely
Attorney
at Law
Pacific
Casulty
G roupMomentum
for Mental
Health
Taqueria
Azteca
California
Cleaners
Hotel
California
Building
Avenue
Florist
Bargain
BoxMedite-
rranean
Wrap
Lotus Thai
Bistro
Zombie
Runner
Fine
Arts
Building
Uzumaki
SushiCampus
Barber
Shop
LEGEND
New Standard Grey Sidewalk
Special ColorConcrete Paving Crosswalk
3’ Textured Band Existing News Rack
Alley Access to Parking
Art ElementNew Tree
Existing Tree
New Planting
Single Bike Rack
Granite Seat Pad
Seatwall
Trash Receptable
Pot on Plinth
Existing Planting
0 10'20'40'
PEDESTRIAN LIGHT
PISTACIA CHINENSIS TO MATCH EXISTING
EXISTING TREES TO REMAIN
Bicycle Corral
Bench
Plaza Light
New/Relocated News Rack
T
T
T
T
T T
T
TT
TT
T T
T
T
ENHANCED CROSSWALK, TYPICAL
EX. BRICK WALL TO REMAIN WITH NEW GRANITE SEAT
BOULDER OR NEW WOOD BENCH
AL
L
E
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W
A
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AL
L
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Y
W
A
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AL
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W
A
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AL
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W
A
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AL
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W
A
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AL
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W
A
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RELOCATED
NEWS RACK
TRASH RECEPTACLE
EX. ART
TO REMAIN EX. ART
TO REMAINRELOCATED
NEWS RACK
LOW WALL WITH STREET NAME
GROUP OF
NEW TREES
TEXTURED BAND
EX. BRICK WALL TO REMAIN
WITH NEW GRANITE SEAT BOULDER
OR WOOD BENCH
BIKE CORRAL
TRASH RECEPTACLE
NEW CONCRETE SEAT WALLS
NEW CONCRETE
SEAT WALLS
TRASH RECEPTECLE
30” RAISED CONCRETE CURB
RAISED CONCRETE
BLOCK (+18”)
SPECIAL COLOR CONCRETE PAVING
CUT-OUT FOR
NEW STREET TREE
EX. TREE TO REMAIN
SINGLE LOOP BIKE RACK
TRASH RECEPTACLE
NEW STANDARD
GREY CONCRETE
SIDEWALK
NEW BRICK WALL
SEAT PADS
NEW CONCRETE
SEAT WALLS
SINGLE BIKE RACKS
NEW CONCRETE
SEAT WALLS
DECORATIVE
BOLLARDS
TRASH RECEPTACLE
SINGLE LOOK
BIKE RACK
SINGLE LOOP BIKE RACK
SINGLE LOOP
BIKE RACK
RELOCATED
NEWS RACK
SPECIAL COLOR
CONCRETE PAVING
SPECIAL
COLOR PAVING
NEW CONCRETE
SEAT WALL
SPECIAL COLOR
CONCRETE PAVING
BIKE CORRAL
SPECIAL COLOR
CONCRETE PAVING
EXISTING BRICK WALL
AND DRINKING FOUNTAIN
TO REMAIN
SPECIAL COLOR
CONCRETE PAVING RELOCATED NEWS RACK
NEW TREES
EX. TREES TO REMAIN
EX. BRICK
WALL TO REMAIN
WITH NEW
GRANITE SEAT
BOULDER OR
BENCH
SPECIAL COLOR
CONCRETE PAVING
RELOCATED NEWS RACK
EX. BRICK WALL TO REMAIN
WITH NEW GRANITE SEAT BOULDERS
NEW CONCRETE
SEAT WALL
EX. NEWS RACK
TO REMAIN
EX. TREE TO REMAIN
SINGLE LOOP BIKE RACK
NEW CONCRETE SEAT WALL
TEXTURED BAND
GROUP OF TREES
PARKING COUNT:
Existing Parking: 111
Proposed Parking: 116
Parking Gain: 5
TEXTURED BAND
RELOCATED NEWS RACK
GROUP OF NEW TREES
POT ON RAISED
CONCRETE PEDESTAL
SPECIAL COLOR
CONCRETE PAVING
EX. STREET LIGHT TO REMAIN
EXISTING BRICK WALL AND
HANGING BASKETS TO REMAIN
SINGLE LOOP BIKE RACKS
TRASH RECEPTACLE
RELOCATED NEWS RACK
NEW CONCRETE SEAT WALL
RELOCATED EX. GRANITE BOULDERS
KIOSK
PLANTERS TO SEPARATE
OUTDOOR DINING
AREA FROM PARKING
BIKE CORRAL
EX. STREET
LIGHT TO REMAIN
BIKE
CORRAL
EXISTING ART BENCHES TO REMAIN
BIKE CORRAL
NEW CONCRETE SEAT WALL
OUTDOOR DINING AREA
NEW CONCRETE
SEAT WALL
BIKE CORRAL
EXISTING BRICK WALL AND GRANITE
SEAT BOULDER TO REMAIN IN PLACE
EX. STREET LIGHT TO REMAIN
POT ON RAISED
CONCRETE PEDESTAL
WITH COLOR PLANTING
EX. STREET LIGHT
TO REMAIN
POT ON
RAISED
CONCRETE
PEDESTAL
KIOSK OR
DIRECTORY
LOW WALL WITH STREET NAME
1
California Avenue ‐Site Elements
Single Loop Bike RackTrash and Recycle Combo Receptacle
Concrete Paving –
A: Medium Broom
B: Sandblast
C: Integral Color
AB
C
Bike Corral
Color Asphalt at
textured band
Tumbled Glass
Aggregate in
White Concert
Tumbled Glass
Aggregate in
Gray Concert
Seat Pads
2
Pot on Raised PedestalKiosk/Directory Decorative Bollard
Option 1 Blade of Metal
Bench at Existing Brick Wall Concrete Seatwall
California Avenue ‐Site Elements
News Rack
Decorative Bollard
Option 2 Stone Cube in
Carnelian Color
3
Plant Palette ‐Trees
Specimen Tree: Southern Live Oak
Accent Tree: Freeman Maple
New Street Trees
Specimen Tree: Valley Oak
Accent Flowering Tree: Crape Myrtle
Street Tree: Silver Linden
4
California Avenue ‐Plant Palette
Pot Planting:
Phormium and Million Bells
Meidiland Rose
Phormium
Blue Oat Grass
From El Camino to Ash St
Azure Bush
Germander
Hakone Grass
Fortnight Lily Salvia/Sage
Carpet Rose
From Ash St to Park Blvd
5
Plaza ‐Site Elements
Alternative Wood Bench with Armrest and Intermediate Arm Rests
Drinking Fountain
Wood Bench with Back and Intermediate Arm Rests
6
Plaza –Plant Palette
Carpinus betulus Pistacia chinensis
Chitalpa tashkentensis
7
Salvia Red Buckwheat Rosemary
Plaza –Plant Palette
Phormium Carpet Rose Coffeeberry
Catmint California Fuschia Achillea
CALIFORNIA AVENUE TRANSIT HUB PALO ALTO, CALIFORNIA FEBRUARY 2013
LIgHTINg L-16
PEDESTRIAN LIgHT OPTIONS
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Cooper Lighting, Invue, Mesa, SustainabLEDesign, LightBAR and AccuLED Optics are valuable trademarks of Cooper Industries in the United States and other countries. You are not permitted to use the Cooper Trademarks without the prior written consent of Cooper Industries.
MESA LED
OPTIONS + ACCESSORIES [Must be listed in the order shown and separated by a dash]OPTIONS 4PC=Button Type Photocell [Specify Voltage]R=NEMA Photocontrol Receptacle2L=Bi-Level Switching 5LCF=LightBAR Cover Plate Matches Housing Finish7060=70 CRI / 6000K CC 68030=80 CRI / 3000K CC 6ICB= Integral Cold Weather Battery Pack [Specify 120V or 277V] 7
ORDERING INFORMATIONSAMPLE NUMBER: MSA-B06-LED-E1-T3-BK
PRODUCTFAMILYMSA= Mesa [Slip-fits Over 3" OD Tenon]
NUMBER OFLIGHTBARS 1, 2B01=[1] 21 LED LightBARB02=[2] 21 LED LightBARsB03=[3] 21 LED LightBARsB04=[4] 21 LED LightBARsB05=[5] 21 LED LightBARsB06=[6] 21 LED LightBARsC01=[1] 7 LED LightBARC02=[2] 7 LED LightBARsC03=[3] 7 LED LightBARsC04=[4] 7 LED LightBARsC05=[5] 7 LED LightBARsC06=[6] 7 LED LightBARs
LAMP TYPELED= Solid State Light Emitting Diodes
VOLTAGEE1= Electronic[120-277V]347= 347V480=480V
DIMENSIONS MOUNTING OPTIONS
DISTRIBUTIONT2=Type IIT3=Type IIIT4=Type IV5MQ=Type V Square Medium5WQ=Type V Square Wide5XQ=Type V Square Extra WideRW=Rectangular WideSL2=Type II w/Spill ControlSL3=Type III w/Spill ControlSL4=Type IV w/Spill ControlSLL=90° Spill Light Eliminator LeftSLR=90° Spill Light Eliminator Right
FINISH 3BK=BlackAP=GreyBZ=BronzeWH=WhiteDP=Dark PlatinumGM=Graphite Metallic
OPTIONS + ACCESSORIES[see below]
VA6028-XX=Dual Mount ArmVA6029-XX=Wall Mount ArmOA/RA1016=NEMA Photocontrol - Multi-TapOA/RA1027=NEMA Photocontrol - 480VOA/RA1201=NEMA Photocontrol - 347VMA1253=10kV Circuit Module Replacement
LIGHTBARTM TECHNOLOGY
NOTES: 1 Standard 4000 K CCT and nominal 70 CRI. 2 21 LED LightBAR powered at 350mA, 7 LED LightBAR powered at 1A. 3 Custom and RAL color matching available upon request. Consult your customer service representative for further information. 4 Add as suffix in the order shown. 5 Low-level output varies by bar count. Consult factory. Requires quantity two or more LightBARS. 6 Consult customer service for lead times and lumen multiplier. 7 Available with B01 - B04 or C01 - C04 configurations only. Specify 120 or 277V. LED cold weather integral battery pack is rated for minimum operating temperature -4°F (-20°C). Operates (1) lightbar for 90 minutes. Not available in all configurations, consult factory. Rated for use in 25°C ambient. 8 Order separately. 9 Specifications and dimensions subject to change without notice.
28-1/4" [717 mm]
6-7/32"[157 mm]
21-1/2"[647 mm]
38" [965 mm]
4"[101 mm]
8-3/16"[207 mm]
19" [482 mm]
4"[101 mm]
8-3/16"[207 mm]
3" [76 mm] 3" [76 mm]Dual Mount Arm [EPA 1.36]Mesa [EPA 1.1]Wall Mount Arm
SUPERIOR EFFICIENCY + CONTROLWith efficiencies as high as 95%, patented AccuLED Optics™ systems are as much as 30% more efficient than traditional HID optical systems. Available in twelve [12] beam distributions, AccuLED Optics™ systemsprovide the flexibility and performance required for any outdoor application.
Each patented LED LightBAR™ optic renders the entirety of the pattern. As the number of LightBAR™ elements increase so does the application illuminance, allowing lumen and energy output to be scaled and optimized per application. Obtrusive spill light and glare is replaced by uniform, application specific illumination.
Lighting Designers, Architects and Specifying Engineers have long preferred light sources which provide a balanced spectral power distribution and warm white light. Typical LED solutions standardize on a cold blue 6000-6500K correlated color temperature [CCT] to maximize lumen output. Mesa LED provides warm white light at a standard 4000K CCT with no sacrifice in lumen output.
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LONG LIFEWith a 50,000+ hour rated life at 70% lumen maintenance, Mesa LED operates six [6] times longer than traditional Metal Halide sources.
4000K nominal
2700K
High Pressure Sodium[2000K] Metal Halide [Quartz, Ceramic]
Cooper LED LightBARTM[4000K]
Cold LED[6000-6500K]
3000K 4500K 6500K
SCALABLE ILLUMINATION WARM WHITE COLOR
COOPER LIGHTING’S PATENT PENDING LED LIGHTBAR LIGHT ENGINE BRINGS NEW MEANING TO THE WORD SCALABILITY
Mesa LED
Decorative Area Luminaire
PATENTS PENDING
Ambient Lumen Temperature Multiplier10°C 1.0415°C 1.0325°C 1.0040°C 0.96
AMBIENT DATA Approximate Net Weight1-6 Bars 50 [22.73 kgs.]
SHIPPING DATACERTIFICATIONSUL and cUL ListedISO 90012G Vibration RatedIP66 LightBARsLM79 / LM80 CompliantAARA Compliant
Electronic LED Driver>0.9 Power Factor<20% Total Harmonic Distortion120-277V/50 & 60Hz, 347V/60Hz, 480V/60Hz40°C Ambient Temperature Rating-30°C Minimum Temperature
ENERGY DATA
ACCESSORIES 8
25% PCRF
Option 1 Option 2 Option 3 Option 4 Light Pole Accessories
Pole with
Receptacle
Domus series by Lumec
Pole Height: 12’ to 14’
Pole with Banner or
Hanging Basket
Beacon Product
Pole Height: 12’
INVUE MESA LED
by Cooper Lighting
Pole Height: 12’
Lumec Domus 50 LED
Height: 12’ for Ped Light
Option 1 Option 2
Lumec CTM YC4-1A ATR74V-25
Pole Height: 25’
Lumec Domus 50 LED
Height: 30’ for Street Light
Lumec HBM DC8-1A SSM8V-25
Pole Height: 25’
Option 3 Option 4
RoadStar
Pole Height: 25’
CALIFORNIA AVENUE TRANSIT HUB PALO ALTO, CALIFORNIA FEBRUARY 2013
LIgHTINg L-17
STREET LIgHT OPTIONS
1
Planning and Transportation Commission 1
Draft Verbatim Minutes 2
January 30, 2013 3
4
EXCERPT 5
6
NEW BUSINESS. 7
8
California Avenue Transit Hub Corridor Streetscape Improvements Project - Update on 9
California Avenue Street Alignment and Request for Planning and Transportation Commission 10
Input on Street Lighting Options for California Avenue 11
12
Chair Martinez: We are going to move onto our first agenda topic and that is the 13
recommendation by Planning Department to implement a ground floor overlay on the… no, isn’t 14
it the other first? Oh, I apologize. Ok. Sorry. I will stop there. We’re going to hear from staff 15
regarding the status of the California Avenue Street Improvement Projects and related topics. 16
17
Aaron Aknin, Assistant Director: Thank you and good evening honorable Chair and Planning 18
Commission. Before I turn the project over to Transportation staff I wanted to go over several 19
reasons why the Planning Commission, the Planning and Transportation Commission is looking 20
at this item tonight. So if we go to the first slide I think there’s three primary reasons that you’re 21
here tonight. The first is just to get a general background and get up to speed on where we’re at 22
in terms of the Cal Ave Streetscape Project and we’re going to highlight a lot of the progress that 23
has been made since July of last year. The second thing is to highlight some of the minor street 24
alignment issues that have been resolved and that are ongoing within the Cal Ave area. 25
26
And the third and probably where most of the discussion will be tonight is around introducing 27
street lighting upgrades to this project. And this is something that has come up in numerous 28
times which Transportation staff will get into, but why it’s important; I think it’s important for 29
both the planning and the transportation aspects of the Commission. From a planning standpoint 30
looking at lighting is, asks the question whether lighting is an important aspect to a vibrant 31
downtown type area. And given where the lighting conditions are, will adding additional 32
lighting, improving the lighting area make it a more vibrant area consistent with the Comp Plan 33
policies that we have. And then from a transportation standpoint it’s primarily a pedestrian 34
transportation issue in that is the current level of street lighting safe for pedestrians in the area 35
and if not is improved lighting going to improve the situation consistent with the various Comp 36
Plan policies? 37
38
If we go to the next slide, these were included in there. I won’t go over all of them because there 39
are in front of you in writing and up on the screen right now, but as you can see these are just a 40
handful that we picked out from our Comp Plan that relate to vibrant areas as well as 41
transportation issues so I would encourage you to look at those. So with that I will turn it over to 42
Jaime for continuing this presentation. 43
44
Jaime Rodriguez, Chief Transportation Official: Thank you very much Aaron. Tonight’s the 45
remainder of the presentation will actually be provided by our consultant team. We’re going to 46
have David Gates & Associates and Candy from RBF to talk about the next set of slides. And as 47
we begin the lighting element Shahla Yazdy who is the Project Manager for Transportation on 48
2
the California Avenue Streetscape Project will actually discuss for us the lighting. So with that 1
I’m going to hand it over to David Gates to kind of walk you through kind of the background and 2
kind of where we’ve been over the last several months in relation to the design of the California 3
Avenue Streetscape Project. 4
5
David Gates, Consultant: Good evening, good to see you again. So since we last saw you we 6
had several schemes. Those schemes have been coalesced into what we call the “modified 7
hybrid.” The modified hybrid has since gone through a series of meetings in the community 8
soliciting input and basically rearranging the pattern of that modified hybrid. So what I want to 9
do tonight is kind of walk you through some of the, what I’ll call an evolution of that particular 10
plan. Actually there are rather minor changes so that the large idea of traffic calming, road diet, 11
pedestrian vitality, places to sit, outdoor uses is still very much intact. 12
13
So reminding you the nature of the site, working our way from El Camino Real over and every 14
time I hit this it’s going to bring on another element. Keep in mind the darker color trees are 15
existing; the lighter colored trees are proposed. The enhanced paving is kind of in that beige 16
tone. You’ll see the red dots which is art that has been kept in place in almost all cases. You’ll 17
see existing lights; you’ll see existing walls and all of those elements really basically are intact. 18
So what happens is, the bike corrals we were a little short on bikes on the north side so we’ve 19
added bike corrals in this location. We’ve added accessible parking. So again that particular 20
spot we could create an accessibility and good access for it. The bus stop has been relocated so 21
we pulled in the curb line at that point which allowed the bus to pull in. Sorry this is a little 22
slow. The other bus stop is a key one right at the El Camino. So those elements are all part and 23
parcel, subtle changes to that particular piece of the street. 24
25
So the Joanie’s Café requested a little bit of additional outdoor eating so we took the special 26
paver, pulled it across and created a nice larger node sitting out at that corner. Moving then to 27
the next strip and reminding you this is sort of the central area so that it will become the readily 28
blocked off zone so that the striping in the middle of Cal Ave is to demark an area that will be 29
pedestrian on many occasions as well as a traffic zone. Again all the same criteria; see the same 30
patterns. So we got a sidewalk widening by the nature of how we took the curb line, pulled it 31
south. It reduced the crossing distance at the crosswalks. Bus relocation right at that zone. New 32
planting island, again with a pop out so we can get a new tree and again we’re matching the 33
species of trees that are there now with one exception. We’re adding the colorful Crepe Myrtle 34
to bring theatre. So you can see the addition of those. Another bike corral, which is a grouping 35
again of the bike parking areas. We took the crosswalks and reordered the geometry so they 36
weren’t random angles across the street so that they were more architecturally aligned with the 37
patterns of the street. 38
39
Moving on to Birch to Park Street, again more of the same. You see the existing conditions 40
pretty much intact. Another bike corral, another nice grouping. Keeping in mind we still have 41
isolated bike parking along; this is just a new location for it. The existing brick walls we had an 42
opportunity by reorganization of our patterns to keep the brick walls which are there now some 43
of which have artful granite stone sitting in front for seating, also retained. Another bike corral. 44
Accessible parking again. 45
46
The final leg, which is the Park Boulevard to the Plaza, again minor changes. We relocated the 47
loading zone. This is, and again these comments and changes are coming with a lot of time spent 48
with the community a lot of direct inputs, folks with direct knowledge about how the service was 49
3
actually happening out there and they had some very good advice. So this was relocated onto 1
Park. The motorcycle parking was added. Angle parking changed as partly result of getting the 2
bicycle movement, but angle parking was transformed into parallel parking and the bike route 3
which changed the width of the street allows the bike moving in the westerly direction to stay in 4
the plaza. Bikes moving easterly toward Caltrain would stay in a sharrow on the street. And 5
then there’s an opportunity for a bike share location, which would be a grouping of bikes sitting 6
at the far end where the bike lockers actually sat before. At this point I’m going to turn it over 7
to Shahla unless you have questions at this point. We’d like to get into the lighting component. 8
9
Chair Martinez: Commissioner Keller. 10
11
Acting Vice-Chair Keller: Yes, could you go back to the previous slide? Yes, it looks like where 12
it says, “Relocated loading zone,” I assume that that’s Park Boulevard in the southerly direction. 13
Is that right? 14
15
Mr. Gates: Yes, it’s on the easterly side, so it would be the northerly direction. 16
17
Acting Vice-Chair Keller: And what I’m wondering is, is there a left, a dedicated left turn lane 18
from westbound California Avenue onto southbound Park Boulevard? Or is that, it’s hard to 19
read what’s going on there. So I know there’s a dedicated turn lane going at the northbound Park 20
Boulevard, but I’m wondering if there’s dedicated turn lane onto southbound Park Boulevard. 21
22
Mr. Rodriguez: Thank you Commissioner Keller. On California Avenue today there isn’t an 23
existing dedicated left turn lane to turn you onto Park. It’s an all-way stop intersection so you 24
turn onto southbound Park from the one lane and this configuration is maintained through this 25
alignment here. And the approach on Park and also again is one lane, an all-way stop that you 26
can then once you’re stopped have right of way you can turn left or turn right. 27
28
Acting Vice-Chair Keller: So what I’m wondering is the dedicated, you have the dedicated left 29
turn lane onto northbound Park Boulevard, which is a short street that only goes for two blocks 30
before it’s blocked off. Is there a reason that that left turn lane is there? 31
32
Mr. Rodriguez: As part of the early on community outreach with the residents and the merchants 33
in the area they identified that left turn lane as an important element to help sustain operations 34
into the Mollie Stone’s Market. I keep saying Mollie Stumps, I got to correct myself here; the 35
Mollie Stone’s Market. And so we maximized the length of that left turn lane to get you from 36
California onto Park Boulevard North, onto Park Boulevard to the north of that. That was 37
actually a community requested element that we felt was appropriate to include in the project. 38
39
Acting Vice-Chair Keller: Alright, thank you. 40
41
Chair Martinez: Can you describe the, not the bicycle parking, but the circulation enhancements 42
that are part of this plan? 43
44
Mr. Rodriguez: I’m sorry Commissioner, can you repeat the question? 45
46
Chair Martinez: Yeah, I didn’t hear or can find the description of how bicycle circulation along 47
California Avenue has been improved over what it is today and I’d like you to just review that 48
for us. 49
4
1
Mr. Rodriguez: Thank you Commissioner for clarification. So California Avenue today again is 2
a four lane roadway and one of the elements of the project includes a lane reduction down to two 3
lanes. And so the proposed project includes wider, wide lanes, but one lane per approach of 4
California Avenue for approximately 15 feet travel lanes. And the concept for the operation, 5
bicycle operation of California Avenue is that there will be a share the road or sharrow roadway 6
markings to encourage bicyclists to ride kind of in a certain kind of path on the roadway and also 7
then to remind motorists that they’re sharing that right of way with vehicles. The 15 foot lane is 8
again a very, very wide, fairly comfortable lane and so that is something that we do feel is an 9
enhancement over the existing condition that exists today where the lanes vary in width from 10
about 9 to 10 feet. 11
12
Chair Martinez: Ok, thank you. Anybody else? Ok, let’s go on to the proposed lighting. 13
14
Shahla Yazdy, Transportation Engineer: Good evening Chair Martinez, Commissioners. My 15
name is Shahla Yazdy. I’m here to present the lighting element for the project. So one 16
consistent comment that we kept hearing from the community and the business merchants along 17
California Avenue was the need for additional lighting on California Avenue. The street lights 18
provide, that were recently upgraded to LED’s and they do provide lighting for the street, but 19
what’s lacking is the sidewalks where there’s businesses and so pedestrians can walk safely. 20
21
The lighting for this project is an unfunded element. It was never included in the grant proposal, 22
but again we’ve been hearing from the community and we, this is something that we feel that it 23
would be good to include as part of the current project that we’re proposing. The existing 24
streetlights are over 40 years old. They are older and it is again the lighting, they don’t provide 25
adequate lighting for the sidewalks and the pedestrians. And again the luminaries were recently 26
upgraded to LED’s in 2012. And the photo that you see on the right is just a snapshot of the 27
current streetlights out there. 28
29
So the California Avenue lighting we want, the proposal tonight is to request that we consider 30
adding lighting to the current project scope. We do have options that I’d like to, I’ll go over 31
next, but as part of including the lighting with the current project scope would reduce disruption 32
if we were to go in and do this at a later time. The first option, Option 1 would be to paint the 33
existing street poles and just basically leave the streetlights as they are, maybe change the 34
luminaries and the heads on the lights and also to add a pedestrian scale lighting in-between. 35
Second option would be to replace the existing poles with a combination street light and also 36
pedestrian light, which I have a photo that I’ll be showing to you next. The third option, 2B that 37
we call it, is to replace the existing poles, but at a more tighter spacing so the streetlights are 38
about 100 feet apart currently so we probably move them to 75 feet. 39
40
The Option 1 to the left is you’ll see the snapshot of the existing streetlights and we’d keep those 41
and again paint them to match the proposed pedestrian scale lighting that you see on the right 42
side. So that would be kind of placed in between strategically between the existing streetlights. 43
And the Option 2 would be the proposed streetlight that has the combination of the street and 44
again the pedestrian that would be lighting the sidewalk. 45
46
So this is to show you the existing streetlight configurations. So the orange, this is the layout 47
that we have now, the existing streetlights. There’s about 35 lights currently on California 48
Avenue. And the option now to keep the existing streetlights and to add the pedestrian lights in 49
5
between, we’re estimating for it to be a cost about $800,000. And this would include design and 1
construction of the light poles. The second option that we have is to replace the existing 2
streetlights as they are in the same location and replace them with the combination of the 3
pedestrian and streetlights. A cost with this, for this would be up to about a million dollars and 4
the total count would be 37. The third option would be to replace the existing lights but at a 5
tighter spacing so you’ll see that there existing streetlights would be placed as you see them so 6
we could let 75 feet apart. And the cost would be about $1.2 million. This just, this slide shows 7
you the options that we’d have with the street pole. We would have receptacle lighting so we’d 8
have the opportunity to hang banners and hanging baskets. These are decorative elements that 9
would be available as an option for the streetlights. 10
11
Also I’d like to go over the next steps for the project. Following tonight’s meeting we are 12
scheduled to go to the City Council meeting for March 4th. On February 21st we are scheduled to 13
go to Architectural Review Board (ARB) as a preliminary review to go over the streetscape 14
elements and the landscaping for the project. Through the spring we are committed to go over 15
the construction staging and the business preservation plan development with the merchants. 16
That will be an ongoing discussion once we have finalized the project scope. And we’re 17
scheduled for final approval and authorization to bid to come back to both Planning Commission 18
and also the Council in June with going out to bid in the summer of 2013 with construction to 19
begin in the fall. 20
21
So tonight the recommended lighting option is to, we’d like the Planning Commission to forward 22
a recommendation to the City Council to include street lighting elements into the current project 23
for the California Avenue Streetscape Project. And the option that we’re recommending is 24
Option 2A, to remove and replace the existing streetlights at a cost of $1 million. And I will 25
open it up to questions and comments. Thank you. 26
27
Chair Martinez: Can you clarify, to remove and replace Option 2A is to replace them at 100 foot 28
spacing? 29
30
Ms. Yazdy: It would be the exact same locations which are about 100 foot spacing. 31
32
Chair Martinez: And the height of them would be identical, or? 33
34
Ms. Yazdy: That’s something that I think we would be working with the design, the electrical 35
designer on and also going through the ARB process to make sure that we have enough lighting. 36
So it all depends, so if we go with the lower height we can maybe have spacing that’s further 37
apart, but the current I believe the street pole that we have shown can be at a lower height, yes. 38
39
Chair Martinez: And do you have any idea what the spread of the light is at the 100 foot spacing? 40
41
Ms. Yazdy: I believe we had some proposed numbers. If you have the current lighting I’ll bring 42
Kandee Bahmani with RBF Engineers can go over kind of lighting that we’ve… (trailed off) 43
44
Chair Martinez: Thank you. 45
46
Kandee Bahmani, RBF Consulting: Good evening Chair Martinez and Commissioners. We are, 47
we have made some assumptions based on the minimum requirements by the IES. So we’re 48
using the one foot candle average and we’re using a 4:1 average to minimum ratio as a 49
6
maximum. And the sidewalks we’re using .3 for the candles. And the 100 foot spacing works 1
and the height that we’ve assumed right now is about 25 to 30 feet for the street lighting and 2
about 10 to 12 for the pedestrian lights. 3
4
Mr. Rodriguez: Chair Martinez, if I could just add. I think that as we continue to work on the 5
design if we get that support from the Commission and the City Council, I do think we’ll 6
probably end up with the existing poles again they’re at 30 feet today. They are definitely 7
standard highway type of pole. We are probably something that might be a little lower at about 8
25 feet that can be our preference that’s a consistent comment that we kept hearing from the 9
community as well that one, the lights are older, but also that they’re just so high and so we do 10
feel that with this project is that we have an opportunity to reduce that pole to about 25 feet, but 11
also again add that lower pedestrian scale that really lights up the sidewalk and at that 100 foot 12
spacing we were pretty confident that we could get a good light distribution to make those kind 13
of sidewalk environments very comfortable for the community. 14
15
Chair Martinez: Ok well thank you for that. We’re going to open the public, why don’t we hold 16
and open the public hearing. Do we have any members of the public to speak on item one? 17
18
Acting Vice-Chair Keller: Yes, the first speaker is Herb Borock to be followed by Terry Shuchat. 19
20
Herb Borock: Good evening Chair Martinez and Commissioners. This proposal on the street 21
lighting is a segment of a larger project, the California Avenue Streetscape Project, and as such 22
discussing it separately is a violation of the California Environmental Quality Act (CEQA) that 23
prohibits segmenting a project for environmental review. That project, the segment of the 24
project that the Council had previously seen and approved is currently before an appellate court. 25
It was fully briefed as of October 18 of 2012. So far there’s been no further progress other than 26
the best guest of the Court at this time is that they’ll be returning the file to the superior court on 27
March 7th. So this proposal to come before the City Council on the current schedule would seem 28
to indicate to me that it’s trying to get it to the Council before they get the ruling from the 29
appellate court on the Streetscape Project minus this segment. 30
31
But regardless of what happens at the appellate court level, staff is just inviting another lawsuit 32
for violating the California Environmental Quality Act by segmenting the project in this way. If 33
the Council had the street lighting proposal before it at the same time as it was reviewing the rest 34
of the project it may very well have made a decision differently than the one it would make by 35
doing them separately and it certainly would have a different budgetary decision before it than it 36
had at that time. At that time it clearly did not have any money lined up to do the entire project 37
and both of its segments, which is probably an indication of why it was segmented. Once again 38
it is going after the money that has motivated the staff and the Council to violate the California 39
Environmental Quality Act. And I suggest since this project does violate that law that you 40
should take no further action on it. Thank you. 41
42
Chair Martinez: Thank you Mr. Borock. 43
44
Acting Vice-Chair Keller: Terry Shuchat to be followed by Robert Moss. 45
46
Terry Shuchat: Hi, I’m Terry Shuchat; I’m a property owner and a business owner on California 47
Avenue. I’m one of hundreds of people who were totally opposed to this project, but it appears 48
to be going before the City it’s going to progress, it’s probably going to happen and even though 49
7
we have hundreds of people who are opposed to it, I’ve heard of absolutely no one who’s 1
opposed to changing the lighting. The lighting on California Avenue is very, very old fashioned. 2
It’s referred to as “freeway lighting.” It looks old. It’s way too high and it seems that since the 3
City has great plans on redoing the street, making the street look beautiful that it only makes 4
sense to change the lighting also. To bring the height of that lighting down and to make the 5
sidewalk safer certainly seems to make a lot more sense now. 6
7
Jaime hasn’t brought up, but I’ve heard at some meetings we’ve had that the reason for also for 8
doing the lighting now is that the sidewalks are going to be pretty well torn up and the lighting 9
conduit is old on California Avenue and this would be just an excellent opportunity while the 10
sidewalks are already being torn up to in turn replace the conduits for the lighting. So I and I’m 11
sure, as I said I’ve heard absolutely zero objections to redoing the lighting and there again as a 12
property owner, a business owner, I think that it would be safer with new lighting and would 13
certainly definitely improve the looks of the Streetscape Project. 14
15
Chair Martinez: Thank you. 16
17
Acting Vice-Chair Keller: And our final speaker is Robert Moss. 18
19
Robert Moss: Thank you Chair Martinez and Commissioners. The thing that’s bothering me 20
about this project is the way it seems to keep escalating and the cost keeps going up and up and 21
up. When it was originally proposed one of the selling points was that the $1.175 million dollar 22
grant from Santa Clara Valley Transportation Authority (VTA) was going to be most of the cost 23
of the project and now we’re talking about $3.4 million without the cost of the lampposts, which 24
brings us up close to $4.5 million. Also, I’m not convinced that all of the costs are included 25
because when the City Council moved to widen the sidewalks Steve Emslie told me that because 26
of the relocation of the sidewalks the curbs and the gutters the entire street would have to be 27
reconfigured because you’d be destroying the gutters, the storm drains, and the slope between the 28
crest of the street and the drains, which makes water drain. He thought that would cost at least 29
$800,000 to $1 million dollars. And I don’t see that as one of the expenses on here. 30
31
So we’re probably approaching $5 million for this project and staff is talking about half a million 32
dollars of the existing costs not including the streetlights not being funded by anything and then 33
going to the Capital Improvement Fund and taking out that money. About $1.5 million. As you 34
know we have a backlog of Capital Improvements in Palo Alto a minimum of $250 million 35
depending on how you look at it they could be closer to $300 million and this just adds to it. 36
And taking away from the Capital Improvement pot to do additional decoration on California 37
Avenue strikes me as an unwise use of City funds. 38
39
So what could we do with $5 million? Well that would pay most of the cost of rehabilitating the 40
two fire stations which are in serious need of upgrading. And given the choice between making 41
the fire stations safe and more useable or making California Avenue look nice, I would vote for 42
the fire stations. So I think you ought to go back and take another very careful look at all of the 43
costs for the California Avenue Project and all of the funding options and make sure that we’re 44
not just keep on building up the cost and building up the expenses and having no place to go 45
except taking it out of our very, very sick Capital Improvement Fund. 46
47
8
Chair Martinez: Thank you Mr. Moss. Commissioners let’s keep the public hearing open for a 1
bit. I may have some questions of our speakers. Ms. City Attorney can you talk a bit about sort 2
of the legal side of this project? 3
4
Cara Silver, Sr. Assistant City Attorney: Yes, thank you. Cara Silver, Senior Assistant City 5
Attorney. And I did want to respond to Mr. is it? I think it was Mr. Borock who made the issue 6
about, who made the point about the CEQA segmentation. And there is currently a Mitigated 7
Negative Declaration (MND) that was approved for this project by the City Council. That 8
Mitigated Negative Declaration is currently the subject of some litigation. It, the adoption of the 9
MND was found to be sufficient by the trial court, but now the issue is on appeal and until the 10
appellate court or unless the appellate court sets aside the trial court’s decision the MND is 11
currently operative and it’s operative as of this time. The MND did discuss various streetscape 12
improvements such as street furniture and that type of thing. It did not specifically address 13
streetlights, but staff has analyzed this issue and since this is just a simple replacement of an 14
existing streetlight we have not determined that there are any environmental effects that would 15
give rise to additional environmental analysis and so the MND for the overall project is sufficient 16
for moving forward. 17
18
Chair Martinez: Can I ask you a question about that? If we are going to replace streetlights 19
someplace in another part of the City, another three blocks, would that require an environmental 20
review of any kind? 21
22
Ms. Silver: Typically those types of replacements are categorically exempt. Almost all of our 23
streetlight replacements and street paving projects and sidewalk projects are always categorically 24
exempt. 25
26
Chair Martinez: Ok and then one last question on this. Does this street lighting project have to 27
be, I know the, I understand the, you don’t want to rip up the sidewalks a second time, but does it 28
necessarily have to be part of this? Because it makes it more complicated. Can it be a separate 29
project? 30
31
Ms. Silver: It certainly could be a separate project. I think there are some economic and 32
construction issues that I’ll defer to Jaime on. 33
34
Mr. Rodriguez: Thank you Cara. Yes Commissioner, Cara’s actually correct here in this 35
particular case we’re actually trying to just make sure we’re providing the project to the City in a 36
timely manner in this specific case concrete for sidewalks is very expensive to reconstruct and 37
you can’t get the same look and finish if you have to go and saw cut it later to re-allow for the 38
new conduits to be reconstructed. And so we’re trying to actually just make sure that we are 39
capitalizing on the work that’s already going to be taking place and as Mr. Shuchat mentioned 40
earlier as part of his public comments is, the sidewalk will already be destroyed, meaning it will 41
be ripped up already, the ground will be expelled it’s a very simple cost savings measure for the 42
City to offer this as an element of the project now versus later. 43
44
Chair Martinez: Mr. Chief Transportation Official, I don’t think we can call this project timely, 45
so I beg to differ. Commissioner Panelli had a comment or question. I’m going to let him go 46
first. 47
48
9
Commissioner Panelli: Thank you Mr. Chair. My question, well the overarching question I have 1
is what problem are we trying to solve with this project? I think I heard maybe three or four 2
different objectives and so I want to be clear that I understand what they are. One is pedestrian 3
safety, would that be accurate? 4
5
Mr. Rodriguez: Yes Commissioner Panelli. The specific recommendation to add lighting would 6
be specifically to help illuminate the pedestrian zone of the roadway. 7
8
Commissioner Panelli: Ok, but it sounds like also there were some other driving forces behind 9
what the community, the community’s reason for asking for some of this. Some of it is 10
marketability to make it a more pleasant place. It seems like and the reason I’m asking this 11
question is what were the other options that were considered beside the 1, 2A, and 2B? For 12
example, smaller but more frequently placed lighting standards or planter box lighting because 13
now we’re adding so much more vegetation. So maybe you could give a little bit of color behind 14
the thinking there. 15
16
Mr. Rodriguez: Thank you Commissioner. I’ll try and answer that question and if I stray please 17
reel me back in. So there’s definitely a lot of elements to a streetscape project and lighting is a 18
great opportunity to compliment all the other work that is already happening with the project to 19
allow that roadway element to be more visible during the evening hours, to highlight those 20
streetscape elements that have been added. Street lighting is not just the pole; it’s the type of 21
light that’s added onto the roadway that provide the effects that we might be looking for within 22
this corridor. It’s the illumination of the roadway, it’s the illumination on the sidewalk, and we 23
really are just trying to be responsive to the community in this case. That’s why we’re here 24
tonight, is the community has been very clear to us saying we just want to make sure that it is 25
clear we have heard them every time and this is really our last opportunity. 26
27
And if we don’t add the lighting in now we definitely can’t meet our design date. Well, basically 28
like if we don’t add it we’ll meet the design date, but if we were asked to then add lighting say in 29
April we definitely won’t meet our design date. So we really need to get, to make that 30
determination kind of now early into this calendar year so that RBF and Gates have an 31
opportunity to finish that civil plan correctly so we can bid it out rather than trying to do this as 32
an addendum after we award the project we would pay a lot more money later. And so that’s the 33
driving force here, just trying to take advantage of the design, make sure it’s part of that so we 34
get a price for the community. 35
36
Commissioner Panelli: Ok and let me just follow that part up because one of the things that I 37
highlighted in the report is that because you’re going to be cutting up the sidewalks and the 38
existing underground conduit and wiring of the streetlights are aged, right? So the idea is hey, 39
we’re going to tear these up, we may as well replace while we have, while we’ve opened it up so 40
we don’t have to go back and do it again. And my question for you is if we didn’t replace any 41
of the lighting how much longer would that conduit, underground conduit and wiring last before 42
it would have had to been replaced anyway? 43
44
Mr. Rodriguez: Thank you Commissioner. Street light facilities usually have a useful life of 45
about close to 50 years. In this particular case the conduits that are on California or under 46
California Avenue in this case are already 40 years old. They are rigid steel conduits smaller 47
than two inches, about an inch and a half conduit size. The conductors that are in those conduits 48
are also aged. We actually did look at whether or not those conduits could be reused such as just 49
10
pull out the old cables, put new ones in, and we actually can’t do that in most cases. We also 1
have a design standard in the City where we try to put new conduits in at about 18 to 24 inches 2
depth below before the sidewalk. In this case they are as shallow as eight inches so we actually 3
do run the risk even with demolition of the existing sidewalk that we actually may damage the 4
existing conduits as well. 5
6
Commissioner Panelli: Ok and let me just, I’ll summarize it here, but I just want to make sure 7
I’m drawing the right conclusion here, which is as part of this between $800 and $1.2 million 8
proposed spend, there’s some percentage of that that if we didn’t entertain deferred maintenance 9
we’d have to replace, we’d have to spend in the next 10 years anyway. Is that a fair way to 10
characterize it? 11
12
Mr. Rodriguez: Yes it is, and if I may just take advantage of the opportunity to have the mike 13
again, when we looked at the various options of lighting configurations we did analyze two. 14
Again one is just leaving those existing pole standards in place and repainting them to get them a 15
little bit of a different look and simply just adding additional lights in between, but one of the 16
reasons why we did recommend against that first option is because one of the consistent 17
community comments that we do hear from the community, specifically the merchants and 18
property owners along California Avenue was that they wanted to preserve the storefront 19
visibilities within the corridor. There was a lot of concern about having pole clutter on the street 20
and we didn’t highlight it as part of the presentation but there’s again 35 existing lights and if we 21
add in just lights in between that with all the other furniture now the sidewalk does begin to look 22
very busy and you get to have a little more of a fence like effect kind of looking down the 23
corridor because you see pole, pole, pole, pole and although that would definitely achieve the 24
benefit that we would be looking for with this project, which is the pedestrian sidewalk lighting 25
then that would have a different impact even though it’s a cheaper solution. 26
27
Commissioner Panelli: Yeah it starts looking like a bunch of parking meters, right? 28
29
Mr. Rodriguez: You said that, not me. 30
31
Chair Martinez: Certainly. Before we go on, Assistant Director Aknin do you want to talk a bit 32
about sort of the rest of what’s going on? Like for example the California Avenue Concept Plan 33
and how would the progress of that and how that fits into the overall development here. Just 34
give us a brief update. 35
36
Mr. Aknin: Sure, and I haven’t been intimately involved with this, but I could give you kind of a 37
broader overview. As you know concept, there’s two concept plans that are going to become 38
part of the General Plan. And the California Avenue Concept Plan is one of those and what 39
we’re doing tonight even though the California Avenue Concept Plan has not been adopted yet 40
there has been a community input process and nothing that’s proposed tonight is inconsistent 41
with what’s been heard during that community input process. Now the environmental review of 42
the California Avenue Concept Plan is going to be go hand and hand with the general, with the 43
Comprehensive Plan and that environmental review will start over the next few months. So I 44
think the short story of it is everything that’s being proposed as part of the streetscape alignment 45
is consistent with what’s shown within that Concept Plan at this time, but the Concept Plan even 46
has greater and more broader type improvements for the area. 47
48
11
Chair Martinez: Thank you for that. And before we go forward with comments and questions, 1
Ms. Yazdy? Did I say that right? Can you just give us a summary of the preferred Option 2A 2
not only the replacement of the light standards, but the other parts of the lighting plan that will be 3
part of this million dollars or whatever the number’s going to be as part of the lighting part of 4
this? Do you have that? 5
6
Ms. Yazdy: Sure, yes. Let me just I’ll bring back the layout that kind of shows the, so the 7
bottom option, Option 2 we’re calling it, is that we would replace the existing streetlights with 8
basically the new combination pedestrian/streetlights. So they would pretty much go exactly 9
where they are and again, the same spacing as they are now and in addition to lighting up the 10
street the pedestrian, the sidewalks would also be lightened up as well. And the street we have a 11
couple of street pole, street lights options that we’ve picked out. Again they will have to go 12
through ARB review and we will be doing that February 21st. And I can show you the photo. 13
It’s to the right where you see the combination pedestrian and streetlight option that would also 14
have the opportunity to hang banners or hanging baskets from them also as a streetscape feature 15
if we choose to. 16
17
Chair Martinez: And the total number of those light fixtures is again? 18
19
Ms. Yazdy: I’m sorry. 20
21
Chair Martinez: The total number of light fixtures that are part of that package is? 22
23
Ms. Yazdy: 37. 24
25
Chair Martinez: 37. And they’ll be no… I’m saying it, but a question, like bollards or street 26
lighting or lighting at people, places, gathering places or anything like that? 27
28
Ms. Yazdy: That’s a very good question. Thanks for bringing that up. In addition to providing 29
street lights for the pedestrians and also the street the poles will have power outlets for additional 30
lighting during events for the central plaza location, festive lighting, so it will provide that 31
additional pole power to do so. Also the one important element of the fact that we’re widening 32
the sidewalks, the current streetlights are with the widened sidewalks the current streetlights 33
would be in the middle of the sidewalk. So with, if we do replace the streetlights what we can do 34
is actually move the streetlights out closer towards the curb, which would give more space for 35
the sidewalk for tables and benches and streetscape elements to be placed. 36
37
Chair Martinez: And Mr. Landscape Architect how does that fit with your plan? 38
39
Mr. Gates: Sorry, could you repeat that? 40
41
Chair Martinez: Oh I just wanted to know whether in your landscape design whether you’ve had 42
thought about the lighting and this placement of lighting and does that work adequately with the 43
landscaping plan? 44
45
Mr. Gates: Yeah, actually it’s a vast improvement if we bring the lighting down those species 46
will grow above so the lower the light in the future it will be much more efficient for us and we 47
have actually got the trees spaced based on the lighting and as she mentioned if the light poles 48
get pulled out to the street that’s going to help us separate the pedestrian lighting from the street 49
12
lighting and pull it away from the trees again. And I believe we do have some limited number of 1
niche lights that will sit in the walls, in the new walls, which will actually create some limited 2
pools of light at crossing areas as well. So it’s a big help from a landscape point of view. 3
4
Chair Martinez: Good. That’s what I was looking for. Sorry to bogart the time Commissioners. 5
Commissioner Tanaka. 6
7
Commissioner Tanaka: Yeah, so first of all it sounds like this is some good forward thinking. So 8
thanks for bringing this forward. A couple of quick questions; first question is, of the three 9
different options can staff talk about in terms of light on the sidewalk and street which option 10
gives us the most light on the sidewalk and street? Do we know that? 11
12
Ms. Yazdy: That would be the option that we’re recommending. They are I guess the spacing 13
that we have right now and some of the really basic studies that we’ve done with the lighting we 14
feel that this option, the combination streetlight and pedestrians would provide adequate lighting 15
for the sidewalk. And anything more would be really just provide extra clutter and definitely not 16
enough, I mean the lighting could be satisfied with this option. 17
18
Commissioner Tanaka: Ok. The only reason I was asking is if I just do the math on wattage, 19
now wattage not equal to lumens, but let’s just use watts as an example. The first option is like 20
40, almost 5,000 watts, right? And then the second option is 37,000 watts, 3,700 watts. And so I 21
just in terms of like pure wattage the first one is, by far the most light, but I was just trying to 22
understand why the second option would be more light. I just, I don’t know if staff could talk a 23
little more about that? 24
25
Ms. Yazdy: I guess, I’m sorry I misunderstood. It wouldn’t provide more light; it would be 26
adequate light to light the sidewalk I must have I misunderstood your question. So the second 27
option would provide enough lighting for the sidewalk. The first option is to just provide, it 28
would be just a lot of lighting in between the existing. 29
30
Commissioner Tanaka: Ok, and is there also plans to run communication to these lights as well 31
in case you wanted to have finer control or is that… where you’re laying your conduits and 32
cable? 33
34
Mr. Rodriguez: Thank you Commissioner Tanaka. I think you’re referring to like data cables, is 35
that what you’re referring to? It isn’t something that we’d actually planned. We actually are 36
pretty familiar with the cities that have done similar things and actually have not found very 37
specific uses for them. I know that downtown Gilroy did that. They wired up their whole 38
downtown and they have never once been able to use that option. 39
40
Commissioner Tanaka: I see. Ok. Great, thank you. 41
42
Chair Martinez: Commissioner Alcheck, further questions, comments? 43
44
Commissioner Alcheck: Ok, so I want to start by saying that I feel like your presentation does 45
make the case that this is an ideal time to improve the lighting on Cal Ave. I want to highlight 46
that according to the staff report the project is half a million dollars over budget and you’re 47
talking about adding another million two. So we’re talking about nearly two million dollars over 48
budget and I wasn’t involved in this project in any capacity because I came, I’m so new, but I 49
13
don’t often criticize our Planning Department, but I really want to stress that I think that in this 1
business budgeting is a very important skill. I just, I mean we’re actually not talking about 2
Option 1 versus Option 2 versus no option. Really, no matter what we’ll have to spend it looks 3
like $800,000. There is no option where we don’t do anything, which really means that the cost 4
differential is potentially $200,000 or $400,000 because there is no zero thousand dollar option. 5
Am I right? There’s no decision that the City Council could make that nothing would happen. 6
7
Mr. Rodriguez: Thank you Commissioner Alcheck. That actually is an option. If we don’t want 8
to do lighting, we definitely don’t have to do it. We just didn’t present that as an option for you, 9
but it is an option on the table so thank you for clarifying (interrupted) 10
11
Commissioner Alcheck: Would those lights still have to move or they could stay where they’re 12
at? 13
14
Mr. Rodriguez: Thank you. If we don’t add lighting to the project lights would just stay where 15
they are and the point that Shahla was trying to make is in the areas where we’re doing the 16
majority of the widening, specifically at that first block of California between El Camino Real 17
and Ash that’s where the largest amount of widening does occur along the south side of the street 18
so if we don’t move the poles, the poles then end up that are existing end up being more in the 19
middle of the sidewalk. And they’ll do a great job of lighting up the sidewalk at that point until 20
the trees get a little bigger, but then we might light up the roadway. That’s actually a point that a 21
lot of the merchants have been making to us and again it just hasn’t been an element of the 22
project for us to be able to add in. 23
24
Commissioner Alcheck: Yeah so if I could just follow up, that just, I mean to be honest your 25
answer just further frustrates me because if it’s such a no brainer I cannot imagine that they 26
wouldn’t have discussed this at the time they were making the decision about this project as a 27
whole. And that’s sort of my broader point. From outside this Commission as just a citizen of 28
Palo Alto when this project was being discussed it sounded wonderful to me. But at what cost, 29
right? Everything has a cost. And if we’re talking about $6 million streetscape improvement or 30
$3 million streetscape those are decisions obviously the City Council has to make, but it just sort 31
of seems like how is it possible that this project go this far along without the discussion of street 32
lighting and now that essentially the project’s been approved and for good reason now you’re, 33
now we’re coming to a point where we’re talking potentially a million and a half dollars or a 34
million dollars. And it just, I can’t comprehend a scenario where anybody’s sort of happy with 35
that kind of decision making. 36
37
So again, I do think it’s an ideal time to deal with this lighting. It sounds to me like ripping up 38
concrete 10 years from now would be a mistake and obviously we can’t leave them where 39
they’re at because they are going to inefficiently light this new wonderful area. That being said I 40
am a little disappointed because I would like, I think the City Council should make these 41
decisions with all the information and what you’re telling me is it’s a no brainer and it seems so 42
obvious; at the same time no one was discussing this when they were making this decision that 43
seems like a failure on the part of the Planning Department. So I think in general you guys do an 44
excellent job, but this is an important skill and I think that we should learn something from this. 45
46
Chair Martinez: We’re kind of reversing roles here because I want to defend the Planning 47
Department, but I’m going to put that on hold for now. Commissioner Panelli do you have 48
14
further comments? Well we’re going to wrap it up pretty soon so… Yes, Acting Vice-Chair 1
Keller, please. 2
3
Acting Vice-Chair Keller: Thank you. So I was going to ask a question first about CEQA. So 4
let me follow that up. There’s a question that was answered earlier that was raised by the Chair 5
was the issue of segmenting, but one part that was brought up by a member of the public was the 6
issue of budget and although Commissioner Alcheck is right that the Council sort of made a 7
decision that to fund some of it and then sort of like the camel’s nose and more of the camel 8
winds up under the tent in the morning, the whole camel winds up under the tent in the morning. 9
But the, but to what extent is that a CEQA question? Does the Council not having studied the 10
degree of the budget of the overall project is that, is budget at all a CEQA question? 11
12
Ms. Silver: Commissioner Keller CEQA is triggered by any discretionary action, so the 13
budgeting does trigger CEQA and then you need to look at whether that budgetary action will 14
have environmental impacts. So in this case a budgetary action is discretionary so CEQA is 15
invoked, but our analysis is that the Mitigated Negative Declaration already covers the overall 16
project and that the addition of or the replacement of streetlights does not trigger any other 17
environmental impacts that haven’t already been studied in the MND. 18
19
Acting Vice-Chair Keller: I think I didn’t phrase my question in a clear enough way. To the 20
extent that the project cost $3 million or $30 million, which it hopefully doesn’t cost $30 million, 21
but just as an example, does the cost of the project is that effect the CEQA analysis? 22
23
Ms. Silver: No, it typically doesn’t. 24
25
Acting Vice-Chair Keller: Thank you. So therefore the fact that the City Council didn’t know 26
the total cost of the whole project that somehow increased, that’s not a CEQA question? 27
28
Ms. Silver: That’s generally correct unless the cost of the project increased because additional 29
elements that would have significant environmental impacts that weren’t analyzed were the 30
cause of the increase. 31
32
Acting Vice-Chair Keller: So would it be fair to say that it’s the elements themselves that trigger 33
whether or not there’s a CEQA question, not the cost? 34
35
Ms. Silver: Right. That’s correct. 36
37
Acting Vice-Chair Keller: Thank you. The next question is with respect to the interaction of the 38
trees and lights. So when the trees were cut down on California Avenue and then they were 39
replaced, they were replaced basically in the same spots and now the curb is being extended. 40
And when the curb is being extended with the light fixtures being placed at the new curb will 41
there be shadows behind the trees that are inset further from the, in other words where the inward 42
tree wells are? 43
44
Mr. Gates: The photomatic metric patter will certainly change, but one of the reasons we’re 45
going for a high/low is that you come below the canopy for the pedestrian to put it on the 46
sidewalk and you go ultimately below the canopy but in the middle of it for the first 7 years to 10 47
years so that ultimately in mature form we’re getting very good distribution of streetlight which 48
is [brighter] different than pedestrian light which is lower and more in character. So the ideal 49
15
position is next to the street but low, close to the sidewalk. So we’ll be in a better position than 1
leaving them where they are now. 2
3
Acting Vice-Chair Keller: So you won’t get shadows behind on the sidewalk lighting behind the 4
trees that are set inward? 5
6
Mr. Gates: The trees that are there now will be inset, but a 12 foot high light in the very short 7
time your existing trees are going to be canopy above that, so that’s why the lower pedestrian 8
scale will give us a very good foot candle on the sidewalk even though they’re upward a little 9
more than what the trees are today. 10
11
Acting Vice-Chair Keller: Thank you. The next question is with regard to in terms of the cost 12
and I’m not asking you to answer this for now, but when you go to City Council it would be 13
helpful to distinguish between the cost of replacing the conduit with modern conduit, which 14
arguably is a accelerated maintenance job as opposed to deferred maintenance from the cost of 15
replacing the lighting which is more of an improvement. So in some, just for discussion’s sake 16
say about $600,000 to replace the conduit and $400,000 for the new lighting then really that’s 17
$600,000 of accelerated maintenance and $400,000 is the actual improvement. And that might 18
affect how the budget is considered. 19
20
In, it was also mentioned by a member of the public about storm drains as not being included. 21
Are the relocation of the storm drains and how they feed into the storm drain system, is that 22
budgeted for or is that something that will have to be added on as an addition? 23
24
Mr. Rodriguez: Thank you Commissioner Keller. The design does actually include today 25
protection of the existing storm drains say from rooftops that currently spill out into the gutter 26
today and there are several locations where we actually need to relocate storm drains to maintain 27
flows and actually be able to get that water into the storm drain system. So that is budgeted as 28
part of the project. 29
30
Acting Vice-Chair Keller: Thank you and I assume that also includes an analysis of where the 31
roadway goes in and out and the curb goes in and out that there’s not going to be ponding of 32
water with no place to go. 33
34
Mr. Rodriguez: Yes, that’s correct Commissioner. 35
36
Acting Vice-Chair Keller: Thank you. One thing that was in the staff report that wasn’t in the 37
diagram that you have up there on the screen in page, is that one of the choices was something 38
that looks like a bell and I would just discourage use of that particular design because that’s a 39
motif for El Camino Real’s bell and we don’t, I don’t think we want to use that motif on 40
California Avenue because it’s not El Camino Real. If we were redoing lighting on El Camino 41
that would actually be a good idea, but on California I would not use that design off of El 42
Camino Real. 43
44
As a side issue Mountain View when they redid they apparently did not relocate the lights, the 45
streetlights and theirs are shorter though, but on the other hand there’s some situations where you 46
wind up with a light pole in the middle of the sidewalk which is odd and sometimes people bump 47
into them so this is actually a good thing that we’re relocating them. As, on slide 12 you 48
16
mention Options 1, 2, and 3, but in the staff report I think they’re 1, 2A, and 2B. So Option 2 is 1
really Option 2A so I assume that when this goes to Council you’ll correct that. 2
3
And finally let me get to the Comp Plan process. So the, what I understand is that when the 4
Comp Plan is evaluated for CEQA we’re going to take the whole Comp Plan and bring it to 5
CEQA analysis. Excuse me? 6
7
Mr. Aknin: You take the entire Comp Plan and analyze it within a CEQA document. 8
9
Acting Vice-Chair Keller: Or are we going to analyze parts of the Comp Plan and parts later? 10
How are, are we going to segment the Comp Plan analysis for Environmental Impact Report 11
(EIR)? How’s that process going to work? 12
13
Ms. Silver: For the updated, updates to the Comp Plan we are planning on doing one single 14
CEQA analysis. However the Concept Plan for California Avenue is on a more quick schedule 15
and it is also relevant to another project in the pipeline, 395 Page Mill. And so our current 16
thinking is that we will do a joint EIR for 395 Page Mill and the California Avenue Concept Plan 17
in advance of the overall Comp Plan EIR. 18
19
Acting Vice-Chair Keller: So when would the Comp Plan EIR happen? What’s the timing of 20
that? 21
22
Mr. Aknin: It’ll kick off within a few months. The EIR scoping portion of it. And then the EIR 23
process will go through the remainder of this year and into early next year. 24
25
Acting Vice-Chair Keller: And how does that affect our process for getting our Housing Element 26
approved because that’s I think part, the important thing that’s part of the Comp Plan, right? 27
28
Mr. Aknin: Well the Housing Element is for the previous housing cycle, correct? So, yeah, so 29
that’s being done with the Negative Declaration as a stand-alone document. 30
31
Acting Vice-Chair Keller: Ok, that’s useful to know. And that means that all of our work on the 32
various elements of the Comp Plan either have to happen as part of this, either they have to 33
happen in advance of the Comp Plan review, the Comp Plan EIR or they don’t happen this cycle. 34
Is that the idea? 35
36
Mr. Aknin: So repeat that again? 37
38
Acting Vice-Chair Keller: Sorry. We are doing a bunch of elements of the Comp Plan, redoing a 39
bunch of elements, updating a bunch of elements. Either those elements get finished and are 40
included in the EIR for the Comp Plan Update or they miss the boat and don’t happen at this 41
cycle. 42
43
Mr. Aknin: Correct or you’d have to amend the Comp Plan later and review those 44
environmental, review it environmentally at the same time. 45
46
Chair Martinez: Can I add my two cents here? It’s my understanding we only are doing an EIR 47
for the mandated elements and not Governance, Business, Community Services I think. So not 48
all of the elements of the Comp Plan are subject to the EIR. Ms. Silver, is that correct? 49
17
1
Ms. Silver: Some of the elements like Governance probably don’t have any environmental 2
impacts so that’s probably something that doesn’t need to be included in the EIR. 3
4
Acting Vice-Chair Keller: Thank you. So, but the important thing is that the Cal Avenue 5
Concept Plan is going to be studied separately from the rest of the Comp Plan. 6
7
Ms. Silver: Given the current schedule that appears to be the case. That may change over time, 8
but that’s staff’s current thinking. 9
10
Acting Vice-Chair Keller: Thank you. I’ll just say one thing, I don’t know if the new member of 11
the public came in and wishes to speak before… 12
13
Chair Martinez: I think we’re just going to move on. We’re running out of time. It seems to me 14
that this project came before the Commission in a timely manner. When I was a young 15
Commissioner Alcheck, full head of hair, no grey… and to kind of address some of the criticisms 16
that the Commissioner raised about Planning it was presented as a project that was going to be 17
funded by a VTA grant, but I think the Council chose this opportunity of leveraging that grant to 18
make it a more important project for the public by widening the sidewalks and I think that it is 19
also now at this point asked us to really look at the lighting as part of that project too. I think one 20
thing if I’m not mistaken that the new Americans with Disabilities Act of 1990 (ADA) standards, 21
which are going to be the federal standards, which are going to be incorporated into the new 22
update to the California Building Code are not going to permit lighting standards in the middle of 23
sidewalks. As was mentioned those are things that people with limited vision walk into, 24
especially at night. So I think we’re in a situation where this is a great idea to do it. The 25
reasoning to do it is correct and if that weren’t enough we have no choice. 26
27
So Commissioners, really quickly now taking a minute or two we’re supposed to give a 28
recommendation on staff’s recommendation of the option and if any of you have anything further 29
to say about that I’d like to limit it to recommendations for what’s been offered and not further 30
questions or comments about the Comp Plan or anything else. Commissioner Panelli I trust you 31
to start that discussion. 32
33
Commissioner Panelli: Yeah, thank you and by the way as I predicted, as I predicted 34
Commissioner Keller brought up what my last follow up point was going to be. So thank you. 35
36
I’d like to echo the sentiments that I’ve heard from several of the other Commissioners, which is 37
the project makes sense. The option that you’re recommending makes sense. I think the 38
frustration that I’ve heard voiced here and I will echo it, is the cost overruns. And when I hear 39
about a million here, a million there and after having served on the Infrastructure Blue Ribbon 40
Commission (IBRC) I know how much deferred maintenance we have. I know what our catch 41
up is. I know what our keep up is and I get very, very concerned because I know that this 42
million dollars is coming from somewhere else. I just don’t know what’s not getting done to 43
make this project happen. So that’s my simple comment. 44
45
Chair Martinez: Commissioner Tanaka, any recommendations? 46
47
Commissioner Tanaka: Yes. I’m also in favor of having the lighting, I’m just thinking about 48
Option 1, 2, and 3, or 2A, 2B. I’m not sure which way to call it. And I actually go to Cal Ave 49
18
quite a bit. I bike along Cal Ave quite a bit and I actually find it kind of dark now so the current 1
lighting, I hate this use, “watts,” but the current lighting’s I think is 7,500 watts. And so even 2
though Option 3 is a little more expensive I’m leaning that way because it seems to be brighter 3
versus this Option 2. So that’s my thoughts. 4
5
Chair Martinez: Commissioner Alcheck. Commissioner Alcheck any last comments or? 6
7
Commissioner Alcheck: Yeah. In case I wasn’t clear, I think this is an ideal time to do this 8
project and I just can’t imagine a scenario where we devote the resources we are to this 9
improvement and then replace wonderful brand new light posts in the location that’s not ideal. 10
So I think that when you have the opportunity to do something you should do it exactly the way 11
you want it to be done and the way you think it’s perfectly suited. So I actually think that this 12
more expensive option, which would essentially mean removing and replacing the existing 13
streetlights in a slightly different but more preferred location is the option that we should 14
encourage the City Council to choose because after they’ve approved that project ideally this will 15
be a perfected street. So that being said, that’s all I have to say. 16
17
Chair Martinez: Commissioner Keller. 18
19
Acting Vice-Chair Keller: Yes, so firstly let me say that I’m opposed to the do nothing option. 20
And secondly I’m opposed to the, to the stay at Option 1. Whether we go with Option 2A or 2B 21
or not to be… or Option 2 or 3 should depend on the lighting study that’s done and see whether 22
there’s adequate lighting on the street and on the pavement, on the sidewalk. And if there is 23
inadequate lighting then it’s not clear whether it should be 37 or 48 or but actually design it 24
where you need the more lighting based on where it’s short and understanding where the trees 25
are and that. So I’m not going to choose between Option 2 and 3 because that should be a choice 26
based on the particular lighting that exists. And we have been successful in identifying grant 27
funding from the VTA for this project. We’ve identified funding for improvements based on the 28
vehicle license tax, vehicle license fee revenue. And I’m hoping that the City Council will 29
somehow identify some grant funding to do the rest of this project and that would be a good 30
thing for the City Council to identify so that we don’t rob from Peter to pay Paul. 31
32
Chair Martinez: Thank you. I would be willing to bet, not much, but I’d be willing to bet that 33
somewhere in the CIP list that there’s a project to replace street lighting here. So I don’t think 34
we’re robbing anyone I think we’re just moving it ahead on the scale. My theme for tonight for 35
both of our items is the streets are for the people. This is going to be a huge street improvement 36
for the people, for the business. You visit any other small city in California and across this 37
country that has done a project like this and it has made a huge difference. Next time that this 38
project comes before us I’d like to see not Transportation reasons for doing it from the Comp 39
Plan, but things from our Complete Streets and sitting places and the Land Use Element or 40
sustainability policies that really underscore the importance of doing projects like this. 41
42
I support 2A. I think that I would ask you to look at perhaps even lowering these lights down 43
from 25 feet and I wanted to comment on Commissioner Tanaka’s question about the amount of 44
wattage or that when the lights are lowered you’re not comparing apples with apples anymore. 45
That you’re going to get substantially better light from even 25 feet and I think 22 feet might be 46
even better and closer to a better lighting situation for the pedestrians using California Avenue. 47
48
19
I want to thank staff, thank our consultant. Great job. I like the plan and personally I support it 1
going forward. Thank you. Let’s take about a 10 minute break. Oh yes, let’s close the public 2
hearing and thank you all for coming tonight. About a 10 minute break. 3
4
Commission Action: No Commission action, directed staff to pursue lighting. 5