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2012-11-19 City Council Agenda Packet
CITY OF PALO ALTO CITY COUNCIL Special Meeting Council Conference Room November 19, 2012 5:00 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 November 19, 2012 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. Call to Order Closed Session Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker. 1. CONFERENCE WITH LABOR NEGOTIATORS City Designated Representatives: City Manager and his designees pursuant to Merit System Rules and Regulations (James Keene, Pamela Antil, Lalo Perez, Joe Saccio, Kathryn Shen, Sandra Blanch, Marcie Scott, Darrell Murray, Val Fong) Employee Organization: Utilities Management and Professional Association of Palo Alto (UMPAPA) Authority: Government Code Section 54957.6(a) Study Session 2. Potential Topics of Discussion for the Joint Study Session with the Palo Alto Youth Council COUNCIL CHAMBERS Special Orders of the Day 3. Resolution of the Council Honoring Former Council Member Ellen Fletcher City Manager Comments Oral Communications 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 November 19, 2012 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. Consent Calendar Items will be voted on in one motion unless removed from the calendar by two Council Members. 4. Approval of a Naming Recognition Plan for Designated Play Zones at the Magical Bridge Playground for Individuals or Businesses that Contribute at Least $200,000 per Zone 5. Approval of an Extension of the Term of Contract with SAIC Energy, Environment & Infrastructure, LLC to August 28, 2013 6. Approval of Contract with Sandis Engineers in an Amount Not to Exceed $110,000 for Parking Garage Feasibility and Attendant Parking Study in Downtown Palo Alto 7. Adoption of Resolution of Intent to Fix the Employer's Contribution Under the Public Employee's Medical and Hospital Care Act with Respect to Members of the Palo Alto Police Officers Association and Rescinding Resolution No. 8896 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. Action Items Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 8. Public Hearing: Consider Extending through December 29, 2013 a Moratorium on the Use of Certain Parking Exemptions contained in Section 18.52.060(c) of of the Zoning Ordinance Related to the Downtown and California Avenue Parking Assessment Areas; and Considerations for Making Exceptions from the Moratorium for Proposed Projects at 135 Hamilton Avenue and 636 Waverley Street 9. Adoption of Budget Amendment Ordinance and Approval of a Loan Request from Palo Alto Housing Corporation in the Amount of $3,220,220 for the Acquisition of 567-595 Maybell Avenue and 3 November 19, 2012 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. Provide Direction to Staff to Extend a $2.6 Million Short Term Loan (continued from November 13, 2012) 10. Recommendation of the Parks and Recreation Commission Concerning Amendment of Section 22.04.180 of Chapter 24.04 of Title 22 [Park And Recreation Building Use And Regulations] of the Palo Alto Municipal Code and Amendment of Park and Open Space Regulations R1-4, R1-5a, R1-5b, and R1-10b to Impose Time Use Limitations on Sound Amplification Equipment at Lytton Plaza. 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. 4 November 19, 2012 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 Cancellation Policy & Services Committee Meeting Schedule of Meetings Schedule of Meetings from the City Clerk Tentative Agenda Tentative Agenda from the City Clerk Informational Report Boards and Commissions Recruitment Consolidated Annual Performance and Evaluation Report (CAPER) for the Community Development Block Grant (CDBG) Program for Fiscal Year 2012 Public Letters to Council Set 1 City of Palo Alto (ID # 3308) City Council Staff Report Report Type: Study SessionMeeting Date: 11/19/2012 Summary Title: Joint Study Session with Youth Council Title: Potential Topics of Discussion for the Joint Study Session with the Palo Alto Youth Council From: City Manager Lead Department: Community Services Potential Topics of Discussion for the Joint Study Session with the Palo Alto Youth Council, scheduled for November 19, 2012 at 6:00 PM: 1) Introductions of Youth Council members and liaisons 2) 2012-2013 Priorities 3) Questions/Discussion Prepared By: Erin Perez, Administrative Assistant Department Head: Greg Betts, Director, Community Services City Manager Approval: ____________________________________ James Keene, City Manager CITY OF PALO ALTO OFFICE OF THE CITY CLERK November 19, 2012 The Honorable City Council Palo Alto, California Resolution of the Council Honoring Former Council Member Ellen Fletcher The Resolution will be distributed at places on Monday, November 19, 2012. ATTACHMENTS: Public Comment (PDF) Department Head: Donna Grider, City Clerk Page 2 Gonsalves. Ronna From: Sent: To: Cc: Subject: Joseph Kott <joekottiii@gmail.com> Friday, November 09, 2012 1:09 PM Council, City; Planning Commission \ 2NOV \ 3 PI~ 12: 05 Keene, James; Emslie, Steve; Williams, Curtis; Antil, Pamela; Rodriguez, Jaime; Sartor, Mike; Durham, Kathy Ellen Fletcher Dear Mayor, City Council, and Planning and Transportation Commission, I have been saddened about the news of the death of former Council Member and Vice Mayor Ellen Fletcher. Ellen Fletcher was a thoughtful, enlightened, and inspirational civic leader in Palo Alto for many years. Ellen was far ahead of her time in advocating decades ago for the bicycle mode of transportation. All across America, from Palo Alto and Davis to Manhattan and many places in between, Ellen's vision of the emergence of bicycling as a clean, healthy, quiet, and efficient alternative to the automobile has become a reality. I was so moved last year when she bicycled across town here in Palo Alto to attend my PhD award celebration. Ellen's passing is a great loss for the Palo Alto community. God bless her lovely soul. My deep sympathies go out to her family and many, many friends. I urge Palo Alto's civic leaders to honor the courageous, pioneering work of Ellen Fletcher by securing national and international distinction for Palo Alto in safe, convenient, and comfortable bicycling facilities for Palo Altans of all ages. Best regards, Joe Joseph Kott, PhD, AICP, PTP Palo Alto Chief Transportation Official, 1999-2005 268 Mosher Way, Palo Alto 94304 13 Gonsalves. Ronna From: Sent: To: Subject: rdevincenzi@akrealty.com Saturday, November 10, 2012 1:55 PM Council, City; Planning Commission An Ellen Fletcher Recognition Dear Mayor, City Council, and Planning and Transportation Commission, -'T j During the time she served in elected office, former Council Member and Vice Mayor Ellen Fletcher was a liaison from City Council to CAADA (California Avenue Area Development Association). Ellen was a valuable asset to the business district then, and even after she left elected leadership. Over these many years, Ellen continued to share her thoughts with me, when I was CAADA President, about how cars and bicyclists could best share the road. I personally asked Ellen for her thoughts, when the two lane configuration was being discussed by the CAADA Board of Directors, and was later adopted and supported by the city 7years ago, as part of the "Cal Ave Streetscape Concept Plan". At the last Cal Ave Concept Plan meeting (Thurs. 11/8 at Lucie SternL it was mentioned by attendees that to have a specific route available for bicyclists to use within the business district would be ideal. This is a request to City Council and to Planning & Transportation, to please consider extending the Bryant Street Bike Boulevard, named in Ellen's honor in 2002, to connect with a comparable bike route within the California Avenue Corridor. A thoughtful and useful bike route in the Cal Ave district would be a fitting tribute to Ellen, and it would be an asset for all of Palo Alto, and a benefit to visitors coming to Palo Alto from the greater community. Thank you. Best regards, Ronna Devincenzi, CAADA President 1989-2010 P. O. Box 60583 Palo Alto, CA 94306 650-688-6295 10 City of Palo Alto (ID # 3286) City Council Staff Report Report Type: Consent Calendar Meeting Date: 11/19/2012 Summary Title: Naming Recognitions for Magical Bridge Playground Title: Approval of a Naming Recognition Plan for Designated Play Zones at the Magical Bridge Playground for Individuals or Businesses that Contribute at Least $200,000 per Zone From: City Manager Lead Department: Community Services Recommendation Staff recommends that the Council approve the attached naming recognition plan for designated play zones at the proposed Magical Bridge Playground pursuant to Section 3 of City Policy and Procedures 1-15, Naming City-Owned Land and Facilities (Attachment A). Background The City of Palo Alto, in collaboration with the community-based non-profit group The Friends of the Magical Bridge LLC (Friends), formed a partnership to design and build a playground inclusive of all user groups in the community. Beginning in 2008, the Friends of the Magical Bridge requested assistance from the City of Palo Alto to identify a location and aid in the design and installation process of such a playground. Using an undeveloped portion of the park near Abilities United and AchieveKids at the south end of the park adjacent to Charleston Road the quarter- acre Magical Bridge playground will not only provide a vibrant selection of play, discovery and imagination-inspiring components, but will also be an inviting place where all children – regardless of abilities or limitations – can come together to play and socialize without physical and social barriers. This month, the Friends launched a capital campaign to engage the community in an effort to raise $3,000,000 by end of this year to make this dream a reality. To support the fundraising campaign, City staff proposes to offer naming opportunities for the 15 designated play zones in the park to donors who contribute a minimum of $200,000 per zone. As required by Policy and Procedures 1-15 (Naming City-Owned Land and Facilities), staff is bringing this plan forward to the Council for its approval. Discussion On April 12, 2008, the Council approved revisions to the City’s policy on naming city-owned land and facilities to accommodate naming opportunities associated with significant donations to capital campaigns that raise funds for the acquisition, construction or renovation of City facilities. Prior to these revisions, the policy granted to the City Manager, subject to the final approval of the City Council, approval of naming places within City-owned land or facilities, such as rooms in a building or fields in a park. In order to simplify the approval process, the City’s naming policy was revised with the addition of Section 3- “Procedure for Offering Naming Recognition for Significant Donations to Capital Fundraising Campaigns.” As stated in the policy: “This section applies to any organized fundraising initiated by the City, a Board/Commission or other group whose sole purpose is to support City programs and operations in support of the renovation/expansion of an existing building, the construction of a new facility, the acquisition of a building/land, or the furnishings, fixtures and equipment in said facilities.” To comply with the requirements for the Council’s approval of offering naming recognition for major donations to the Magical Bridge Playground, a detailed schedule of naming opportunities (Attachment B) for the 15 designated play zones (Attachment C) is provided for those donors contributing $200,000 or more. A donor plaque will be placed in the park acknowledging zone sponsors and other major contributors. Resource Impact On July 18, 2011, Council approved a Letter of Intent with the Friends of the Magical Bridge wherein the City would comit an amount towards the project not to exceed $300,000 for design, permitting and public outreach expenses. The Friends are responsible for raising all necessary funds for the construction of the playground, initially estimated at $1,300,000. Costs for the design, fabrication and installation of donor recognition plaques (estimated to cost $6,150) would be a part of the expenses borne by the Friends. Similarly, all fundraising costs necessary to solicit sponsorships for the named zones is the obligation of the Friends. The naming of the zones has no direct financial impact to the City. Policy Implications Approval of this recommendation is consistent with the City’s naming policy for City-owned land and facilities. Environmental Review The recommendation in this report does not constitute a project requiring environmental review under the California Environmental Quality Act (CEQA). Attachments: Attachment A - Park Naming Policy (PDF) Attachment B - Donor Breakdown (DOCX) Attachment C - Designated Play Zones Diagram (JPG) Prepared By: Erin Perez, Administrative Assistant Department Head: Greg Betts, Director, Community Services City Manager Approval: ____________________________________ James Keene, City Manager POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 1 of 8 NAMING CITY-OWNED LAND AND FACILITIES POLICY STATEMENT The purpose of this policy is to ensure that City-owned land and facilities, when named for individuals, are persons who have made significant contributions or performed services deemed to have been of major importance to the community. This policy establishes uniform procedures for the naming of City-owned land and facilities as set forth by Council Resolution No. 6211, approved on December 12, 1983, and revised by Council on April 12, 2004. The policy is applicable to new and existing City-owned land and facilities. The policy provides a mechanism for citizens to suggest names which they believe should be considered for new City facilities or land acquisitions and for the renaming of existing facilities and lands. The policy also establishes criteria which will guide the Historical Association and the appropriate City Commission or Committee in recommending names to the Council for approval. Naming and renaming City-owned land and facilities shall be the responsibility of the City Council. However, places within City-owned land or facilities, such as a room or patio within a building or a trail or athletic field within a park, which do not require formal dedication by the City Council, may be named by the City Manager or his/her designee, subject to final approval by the City Council via the consent calendar. This process does not apply to the naming of streets which will continue to be processed through the Planning and Community Environment Department (Policy and Procedure 1-16: Naming of City Streets). The naming of a street may be considered an appropriate alternative means of honoring an individual. The City Council has determined that significant individual, family or foundation contributions to the construction/renovation of City facilities can be recognized through the naming of said facilities after these groups. This document outlines the procedure to be followed when a fund- raising group or board, with the approval of the City Council, embarks upon a capital campaign for the purpose of securing private funds for the acquisition of land, renovation/expansion of an existing building, or the construction of a new facility, and wishes to offer naming opportunities in recognition of significant donations of money or land. The City Council has determined that significant contributions from corporations or corporate foundations to capital campaigns will not be accepted in exchange for the ability to name entire facilities in recognition of these corporate entities. However, the City Council has agreed to allow naming recognition of corporate or commercial entities in facility interiors or on sub-facilities as described in this policy. Business logos associated with any benefactor seeking naming rights shall not be allowed on any City owned land, facility, building or sub-facility under this policy. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 2 of 8 The City may remove any business name from a City facility or property if the business declares bankruptcy and goes out of business. The City may remove any individual name from a City facility or property if the person is convicted of a felony or other crime of moral turpitude. If a name is removed under this provision, the City shall not be required to return the donation. SECTION 1: PROCEDURE FOR NAMING NEW FACILITIES OR CITY-OWNED LANDS In cases involving a major capital fundraising campaign, there will be a separate and different procedure from the one outlined below. Section 3 below on “Naming Recognition for Capital Campaigns” further outlines this process. A. Responsibility of the Project Manager Implementation of this policy is the responsibility of the department in which the project to be named is managed. In the instance of a new City-owned land or facility, the project manager should incorporate the process for naming into the project schedule so the naming is accomplished in a timely manner. 1. Requests concerning a name to be given to the City-owned land or facility shall be made in writing on an approved suggestion form to the City Clerk. a. The project manager should alert the City Clerk when to expect the submission of names and the anticipated time frame for the naming process. b. The project manager may submit suggested names on an approved suggestion form on behalf of staff or citizens who have been involved in the project development. c. In some instances, it may be appropriate to actively solicit suggestions and, in those cases, the project manager should specify a time frame for submissions and method of notification. d. All submittals, whether from an individual or an organization, must include the name and address of the submitter. No anonymous submittals will be accepted. e. All suggestions will be given the same consideration without regard to the nomination source. 2. The project manager is responsible for conveying the name suggestion forms from the City Clerk to the Palo Alto Historical Association and presenting the recommendations from the Historical Association to the appropriate commission or committee whose sphere of influence is most closely associated with the facility in question. The Parks and Recreation Commission shall review name suggestions for acquired land to be dedicated as a park, recreational facilities, community centers and interpretive centers. The Library POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 3 of 8 Advisory Commission shall review name suggestions for library facilities. The Public Art Commission shall review name suggestions for art facilities. The Policy and Services Committee shall review name suggestions for police, fire or utility facilities as well as major civic complexes. a. The Historical Association may also originate suggestions for names or provide suggestions for appropriate alternatives as part of its recommendations. b. The project manager shall assure that adequate time is allowed for the Historical Association and the appropriate commission or committee to evaluate the recommended names. c. The Historical Association shall determine if the suggested names meet the criteria of appropriate significance, and shall submit the recommendations to the appropriate commission or committee together with the rationale for the recommendations. The response from the Historical Association shall acknowledge all the names that are submitted, but recommend only those which it feels meet the criteria and warrant serious consideration. B. Responsibility of the Reviewing Commission Or Committee 1. The commission or committee shall conduct a public hearing, confirm that the recommended names meet the criteria of appropriate significance, select recommendation(s) provided by the Historical Association, and shall forward its recommendation to the City Council. The report from the commission or committee shall acknowledge all of the recommended names together with their evaluation, but present only the name(s) which it feels best meets the criteria and merits serious consideration by the City Council. 2. Once approved, a transmittal and resolution will be prepared by staff for consideration and approval by the City Council. The transmittal shall include a narrative of historic reference prepared by the Palo Alto Historical Association for the name, a copy of the name suggestion form, and minutes of the Commission meeting when the recommendation was discussed. C. Criteria The following criteria shall be used in selecting an appropriate name for City-owned land and facilities. 1. The name should, if possible, have or preserve the geographic, environmental (relating to natural or physical features), historic or landmark connotation of particular significance to the area in which the land or facility is located, or for the City as a whole. Either connotation is equally valid. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 4 of 8 2. Acknowledgement of contributions: Consideration may be given to naming the City- owned land or facility after an individual when the land or facility, or the money for its purchase, has been donated by the individual, or when otherwise warranted by some contribution or service which is deemed to be of major and lasting significance to the acquisition of that piece of land, or planning, development, construction or renovation of that particular facility. Donation of land or resources shall not constitute an obligation by the City to name the land or facility or any portion thereof, after an individual, family, or individual/family foundation. City-owned lands, parks, or entire facilities shall not be named for benefactor organizations, groups or businesses, but in special cases, may be considered for sub-facilities such as rooms or playgrounds. In cases involving a major capital fundraising campaign, see Section 3 below – Naming Recognition for Capital Campaigns. 3. Names honoring individuals or families, other than those of recognized historic importance, must be supported by compelling reasons. 4. In the event the City-owned land or facility was formerly school property or had other ownership such that the name of the school, building or site has community significance or community recognition, consideration may be given to preserving that name. 5. The City encourages naming which reflects the City’s ethnic and cultural diversity. 6. No City-owned land or facility shall be named after a seated elected or appointed official. 7. No City-owned land or facility shall be named after a person whose contribution to the City of Palo Alto was or is a part of that individual’s normal duties as an employee of the City. An exception may be made for former such employees who have contributed volunteer services of an exceptional nature beyond their normal duties. 8. When naming sub-facilities or interior spaces, such as rooms or playgrounds, after corporate or commercial entities or foundations, these entities must abide by the City’s anti-discrimination policy. D. Council Action 1. The recommendations received from the Historical Association and the commission or committee shall be placed on the Council agenda for final approval. 2. Action by the Council shall be by Council Resolution. E. Follow-up to Selection of the Name 1. The above-described process for selecting an appropriate name should precede the preparation of a park dedication ordinance. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 5 of 8 2. Subsequent to approval by the City Council, the name for the City-owned land or facility shall be conveyed to the Department of Public Works for incorporation in City official maps and plans, and to the Palo Alto Historical Association for its records. F. Naming Places Within City-owned Land or Facilities In the case of places within City-owned land or facilities, where the policy does not require a Council resolution, responsibility for requesting Council approval of the new name shall reside with the department head who manages the land or facility. Ideally, the naming of features within a park and specific trails or facilities within open space lands will occur during the master plan or site plan process. Names within parks should be appropriate to the park by reflecting the expression of the place (topography, geology, natural features), flora and fauna, or history of the area. In advance of the naming, the department head shall send a memorandum to the City Manager advising of the proposed action and requesting approval. The City Manager will then seek approval of the name from the City Council via the consent calendar. SECTION 2: PROCEDURE FOR RENAMING EXISTING FACILITIES OR CITY- OWNED LANDS Existing place names are deemed to have historic recognition. City policy is not to change the name of any existing facilities or City-owned land, particularly one whose name has City or regional significance, unless there are compelling reasons to do so. Further, the City will consider renaming to commemorate a person or persons only when the person or persons have made major, overriding contributions to the City and whose distinctions are as yet unrecognized. A. Renaming Suggestions 1. All requests concerning a new name to be given to the City-owned land or facility shall be made in writing on an approved suggestion form to the City Clerk. The suggestion must detail how the proposed name change is consistent with the criteria, the purpose of the name change, and how the new name is directly associated with the land or facility. 2. All submittals, whether from an individual, organization or City staff, must include the name and address or the submitter. No anonymous submittals will be accepted. 3. The City Council shall initiate the renaming process by referral of the public or staff request to the commission or committee whose sphere of influence is most closely associated with the facility in question. Council can also initiate the renaming of lands or a facility without a public request whenever deemed necessary or in the best interest of the City of Palo Alto, following established criteria. Once the referral is made by the City POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 6 of 8 Council to a specific commission or committee, the commission or committee will await comment and evaluation of the new name from the Palo Alto Historical Association. B. Responsibility of the Project Manager 1. The City Clerk is responsible for conveying the name suggestion form(s) received by the deadline to the Project Manager, who will be responsible for forwarding to the Palo Alto Historical Association and then transmitting the recommendation(s) from the Palo Alto Historical Association to the appropriate commission or committee as outlined in Section A above. 2. The recognized neighborhood association in the vicinity of the land or facility will be notified of the proposed name change at the time the reviewing commission or committee receives the report from the Historical Association. C. Responsibility of the Reviewing Commission Or Committee 1. The commission or committee shall conduct a public hearing, confirm that the suggested name(s) meet the criteria of appropriate significance, select recommendation(s) from the names provided by the Historical Association, and shall forward its recommendation to the City Council. The report from the commission or committee shall acknowledge any recommended names together with its evaluation, but present only the name or names which it feels best meets the criteria and merits serious consideration by the Council. 2. Once approved, a transmittal and resolution will be prepared by staff for consideration and approval by the City Council. The transmittal shall include a narrative of historic reference for the name or names, together with a copy of the name suggestion form. D. Criteria Each application for renaming a city park or facility must meet the criteria in this policy, but meeting all criteria does not ensure renaming. City-owned lands and facilities may be renamed for an individual(s) under the following conditions. Where the individual: 1. Has made lasting and significant contributions to the protection of natural or cultural resources of the City of Palo Alto, or 2. Has made substantial contributions to the betterment of a specific facility or park, consistent with the established standards for the facility, or 3. Has made substantial contributions to the advancement of commensurate types of recreational opportunities within the City of Palo Alto. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 7 of 8 E. Council Action 1. The recommendations received from the Palo Alto Historical Association and commission or committee shall be submitted for Council approval. 2. Action by the Council shall be by Council Resolution. F. Follow-up to Selection of Name 1. Subsequent to approval by the City Council, the new name for the City-owned land or facility shall be conveyed to the Department of Public Works for incorporation in City official maps and plans, and to the Palo Alto Historical Association for its records. NOTE: Questions and/or clarification of this policy should be directed to the City Manager's Office. SECTION 3: PROCEDURE FOR OFFERING NAMING RECOGNITION FOR SIGNIFICANT DONATIONS TO CAPITAL FUNDRAISING CAMPAIGNS This section applies to any organized fundraising initiated by the City, a Board/Commission or other group whose sole purpose is to support City programs and operations in support of the renovation/expansion of an existing building, the construction of a new facility, the acquisition of a building/land, or the furnishings, fixtures and equipment in said facilities. A. Responsibility of the staff liaison to the Board, Commission, Task Force or group conducting the Capital Campaign Implementation of this policy is the responsibility of department in which the project to be acquired/constructed/renovated is managed. A staff liaison appointed to work with the board/committee will guide them through the process and manage appropriate contacts with other departments as necessary during the acquisition, design and construction process. This will ensure that appropriate information and materials are provided to the group and that opportunities and expectations are clear, understandable, and feasible within the framework of the project. B. When a Capital Campaign is initiated by the City, a Commission or other group whose sole purpose is to support City programs and operations, accommodations to the procedures outlined in Sections 1 and 2 shall be made as follows: a. The organizing body may meet and discuss preliminary plans with the City’s liaison, Department Head and the City Attorney’s office in order to facilitate any “silent” fundraising period. b. The organizing body shall request authorization from the City Council for a Naming Recognition Plan in support of a specific project. They shall provide the following information in their request: POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 8 of 8 i. Name of the organizing body; ii. Purpose of the campaign; iii. Monetary goal of the campaign; iv. Expected term of the campaign; v. Plan for naming recognition including a schedule of naming opportunities and associated gift levels vi. Maintenance/replacement of naming recognition items – City staff shall work with the organizing body to ensure that the plan includes acknowledgement of the maintenance responsibilities associated with any naming recognition items within the facility. c. Once the Naming Recognition Schedule has been approved by the City Council, the fund-raising body shall have the authority to proceed with making commitments for naming opportunities with potential donors subject to final Council review. d. The naming of a facility or sub-facility will not occur until the pledged donation is received. e. Consistent with the Gifts to the City policy, all gifts paid directly to the City shall be duly reported to the Administrative Services Department (ASD) Director and recognized appropriately in accordance with that policy (Policies and Procedures 1-18). If a donation was given anonymously, the donor’s identity shall be protected to the extent possible. f. Under this procedure, the organizing body must present a final report to the City Council for approval, detailing the funds received and any naming opportunities granted, along with a timeline for the completion of the recognition. The group may also come to the Council at any time during the capital campaign for approval of one or more naming recognition items. All naming recognition must be adopted by resolution of the City Council. The City Manager or designee can also request that any donations and associated naming recognitions be brought to the City Council at an earlier point in the capital campaign for approval. C. The one exception to this procedure shall be for the naming of an entire building as recognition for a significant monetary or land contribution. If a fund-raising group secures a donation significant enough to warrant naming the entire facility in recognition of that individual, family or foundation, this should be presented directly to the City Council for approval separately and as soon as possible after this type of donation is secured. As part of this approval process, the Council may solicit input from the Palo Alto Historical Association or the appropriate board/commission. Consistent with the policy statement, the City will not recognize significant corporate donations by naming an entire facility in honor of these entities. D. In cases of major building reconfigurations or disasters that destroy or damage portions of the building, the City reserves the right to remove and not replace naming recognitions. However, the City will consider the original donation intent in these instances and make accommodations as feasible. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 1 of 3 APPLICATION FOR NAMING OR RENAMING CITY-OWNED LANDS OR FACILITIES Naming objectives: 1. Ensure that parks, recreational areas and facilities are easily identified and located. 2. Ensure that names designated for parks, recreational areas and facilities are consistent with the values and character of the area or neighborhood served. 3. Encourage public participation in the naming, renaming and dedication of parks, recreation areas and facilities. 4. Encourage the donation of land, funds for land acquisition or development by individuals and groups. Criteria for naming new facilities or parks: The following criteria shall be used in selecting an appropriate name for City-owned land and facilities. 1. The name shall have or preserve the geographic, environmental (relating to natural or physical features), historic or landmark connotation of particular significance to the area in which the land or facility is located, or for the City as a whole. Either connotation is equally valid. 2. Consideration may be given to naming the City-owned land or facility after an individual when the land or facility, or the money for its purchase, has been donated by the individual, or when otherwise warranted by some contribution or service which is deemed to be of major and lasting significance to the acquisition of that piece of land, or planning, development, construction or renovation of that particular facility. Donation of land or resources shall not constitute an obligation by the City to name the land or facility or any portion thereof, after an individual or family. City-owned lands or parks shall not be named for benefactor organizations, groups or businesses, but in special cases, may be considered for sub- facilities such as rooms or playgrounds. 3. Names honoring individuals or families, other than those of recognized historic importance, must be supported by compelling reasons. 4. In the event the City-owned land or facility was formerly school property or had other ownership such that the name of the school, building or site has community significance or community recognition, consideration may be given to preserving that name. 5. The City encourages naming which reflects the City’s ethnic and cultural diversity. 6. No City-owned land or facility shall be named after a seated elected or appointed official. 7. No City-owned land or facility shall be named after a person whose contribution to the City of Palo Alto was or is a part of that individual’s normal duties as an employee of the City. An exception may be made for former such employees who have contributed volunteer services of an exceptional nature beyond their normal duties. 8. When naming sub-facilities, such as rooms or playgrounds, after corporate or commercial entities or foundations, these entities must abide by the City’s anti-discrimination policy. POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 2 of 3 Criteria for renaming existing facilities of parks: Each application for renaming a city park or facility must meet the criteria listed above, but meeting all criteria does not ensure renaming. Existing place names are deemed to have historic recognition. City policy is not to change the name of any existing facilities or City-owned land, particularly one whose name has City or regional significance, unless there are compelling reasons to do so. Further, the City will consider renaming to commemorate a person or persons only when the person or persons have made major, overriding contributions to the City and whose distinctions are as yet unrecognized. City-owned lands and facilities may be renamed for an individual(s) under the following conditions. Where the individual: 1. Has made lasting and significant contributions to the protection of natural or cultural resources of the City of Palo Alto, or 2. Has made substantial contributions to the betterment of a specific facility or park, consistent with the established standards for the facility, or 3. Has made substantial contributions to the advancement of commensurate types of recreational opportunities within the City of Palo Alto. Suggestions for naming or renaming City-owned lands or facilities shall be evaluated on the basis of the above criteria and upon appropriate documentation. Person making the name suggestion (required): Address (required):_____________________________________________________________ Contact phone number (required):_________________________________________________ E-mail (not required):___________________________________________________________ Location of site or facility to be named:_____________________________________________ Suggested name (required):_______________________________________________________ Biographical information: (Explain) ________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Civic involvement: (Explain) ______________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ POLICY AND PROCEDURES 1-15/MGR Revised: April 2008 Page 3 of 3 ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Connection to the facility: (Please explain in depth) ____________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Reason for Nomination (required): _________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Additional Comments (additional information may be attached): _________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Date Received by the City Clerk: ____________________________________ Submitted to Palo Alto Historical Association: _________________________ Date scheduled for review by commission: ____________________________ Magical Bridge Playground City of Palo Alto, California Cost Breakdown for Donor Funding 1. Magical Bridge 2. Elevated Tree Walk a. Entry Feature b. Talk tubes c. Binoculars d. 2 Story Playhouse e. Sway Walk 3. Bike Path a. (10) Bike Racks 4. Entry Plaza a. Main Park Entrance Feature & Gate b. Interactive Sculpture/Focal Point Feature c. Interactive Entry Sound Feature d. Donor Wall 5. Play Mound a. Roller Slide b. Waterfall Slide c. Twist Slide d. Group Slide e. Custom Loop Climbers f. Interactive Climber (light or sound) g. Custom Net Climber w/Climbing Wall h. Music roller walk (on elevated walk) i. (2) Interactive bridge panels (on elevated walk) j. (3) Benches 6. Spinning Zone #1 a. Entry Feature b. Retreat Cocoon c. Accessible Merry-Go-Round d. Overhead Spinner e. Custom Seating Shelter 7. Spinning Zone #2 a. Entry Feature b. Group Spinner c. Nest Spinner d. Spinner Dish e. (2) Benches 8. Tot zone a. Entry Feature b. Imagination Stage c. Custom Tactile Wall d. Voice Repeat Feature e. (2) Spinner Bowls f. Interactive Climber (light or sound) g. Custom Spaghetti Climbers h. Sound Spring Rider i. Double Slide j. Retreat Cocoon k. Tot Hammock l. Tot Swings m. Interactive Art Feature n. (1) Multi Generational Exercise Equipment Piece o. (1) Bench 9. Music & Interactive Zone a. Whisper Dishes b. Bells c. Dance Chimes d. Metallophones e. Chimes f. Drums g. Custom Interactive Maze h. Custom Padded Cylinders (Hug Machine) i. Custom Wheelchair Physics Zone 10. Picnic & Performance a. (2) Picnic Tables b. (4) Benches c. Playhouse Stage 11. Nature & Exploration a. Water Feature b. Willow Walk c. (2) Small Play Huts d. (1) Large Play Hut e. (4) Interactive Nature Panels f. (2) Multi Generational Exercise Equipment Pieces g. Manipulation Table h. Chalk Wall 12. Swinging & Swaying a. Entry Feature (up to 4) b. School Age Swings c. Group Swings d. Sway Fun e. Custom Seating Shelter f. (1) Multi Generational Exercise Equipment Pieces City of Palo Alto (ID # 3304) City Council Staff Report Report Type: Consent Calendar Meeting Date: 11/19/2012 City of Palo Alto Page 1 Summary Title: Extend Term of Utilities Organizational Assessment Contract Title: Approval of an Extension of the Term of Contract with SAIC Energy, Environment & Infrastructure, LLC to August 28, 2013 From: City Manager Lead Department: Administrative Services Recommendation Staff recommends that the Council approve and authorize the City Manager or his designee to execute Amendment Number Two to Contract C12141152 with SAIC Energy, Environment & Infrastructure, LLC to extend the contract term a second time by nine (9) months (to August 28, 2013), with no increase in compensation, to allow the vendor to complete the agreed-upon scope of work. (See Attachment A: Amendment Number One to Contract C12141152.) Background and Discussion The Council, as part of the FY 2012 Budget discussion, asked the City Manager to retain a firm with expertise in conducting organizational assessments of municipal utility operations. The City issued a formal Request for Proposals (RFP) in fall 2011. Seven firms responded to the RFP, and SAIC was selected by staff and recommended as the lowest responsible bidder, with the Council granting its approval on February 6, 2012. (See Attachment B: CMR #2421.) Discussion The original contract term was to expire on May 28, 2012. The term was extended to November 28, 2012 with no increase in compensation. The vendor produced its draft final report on July 24, 2012. However, staff identified several significant issues with the report that will require further discussion and review, which SAIC agreed to address. That work is still in process, and staff wants to ensure that the consultant will be afforded adequate time in order for the final product to be completed and presented for discussion. City of Palo Alto Page 2 Resource Impact No additional funding is needed at this time. Policy Implications Approval of the agreement is consistent with existing City policies. Environmental Review These services do not constitute a project for the purposes of the California Environmental Quality Act. Attachments: Attachment A: Amendment Number 1 to Contract Number C12141152 (PDF) Attachment B: CMR #2421 (PDF) AMENDMENT NO. 2 TO CONTRACT NO. C12141152 BETWEEN THE CITY OF PALO ALTO AND SAIC ENERGY, ENVIRONMENT & INFRASTRUCTURE, LLC This Amendment No. 2 to Contract No. C12141152 (“Contract”) is entered into November 19, 2012 by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SAIC ENERGY, ENVIRONMENT & INFRASTRUCTURE, LLC (SAIC), a Delaware Corporation, authorized to do business in the State of California, located at 1000 Broadway, Oakland, California 94607 (“CONSULTANT”). R E C I T A L S: WHEREAS, the Contract was entered into between the parties for the provision of an organizational assessment of the CITY’S Utilities Department; and WHEREAS, the parties wish to amend the Contract; NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree: SECTION 1. Section 2 is hereby amended to read as follows: “SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through 08/28/2013 unless terminated earlier pursuant to Section 19 of this Agreement.” SECTION 2. Except as herein modified, all other provisions of the Contract, including any exhibits and subsequent amendments thereto, shall remain in full force and effect. 1 Revision July 25, 2012 2 Revision July 25, 2012 IN WITNESS WHEREOF, the parties have by their duly authorized representatives executed this Amendment on the date first above written. CITY OF PALO ALTO ____________________________ City Manager APPROVED AS TO FORM: _____________________________ Senior Asst. City Attorney SAIC ENERGY, ENVIRONMENT & INFRASTRUCTURE, LLC By:___________________________ Name:_________________________ Title:________________________ City of Palo Alto (ID # 2421) City Council Staff Report Report Type: Consent Calendar Meeting Date: 2/6/2012 February 06, 2012 Page 1 of 5 (ID # 2421) Summary Title: Utilities Organizational Assessment Contract Title: Approval of an agreement for Professional Services with SAIC Energy, Environment & Infrastructure, LLC in the amount of Two Hundred and Twenty Five Thousand dollars ($225,000) for an Organizational Assessment of the Palo Alto Utilities Department From: City Manager Lead Department: Administrative Services Recommendation Staff recommends that the City Council authorize the City Manager to execute a contract for professional services with SAIC Energy, Environment & Infrastructure, LLC in the amount of Two-Hundred and Twenty Five Thousand dollars ($225,000) to complete an organizational assessment of the Utilities Department. Executive Summary The City Council as part of the FY12 budget discussion asked the City Manager to move forward with a plan to retain a firm with expertise in conducting organizational assessments of municipal utility operations. The City issued a formal Request for Proposals (RFP) for this work in the fall of 2011. Seven firms responded to the RFP. After review of the written RFP responses and personal interviews with the finalist firms, SAIC was selected to do the work. Two SAIC innovations they proposed included: 1. A Cultural Assessment Tool. SAIC plans to quantify and measure the existing CPAU culture to determine how the culture is supporting or hindering organizational performance and achievement of strategic initiatives. This work will be essential to developing a practical plan leading to potential attainable improvements in CPAU operations. 2. A Workload Forecasting Tool. SAIC has also developed a forecasting tool to provide a quantitative assessment of staffing requirements. The tool looks at both capital and operating budget-based projects and estimates the labor hours required by task, subtask, project and function. Each project and function is assigned a priority based on a multi-objective function that considers safety, reliability, customer service, regulatory compliance and cost minimization as objectives. The tool then provides a quantitative assessment of the workload and resources to help managers align the work with February 06, 2012 Page 2 of 5 (ID # 2421) available resources. Background and Discussion Solicitation and Evaluation Process Development of the Request for Proposals (RFP) began in the summer 2011. As part of this process the decision was made that the evaluation criteria weighted value would be 90% qualitative and 10% cost. The Request for Proposals (RFP) for these services was issued September 16, 2011. As part of the outreach, sixteen perspective proposers were sent a copy of the RFP. Additionally, the RFP was posted on the City Web Site. Furthermore, a Pre-Proposal Solicitation Conference was held October 5, 2011 to explain the RFP and answer questions submitted by potential proposers regarding the RFP. On November 7, 2011 the RFP closed. Seven proposers responded. These firms were: First Quartile, Moss Adams LLP, PA Consulting Group LLC, SAIC, Nexant, Matrix and Capgemini Consulting. The range of proposal prices submitted was between: $95,000-$516,120. The evaluation committee was comprised of members from the City Manager’s Office, Planning and Community Environment, Utilities and ASD. After reviewing the seven proposals the committee decided to invite four proposers for interviews: First Quartile, Moss Adams LLP, PA Consulting Group LLC, SAIC. After completion of the interviews the evaluation committee unanimously decided to recommend to the City Manager that SAIC be awarded a contract to perform the work. The last major external organizational assessment of the City of Palo Alto Utilities Department (CPAU) was done in November of 1996. This assessment was done by a firm called TB&J which has since been purchased by a larger firm in the same line of work. The City has also completed such studies in the past including an organizational review of paramedic billings and collections and a separate report was done evaluating all city operations. Both of these reports were done in 1994. Since that time, there have been many changes to CPAU’s operations and services to the community. For example, one significant change has been the emergence of sustainability measures due to the passage of AB32 and SB375 in California. CPAU is the largest City department. It operates five enterprise funds in which rates and charges support the services provided as well as the infrastructure maintained and operated by CPAU. In each budget cycle CPAU presents information on suggested rates and charges, recommended capital improvement plans, and operational data. An independent and comprehensive review of CPAU will be conducted, including administration, customer support services, resource management, engineering, and operations. The report will analyze and review how the department is organized, and how the department is performing in terms of providing highly efficient and effective utility services to the community. The purpose for undertaking an organizational assessment is twofold. The first is to review the services CPAU provides to determine optimal staffing levels. The second is to evaluate the current and potential future trends in the utilities industry (electric, gas, water, wastewater collection, fiber), to ensure that CPAU is appropriately positioned to meet those challenges. For example, is CPAU positioned correctly to be appropriately innovative and February 06, 2012 Page 3 of 5 (ID # 2421) effectively and efficiently use state-of-the art technology applications to serve its customers? Should CPAU take full advantage of emerging and new technologies on the horizon and at what cost? What level of leadership should CPAU take as compared to its peers in the area of environmental sustainability and green technologies, and at what cost? The organizational assessment will review current CPAU services and determine how to best deliver required services to customers in the most fiscally responsible way. How it relates to strategic plan The CPAU 2011 strategic plan approved by the City Council will be one of several source documents that will be used by SAIC to perform the CPAU organizational analysis work. Driving the recent completion by CPAU of a new strategic plan was the need for an update since the last plan was completed in 2005. Deliverables A report listing current CPAU services, organizational structure, and services desired by the community Recommendations on the optimal utilities services provision model Report outlining external regulatory and business environment Report outlining future trends and technologies expected to influence the provision of utilities services in the next 5-10 years Assessment of skills required to meet current and future utilities business needs Recommendations on the organizational changes desired to optimally meet the needs of the current and future utility business and the customer service environment Report outlining the current cost of service delivery by function or service Benchmark results comparing CPAU to organizations providing similar services Report providing a comparison of customer satisfaction for CPAU versus similar organizations Recommendations for the adequacy of current staffing and the use of internal versus external service delivery mechanisms Report listing alternative service delivery mechanisms, services that should be discontinued, and services that should be added Recommendations on the optimal service delivery mechanism for the delivery of each service identified The final report will include recommendations on the: 1) set of services that are valued by the community; 2) key features of the external environment that will the influence organizational structure and the delivery of services; 3) appropriate staffing and use of external resources and services; 4) the best way to provide each service; 5) organizational changes needed to support the provision of the recommended services; and 6) a plan to implement the organizational changes over the next three years. The final report will include: An executive summary of key findings February 06, 2012 Page 4 of 5 (ID # 2421) A comprehensive analysis of CPAU’s current effectiveness and efficiency in the delivery of services Recommendations on areas where efficiency and effectiveness can be improved. The report will also identify recommendations in order of priority and consider: Alternative staffing strategies Alternative or modified service delivery methods including, the costs and benefits of privatization options and alternatives Alternative organizational structures and functional relationships within the department, and possible changes to this structure and with third party organizations; and Alternative or modified work methods and protocols Recommendations on changes to the organizational structure to enhance the cost effectiveness and quality of service delivery in the future will analyze: Steps needed to implement the organizational structure Options for phasing in the recommendation Costs for implementation Staffing and additional resources required to implement the changes Changes required in existing policy Impacts to existing employees The recommendations including recommended actions will be ranked by priority, include a resource plan needed to execute (e.g., staff, budget, outside resources), identified success criteria, a workplan and schedule, issues identification and policy implications. Once completed, the report will be presented to the City Manager, the UAC and the City Council for review and action. Based on City Council policy direction, staff will implement the plan recommendations. Timeline and Resource Impacts It is anticipated this work will take approximately four to five months to complete following contract award. Thus, we are anticipating the report will be available in May/June of this year. The Utilities Department (UTL) had budgeted $100,000 in their FY12 budget previously approved by the City Council. The project cost is $225,000. The UTL’s Department will augment the original $100,000 with another $50,000 in current savings in their budget and request the remaining balance of $75,000 in the FY12 Mid-Year budget adjustment. Attachments: Attachment A: Introduction to SAIC, the Project Consultant (PDF) Attachment B: Palo Alto City Council Slides January 2012 (PDF) February 06, 2012 Page 5 of 5 (ID # 2421) Prepared By: Rob Braulik, Director of Office of Management and Budget Department Head: Lalo Perez, Director City Manager Approval: ____________________________________ James Keene, City Manager 120118 dm 6051671 1 CITY OF PALO ALTO CONTRACT NO. C141152 AGREEMENT BETWEEN THE CITY OF PALO AND SAIC ENERGY, ENVIRONMENT AND INFRASTRUCTURE, LLC FOR PROFESSIONAL SERVICES This Agreement is entered into on this 23rd day of January, 2012, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SAIC ENERGY, ENVIRONMENT & INFRASTRUCUTRE, LLC (SAIC), located at 1000 Broadway, Oakland, CA 94607 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to conduct an organizational assessment of the City’s Utilities Department (“Project”) and desires to engage a consultant to perform this assessment 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 completion of the services in accordance with the Schedule of Performance attached as Exhibit “B” unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT 120118 dm 6051671 2 shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. 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 and Five Thousand Eight Hundred and Eighty-Eight Dollars ($205,888). In the event Additional Services are authorized, the total compensation for services and reimbursable expenses shall not exceed Nineteen Thousand One Hundred and Twelve Dollars ($19,112). The applicable rates and schedule of payment are set out in Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described in Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C-1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City 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. 120118 dm 6051671 3 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. 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. 120118 dm 6051671 4 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. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Thomas Jensen as the Project Lead 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. The City’s project manager is Rob Braulik, City Managers Office, Telephone:650-329-2512. 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, provided, however, that CONSULTANT shall retain ownership of its intellectual property including the procedures, processes, internal resources, tools and other means used by CONSULTANT to prepare the work product. 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, except the intellectual property, described above, which CONSULTANT used to prepare the work products, 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 with three (3) business days notice, 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. 120118 dm 6051671 5 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. 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 by blanket endorsement 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 by blanket endorsement under such policies as required above. 18.3. A Memorandum of Insurance (MOI) evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The MOI will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage. If the insurance is canceled or materially reduced in coverage or limits by the insurer, the CONSULTANT shall provide the Purchasing Manager seventy-five (75) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the 120118 dm 6051671 6 insurance without providing prior notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that the current MOI 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 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. 120118 dm 6051671 7 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, 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. 120118 dm 6051671 8 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 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. 120118 dm 6051671 9 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. // // // // // 120118 dm 6051671 EXHIBIT “A” SCOPE OF SERVICES Project Title: Palo Alto Utilities Department Organizational Assessment Description of Project: An independent and comprehensive review of the CPAU will be conducted, including administration, customer support services, resource management, engineering, and operations. The report will analyze and review how the department is organized, and how the department is performing in terms of providing highly efficient and effective utility services to the community. The purpose for undertaking an organizational assessment is twofold. The first is to review the services CPAU provides to determine optimal staffing levels. The second is to evaluate the current trends and challenges in the utilities industry (electric, gas, water, wastewater collection, fiber), and in the future to ensure that the CPAU is appropriately positioned to meet those challenges. For example, is CPAU positioned correctly to be appropriately innovative and effectively and efficiently use state-of-the art technology applications to serve its customers? Should CPAU take full advantage of emerging and new technologies on the horizon and at what cost? What level of leadership should CPAU take as compared to its peers in the area of environmental sustainability and green technologies, and at what cost? The organizational assessment will review current CPAU services, and determine how to best deliver required services to customers in the most fiscally responsible way. Some key questions the assessment will answer include the following: • What are the services the CPAU currently provides to the community? • What are the current CPAU efficiencies and inefficiencies? • Are the services currently delivered valued by customers? • What services do customers want that are not currently being offered? • What functions does the CPAU provide that, in other cities, are funded by the General Fund? • What services are provided to the utility from the City’s General Fund? • Is current staffing optimal to support current services? If additional services were desired what additional resources would be needed to deliver them? • How do the services delivered by the CPAU and staffing levels in place to deliver the services, compare to other organizations of similar size providing similar services? Staff expects that industry accepted benchmarks would be provided to quantify the response to this question. • Which services should be provided internally versus externally? For example, are there services the Northern California Power Agency (NCPA) could provide that would save the City money? What services provided to CPAU by the General Fund should be provided internally versus externally? • Are there opportunities to hire external expertise (e.g., construction, engineering, maintenance) that could save money? There should be a discussion on the advantages and disadvantages of various alternative service delivery methods and costs. 120118 dm 6051671 Project Organization and Startup: Immediately upon receiving authorization to proceed, CONSULTANT will meet with City management and the Project team to kick off the CPAU Organizational Assessment. CONSULTANT will facilitate this one to two-day meeting and prepare a working record of matters discussed and decisions made by the group. The City and CONSULTANT teams will establish all critical components to a successful engagement during the kick off meetings. These components include: • Any revisions to the project scope presented in CONSULTANT’s proposal document. • An appropriate “screening” process to prioritize scope and issues described in sufficient detail to allow CPAU project management to direct CONSULTANT’s efforts at the most critical subjects or topics. Although CONSULTANT’s assessment will be fully objective, some further definition of the areas for investigation will be necessary to insure the most cost effective application of CONSULTANT’s assessment. • Final fee estimate. • Roles and responsibilities, and communication and reporting protocols. • Time commitments and other resource requirements from City staff. • Discussion and understanding of CONSULTANT’s initial Request for Information. CONSULTANT’s request, provided prior to the kick-off meetings, will specify particular types of information and documents that are relevant to the goals of the initiative and the specific requirements of the work plan. Scheduled dates for on-site visits and personnel interviews, status meetings (or conference calls) with CPAU and City staff, delivery of interim memoranda of findings, draft Final Report, Final Report, and presentations. Deliverables: Written record of kick-off meeting discussions and decisions on project components, and revisions to CONSULTANT’s proposed work plan as necessary. 120118 dm 6051671 Task 1A: Assess community needs, current organizational structure, and evaluate service delivery. The purpose of the current situation analysis is to review current CPAU services and determine how to best deliver required services to customers in the most cost-effective way. The CONSULTANT team will develop a more in-depth understanding of CPAU’s current services, the utility’s approach to organizational design, and what services are valued and expected by customers. CPAU has recently completed a strategic plan and associated business plans. The CONSULTANT team will pay particular attention to the details of these plans to determine the appropriateness of the organization’s structure to support the defined strategic initiatives and the delivery of current and potential new services. CONSULTANT’S analysis will identify current services provided by CPAU to customers and the community and how these are structurally organized. It is our understanding the CPAU delivers electric, natural gas, water and wastewater, and fiber optic services to a community with a population of approximately 65,408. Our assessment will also extend to include support services provided by CPAU such as engineering design, resource planning and procurement, construction and contract management, system maintenance and operations, customer support and billing, energy and water efficiency services, and services provided to CPAU by the General Fund. Our assessment will rely on information provided by CPAU and we will also conduct interviews with key CPAU management and staff personnel, as identified in Step 1. The organizational assessment will focus on how CPAU is structurally organized and performing to provide the previously mentioned services and will examine the pertinent interfaces within the utilities department to effectively deliver these services to customers. The review will include the assessment of: • Engineering • Operations • Customer Support Services • Resource Management • Utilities Administration CONSULTANT will also assess customer satisfaction with the current services CPAU provides and whether there is a desire and a need for additional services. CONSULTANT will rely on customer satisfaction surveys and any additional information CPAU will provide. Consultant will: • Identify CPAU services and how those services are organized. • Identify all services provided to CPAU by the General Fund. • Identify utilities services the community needs and values (e.g. reliable and safe delivery of water, gas, electricity, and wastewater collection services, assistance for efficient use of resources, fiber to the home). 120118 dm 6051671 • Evaluate CPAU organizational structure, functional responsibilities, and alignment for delivering efficient and effective utility services. • Determine the best way to deliver CPAU services and how the organization might change to provide those services. • Evaluate services to the CPAU by the General Fund, including an evaluation of alternatives with costs and benefits identified. Deliverables: • Report listing current CPAU services, organizational structure, and services desired by the community. • Assessment of whether CPAU current service delivery approaches support its strategic and business plan. • Draft recommendations on the optimal utilities services provision. Task 1B: Assess the external environment in which the CPAU operates, and evaluate work accomplished to date to respond to future trends in service delivery. Whereas Task 1A focused on CPAU’s current relationship with its customers, the objective of Task 1B is to understand the business and political environment in which CPAU currently operates and identify future demands that will impact this environment, including regulatory requirements, new programs, technologies, and services evolving in the utility industry. The result of this task is an evaluation of CPAU’s capability to excel given anticipated future demands on the utilities department. CONSULTANT will rely on the industry knowledge and expertise of its project team to identify current regulatory requirements that may impact CPAU. Additional research will also be conducted to create a complete and detailed list that compiles the regulatory requirements identified and describes the potential impact to CPAU. CONSULTANT’s team also includes professionals very knowledgeable and up-to-date on the latest trends, technologies, programs and services developing in the utility industry. CONSULTANT will bring this expertise to CPAU’s project to identify and evaluate future trends, and assess what value CPAU may gain from early response to these trends such as adoption of emerging technologies or programs. To guide this task, CONSULTANT will develop an assessment protocol that will list the specific research questions we will address and the metrics we will use. We will identify the information sources that these questions and specific metrics will be applied to. CONSULTANT’s review will heavily rely on the evaluation of any material and information provided by CPAU regarding regulatory requirements and future trends. 120118 dm 6051671 Additionally, an evaluation of CPAU’s culture will be conducted to understand the values and behaviors that exist within CPAU. Understanding the organization’s culture is critical in developing recommendations that will lead to attainable improvements. CONSULTANT suggests the application of Cultural Transformation Tools® (CTT), trademarked by Barrett Values Center, to conduct such a cultural assessment. This assessment tool will measure how open and flexible CPAU’s culture is to organizational change. Consultant will: • Assess the current regulatory environment. Evaluate the adequacy of the CPAU to fulfill and meet these requirements. Provide a list of current regulatory requirements, with current and recommended staffing levels. • Identify the trends that are developing in the utility industry, and the skills needed to support these trends. Determine how the organization needs to change to support future trends in utilities services and future service delivery requirements. • Evaluate programs, technologies, and services that are expected to be part of future utility services. Provide a matrix on future programs, technologies, and services including an estimate of when these services might be implemented. • Evaluate the adequacy of the current organization to support these future services. Identify deficiencies and make recommendations on organizational changes required to meet future needs. • Evaluate the flexibility of the CPAU culture to change, and make recommendations on change management strategies to implement organizational changes. • Assess what skills will be required to meet indentified future needs. Compare the skills required with current Staff credentials. Make recommendations on rectifying deficiencies through the use of internal and external resources. For internal resources, assess the competitiveness of City compensation to attract qualified personnel. Deliverables: • Prepare a report t comparing the current and future regulatory and potential impact to the CPAU organization . • Prepare a reportt outlining future trends and technologies expected to influence the provision of utilities services in the next 5-10 years. • Provide a matrix assessment of skills required to meet current and future utilities business needs. • Draft recommendations on the organizational changes desired to optimally meet the needs of the current and future utility business and the customer service environment. Task 1C: Determine the cost to deliver services provided by the CPAU, and compare CPAU’s cost to deliver services to other similar agencies. The CONSULTANT team will determine and evaluate the cost for CPAU to deliver current services, including operating and capital improvement expense. A comparative benchmarking 120118 dm 6051671 assessment will be conducted with similar utility organizations. CONSULTANT will confer with CPAU to define the criteria for selecting other utilities. Criteria may include: • Number of retail customers • Customer mix (by utility type) • Total sales volume • Geographic location • Services provided Following establishment of criteria, CONSULTANT will produce a list with a maximum of 10 similar utility organizations to benchmark. Additionally, service delivery costs will be compared against industry best practices, when readily available. Publicly available sources of information may include industry associations such as the American Public Power Association, American Water Works Association, and publications such as the Platts UDI Directory of Electric Power Producers and Distributors. Cost parameters, staff numbers and capabilities, compensation levels, organizational structures, and customer satisfaction indices from other similar utility organizations will be compared to those at CPAU. CONSULTANT will establish a list of corporate and tactical performance measures for this benchmarking effort. Corporate measures will evaluate the status and well-being of CPAU: • Financial and operating ratios • Customer service measures • Reserved funds and fund transfers • Tactical measures will evaluate the performance of the utility organization: • Capital, operation and maintenance cost levels and structure • Retail pricing levels and practices • System reliability and efficiency • Customer service and satisfaction The list of measures will be finalized after (1) consulting with Management and the Project Management team (2) assessing CPAU’s strategic plan and associated business initiatives, and (3) reviewing the availability of target data and practice descriptions. Written descriptions will be produced for each measurement parameter and the list of measures will be provided to Management and the Project Management Team for review. CONSULTANT anticipates that the data that will be used to conduct this benchmarking assessment will be obtained from CONSULTANT’s database, industry information that is readily available, and documentation provided by CPAU. This Task will result in the evaluation of the efficiency of CPAU’s service delivery when compared to costs and associated service delivery practices found at other similar utilities. Consultant will: • Analyze the cost of delivery for each service currently provided, including operating and capital improvement costs. • Benchmark, and analyze results, on the cost of providing services to other similar agencies (and, if available, industry standards). 120118 dm 6051671 • Evaluate the efficiency of the CPAU service delivery, and compare the efficiency of the service delivery to other agencies. • Determine staffing levels and compensation levels, and compare the levels to similar organizations delivering similar services. • Compare customer satisfaction survey results to other similar agencies. • Provide recommendations on the adequacy of current staffing levels. • Provide recommendations on the use of internal versus external service delivery. Deliverables: • Prepare a report outlining the current cost of service delivery by function or service. • Benchmark results comparing CPAU to organizations providing similar services regarding service delivery costs, organizational structures to support the delivery of such services, staffing levels and capabilities, customer satisifaction indices • Draft recommendations for the adequacy of current staffing and the use of internal versus external service delivery mechanisms. Task 1D: Identify and evaluate alternative service delivery methods. The CONSULTANT team will explore potential alternative service delivery methods. This will include services recommended to be added, discontinued, modified or performed by third parties. CONSULTANT’s recommendations will include cost impact to CPAU. Using the findings of the organizational assessment and the comparative analysis conducted in previous steps and the Consultant doing the following: • Identifing and analyzing alternative ways to deliver utilities services, and identifying services that should be discontinued. services not currently provided, and potential alternatives for the provision of those services.and • Determining the cost for each alternative service delivery method, and provide a list of the pros and cons of the current method and each alternative delivery method identified and. • Making recommendations on the best way to provide each service identified, including an analysis of potential privatization/outsourcing options. The CONSULTANT team will work closely with management and the project team to agree on candidate areas for alternative service delivery methodology. This discussion will result in identification of a list of services to be added, discontinued and/or modified. The CONSULTANT team will evaluate CPAU’s adequacy and ability to effectively and efficiently provide these alternative service delivery methods. The current structure, staffing and staff skill sets will be evaluated as to capability to support alternative service delivery methods. The CONSULTANT team will determine estimated cost increases or cost savings for each recommended alternative. Leveraging findings from previous steps the CONSULTANT team will conduct additional primary and secondary research to estimate the costs associated with implementing recommendations for alternative service delivery methods and mechanisms. 120118 dm 6051671 The CONSULTANT will also evaluate the Pros and Cons for Each Alternative Service Delivery Method based on earlier work done. The CONSULTANT team will aggregate potential benefits, challenges, risks and issues that may arise as a result of implementing any of the recommendations for alternative service delivery. This will require a meeting between the CONSULTANT team and management and the project team to facilitate a thorough dialogue around the impacts of each proposed recommended change in service delivery. Once the pros and cons are fully understood and agreed upon by both parties, a final set of potential alternative service delivery methods will be produced succinctly presenting the advantages and disadvantages for each alternative service delivery method. A summary report that includes findings outlined in memoranda submitted in Tasks 3A and 3B along with a high-level qualitative and quantitative evaluation of the advantages and disadvantages for each alternative service delivery method. Deliverables: • A report listing potential alternative service delivery mechanisms and service devlivery methods covering services that could be be discontinued, modified or performed by outside agencies.. Report would also includeoptimal service delivery mechanism for the delivery of each service identified. • A report outlining the cost impact of each alternative service delivery method. • A summary report that includes findings outlined in memoranda submitted in earlier tasks along with qualitative and quantitative evaluation of the advantages and disadvantages for each alternative service delivery method. Task 1E: Organizational Options and Staffing Levels The CONSULTANT team will draw on findings from all previous steps of the work plan to describe alternative organizational options for CPAU. Included will be alternative staffing levels and staffing mix. We will also describe alternative ways for CPAU to receive services currently provided from the General Fund. All changes presented will be focused on reducing costs, improving service delivery effectiveness and/or improving customer satisfaction. CONSULTANT will also provide an Implementation Plan addressing all of CONSULTANT’s recommended actions. The Implementation Plan will show prioritization and timeline for recommendations, costs to implement, any identified staffing changes, and any needed policy or procedural changes. At completion of this step CONSULTANT will deliver a Draft Final Report for City’s review. In this task, the CONSULTANT team will use the list of potential alternative service delivery methods developed in previous steps. Findings from all previous work plan steps will guide the CONSULTANT team in arriving at the final recommendations. During this final selection of alternatives, the CONSULTANT team will meet with management and the project team to explain the logic behind the team’s selections. Included will be staffing levels and skill sets for each recommended structure. If the CONSULTANT team can clearly demonstrate a service can be more cost effectively delivered by a third party, a recommendation will be made to that effect. All changes presented will be focused on reducing costs, improving service delivery effectiveness and/or improving customer satisfaction. 120118 dm 6051671 Alternatives to Services Provided from the General Fund. This component of the task examines those services provided to CPAU that are funded by the City’s General Fund. The CONSULTANT team will determine the services in question and how these services impact CPAU’s from an operational and financial basis. CONSULTANT will then review and analyze alternatives. These alternatives could include different methods as to how the services can be funded, such as funded from utility revenues. Other alternatives could be to discontinue the service, or more cost-effectively obtain the same service from a third party. Implementation Plan, CONSULTANT will develop an Implementation Plan addressing all of CONSULTANT’s recommended actions regarding alternative service delivery methods and CPAU’s organizational structure. The Implementation Plan will show prioritization and timeline for recommendations, costs to implement, staffing changes, potential roles and responsibilities and identification of needed policy or procedural changes. Considerable dialogue with management and the project team will be necessary to formulate the Implementation Plan. The activities of the Implementation plan must be carefully integrated and coordinated all other CPAU initiatives planned or underway, and CONSULTANT will coordinate with management and the project team. Deliverables: • Draft Final Report, including the following recommendations: 1) set of services that are valued by the community; 2) key features of the external environment that will influence organizational structure and the delivery of services; 3) appropriate staffing and use of external resources and services; 4) the best way to provide each service; 5) organizational changes needed to support the provision of the recommended services; and 6) a plan to implement the organizational changes over the next three years. Project Deliverables and Final Project Report A. The Final Report will include: • An executive summary of key findings; • A comprehensive analysis of the CPAU’s current effectiveness and efficiency in the delivery of services • Recommendations on areas where efficiency and effectiveness can be improved. The report should identify recommendations in order of priority and should consider: • Alternative staffing strategies; • Alternative or modified service delivery methods including, the costs and benefits of privatization options and alternatives; • Alternative organizational structure and functional relationships within the department, and possible changes to this structure and with third party organizations; and • Alternative or modified work methods and protocols. • Recommendations on changes to the organizational structure to enhance the cost effectiveness and quality of service delivery in the future. Recommendation should analyze: 120118 dm 6051671 • Steps needed to implement the organizational structure; • Options for phasing in the recommendation; • Costs for implementation; • Staffing and additional resources required to implement the changes; • Changes required in existing policy; • Impacts to existing employees. B. Execution of plan and strategy. The plan will consider and address anticipated policy issues, challenges, and phasing recommendations. C. Provide a comprehensive set of recommendations for recommended actions ranked by priority, resource plan needed to execute (e.g., staff, budget, outside resources), success criteria, workplan and schedule, and issues and policy implications. D. Presentation of the Final Report and findings to the City Manager, Utilities Advisory Commission, and the City Council. Meetings that are incorporated into the project budget in include: 2 City Council meetings, 1 Finance Committee meeting, 1 Utilities Advisory Committee meeting and 1 meeting with the City Manager. 120118 dm 6051671 EXHIBIT “B” SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services so as to complete each milestone within dates specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed. • Due Date for Task 1A Deliverables: Completed by April 2. • Due Date for Task 1B Deliverables: Completed by May 2. • Date for Task 1C Deliverables: Completed by May 2. • Date for Task 1D Deliverables: Completed by May 28. • Date for Task 1E Deliverables: Completed by May 28. 16 120118 dm 6051671 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services described in Exhibit “A” (“Services”) and reimbursable expenses shall not exceed $205,888. CONSULTANT agrees to complete all Services, including reimbursable expenses, within this amount. In the event CITY authorizes any Additional Services, the maximum compensation shall not exceed $225,000. 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. REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost. All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $500 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. 120118 dm 6051671 EXHIBIT C-1 HOURLY RATE SCHEDULE Scope Labor Categories Est. Hours Hourly Rate Extended Rate Step 1 - Project Organization and Startup Sr. Consultant 1 16 $290.00 $4,640.00 Sr. Consultant 2 16 $285.00 $4,560.00 Sr. Consultant 3 16 $205.00 $3,280.00 Sr. Consultant 4 16 $170.00 $2,720.00 Travel and Living Expenses $5,060.00 Not to Exceed, Step 1 $20,260.00 Step 2 - Current Situation Analysis Sr. Consultant 1 8 $290.00 $2,320.00 Sr. Consultant 2 16 $285.00 $4,560.00 Sr. Consultant 3 16 $205.00 $3,280.00 Sr. Consultant 4 16 $170.00 $2,720.00 Sr. Consultant 5 4 $208.00 $832.00 Sr. Consultant 6 4 $250.00 $1,000.00 Sr. Consultant 7 4 $250.00 $1,000.00 Consultant 0 $0.00 Task 2A - Community Needs, Current Organizational Structure, and Service Delivery (CPAU RFP Task 1A) Consultant 0 $0.00 Travel and Living Expenses $1,500.00 Subtotal, Task 2A $17,212.00 Sr. Consultant 1 8 $290.00 $2,320.00 Sr. Consultant 2 24 $285.00 $6,840.00 Sr. Consultant 3 16 $205.00 $3,280.00 Sr. Consultant 4 8 $170.00 $1,360.00 Sr. Consultant 5 8 $208.00 $1,664.00 Sr. Consultant 6 8 $250.00 $2,000.00 Sr. Consultant 7 8 $250.00 $2,000.00 Consultant 1 4 $170.00 $680.00 Task 2B - External Environment and Future Trends (CPAU RFP Task 1B) Consultant 2 8 $141.00 $1,128.00 Travel and Living Expenses $4,180.00 Subtotal, Task 2B $25,452.00 Sr. Consultant 1 0 $290.00 $0.00 Sr. Consultant 2 8 $285.00 $2,280.00 Sr. Consultant 3 16 $205.00 $3,280.00 Sr. Consultant 4 8 $170.00 $1,360.00 Sr. Consultant 5 8 $208.00 $1,664.00 Sr. Consultant 6 8 $250.00 $2,000.00 Sr. Consultant 7 8 $250.00 $2,000.00 Consultant 1 32 $170.00 $5,440.00 Task 2C - Cost to Deliver Services and Cost Comparisons (CPAU RFP Task 1C) Consultant 2 0 $141.00 $0.00 Travel and Living Expenses $500.00 Subtotal, Task 2C $18,524.00 Not to Exceed, Tasks 2A–2C $61,188.00 120118 dm 6051671 Scope Labor Categories Est. Hours Hourly Rate Extended Rate Step 3 - Alternative Service Delivery Methods Sr. Consultant 1 4 $290.00 $1,160.00 Sr. Consultant 2 16 $285.00 $4,560.00 Sr. Consultant 3 8 $205.00 $1,640.00 Sr. Consultant 4 16 $170.00 $2,720.00 Sr. Consultant 5 8 $208.00 $1,664.00 Sr. Consultant 6 8 $250.00 $2,000.00 Sr. Consultant 7 8 $250.00 $2,000.00 Consultant 1 0 $170.00 $0.00 Task 3A - Identification of Alternative Service Delivery Methods (CPAU RFP Task 1D) Consultant 2 8 $141.00 $1,128.00 Travel and Living Expenses $2,970.00 Subtotal, Task 3A $19,842.00 Sr. Consultant 1 0 $290.00 $0.00 Sr. Consultant 2 4 $285.00 $1,140.00 Sr. Consultant 3 4 $205.00 $820.00 Sr. Consultant 4 8 $170.00 $1,360.00 Sr. Consultant 5 4 $208.00 $832.00 Sr. Consultant 6 4 $250.00 $1,000.00 Sr. Consultant 7 4 $250.00 $1,000.00 Consultant 1 28 $170.00 $4,760.00 Task 3B - Cost Impact for Alternative Service Delivery Methods (CPAU RFP Task 1D, cont.) Consultant 2 0 $141.00 $0.00 Travel and Living Expenses $1,500.00 Subtotal, Task 3B $12,412.00 Task 3C - Pros and Cons for Each Alternative Service Delivery Method (CPAU RFP Task 1D, cont.) Sr. Consultant 1 0 $290.00 $0.00 Sr. Consultant 2 16 $285.00 $4,560.00 Sr. Consultant 3 8 $205.00 $1,640.00 Sr. Consultant 4 8 $170.00 $1,360.00 Sr. Consultant 5 4 $208.00 $832.00 Sr. Consultant 6 4 $250.00 $1,000.00 Sr. Consultant 7 4 $250.00 $1,000.00 Consultant 1 0 $170.00 $0.00 Consultant 2 8 $141.00 $1,128.00 Travel and Living Expenses $500.00 Subtotal, Task 3C $12,020.00 Not to Exceed, Tasks 3A–3C $44,274.00 Step 4 - Organizational Options Sr. Consultant 1 4 $290.00 $1,160.00 Sr. Consultant 2 8 $285.00 $2,280.00 Sr. Consultant 3 8 $205.00 $1,640.00 Sr. Consultant 4 8 $170.00 $1,360.00 Sr. Consultant 5 4 $208.00 $832.00 Sr. Consultant 6 4 $250.00 $1,000.00 Sr. Consultant 7 4 $250.00 $1,000.00 Consultant 1 0 $170.00 $0.00 Task 4A - Organizational Options and Staffing Levels (CPAU RFP Task 1E) Consultant 2 0 $141.00 $0.00 Travel and Living Expenses $500.00 Subtotal, Task 4A $9,772.00 Task 4B - Alternatives to Services Sr. Consultant 1 4 $290.00 $1,160.00 120118 dm 6051671 Scope Labor Categories Est. Hours Hourly Rate Extended Rate Sr. Consultant 2 4 $285.00 $1,140.00 Sr. Consultant 3 4 $205.00 $820.00 Sr. Consultant 4 0 $170.00 $0.00 Sr. Consultant 5 0 $208.00 $0.00 Sr. Consultant 6 0 $250.00 $0.00 Sr. Consultant 7 0 $250.00 $0.00 Consultant 1 4 $170.00 $680.00 Provided from the General Fund (CPAU RFP Task 1E, cont.) Consultant 2 0 $141.00 $0.00 Travel and Living Expenses $500.00 Subtotal, Task 4B $4,300.00 Sr. Consultant 1 4 $290.00 $1,160.00 Sr. Consultant 2 4 $285.00 $1,140.00 Sr. Consultant 3 4 $205.00 $820.00 Sr. Consultant 4 0 $170.00 $0.00 Sr. Consultant 5 0 $208.00 $0.00 Sr. Consultant 6 0 $250.00 $0.00 Sr. Consultant 7 0 $250.00 $0.00 Consultant 1 4 $170.00 $680.00 Task 4C - Implementation Plan (CPAU RFP Task 1E, cont.) Consultant 2 0 $141.00 $0.00 Travel and Living Expenses $1,500.00 Subtotal, Task 4C $5,300.00 Sr. Consultant 1 8 $290.00 $2,320.00 Sr. Consultant 2 24 $285.00 $6,840.00 Sr. Consultant 3 20 $205.00 $4,100.00 Sr. Consultant 4 24 $170.00 $4,080.00 Sr. Consultant 5 8 $208.00 $1,664.00 Sr. Consultant 6 8 $250.00 $2,000.00 Sr. Consultant 7 8 $250.00 $2,000.00 Consultant 1 20 $170.00 $3,400.00 Task 4D - Draft and Final Reports (CPAU RFP Task 1E, cont.) Consultant 2 12 $141.00 $1,692.00 Travel and Living Expenses $0.00 Subtotal, Task 4D $28,096.00 Not to Exceed, Tasks 4A–4D $47,468.00 Presentations Sr. Consultant 1 16 $290.00 $4,640.00 Sr. Consultant 2 24 $285.00 $6,840.00 Sr. Consultant 3 20 $205.00 $4,100.00 Consultant 2 8 $141.00 $1,128.00 Travel and Living Expenses $4,180.00 Subtotal, Presentations $20,888.00 TOTAL NOT TO EXCEED, ALL TASKS AND PRESENTATIONS $194,078.00 Optional Tasks: Scope Labor Categories Est. Hours Hourly Rate Extended Rate Sr. Consultant 4 16 $170.00 $2,720.00 Optional Task 1 - Customer Surveys and Focus Group Meetings Consultant 1 36 $170.00 $6,120.00 Travel and Living Expenses $2,970.00 Not to exceed, Optional Task 1 $11,810.00 120118 dm 6051671 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: MINIMUM LIMITS REQUIRED TYPE OF COVERAGE REQUIREMENT EACH OCCURRENCE AGGREGATE YES 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 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 BY BLANKET ENDORSEMENT: 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 SEVENTY-FIVE DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY BLANKET 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 MEMORANDA 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. 120118 dm 6051671 B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A SEVENTY-FIVE (75) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE MAILED TO: PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 NATIONAL SECURITY • ENERGY & ENVIRONMENT • HEALTH • CYBERSECURITY © SAIC. All rights reserved. Utilities Department Organizational Assessment City of Palo Alto City Council Presentation January 2012 Agenda SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Who Is SAIC? 3 •Science Applications International Corporation (SAIC), is a FORTUNE 500® company with approximately 41,000 employees located in 450 offices worldwide, generating $11.1 billion revenue in FY 2011. •The 2009 acquisition of R. W. Beck by SAIC created a firm with an unparalleled pool of talent and resources to deliver complete integrated solutions to utilities. •Organized within SAIC’s Energy Environment & Infrastructure division, these consulting resources have more than 25 years of experience in conducting organizational assessments for various electric, water, wastewater, and natural gas utilities throughout the country. •SAIC’s local presence includes offices in Oakland, Sacramento, and San Diego. Our proposed project manager, Tom Jensen, lives and works in Oakland, while our External Environment Task Leader, Steve Rupp, is in Sacramento. In addition to our proposed project team, we have hundreds of professionals who work day-to- day with utilities. SAIC.com © SAIC. All rights reserved. Introduction to Project Team 4 Similar Engagements SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Brownsville Public Utilities Board Management & Organizational Assessment •Brownsville Public Utilities (BPUB) is a municipally owned water, wastewater & electric utility in Brownsville, TX governed by a Board of Directors with approximately 50,000 customers. •Purpose: Conduct objective assessment of the organizational structure, strategic & business planning, financial management, operations & maintenance, & overall effectiveness of the utilities. •Highlights: •Using Integrated Systems Approach the assessment resulted in over 100 recommendations related to: •Governance •Planning •Organizational structure & staffing •Financial services & rate design •Water & wastewater services •Electric services •Corporate support services 6 SAIC.com © SAIC. All rights reserved. BPUB Primary Issues & Recommendations Four Primary Issues (PI) & Recommendations (R) were given top priority in the final report •PI 1: Policies for the Board of Directors are not Established & Understood •R: Board policy statements should be developed •PI 2: BPUB does not exhibit a “Planning Culture” •R: Update Strategic Plan •R: Review items that only exceed budget, once approved by Board •R: Involve all employees in planning process •PI 3: An alternate organizational structure is needed •R: Implement proposed organizational structure to more effectively & efficiently manage core functions •PI 4: Water & wastewater utility staffing challenges may create safety issues •R: Assign additional staff to treatment plants •R: Hire/cross-train electrician to serve water & wastewater facilities •R: Hire additional licensed professional engineer to assist in project design & construction. 7 SAIC.com © SAIC. All rights reserved. Lafayette Utilities Systems Organizational Assessment •Lafayette Utilities System (LUS) is a municipally owned utility that provides water, wastewater, electric & fiber services to approximately 60,000 customers in Lafayette, LA. •SAIC has conducted various organizational assessments for LUS over the last 15 years. Examples include assessment for the Civil Engineering & the Power Production Division •Purpose: Conduct objective assessment of the organizational structure, planning culture, operations & maintenance, & overall effectiveness of the divisions. •Assessment resulted in recommendations related to: •Planning •Organizational structure & staffing •Processes 8 SAIC.com © SAIC. All rights reserved. LUS Civil Engineering Division Org Assessment Issues & Recommendations Issues (I) & Recommendations (R) found in LUS report Section 1 •I: Strategic vision & priorities should be established •R: Facilitate a strategic planning process •I: Organizational structure does not support core functions •R: Reorganize division to focus on core areas •I: Insufficient & inadequate planning tools create inefficiencies •R: Implement planning processes & tools 9 SAIC.com © SAIC. All rights reserved. LUS Power Plant Division Org Assessment Issues & Recommendations Issues (I) & Recommendations (R) found in LUS report Section 2 •I: The span of control of Superintendent is very broad •R: Reduce span of control by creating supervisory level •I: Power Plant division is not adequately staffed •R: Pay scales need to be reviewed to attract & maintain qualified personnel •I: Increased costs due to outsourcing & skilled craft augmentation contracts •R: Aggressive efforts to staff vacant positions & reduce dependency on external contractors 10 SAIC.com © SAIC. All rights reserved. Pasadena Water and Power Electric Master Plan & Staffing Analysis •Pasadena Water and Power (PWP) is municipal utility serving 55,000 electric and 33,000 water customers in Pasadena, CA. •Purpose: Conduct objective assessment of the current electrical system, including an organization and staffing analysis, to develop a comprehensive plan for the future. •Highlights: •SAIC developed a Master Plan for PWP which included organization and staffing recommendations. •SAIC developed a Workload Forecasting Tool which was provided to PWP to aid in personnel resources management. 11 SAIC.com © SAIC. All rights reserved. Fortis Turks & Caicos Islands (formerly PPC) Organizational Assessment •Fortis Turks & Caicos Islands (Fortis TCI), formerly PPC, is an investor-owned electric utility located in Providenciales, Turks & Caicos Islands with approximately 10,000 customers. •Purpose: Conduct objective assessment of the utility to determine how to improve organizational effectiveness & efficiency. •Highlights: •Using Integrated Systems Approach the assessment resulted in recommendations related to: •Strategic planning •Cultural challenges •Organizational structure & staffing •Leadership development & succession planning 12 Innovative Assessment Tools SAIC Project Team Similar Engagements Innovative Assessment Tools - A “Systems” Approach - Cultural Transformation -Workload Forecasting Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. An Approach that Looks at Organizations as “A System.” Greater value to the Utility in using a holistic view. 1414 Strategic Plan Organizational Structure & Processes Personnel Skills & Capabilities Cost Requirements & Structure Cultural Flexibility Optimize Service Delivery SAIC.com © SAIC. All rights reserved. Cultural Transformation Tool (CTT) •Understanding an organization’s current culture, and the values that drive that culture, is critical in developing plans and initiatives that will lead to attainable improvements. •The tool SAIC uses to conduct a cultural assessment is a powerful instrument that describes corporate cultures by identifying the core values that exist within each functional area of the organization. It provides a framework for understanding how the individuals, teams and organizations develop and grow and provides insight into how to align an organization’s culture. •The CTT assessment tools are based on the Seven Levels of Consciousness model. 15 SAIC.com © SAIC. All rights reserved. Seven Levels of Organizational Consciousness Positive Focus /Excessive Focus SERVICE MAKING A DIFFERENCE INTERNAL COHESION TRANSFORMATION SELF-ESTEEM RELATIONSHIP SURVIVAL SERVICE TO HUMANITY Long-term perspective. Future generations. Ethics.. DEVELOPMENT OF CORPORATE COMMUNITYPositive spirit. Creativity. Honesty. Shared vision and values. CONTINUOUS RENEWAL Innovation. Personal Growth. Teamwork.Organizational growth through employee participation. BEING THE BEST. BEST PRACTICEProductivity, efficiency, quality, systems and processes. Bureaucracy. Complacency. RELATIONSHIPS THAT SUPPORT CORPORATE NEEDSOpen communication. Customer satisfaction. Respect. Manipulation. Blame. PURSUIT OF PROFIT & SHAREHOLDER VALUEFinancial stability. Employee health and safety. Exploitation. Over-control. Level 7 Level 6 Level 3 Level 2 Level 1 Level 5 Level 4 COLLABORATION WITH CUSTOMERS & THE LOCAL COMMUNITYStrategic alliances. Employee fulfillment. Environmental awareness. 16 SAIC.com © SAIC. All rights reserved. PPC: Group (80) Level 7 Level 6 Level 5 Level 4 Level 3 Level 2 Level 1 Personal Values Current Culture Values Desired Culture Values IRS (P)= 6-4-0 | IRS (L)= 0-0-0 IROS (P)= 0-1-7-2 | IROS (L)= 0-0-0-0 IROS (P)= 2-5-6-0 | IROS (L)= 0-0-0-0 Matches PV - CC 1CC - DC 6PV - DC 5 Health Index (PL) PV: 10-0CC: 10-0DC: 13-0 1. accountability 40 4(R) 2. honesty 38 5(I) 3. commitment 27 5(I) 4. caring 23 2(R) 5. continuous learning 23 4(I) 6. ambition 21 3(I) 7. performance 21 3(I) 8. positive attitude 21 5(I) 9. respect 21 2(R) 10. reliability 20 3(R) Black Underline = PV & CC Orange = CC & DC P = Positive L = Potentially Limiting I = Individual O = Organizational Orange = PV, CC & DC Blue = PV & DC (white circle) R = Relationship S = Societal 1. community involvement 35 6(S) 2. customer satisfaction 34 2(O) 3. cost management 29 3(O) 4. safety 26 1(O) 5. continuous improvement 24 4(O) 6. accountability 18 4(R) 7. being the best 18 3(O) 8. leadership development 18 6(O) 9. long-term perspective 18 7(O) 10. making a difference 18 6(S) 1. accountability 43 4(R) 2. teamwork 36 4(R) 3. customer satisfaction 31 2(O) 4. continuous improvement 23 4(O) 5. leadership development 23 6(O) 6. open communication 22 2(R) 7. cost management 21 3(O) 8. coaching/ mentoring 20 6(R) 9. reliability 19 3(R) 10. being the best 16 3(O) 11. commitment 16 5(I) 12. continuous learning 16 4(O) 13. positive attitude 16 5(I) Values Plot Copyright 2011 Barrett Values Centre February 2011 SAIC.com © SAIC. All rights reserved. Current Strengths Key Issues Moving Forward Personal Values: •Take ownership of actions & demonstrating dedication •Building relationships based on authenticity •An upbeat & determined approach to expanding knowledge & skills to be effective •Top Value: Accountability Current Culture: •Participating in the community & having positive impact •Attention to the bottom line & creating secure work environment where employees take ownership of their actions •Being leaders in the industry •Top Value: Community Involvement •Entropy is slightly elevated at 13% •No potentially limiting values; however some issues beneath the surface may be cause for frustration: •Employees feel stifled by rigid systems/processes & lack of communication •May be working against each other at times due to lack of empowerment & uncertainty about the future •No values at Level 5: Internal Cohesion: May be a gap, covered or new area for development Personal Values to Desired Culture: •Reliability, commitment, continuous learning, positive attitude •Suggests employees desire greater sense of satisfaction & connection with their workplace Current to Desired Culture: •Accountability, customer satisfaction, continuous improvement, leadership development, cost management, being the best •Suggest employees have confidence in the direction of PPC •Values concentrated in Level 4 – Transformation – suggest desire for more energy directed to employee participation & development Desired Culture: •New values indicate that employees want to strengthen the way they work together: •Opportunities to work together & learn from each other •Take ownership of their actions •Establish high standards & principles Cultural Assessment Summary – An Example 18 SAIC.com © SAIC. All rights reserved. Cultural Assessment Recommendations – from recently completed project •Develop internal communication plan to share results of assessment. •Define the key processes & systems to focus on in the next year. Develop specific actions and programs that will foster changes. •Examine new values desired to determine meaning & associated behaviors. •Discuss how the Utility can continue to live the values carried from Current to Desired Culture. •Consider the Values Jump and determine significance. •Determine & define what values the Utility wants to espouse. 19 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool An Excel© spreadsheet based tool developed by SAIC that: •Provides a quantitative assessment of workload and staffing requirements •Allows management to understand the work that needs to get done and resources required to perform that work in the required timeframe •Allows quantification of resource needs to help solve hiring and outsourcing decisions •Includes templates for estimating resource needs for operating, maintenance and capital projects 20 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will evaluate CPAU’s existing staffing levels for field construction work, project management and engineering work to determine how time is allocated between administrative, O&M, customer projects and capital improvement projects. 21 Allocation Hours/Year Ta s k O w n e r Task Name Ti m e A l l o c a t e d Ho u r s P e r Y e a r MG T & A d m i n Op e r a t i o n s / Ma i n t e n a n c e Cu s t o m e r P r o j e c t s CI P MG T & A d m i n O& M Cu s t o m e r C a p i t a l Pr o j e c t s Ca p i t a l R e p l a c e m e n t & I m p r o v e m e n t s Chen “As Built” drawing revisions & updating 10 hrs/wk 500 30% 40% 30% 0 150 200 150 Chen Drawing for new project of underground utility district 10 hrs/wk 500 50% 50% 0 0 0 500 Chen Another work assigned 5 hr/wk 250 20% 40% 40% 0 50 100 100 Moeis Material specifications 3 hrs/day 666 100% 0 666 0 0 Moeis Material inventory 1 hr/day 222 50% 50% 0 222 0 0 Moeis Underground utility districts 2 hrs/day 444 100% 0 0 0 444 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will assist CPAU in prioritization of proposed projects to determine schedules and associated FTE requirements 22 SAIC.com © SAIC. All rights reserved. Workload Forecasting Tool, cont. •SAIC will assist CPAU in evaluating the hours currently spent to support each function compared to the hours required to meet budget projections and the impact of levelizing, expanding and/or outsourcing resources. 23 Project Timeline SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. Project Timeline 25 Conclusion & Questions SAIC Project Team Similar Engagements Innovative Assessment Tools Project Timeline Conclusion & Questions SAIC.com © SAIC. All rights reserved. 2727 Why Select SAIC? Utility Experts Innovative Approach to Organizational Assessments Experience with Multi- Service Utilities Local Presence & Knowledge To Optimize Service Delivery at the City of Palo Alto Questions City of Palo Alto (ID # 3290) City Council Staff Report Report Type: Consent Calendar Meeting Date: 11/19/2012 Summary Title: Garage Feasibility and Attendant Parking Study Contract Title: Approval of Contract with Sandis Engineers in an Amount Not to Exceed $110,000 for Parking Garage Feasibility and Attendant Parking Study in Downtown Palo Alto From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council authorize the City Manager to execute the attached contract in a total amount not to exceed $110,000 (Attachment A), with Sandis Engineers Surveyors Planners (Sandis) for a Parking Garage Feasibility and Attendant Parking Study. Executive Summary The City’s Downtown Parking Program includes identifying opportunities to both increase the Downtown parking supply and to operate the existing parking inventory to better use its capacity. After completion of a Request for Proposals (RFP) process, staff is recommending a consultant services agreement with Sandis Engineers Surveyors Planners in an amount not to exceed $110,000 for completion of a feasibility study to evaluate five surface parking lots in Downtown for potential construction of a parking garage and to compare each site against constructability factors to determine the most appropriate site(s) for construction. The feasibility study also includes an evaluation of four existing parking garages in the Downtown to determine the feasibility of using an Attendant Parking service at each site to help increase permit parking opportunities for Downtown employees. Background Several elements of the Downtown Parking Program were presented to Council on November 13, 2012, including recommendations for the evaluation of five Downtown surface parking lots for construction of a new parking garage (or garages) in efforts to help increase the parking supply. Staff also recommended studying 4 of the City’s 6 downtown parking garages for the consideration of Attendant Parking operations to help increase permit parking opportunities for Downtown employees. Only 4 existing garages were recommended for evaluation of Attendant Valet operations because 2 of the 6 garages comprise public-private partnerships that restrict parking supply for private use. Permit parking in the Downtown is a benefit to employees of businesses in the Downtown Parking Assessment District, which was formed in the 1990’s to help fund the construction of parking structures. Funds from permit sales are used to cover the operations and management responsibilities of the Downtown Parking Program. The Downtown Parking Program inventory offers 3,138 spaces over 6 parking garages and 11 surface parking lots; the inventory is divided into 1,672 permit parking spaces between the hours of 8AM and 5PM and 1,466 hourly parking spaces for Downtown visitors. The City currently sells 2,711 parking permits at any given time, approximately 62% over the permit supply, but permit demand remains steady. The City has implemented changes in the management of permit sales over the past year and has made more permits available to Downtown employees. A new online permit parking management system is scheduled to go live before the end of the year, offering Downtown employees an online wait list and credit card renewal management along with monthly renewal options compared to the current quarterly or annual options. Discussion Request for Proposals (RFP) Process The City released an RFP for the Parking Garage & Attendant Parking Feasibility Study project on August 23, 2012. Two phone-in pre-bid conferences were offered as part of the RFP process. The RFP proposal submittal deadline was extended from its original September 6, 2012 date to September 18, 2012 to allow potential bidders more time to prepare proposals. At the end of the RFP process the City did not receive any proposals. Following the RFP process, Staff outreached to two separate consulting firms with parking garage design experience to solicit bids for the project, Sandis Engineers Surveyors Planners (Sandis) and Swinerton. Swinerton opted not to submit a proposal due to limited staff resources. Sandis partnered with two subconsultants, HNA Pacific and Signature Parking, to offer the City a proposal responding to all the elements of the RFP. Parking Garage Feasibility The Parking Garage Feasibility study element will focus on evaluating the following five surface parking lots for construction of a new garage: Lot D Hamilton Avenue & Waverly Street Lot E/G Gilman Street between Hamilton Avenue and Forest Avenue Lot O High Street between Lytton Avenue and University Avenue Lot P High Street between University Avenue and Hamilton Avenue Caltrain Lot Urban Lane between University Loop and PAMF Each site will be evaluated to determine: parking garage footprints, potential parking space counts, parking garage massing, and cost estimates. The study will also include the development of constructability factors so that each site can be compared against one another to determine the most appropriate or cost-effective sites for future parking garages to be constructed. The Study will also include an evaluation of “developability” opportunities so that the City can consider public-private funding opportunities and multiple use of each site if desired. The Caltrain Lot on Urban Lane was identified as appropriate for studying for a parking garage due its proximity to the Downtown; the west side of Downtown is also the City’s highest demand permit parking area. The parking lot is currently used as overflow parking for the University Avenue Caltrain Station. Staff outreached to Caltrains/Samtrans to offer the inclusion of the parking lot for study as part of the project and the offer was accepted to help identify future development opportunities for the site to increase transit and parking opportunities. Attendant Parking Feasibility The Attendant Parking Feasibility study element will evaluate four of the City’s six Downtown parking garages to determine the feasibility of using an Attendant Parking operator to help increase permit parking opportunities. The four sites that will be evaluated include: Lot CC Civic Center Lot R Garage between University Avenue and Hamilton Avenue Lot S Bryant Street Garage Lot W/C Cowper Street-Webster Street Garage Attendant parking operations can operate in one of two ways: 1) motorists drive up to a designated spot and the attendant takes over and parks the vehicles (a “valet” service), or 2) motorists are guided by an attendant to park at a designated spot and the keys then handed to the operator, who may move the vehicle as needed for access to other parked vehicles. Both options will be evaluated. Staff estimates that such a parking arrangement may result in increases of from 10-30% of the capacity of a garage. The evaluation will include development of an Attendant Parking Program at each site, to identify where vehicles should be parked, signage program elements, and proposed hours of operation. The study will also determine the likely number of additional vehicles that can parked as part of the permit program and identify innovation strategies to better manage the garages if attendant parking is found to be an infeasible or cost-prohibitive alternative. Additional Services The project includes an Additional Services element so that consultant resources are available if necessary for additional community meetings that are not included in the tasks described above or if staff determines that there are other parking technology elements that would be helpful to study. Timeline The City anticipates the study taking up to 6 months to complete. The study results will be presented to the Palo Alto Downtown (PAD) – Parking Committee, Planning & Transportation Commission and City Council in the Spring 2013 as part of staff’s regular reporting on the City’s Parking Program. Resource Impact The Consultant Services Agreement with Sandis for the completion of the Parking Garage & Attendant Parking Study project is for $110,000; this includes $10,000 for an Additional Services element. The project will be funded initially by the City’s CIP Project PL-12000 (Transportation & Parking Improvements). The recently approved 101 Lytton/Gateway project offered the City a $60,000 community benefit contribution towards the completion of the parking study. Upon receipt of the Gateway payment or when permits for the project are issued, Project PL-12000 will be reimbursed by $60,000. The ultimate, net effect on PL-12000 from the parking study will be to reduce it by $50,000. Policy Implications The City’s Comprehensive Plan supports the implementation of this project through the following sections: Goal T-8: Attractive, Convenient Public and Private Parking Facilities Policy T-45: Provide Sufficient Parking in the University Avenue/Downtown and California Avenue Business Districts to Address Long-Range Needs Program T-53: Evaluate Options to ensure Maximum Use of the City Parking Structures in the University Avenue/Downtown and California Avenue areas. Environmental Review CEQA Guidelines section 15262 does not require environmental review for feasibility and planning studies. Environmental review may be required if and when the Council chooses to implement any options evaluated in the study. Attachments: Attachment A: Contract with Sandis Engineers (PDF) Prepared By: Jaime Rodriguez, Chief Transportation Official Department Head: Curtis Williams, Director City Manager Approval: ____________________________________ James Keene, City Manager CITY OF PALO ALTO CONTRACT NO. C13147526 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND SANDlS CIVIL ENGTh~ERSSL~VEYORSPLANNF~ FOR PROFESSIONAL SERVICES This Agreement is entered into on this day of , ("Agreement") by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("CITY"), and SAl\1)IS CIVIL ENGINEERS SURVEYORS PLANNERS, a California corporation, located at 936 E. Duane Avenue, Sunnyvale, California, 94085, Telephone Number (408) 636-0900 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement A. CITY intends to identify the location(s) for future parking garage site(s) and to determine whether the use of attendant/valet parking at existing garage(s) is a feasible alternative to help provide additional permit parking spaces for downtown patrons. ("Project") and desires to engage a consultant to develop and provide a feasibility study 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: AGREEl\'lENT 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, 2013 unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the petformance 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 timely mannet based upon the circumstances and direction communicated to the CONSULTANT. CITY's agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. C13l47526 10f22 Professional Services Rev June 2. 2010 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 of this Agreement. Additional Services, if any, shall be authorized in aecordance 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. Additiona,l 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 One Hundred Thousand Dollars ($100,000.00). In the event Additional Services are authorized, the total compensation for services and reimbursable expenses shall not exceed One Hundred Ten Thousand Dollars ($110,000.00). 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 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 hy 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, CONSULTk'-!T 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-I "). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTAl\'T'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. QUALIFICATIONSISTANDARD 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 requiren 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 Cal ifornia under the same or similar circumstances. Cl3147526 2 of 21 Professional Services Rev June 2, 2010 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. ERROR,.'l/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 CONSULT ANT has prepated 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. Ifthe 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. Consentto 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. DOption A: No Subcontractor: 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. [8JOption B: Subcontracts Authorized: Notwithstanding Section 11 above, CITY agrees that subconsultants may be used to complete the Services. The subconsultants authorized by CITY to perform work on this Project are: HNAlPacific (parking Structure Design) 78-7239 Puupele Road Kailua Kona, HI 96740 (808) 322-2250 Cl3l47526 30f22 Professional Services Rev June 2, 2010 Signature Parking (Valet! Attendant Services) 1630 North Main Street, Suite 87 Walnut Creek, CA 94596 (925) 934-7275 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 Ron Sanzo as the Project Manager, Email: rsanzor@sandis.net , Telephone: (408) 636-0900 to have supervisory responsibility for the performance, progress, and execution of the Services and 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, e-mail; jaime.rodriguez@cityofpaloalto.org.. 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. C13147526 40f22 Professional Services Rev JlUle 2, 20 I 0 ~[Option A applies to the following design professionals pursuant to Civil Code Section 2782.8: architects; landscape architects; registered professional engineers and licensed professional land surveyors.! 16.1. To the fullest extentpennitted by law, CONSULTANT shall protect, indemnify, defend and hold hannless 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 iees, experts fees, court costs and disbursements ("Claims") that arise out of, pertain to, or relate to the negligence, recklessness, 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. OIOption B applies to any consultant who does not quaIifyas a design professional as defined in Civil Code Section 2782.8.) 16.1. T o the fullest extent pennitted 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 shaH 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 ofthis Agreement, or of the provisions of any ordinance Of law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18, INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best's Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. C13147526 50f22 Professional Services Rev June 2" 2010 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution ofthis 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, CONSULT ANT 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. 1804. 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 (l0) days prior written notice thereofto 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 A. 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 of this Agreement: 14, 15, 16, 1904, 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 Cl3147526 6of22 Professional Services Rev June 2,2010 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 CONSliLTANT 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 employec 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 defmed by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure document~ required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30510, 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 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: C13l47526 • All printed materials provided by Consultant to City generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, 70fll Professional Services Rev June 2, 2010 reports, and public education materials, shall be double-sided and printed on a minimum of30% 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 Enviromnental 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 ofthe City of Palo Alto and the Palo Alto Municipal Code. This Agreement will tenninate 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, tenn, 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, tenns, 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. CI3I47526 25.7. All exhibits referred to in this Agreement and any addenda, appendices, 80f22 Professional Services Rev June 2, 2010 I . 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 incotporatcd 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 infonnation as defllled in California Civil Code section 1798.8I.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. C13!47526 90f22 Professional Services Rev June 2, 2010 EXHIBIT "A" SCOPE OF SERVICES BACKGROUND The City of Palo Alto is a partner in the Downtown Parking Assessment District with local property owners and merchants. The assessment district is responsible for managing and providing input on the parking operations to ensure the vitality of the Downtown Business District. Within the assessment district the City operates and maintains four parking garages and is partners with private development for the use of structured parking at three additional sites. As part of the assessment district, the City also owns and operates twelve additional surface parking lots in and around the Downtown, see Table 1 and Figure 1 below. Table 1 Downtown Bnsiness District Parking Facilities ~o: Name StMus Bourly ['ermit Total ~~~ Name Houri) Pel"mit Total CC Civic Center City 187 519 706 R AlmalHigh (South) City 77 134 211 SIL Bryant St City 381 307 307 WC Cowper/Webster City 201 388 589 B RamonaiUniversity Partner 63 63 Q AlmaIHigb (North) Partner 134 134 800 High Street Partner 10 53 63 Totals: 919 1,535 2,454 Figure 1 C13147526 II of22 A Emerson/Lytton C RamonalLytton D HarniltonIW averly E GilrnanlBryant F FlorencelL:;1ton G Gilrnan/Waverly H CowperiHatnillOn K LyttonlWaverly N EmersoniRamona 0 EmersoniHigh P HiglllHamilton T L)1toruKipling Totals: 63 18 32 86 34 46 53 90 15 42 48 78 51 25 25 525 186 Professional Services Rev June 2, lOW 68 50 86 34 46 53 90 57 48 78 51 50 711 The CONSULTANT shall be responsible for evaluating the use of an attendant/valet at each of the City-owned and operated parking garages to help increase parking supply as a temporary or long-term parking solution: Lot CC, Lot R, Lot SiL, and Lot W/C. As part of the parking attendant/valet study the CONSULT ANT shall be responsible for estimating the number of additional parking spaces that can be gained as part of an attendant/valet program and to determine whether the structures can physically sustain the additional loads from vehicles parked within the structure. The analysis shall identify the type of attendantlvalet program most appropriate for each parking garage, the location of attendant stations, recommended hours of operation, and after-hours key-recovery solutions for drivers whom do not return to the valet station during normal operating hours. The findings of the attendant/valet study shall be reviewed for accuracy by an experienced parking attendant operator. SCOPE OF WORK The CONSULTANT shall assist the City in determining the feasibility of constructing new parking garage(s) within the Downtown Business District and to determine the feasibility of implementation of an AttendantN alet Parking Program at one or all of the City's existing downtown parking garages, as specified by the City TASK 1: PARKING GARAGE FEASIBILITY STUDY The CONSULTANT shall be responsible for evaluating up to five existing parking lots selected by the City to determine the feasibility of each site for a new parking garage. Eaeh site will be evaluated for the following criteria: Parking Garage Footprint: Using Google maps or other appropriate mapping programs, the CONSULTANT shall provide a potential parking garage footprint onto a scaled-aerial to show the impact to adjacent alleys and private parking facilities. The footprint shall highlight the location oframps, stairwells, and elevator shafts. For Lots E & G, the consultant shall develop options that provide one structure over both lots, public roadway and two separate structures (one on each lot), Potential Parking Spaces: For each garage footprint, the CONSULTANT shall estimate the number of parking spaces that can be provided per floor based on the parking garage footprint by floor and by location. The number of recommended accessible and electric vehicle parking stations per site shall also be identified along with a typical parking floor; parking space configurations complying with City of Palo Alto design standards. Parking Garage Massing: Cl3l47526 The CONSULTANT shall prepare a 3D rendering on a Google map or other visual aid that replicates the approximate massing of the proposed parking structure on the recommended footprint 1J of22 Professional Services Rev Jun;; 2, 20 I 0 Construetability Factor: The CONSIJL TANT shall prepare a matrix that compares the constructability factors of each garsge option. The minimum number of factors that shall be evaluated includes: parking space count; private property impacts, construction staging impacts, access points (driveways on more than one street; number of driveways per street, etc.); adjacent land uses (residential vs. commercial); and utility relocation impacts. Engineer's Estimates: Based on the information developed above, the CONSULTANT shall prepare a preliminary engineer's cost estimate for each parking garage site studied as part of the project. The cost estimate shall be used to determine the cost-benefit factor of building a parking garage at each site. TASK 2: ATTENDANTN ALET -PARKING ATTENDANT STUDY The CONSULTANT shall he responsible for evaluating the use of an attendant/valet parking program at each of the City-owned and operated parking garages including Lots CC, R, S, and W/C. The City envisions a valet program where either: I) a motorists is guided to a location where they park their vehicle and turn over the keys to an attendant or 2) where a motorist leaves their vehicle/keys with an attendant at an entry point in the garage and the attendant proceeds to park the vehicle for the owner. In each case, the attendant may be required to move the car periodically throughout the day to accommodate the removal of self-parked vehicles v.ithin the garage before the attendant valet hours are in operation. Only motorists with parking permits will participate within the valet program and should be operated as "no tip" operation. The City anticipates valet operations to occur along the aisles of the garage and motorists self- parking into marked parking spaces on their own. For each site the CONSULTANT shall be responsible for the following: Attendant VaIet Program: For each site the CONSULTANT shall develop a detail that shows that location of an attendant parking program including valet station; vehicle drop off signage and marking detail; recommended hours of operation; recommended parking floors where valet parking is appropriate; articulated details shov.ing rypical parking floor in a garage with self-parked and valet-parked vehicles to demonstrate garage measurements; an after-hours key-recovery program structure for drivers whom do not arrive in time to recover their vehicle during the normal valet working hours; and annual cost of the program. Potential Parking Spaces: C13147526 The CONSULTANT shall identify the number of additional parking spaces that can be gained through the use of the attendant valet parking program. The City 14of22 Professional Services RevJune2,2010 anticipates the attendant valet program to be used only for the pennit parking areas of the existing garages. Innovation Strategies: The CONSULTANT shall provide an Independent Assessment of the operation of each of the garages being studied for attendanilvalet operations and provide recommendations including cost, to enhance operations at each facility such as access controls, monitoring additional parking spaces, tiered pennits that allow access to pennit spaces by time-of-day, cloud-based revenue collection systems, vehicle counting stations, or other solutions that Consultant identifies as potentially appropriate for improvement garage operations. The CONSULTANT shall provide an Independent Assessment of Access Gate Control to be applied as part oftrus study. The Assessment shall be used to develop a check-list of desirable features in future Access Gate Control Systems for the City. To assist the CONSULTANT in identify appropriate parking solutions, the City will make available in-house staff and equipment resources to assist the CONSULTANT in collecting vehicle count data using both tube count and manual occupancy count surveys as requested. The City shall supply seasonal occupancy count data ofhouriy versus permit parking spaces by time-of-day and shall make that data available to the CONSULTANT. TASK 3: PROJECT STUDY REPORT CONSULTANT shall assemble the results of Tasks I and II into a comprehensive feasibility report describing existing conditions, potential new garage alternatives, construetability evaluation, cost estimates, potential valet parking alternatives at existing garages, and a cost benefit analysis. CONSULTANT shall provide reduced copies of site drawings where each preliminary functional design in both 2D and 3D are placed showing the location of the site on Google maps or other appropriate mapping programs and potential impacts in the context of existing surrounding uses, streets and alleys will be included together with a matrix summarizing the results of the garage constructability evaluation. CONSULTANT shall prepare draft and final reports responding to City Staff and Transportation Commission comments. CONSULTANT shall assist and participate in the City's approval/review process by attending up to two staff level meetings and two public hearings as part of the review process, including Planning & Transportation Commission and City Council. ADDITIONAL SERVICE The City may require additional services as part of the project to assist the City in the development of its on-going parking program development additional services may include additional community meetings outside of the struetured meetings included in Task 3 or the review oftecbnology opportunities for use within existing and proposed parking structures to C13I47526 I50f22 Professional Servlces Rev June 2, 2010 help improve garages operations and efficiencies. The City and Consultant will agree in writing in Additional Tasks on scope and cost prior to the Consultant beginning work on tasks. C!3I47526 160f12 Professional Services Rev June 2, 2010 EXHIBIT "B" SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services so as to complete each milestone within the number of dayslweeks 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. Milestones 1. Task 1 -Parking Garage Feasibility Study 2. Task 2 -AttendantlValet-Parking Attendant Study 3. Task 3 -Project Study Report C13147526 17 of22 Completion No. of DayslWeeks FromNTP 12 Weeks 12 Weeks 18 Weeks Professional Services Rev June 2, 2010 EXHmIT "C" COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services perfonned in accordance with the tenns 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-I 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 $100,000.00. 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 $110,000.00. Any work perfonned 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 perfonn 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 $100,000.00 and the total compensation for Additional Services does not exceed $10,000.00. BUDGET SCHEDULE Task 1 (parking Garage Feasibility Study) Task 2 (AttendantIV alet -Parking Attendant Study) Task 3 (project Study Report) Su b-total Basic Services Reimbursable Expenses Total Basic Services and Reimbursable Expenses Additional Services Maximum Total Compensation NOT TO EXCEED AMOUNT $47,630.00 $34,160 $18,105 $99,895.00 $105.00 $100,000.00 $10,000.00 $110,000.00 REIMBURSABLE EXPENSES C13l47526 180f22 Professional Services Rev June 2, 2010 The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULT ANT shall be reimbursed are: A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto's policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost All reque:,ts for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $105.00 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 Col. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY's Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all re<juirements and restrictions in this Agreement. C13l47526 190f22 Professional Services Rev June 2, 2010 COMPANY Sandis HNAIPacific Signature Parking C13147526 EXHIBIT "C-l" HOURLY RATE SCHEDULE TITLE Senior Traffic Engineer Project Engineer CAD Technician Principal in Charge Admin Principal Graphic Designer Regional Manager 20 uf22 HOURLY RATE 155 110 95 175 55 200 110 200 Professional Services Rev June 2,2010 EXHIBIT "D" INSURANCE REQUIREMENTS COXfRACTORS TO TIlE CITY OF PALO ALTO (CITY1 AT TIlElR SOLE EXPENSE, SHALL FOR TIlE TERM OF THE CON1RACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIHED BELOW, AFFORDED BY COMPA1'<"IES WITH AM BEST'S KEY RATING OF A-:VII, OR HIGHER, l.ICENSED OR AUTHORIZED TO TRANSACT IN~ "ICE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WlTII CITY'S INSURANCE Ril9UIREMENTS AS SPECIFIED BELOW; MINH-ruM LIMITS REQUIRED TYPE OF COVERAGE f8QUIR3MENT EACri YES YES YES YES Y3S YES OCCU1<RENCE A\¥JiiEGATE WORKER'S CCMPENSATION STATIlTORY I EMPLOYER'S LIABILITY STATIlTORY BODILY INJURY $1,000.000 $1,000,000 GENERAL LIABILITY, INCLt:DING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE $1,000,000 $1,000,000 . PROPERTY DA.'dAGE BLANKET CON1RACTUAL, AND FIRE LEGAL BODILY INJURY & PROPERTY DAMAGE $1,000,000 $1,000,000 : LIABILITY COMBINED. i : BODILY INJURY : $1,000,000 $1,000,000 ! , -EACH PERSON $1,000,000 $1,000,000 : EACH OCCI.1\RENCE $1,000,000 $1,000,000 • AUTOMOBILE LIABILITY, INCLt:DING ALL OWNED. HIRED, NON-OWNED PROPERTY DAMAGE i $1,000,000 $1,000,000 $1,000,000 I BODILY INJURY AND PROPERTY $1,000,000 DAMAGE, COMBINED , PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AIm NEGLIGENT PERFORMANCE ALL DAMAGES $1000000 THE CITY OF PALO AI,TO IS TO BE NAMED AS AN ADDITIONAl, L"ISURED CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AKD MAINTAIN, IN FULL FORCE Al\l) EFFECT TIlROT;GHOUT TIlE ENTIRE TERM OF ANY RESULTANT AGREEMEI,'T, TIlE lNSURANCECOVERAGElIEREINDESCRlBED, INSURING NOT ONLY COmRACTORAAl) ITS SUBCONSULTANTS, IF A,'lY, BUT ALSO, wrrn TIlE EXCEPTION OF WORKERS' COMPENSATlON, EMPWYER'S LlABD..ITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMllERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INS~'lCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THlRTY DAY ADV A,'!CE NOTICE TO CITY OF CHA;'1GE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL I.LABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR'S AGREEMENT TO lNDEMJ>.lFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF 85,000 REQURE CITY'S PRIOR APPROVAL. II. CONTACTOR MUST SUDMIT CERTIFlCA 1ES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. m. h'NDORSEMENT PROVISIONS, v,'l1H 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 THlS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF TIIB ADDITIONAL INSUREDS. B. CROSS LIABILITY CI3I47526 210f22 Professional Services Rev Junc2, 2010 City of Palo Alto (ID # 3331) City Council Staff Report Report Type: Consent Calendar Meeting Date: 11/19/2012 City of Palo Alto Page 1 Summary Title: PEMHCA for PAPOA Title: Adoption of Resolution of Intent to Fix the Employer's Contribution Under the Public Employee's Medical and Hospital Care Act with Respect to Members of the Palo Alto Police Officers Association and Rescinding Resolution No. 8896 From: City Manager Lead Department: Human Resources Staff requests that this item, Adoption of Resolution of Intent to Fix the Employer's Contribution Under the Public Employee's Medical and Hospital Care Act with Respect to Members of the Palo Alto Police Officers Association and Rescinding Resolution No. 8896, be continued. City of Palo Alto (ID # 3291) City Council Staff Report Report Type: Action ItemsMeeting Date: 11/19/2012 City of Palo Alto Page 1 Summary Title: Parking Moratorium Extension and Exceptions Title: Public Hearing: Consider Extending through December 29, 2013 a Moratorium on the Use of Certain Parking Exemptions contained in Section 18.52.060(c) of of the Zoning Ordinance Related to the Downtown and California Avenue Parking Assessment Areas; and Considerations for Making Exceptions from the Moratorium for Proposed Projects at 135 Hamilton Avenue and 636 Waverley Street From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council: 1. Adopt the extension of the Interim Urgency Ordinance (Interim Ordinance) establishing a moratorium on the use of the Exempt Floor Area parking exemption set forth in Section 18.52.060(c) of the Palo Alto Municipal Code in connection with any permit, entitlement or development project, pending further study of Downtown and California Avenue parking issues (Attachment A), for a period of thirty (30) days through December 29, 2012; and 2. Direct staff to return prior to further extension of the ordinance with proposed language related to potential exceptions for properties at 135 Hamilton Avenue and 636 Waverley Street. Background On October 15, 2012, the Council adopted an interim “urgency” ordinance that provides for a moratorium on the use of a parking exemption for Exempt Floor Area (up to a 1.0 FAR) on a site. As further detailed in the October 15 staff report, this zoning provision has been used very City of Palo Alto Page 2 infrequently in the past and its rationale no longer applies. Further, its application to properties that have not paid into the assessment district is of some question. In accordance with State law, the moratorium was adopted on an “urgency” basis by Council with a 4/5 vote, 8-0 (Councilmember Schmid was absent). Council also directed that staff return with recommendations for criteria to identify appropriate exceptions for projects in the development review “pipeline.” The ordinance became effective immediately. State law requires that staff report back within 45 days on a procedure for review of the ordinance, at which time a public hearing would be held and the moratorium may be extended for an additional 10 months and 15 days. State law permits a second extension of the ordinance for a maximum duration of two years. The October 15 Council staff report is included as Attachment B, and provides substantially more detailed background about the code and the basis for the moratorium. Discussion Attachment A provides for a further extension of the ordinance for another 30 days, rather than the 10 months, 15 days allowed by State law. A noticed public hearing is required, and approval by a 4/5 vote of the Council (8 members) is needed. Staff has not prepared an “exception” proposal for “pipeline” projects for this meeting, since we are aware that a full Council would not be in attendance. By coming back within 30 days (December 10 is proposed), staff will then propose an exception provision that Council may consider and extension for an additional one year period. The proposed Interim Ordinance (Attachment A) would continue to suspend use of the “Exempt Floor Area Exemption” pending further study and changes to existing parking and zoning requirements, including re-evaluation of the Downtown development cap. Floor area will remain exempt from parking to the extent parking assessments have been paid for a site. Interim Ordinance Process and Evaluation State law allows for a city to extend the interim ordinance on an “urgency” basis, subject to an interim report that outlines steps that have been and are expected to be taken to alleviate the parking problems associated with the continued use of the Exempt Floor Area Exemption. Staff has attached the Parking Study Report presented to Council on November 13 (Attachment C) as the background report detailing the proposed evaluation process. The outcome of the Parking Study, particularly related to the Downtown Development Cap, will include recommendation of zoning changes, following public hearing and recommendation by the Planning and Transportation Commission, to either revise the ordinance as necessary or consider permanent elimination of the exemption, prior to the expiration of the moratorium. City of Palo Alto Page 3 Applicability to Pending Projects As outlined in the October 15 report, cities may revise zoning requirements at any time and new development must comply with those updated requirements. The major exception to this rule is where a property owner has acquired a “vested right” to build a particular structure by obtaining a permit and performing substantial work in reliance on that permit. A vested right is not created by the existence of particular zoning, or by preparatory work performed in advance of obtaining a permit. Staff does not believe there are any pending projects that have acquired a vested right to develop under the old requirements. That being said, Council has discretion to exempt projects form complying with new zoning requirements if there is a rational and equitable basis for the exemption. Staff noted that there are two development projects currently under review: a) 135 Hamilton Avenue, which has been under discussion and review for more than a year and has been reviewed once by the Architectural Review Board; and b) 636 Waverley, which was submitted as a Preliminary Architectural Review application on September 10, 2012. Staff has engaged to some extent in discussions with the property owners for these projects, and will continue to meet and then will return on December 10 with a proposal related to exceptions for these “pipeline” projects, in conjunction with the second ordinance extension. Given the need for 8 votes for any exception, staff believes it is important to have a full Council present to discuss the scope of the exception. Policy Implications Staff believes that the interim ordinance extension is necessary to assure parking availability for businesses and to protect nearby neighborhoods from further parking intrusion. The ordinance is also consistent with Council’s recent direction to study parking improvements and requirements for Downtown. Environmental Review Environmental review is not required for the urgency ordinance, as it simply maintains the status quo, and is exempt under Section 15061(b)(3) of the California Code of Regulations, pursuant to the California Environmental Quality Act (CEQA). Subsequent ordinance changes will, however, require further environmental review prior to consideration by the Planning and Transportation Commission and Council. Attachments: A: Ordinance Extending Interim Urgency Ordinance (PDF) B: October 15, 2012 City Council Staff Report re: Interim Urgency Ordinance (PDF) City of Palo Alto Page 4 C: November 13, 2012 Council Staff Report re: Update of Parking Program (continued from 11/5/12) (PDF) Not Yet Approved 1 121113 jb 0131016 Ordinance No. ______ Ordinance Extending Ordinance No. 5167 of the Council of the City of Palo Alto Adopting a Temporary Moratorium on the Use of the “Exempt Floor Area” Parking Exemption as Contained in Section 18.52.060 (c) [Parking Assessment Districts and Areas ‐ General] of the Palo Alto Municipal Code for New Development in Assessment Districts R E C I T A L S A. The City of Palo Alto downtown area has seen an increase in development and has experienced increases in parking demand, as documented in downtown monitoring reports produced in the past 5 years; and B. The lack of available daytime downtown parking for employees has resulted in complaints from both merchants and other businesses about the lack of parking for their employees; and C. The lack of available daytime downtown parking for employees has also resulted in complaints from residents in downtown areas about congested parking in their neighborhoods; and D. Program L‐8 of the Comprehensive Plan limits new nonresidential development in the Downtown Area to 350,000 square feet (10 percent above the amount of development existing or approved in 1986), and requires that this limit be re‐evaluated when nonresidential development approvals reach 235,000 square feet of floor area; and E. Section 18.18.040 of the Zoning Ordinance requires a development moratorium on downtown nonresidential development upon an increase of 350,000 square feet of net new nonresidential development (since 1986); and F. The 235,000 square foot study limit will be reached upon approval of projects now pending before the Architectural Review Board; and G. On July 23, 2012, the City Council directed staff to initiate the preparation of the re‐evaluation of the downtown development cap; and H. The City’s Zoning Ordinance Chapter 18.18 (Downtown Commercial Districts) and Chapter 18.52 (Parking and Loading Requirements) provide for a variety of exemptions and reductions to parking requirements within the Downtown area and specifically within the Downtown Parking Assessment Area that result in less parking being provided than the calculated demand for parking for new projects; and Not Yet Approved 2 121113 jb 0131016 I. The City’s Zoning Ordinance Section 18.52.060 (c) allows for floor area up to a floor area ratio of 1.0 to 1.0 to be “exempt” from parking requirements within the Downtown Parking Assessment Area and floor are up to 0.5 to 1.0 to be exempt within the California Downtown Parkin Assessment Area (“Exempt Floor Area”); and J. The Exempt Floor Area parking exemption was enacted in the mid 1980’s and appears to have been intended to stimulate downtown development and provide equity to parking assessment district members; and K. The Exempt Floor Area parking exception no longer appears necessary to achieve such purposes, given the vitality of downtown and the need for additional parking; and L. Continued application of the Exempt Floor Area parking exemption will further exacerbate downtown and California Avenue parking deficiencies; and M. The City Council desires on an interim basis to temporarily suspend use of the Exempt Floor Area parking exemption in the City as such use may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission or the planning department is considering or studying or intends to study within a reasonable time; and N. The City Council adopted Interim Ordinance No. 5167 on October 15, 2012, by a four‐fifths vote after a public hearing pursuant to Government Code Section 65858 and Ordinance 5167 will expire on November 29, 2012. O. On November 13, 2012, the Council reviewed, filed and heard comment on a Report pursuant to Government Code Section 65858 regarding the current status of parking issues in the Downtown area. P. The Council desires to extend Interim Ordinance 5167 in accordance with the requirements of Government Code Section 65858 and Palo Alto Municipal Code Section 2.04.270 and is based on the need to protect the public safety, health and welfare as set forth in the above findings and a 4/5 vote is required for passage; and The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Findings. The findings listed above are hereby incorporated. SECTION 2. Written Report. The Report referenced in Recital O is hereby deemed by the City Council to be the written report describing the measures taken to alleviate the condition which led to the adoption of Interim Urgency Ordinance No. 5167. SECTION 3. Moratorium. The City Council hereby extends Interim Urgency Ordinance No. 5167 establishing a moratorium on the use of the Exempt Floor Area parking Not Yet Approved 3 121113 jb 0131016 exemption as set forth in Section 18.52.060 of the Palo Alto Municipal Code in connection with any development or issuance of any permit or other land use entitlement for any project located in the Downtown or California Avenue Assessment Districts. SECTION 4. Study. The City Council directs the Planning Department to consider and study possible amendments to the General Plan, Specific Plan or Zoning ordinance to eliminate use of the Exempt Floor Area Parking Exemption contained in Section 18.52.060 (c) of the Palo Alto Municipal Code. SECTION 5. Written Report. At least ten (10) days before this Urgency Ordinance or any extension expires, the City Council shall issue a written report describing the measures taken to alleviate the condition which led to the adoption of this Interim Urgency Ordinance. SECTION 6. Severability. If any provision, clause, sentence or paragraph of this ordinance, or the application to any person or circumstances, shall be held invalid, such invalidity shall not affect the other provisions of this Ordinance which can be given effect without the invalid provision or application and, to this end, the provisions of this Ordinance are hereby declared to be severable. SECTION 7. Effective Period. This extension ordinance shall take full force and effect immediately upon expiration of Interim Ordinance No. 5167. In accordance with Government Code Section 65856, this ordinance shall be in full force and effect for a period of thirty (30) days following expiration of Interim Ordinance No. 5167. Thus the moratorium shall expire on December 29, 2012, unless this period is extended by the City Council as provided in Government Code Section 65858. / / / / / / / / / / / / / / / / / / Not Yet Approved 4 121113 jb 0131016 SECTION 8. CEQA. The City Council finds that this ordinance falls under the California Environmental Quality Act (CEQA) exemption found in Title 14 California Code of Regulations Section 15061(b)(3) because it is designed to preserve the status quo. INTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: ______________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: ____________________________ City Manager ______________________________ Senior Assistant City Attorney ____________________________ Director of Planning and Community Environment City of Palo Alto (ID # 3174) City Council Staff Report Report Type: Action ItemsMeeting Date: 10/15/2012 City of Palo Alto Page 1 Summary Title: Downtown Parking Exemption Title: Adoption of Interim Urgency Ordinance to Place Temporary Moratorium on use of "Exempt Floor Area Ratio" Parking Exemption Contained in Section 18.52.060(c) of the Zoning Ordinance in the Downtown and California Avenue Assessment Districts From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council adopt the Interim Urgency Ordinance (Interim Ordinance) establishing a moratorium on the use of the Exempt Floor Area parking exemption set forth in Section 18.52.060(c) of the Palo Alto Municipal Code in connection with any permit, entitlement or development project, pending further study of Downtown and California Avenue parking issues (Attachment A). Executive Summary On July 16, 2012, the City Council considered the status of ongoing parking efforts for Downtown and directed staff to look at a variety of approaches to address concerns of businesses and neighbors. Some of the issues to be addressed, particularly in light of the downtown development cap, will include evaluation of zoning measures that might more accurately depict realistic parking ratios and assess the desirability and viability of parking exemptions. Staff has identified, however, that one particular parking exemption, applicable to both the Downtown and the California Avenue areas, is likely to immediately exacerbate parking problems without seeming to provide for any public purpose. This provision (Section 18.52.060(c) of the Zoning Ordinance) appears to allow exemption from parking for any property within the relevant assessment district, up to a 1:1 floor area ratio (FAR) in the Downtown area and up to 0.5:1 in the California Avenue area (see Attachment B.) This clause was included in language adopted in the 1980s to encourage downtown development and as a compromise for then-recently enacted downzoning and establishment of parking assessments. While the basis for those amendments is now outdated and downtown development is thriving, City of Palo Alto Page 2 the provision remains in place and applicants are now invoking it to further exempt parking. This is generally in addition to exemptions due to transfer of development rights (TDR) or other allowances pursuant to the code. Staff recommends that the “Exempt Floor Area exemption” be suspended, at least for the duration of staff’s study of downtown parking, to enable a more complete analysis of its effect in combination with other parking measures. An interim “urgency” ordinance is attached that would allow for such a moratorium on the use of this exemption. According to State law, the moratorium may be adopted on an “urgency” basis by Council with a 4/5 vote, meaning at least eight (8) Council members would need to agree to impose the change for a maximum of 45 days. The ordinance would become effectively immediately. State law requires that staff report back within 45 days on a procedure for review of the ordinance, at which time a public hearing would be held and the moratorium may be extended for an additional 10 months and 15 days. State law permits a second extension of the ordinance for a maximum duration of two years. Background The City of Palo Alto has studied parking limitations, particularly in Downtown, multiple times since the 1980s, when the original assessments for the Downtown and California Avenue areas were established, and Downtown was rezoned (downzoned) to more restrictive building standards. Downtown parking was re-evaluated in the 1990s, leading up to the construction of two new parking garages. Zoning requirements that limit downtown commercial development also mandated that the staff prepare an annual report to monitor downtown development, the use of transferable development rights (TDRs) and parking changes (the most recent report is included as Attachment C). Over the past year, staff has developed considerable data and initiated programs to evaluate the status of parking in Downtown and in the California Avenue area, as well as to assess the impact of overflow parking on nearby residential neighborhoods. On July 16, 2012, the City Council considered the status of ongoing parking efforts and directed staff to look at a variety of approaches to address concerns of businesses and neighbors. Staff is initiating studies of the potential for adding parking facilities Downtown and in the California Avenue area, means to more efficiently use available parking garages and lots, technology to enhance customer service and the customer experience, and evaluation of the downtown development cap and related zoning provisions. Some of the issues to be addressed, particularly in light of the downtown development cap, will include evaluation of zoning measures that might more accurately depict realistic parking ratios and assess the desirability and viability of parking exemptions. Staff has identified, however, that one particular parking exemption, applicable to both Downtown and the California Avenue area, is likely to immediately exacerbate parking problems without seeming to provide for any City of Palo Alto Page 3 public purpose. This provision (Section 18.52.060(c) of the Zoning Ordinance) appears to allow exemption from off-street parking requirements for any property within the relevant assessment district, associated with floor area up to a 1.0:1 floor area ratio (FAR) in Downtown and up to 0.5:1-1.0:1 FAR in the California Avenue area. This clause appears to have been added to the Zoning Code in the 1980s to encourage Downtown development and as a compromise for then-recently enacted downzoning and the establishment of parking assessments. The language is quite convoluted, resulting in varying interpretations by staff and applicants. The City has not been able to locate complete documentation of the history of the exemption. Property owners who never paid into the assessment district have argued that the Exempt Floor Area exemption allows them to retroactively “buy into” the assessment district in order to take advantage of the provision. The exemption has not, to staff’s knowledge, been requested or implemented until recently, specifically: In 2007, a one-story project at 135 Hamilton Avenue was exempted for approximately 7,700 square feet on a 10,000 square foot lot (approximately 31 parking spaces), providing no parking spaces on a site that had not ever paid into the assessment district (note: the project was approved, but was not built and the permit has expired). The applicant, however, was required and had agreed to pay into the assessment district to qualify for the exemption. In 2011, a subsequent application for the same site was submitted for a four-story building, with 10,000 square feet (40 parking spaces) to be exempted from providing on- site parking spaces or paying in-lieu fees, and another 5,000 square feet (20 parking spaces) exempted through the use of TDRs. This project has received review by the Architectural Review Board and is now under redesign. The applicant is again offering to pay into the assessment district to qualify for this exemption. (Note: the applicant has also recently provided a letter stating his intent to revise the application to accommodate the prior one-story proposal). In 2011, the applicants for the four-story Lytton Gateway project at 335 Alma Street requested the 1:1 FAR exemption for the portion of the floor area that was located within the Downtown assessment district, approximately 14,400 square feet (58 spaces). The project was considered as a Planned Community rezoning, however, and the Council did not accept the exemption as a given, instead requiring additional parking and contributions to the City’s In-Lieu Parking Fund. In September 2012, a Preliminary Architectural Review application was filed for a 4,903 square foot office development (with two residences above) at 636 Waverley Street, requesting exemption for the 1:1 FAR equivalent, amounting to 14 spaces of the total 20 required for the office on-site, in addition to other exemptions allowing existing parking deficiencies to be carried over to the new development. Staff has spoken with owners of at least two other sites, for which the 1:1 FAR exemption is being considered, but applications have not yet been submitted. City of Palo Alto Page 4 Given the current parking deficits in the City’s two assessment districts (downtown and California Avenue) and the outdated rationale for applying this exemption, staff has been discouraging recent applications since the 135 Hamilton Avenue and 335 Alma (Lytton Gateway) projects from using this parking exemption. To staff’s knowledge, no project applicant has requested use of the exemption for the California Avenue area. Discussion Staff believes that the basis for the “Exempt Floor Area Exemption”, i.e., encourage development Downtown and compromise for the downzoning and parking assessment requirements, is now outdated, as downtown does not require encouragement to develop, and any equity issues have long been addressed. Nevertheless, the provision remains in place and applicants are now invoking it to further exempt parking. There is also some ambiguity as to whether applicants who have never paid into the assessment district can qualify for the exemption by paying into the district retroactively, and if so, how to calculate the payment. Further, applicants are sometimes coupling this exemption with other parking exemptions due to transfer of development rights (TDR) or other allowances pursuant to the code. The result of the continued use of this exemption would be to exacerbate parking deficiencies in the Downtown and California Avenue assessment district areas. Proposed Ordinance The proposed Interim Ordinance (Attachment A) would suspend use of the “Exempt Floor Area Exemption” pending further study and changes to existing parking and zoning requirements, including re-evaluation of the Downtown development cap. Floor area will of course remain exempt from parking to the extent assessments have been paid for the site. Staff believes it is appropriate to apply the moratorium to both the Downtown and California Avenue areas, as it will in both areas exacerbate parking deficiencies documented previously by staff. Staff distinguishes this provision from others for review, particularly the transferable development rights (TDRs) section, as in those cases other public purposes are readily identified (seismic and historic rehabilitation), and significant investments (either rehabilitation or purchase of TDRs) have been made pursuant to the zoning ordinance. Those provisions will, however, be evaluated as part of the more comprehensive parking studies. Interim Ordinance Process State law allows for a city to enact an interim ordinance on an “urgency” basis, upon a vote of 4/5 of the members of the Council, to protect the health, safety or welfare of the community (the draft ordinance includes the relevant findings). No public hearing and no input from the Planning and Transportation Commission is required prior to the enactment of the urgency ordinance. An ordinance adopted pursuant to this provision of State law takes effect City of Palo Alto Page 5 immediately and does not require second reading. The next steps, pursuant to State law, would be to: 1. Return to Council not later than 45 days later for a public hearing with an interim report with steps taken to alleviate the parking problems associated with the continued use of the Exempt Floor Area Exemption. At that time the Council will also be asked to extend the Interim Ordinance for up to an additional 10 months and 15 days (as allowed under Government Code Section 65858) to allow staff to propose zoning changes; and 2. Recommendation of zoning changes, following public hearing and recommendation by the Planning and Transportation Commission, to either revise the ordinance as necessary or consider permanent elimination of the exemption, prior to the expiration of the 10-month, 15-day extension. Applicability to Pending Projects Cities may revise zoning requirements at any time, except where a property owner has acquired a “vested right” to build a particular structure by obtaining a permit and performing substantial work in reliance on that permit. A vested right is not created by the existence of particular zoning, or by preparatory work performed in advance of obtaining a permit. While the Interim Ordinance as written does not make exceptions for projects that have begun the planning process but not completed it by securing final permits (“pipeline projects”), in the past the City generally has excepted pipeline projects from new ordinance requirements. The City is not legally required to make such exceptions, but the Council may make a policy decision to do so. Two projects are currently under review: a) 135 Hamilton Avenue, which has been under discussion and review for more than a year and has been reviewed once by the Architectural Review Board; and b) 636 Waverley, which was submitted as a Preliminary Architectural Review application on September 10, 2012. Staff has discussed the application of the Exempt Floor Area Exemption for a couple of other projects, but owners have not yet submitted applications for those projects. Council may choose to either include or exempt one or both of the “pipeline” projects from application of the moratorium. If the Council chooses to exclude one or both projects from the moratorium, staff suggests that exclusion be conditional upon: a) preparation of a robust transportation demand management (TDM) program for the project, and b) payment of the equivalent “assessment” amount or increment to the In-Lieu Parking Fund (rather than to pay down the bonds) to contribute to construction of additional parking spaces in the future (note: the amount of the “assessment” should be the present value of a stream of assessments as would originally have been applied over the life of the parking bonds). Staff will be prepared to suggest language to implement these requirements should Council desire. City of Palo Alto Page 6 Policy Implications Staff believes that the interim ordinance is necessary to assure parking availability for businesses and to protect nearby neighborhoods from further parking intrusion. The ordinance is also consistent with Council’s recent direction to study parking improvements and requirements for Downtown. Environmental Review Environmental review is not required for the urgency ordinance, as it simply maintains the status quo, and is exempt under Section 15061(b)(3) of the California Code of Regulations, pursuant to the California Environmental Quality Act (CEQA). Subsequent ordinance changes will, however, require further environmental review prior to consideration by the Planning and Transportation Commission and Council. Attachments: Attachment A: Downtown Parking Exemption Urgency Ordinance (DOCX) Attachment B: Section 18.52.060 of Zoning Ordinance (DOCX) Attachment C: December, 2011 Downtown Monitoring Report to Council (PDF) Not Yet Approved 1 121010 jb 0131000 Ordinance No. _______ Interim Ordinance of the Council of the City of Palo Alto Adopting a Temporary Moratorium on the Use of the “Exempt Floor Area” Parking Exemption as Contained in Section 18.52.060 (c) [Parking Assessment Districts and Areas - General] of the Palo Alto Municipal Code for New Development in Assessment Districts R E C I T A L S A. The City of Palo Alto downtown area has seen an increase in development and has experienced increases in parking demand, as documented in downtown monitoring reports produced in the past 5 years; and B. The lack of available daytime downtown parking for employees has resulted in complaints from both merchants and other businesses about the lack of parking for their employees; and C. The lack of available daytime downtown parking for employees has also resulted in complaints from residents in downtown areas about congested parking in their neighborhoods; and D. Program L-8 of the Comprehensive Plan limits new nonresidential development in the Downtown Area to 350,000 square feet (10 percent above the amount of development existing or approved in 1986), and requires that this limit be re-evaluated when nonresidential development approvals reach 235,000 square feet of floor area; and E. Section 18.18.040 of the Zoning Ordinance requires a development moratorium on downtown nonresidential development upon an increase of 350,000 square feet of net new nonresidential development (since 1986); and F. The 235,000 square foot study limit will be reached upon approval of projects now pending before the Architectural Review Board; and G. On July 23, 2012, the City Council directed staff to initiate the preparation of the re-evaluation of the downtown development cap; and H. The City’s Zoning Ordinance Chapter 18.18 (Downtown Commercial Districts) and Chapter 18.52 (Parking and Loading Requirements) provide for a variety of exemptions and reductions to parking requirements within the Downtown area and specifically within the Downtown Parking Assessment Area that result in less parking being provided than the calculated demand for parking for new projects; and I. The City’s Zoning Ordinance Section 18.52.060 (c) allows for floor area up to a floor area ratio of 1.0 to 1.0 to be “exempt” from parking requirements within the Attachment A Not Yet Approved 2 121010 jb 0131000 Downtown Parking Assessment Area and floor area up to 0.5 to 1.0 to be exempt within the California Downtown Parking Assessment Area (“Exempt Floor Area”); and J. The Exempt Floor Area parking exemption was enacted in the mid 1980’s and appears to have been intended to stimulate downtown development and provide equity to parking assessment district members; and K. The Exempt Floor Area parking exception no longer appears necessary to achieve such purposes, given the vitality of downtown and the need for additional parking; and L. Continued application of the Exempt Floor Area parking exemption will further exacerbate Downtown and California Avenue parking deficiencies; and M. The City Council desires on an interim basis to temporarily suspend use of the Exempt Floor Area parking exemption in the City as such use may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission or the planning department is considering or studying or intends to study within a reasonable time; and N. This interim ordinance is adopted in accordance with the requirements of Government Code Section 65858 and Palo Alto Municipal Code Section 2.04.270 and is based on the need to protect the public safety, health and welfare as set forth in the above findings and a 4/5 vote is required for passage. The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Findings. The findings listed above are hereby incorporated. SECTION 2. Moratorium. The City Council hereby enacts this Interim Urgency Ordinance establishing a moratorium on the use of the Exempt Floor Area parking exemption as set forth in Section 18.52.060 of the Palo Alto Municipal Code in connection with any development or issuance of any permit or other land use entitlement for any project located in the Downtown or California Avenue Assessment Districts. SECTION 3. Study. The City Council directs the Planning Department to consider and study possible amendments to the General Plan, Specific Plan or Zoning ordinance to eliminate use of the Exempt Floor Area Parking Exemption contained in Section 18.52.060 (c) of the Palo Alto Municipal Code. SECTION 4. Written Report. At least ten (10) days before this Urgency Ordinance or any extension expires, the City Council shall issue a written report describing the measures taken to alleviate the condition which led to the adoption of this Interim Urgency Ordinance. Not Yet Approved 3 121010 jb 0131000 SECTION 5. Severability. If any provision, clause, sentence or paragraph of this ordinance, or the application to any person or circumstances, shall be held invalid, such invalidity shall not affect the other provisions of this Ordinance which can be given effect without the invalid provision or application and, to this end, the provisions of this Ordinance are hereby declared to be severable. SECTION 6. Effective Period. This urgency ordinance shall take full force and effect immediately upon adoption. In accordance with Government Code Section 65856, this ordinance shall be in full force and effect for a period of forty-five (45) days from adoption. Thus the moratorium shall expire on November 29, 2012, unless this period is extended by the City Council as provided in Government Code Section 65858. SECTION 7. CEQA. The City Council finds that this ordinance falls under the California Environmental Quality Act (CEQA) exemption found in Title 14 California Code of Regulations Section 15061(b)(3) because it is designed to preserve the status quo. INTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: ______________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: ____________________________ City Manager ______________________________ Assistant City Attorney ____________________________ Director of Planning and Community Environment ATTACHMENT B 18.52.060 Parking Assessment Districts and Areas - General (a) Definitions (1) "Parking Assessment Areas" "Parking assessment areas" means either: The "downtown parking assessment area," which is that certain area of the city delineated on the map of the University Avenue parking assessment district entitled Proposed Boundaries of University Avenue Off-Street Parking Project No. 75-63 Assessment District, City of Palo Alto, County of Santa Clara, State of California, dated October 30, 1978, and on file with the city clerk; or The "California Avenue area parking assessment district," which is that certain area of the city delineated on the map of the California Avenue area parking assessment district entitled Proposed Boundaries, California Avenue Area Parking Maintenance District, dated December 16, 1976, and on file with the city clerk; (2) "Exempt Floor Area" Within the downtown parking assessment area, "exempt floor area" means all or a portion of that floor area of a building which is located at or nearest grade and which does not exceed a floor area ratio of 1.0 to 1.0; Within the California Avenue area parking assessment district, "exempt floor area" means either: (A) All or a portion of that floor area of a building which is located at or nearest grade and which does not exceed a floor area ratio of 0.5 to 1.0 or (B) The amount of floor area shown on the 1983-84 California Avenue area assessment district rolls in the engineer's report for bonds issued pursuant to Title 13 of the municipal code, whichever is greater. (b) In-lieu fees Except as provided in subsection (c) below, within any parking assessment district established by the city for the purpose of providing off-street parking facilities, all or a portion of the off-street parking requirement for a use may be satisfied by payment of assessments or fees levied by such district on the basis of parking spaces required but not provided. (c) Exempt Floor Area (1) Unless a project for the construction of floor area has received design approval prior to December 19, 1983, or has undergone preliminary review pursuant to Sections 18.76.020 and 18.77.070 on December 1st or 15th, 1983, the only portion of off-street parking required for construction of floor area in a parking assessment area which may be satisfied by payment of assessments or levies made within such area on the basis of parking spaces required but not provided, is that portion of the parking requirements associated with the uses proposed to be conducted in that area of the floor equal to the exempt floor area for the site. Where only a portion of floor area constitutes exempt floor area, and uses with more than one parking standard as required by this chapter are proposed for said floor, the use on that portion of the floor which generates the highest parking requirement will be designated as the exempt floor area. (2) All other required off-street parking that is not satisfied by such payment of assessments shall be provided in accordance with this chapter. (3) This subsection shall be interpreted to allow changes in the use of all exempt floor area and nonexempt floor area existing as of February 16, 1984 without requiring additional parking; provided, that the change in use does not consist of a change from residential to nonresidential, or an increase in actual floor area which does not constitute exempt floor area. (4) No project which has received design approval prior to December 19, 1983, or which has undergone preliminary review on December 1st or 15th, 1983, shall increase the amount of floor area approved or reviewed or decrease the area designed or intended for parking without meeting the requirements of this chapter. (Ord. 4964 § 3 (part), 2007) City of Palo Alto (ID # 2424) City Council Informational Report Report Type: Informational Report Meeting Date: 3/5/2012 March 05, 2012 Page 1 of 7 (ID # 2424) Title: Downtown Monitoring Report 2010-2011 Subject: Commercial Downtown (CD) Monitoring Report for 2010-2011 From:City Manager Lead Department: Planning and Community Environment Recommendation This is an informational report and no Council action is required. Executive Summary The annual Commercial Downtown (CD) Monitoring Report tracks total non-residential growth in the commercial downtown area (CD-C zones) and office and retail vacancy rates in CD-C and CD-C (GF)(P) zones. Through mid-January of 2012, there was a 4.8 percent vacancy rate within the Ground Floor Overlay District and a 2.0 percent overall vacancy rate in the Commercial Downtown (CD) zoning district. In this monitoring cycle, approximately 13,500 square feet of space was approved or added to the total downtown non-residential square footage. An additional 61,650 square feet of new non-residential development can be accommodated before the re-evaluation limit of 235,000 square feet growth limit is reached. Background Annual monitoring of available space in Commercial Downtown (CD) zoning area was established in 1998 by Comprehensive Plan Programs L-8 and L-9. These programs require reporting of non-residential development activity and trends within the CD zone district. Staff regularly tracks vacancy rates, changes in floor area and parking in the CD district resulting from approved development to comply with Comprehensive Plan programs and to determine the ground floor vacancy rate in the CD zone district. The zoning code, until 2009, included an exception process to allow office development on the first floor if the ground floor vacancy rate exceeds 5%. In 2009, the City Council adopted zoning ordinance amendments to enhance protection of retail uses in downtown commercial districts to ensure that retail uses are retained and viability enhanced during the economic downturn and beyond. A map of the districts subject to the amendments was included in the 2009 City Council report (CMR 20:09), available on the City’s website. The ordinance amendment eliminated the provision for an exception process if the GF vacancy rate is found to be greater than 5% during the annual monitoring period. March 05, 2012 Page 2 of 7 (ID # 2424) Staff completed field visits for this 2010/2011 monitoring period in early January 2012. Telephone interviews and email exchanges with local real estate leasing agents were also compiled at the same time to determine current vacancy rates and prevailing rents. This report also includes cumulative data on developments in the Commercial Downtown (CD)zone from January 1987 through August 31, 2011 and specific data on vacancy information and rental rates through January 2012. Discussion Economic conditions in Palo Alto downtown area are improving gradually. There is currently a 4.8 percent vacancy rate within the Ground Floor Overlay District and a 2.0 percent overall vacancy rate in the Commercial Downtown (CD) zoning district. This is a noticeable drop of 2.1 percent vacancy in the Ground Floor Overlay District from last year. This number is close to the 2007-2008 period vacancy rate, just before the start of the economic downturn. In the 2010- 2011 monitoring period, the rental rates for retail varied from $2.75 to $4.00 per square foot based on the location, and the average office rental rate was between $4.50 and $7.00 per square foot. Office rental rates have increased in the last year and a half and retail rental rates have remained steady throughout the 2010-2011 monitoring period. The following table shows the approximate total vacant area and percentage of vacancy, beginning in the 2006-2007 monitoring period. TABLE 1: Total Vacancy in CD-C & CD-C (GF) (P) Zones in Downtown Palo Alto Year Total CD-C Vacant (SQFT) % of CD-C Vacancy Total CD-C (GF) (P) Vacant (SQFT) % of CD-C (GF) (P) Vacancy 2006-2007 88,368 2.63 18,330 2.94 2007-2008 120,004 3.60 26,294 4.21 2008-2009 212,189 6.39 56,109 8.99 2009-2010 85,271 2.56 37,888 6.91 2010-2011 66,226 2.0 26, 290 4.8 Non-Residential Development Activity The Downtown Study, approved in 1986, incorporated a growth limit of 350,000 square feet of additional floor area above the total floor area existing in 1986, and provided for a re- evaluation of the CD regulations when net new development reaches 235,000 square feet. Since 1986, a total of 173,356 square feet of non-residential uses has been added (or approved) in the Downtown CD-C zoned area. In the past two monitoring cycles from 2008-2010, March 05, 2012 Page 3 of 7 (ID # 2424) approximately 46,500 square feet of net new commercial floor area was added with a few major contributing projects such as: 317-323 University Avenue, 325 Lytton Avenue, 564 University Avenue, 310 University Avenue, 278 University Avenue, and 265 Lytton Avenue. In this current cycle (2010-2011) approximately 13,499 square feet of net new commercial floor area has been added. Though significant construction activities continue in the downtown CD-C zone area, most of the construction includes redevelopment of existing sites since the existing downtown is close to being built-out. In the current cycle there were approximately five sites that were redeveloped but only one project, at 524 Hamilton Avenue, added significant square footage. Based on this recent monitoring, an additional 61,650 square feet of new non-residential development remains available for development before the re-evaluation limit of 235,000 square feet growth limit is reached. Demonstrating Special Public Benefits The Downtown Study reserved 100,000 square feet of the 350,000 square foot growth limit to be used for projects demonstrating special public benefits. Since 1986, ten projects in the Downtown area have been developed under the Planned Community zoning that requires a finding of public benefit. Five of the projects exceeded the non-residential floor area that would otherwise be allowed under zoning by a total of 34,378 square feet. The total changes in square footage of these projects are shown in the fourth column of Attachment E. The remaining five projects were mixed-use projects that did not exceed allowable non-residential floor areas. All of the projects either provided parking or paid a fee in lieu of providing parking. Projects Qualifying for Seismic, Historic or Minor Expansion Exemptions The Downtown Study designated 75,000 square feet of the 350,000 square foot cap for projects that qualify for seismic, historic or minor expansion exemptions in order to encourage these upgrades. Since 1986, 93,931 square feet have been added in this category. Two projects, 524 Hamilton Avenue and 668 Ramona Street, have used close to 5,000 square feet of Transfer Development Rights (TDR) square footage in this evaluation period. These projects are shown in the fifth column of Attachment E. Parking Inventory At the time of the Downtown Study, performance measures were established that specify that new development in the Downtown should not increase the total parking deficit beyond that expected from development that was existing or approved through May 1986, or 1,601 spaces. In 2003, the City opened two new parking structures: one located on 528 High Street and the other at 445 Bryant Street, adding a total of 899 parking spaces. These parking structure projects, in addition to other projects that provide a parking component, decreased the original 1986 deficit to approximately 628 spaces. At the end of the 2003 monitoring period, the City determined that a re-evaluation of the parking exemption regulations would be undertaken when the unmet parking demand resulting from exemptions (transfer of development rights and FAR bonuses) reaches a cumulative 450 spaces. Currently, the unmet parking demand resulting from exemptions is 323 parking spaces. Through various projects, the total cumulative parking deficit has been significantly reduced from 1,601 in 1986 to 722 in 2011. The main March 05, 2012 Page 4 of 7 (ID # 2424) reasons for the reduction are: 1) the two-floor addition to the Cowper/Webster Garage; 2) significant restriping of on-street parking spaces by the City’s Transportation Division, resulting in 96 additional spaces; and 3) the construction of the two previously mentioned parking structures located on 528 High Street and 445 Bryant Street. Attachment F is a chart of the CD (Commercial Downtown) parking deficit. Staff notes, however, that the effects of the parking deficit, particularly on adjacent neighborhoods, appear to have been exacerbated by the increased employee density of office uses in the downtown. Vacancy Rate for Ground Floor (GF) Combining District The Ground Floor Combining District (GF) was created to encourage active pedestrian uses in the Downtown area such as retail, eating and drinking and personal services. In October 2011, there was approximately 548,675 square feet of total Ground Floor area in the CD-C(GF)(P) zoning district following the adoption of the amended ordinance in December 2009 to enhance protection of retail uses in the heart (University Avenue and side streets) of the downtown commercial district. Attachment C provides the list of parcels affected by adoption of the ordinance. A map showing the location of these parcels is provided as Attachment D. The result was an approximate net 75,660 square feet reduction in the total square footage of GF district. During the staff survey of Downtown vacancies in first week of January 2012, there were seven properties, totaling 26,290 square feet, which met the requirements for vacant and available ground floor area. TABLE 2: Vacant Property Listings for Only Ground Floor (GF) Spaces in CD-C (GF) (P) Combining District. (As of January 4, 2012) Address Vacant Square Feet 541 Bryant 2,556 248 Hamilton 3,000 174 University 2,300* 180 University 12,459 435 University 1,450 429-447 University 1,800 522 Waverley 2,725 Total (GF) Vacancy 26,290 March 05, 2012 Page 5 of 7 (ID # 2424) *Vacant since last year This results in a GF vacancy rate of approximately 4.8 percent, a reduction of 2.1 percent from the vacancy rate of last year. Vacancy Rate for Entire CD District The entire Downtown Commercial (CD) area includes approximately 3,850,000 gross square feet of floor area, including approximately 330,000 square feet within the SOFA CAP Phase 2 area. About 525,000 square feet is used for religious or residential purposes or is vacant and not available for occupancy. Thus, the net square footage of available commercial space is approximately 3,325,000 square feet. Staff conducted a field survey in early January 2012 and communicated with local real estate agents during same time to assess overall vacancies in the downtown area. In this monitoring cycle there was a total vacancy of 66,226 square feet. This vacancy equals a rate of 2.0 percent, somewhat less than the 2.6 percent vacancy noted in last year’s monitoring report. The overall CD-C vacancy rate has reduced considerably since the 2008-2009 period, close to a drop of 4 percent. Table 3 was compiled based on staff conducted fieldwork, research of real estate websites and responses received from local downtown real estate agents. TABLE 3: Vacant Property Listings for Remainder of Commercial Downtown (CD) (As of January 4, 2012) Includes Upper Floor Office Space in CD-C (GF) (P) Combining District and all floors of CD-C (P) District Address Zoning District Vacant Square Feet 635 Bryant CD-C (P)545 644 Emerson CD-C (P)2,238 418 Florence CD-C (P)2,515 155 Forest CD-S (P); CD-C (P)550 120-122 Hamilton CD-C (P)2,260 209 Hamilton CD-C (GF)(P)9,000 261 Hamilton CD-C (GF)(P)783 400 Hamilton CD-C (P)3,320 245 Lytton CD-C (P)13,433 March 05, 2012 Page 6 of 7 (ID # 2424) 550 Lytton CD-C (P)2,892 552 Waverley CD-C (GF)(P)2,400 Total Rest of CD Vacancy 39,936 CD –Commercial Downtown, (C) –Commercial, (S) –Service, GF –Ground Floor Combining District, P -Pedestrian Overlay Trends in Use Composition The primary observation of change in the use composition of Downtown was, in this cycle, a reduction of approximately 12,860 square feet of religious/institutional use that was converted to office use at the 661 Bryant Street project. Since the enactment of new CD zoning regulations in 1986, the total floor area devoted to higher-intensity commercial uses such as office, retail, eating/drinking and housing has increased, while the total floor area in lower- intensity commercial uses like manufacturing and warehousing has decreased (see Attachment G). Retail Rents Retail rental rates have marginally increased since last year’s monitoring report. According to the data gathered from the January 2011 staff survey of commercial real estate agents offering properties for lease in Downtown, rents for retail space generally range from $2.75 to $4.00 per square foot triple net (i.e. rent plus tenant assumption of insurance, janitorial services and taxes). The lower end of this range is generally for spaces in older buildings and away from University Avenue. Retail rental rates in the core downtown University Avenue sometimes increase to highs of $5.00 to $6.00 per square foot. For some vacant properties outside the downtown core, rental rates have been listed as negotiable. Office Rents Based on the information gathered from the commercial real estate agents listing properties for lease in Downtown, rents for Class A Downtown office space (i.e. newer and/or larger buildings on University Avenue and Lytton Avenues) and Class B office space (i.e. older and/or smaller buildings further from University Avenue) range from $4.50 to $7.00 per square foot triple net, compared to $3.50 to $5.50 per square foot triple net in last year’s monitoring report. Timeline This is an annual report. Resource Impact This report has no impact on resources, though the implications of reduced vacancy rates have positive impacts on the City’s potential source of property and sales taxes. Policy Implications This report on the Commercial Downtown (CD) zoning area is mandated by Comprehensive March 05, 2012 Page 7 of 7 (ID # 2424) Plan Programs L-8 and L-9 and by the Downtown Study approved by the City Council on July 14, 1986. Environmental Review This is an informational report only and is exempted from CEQA review. Courtesy Copies Planning and Transportation Commission Architectural Review Board Palo Alto Chamber of Commerce Downtown Palo Alto Palo Alto Board of Realtors Downtown North Neighborhood Association Professorville Neighborhood University Park Neighborhood Association Attachments: ·Attachment A: 1986 Downtown Study Results Summary (PDF) ·Attachment B: Commercial Downtown (CD) Zone District Map(PDF) ·Attachment C: List of Parcels Added and Removed From CD-C(GF) P District (PDF) ·Attachment D: Downtown Map Showing the Zone Changes (PDF) ·Attachment E: CD Non-Residential Change in SQFT 09/01/86 to 08/31/11 (PDF) ·Attachment F: CD Parking Deficit(PDF) ·Attachment G: CommercialDowntown (CD) and SOFA 2 CAP Floor Area by Use Category (PDF) Prepared By:Chitra Moitra, Planner Department Head:Curtis Williams, Director City Manager Approval: James Keene, City Manager ATTACHMENT A DOWNTOWN STUDY RESULTS SUMMARY (July 1986) The following are the primary measures adopted as a result of the study: 1. A new Commercial Downtown (CD) zoning district, including three sub districts (CD-C, CD-S and CD-N), was created and applied to most of the Downtown area previously zoned Community Commercial (CC) or Service Commercial (CS). The basic provisions of the CD district include floor area ratios (FARs) that are more restrictive than in the previous CC and CS zones, limits to project size and to the overall amount of future development, and special development regulations for sites adjacent to residential zones. 2. Growth limits were applied to the CD district restricting future development to a total of 350,000 square feet beyond what was existing or approved in May 1986 and providing for a re-evaluation of the CD regulations when new development reaches 235,000 square feet. In addition, 100,000 square feet of the total new floor area was reserved for projects demonstrating special public benefits and 75,000 square feet for projects which qualify for seismic, historic or minor expansion exemptions. 3. Exemptions to the floor area ratio restrictions of the CD zone were established for certain building expansions involving historic structures, seismic rehabilitation, provision of required handicapped access, or one-time additions of 200 square feet or less. 4. New parking regulations were established for the University Avenue Parking Assessment District that requires new non- residential development to provide parking at a rate of one space per 250 square feet of floor area. Exemptions to this requirement are provided for certain increases in floor area related to provision of handicapped access, seismic or historic rehabilitation, one-time minor additions (200 square feet or less) and development of vacant land previously assessed for parking. The regulations also permit, in certain instances, off-site parking and parking fees in lieu of on-site parking. 5. Performance measures were established that specify that new development in the Downtown should not increase the total parking deficit beyond that expected from development that was existing or approved through May, 1986 (1600 spaces) and that call for re-evaluation of the parking exemption regulations when the unmet parking demand, resulting from exemptions, reaches one half (225 parking spaces) of the minimum 450 parking spaces deemed necessary for construction of a new public parking structure. Staff was directed to monitor the parking deficit. 6. A new Ground Floor (GF) Combining District was created and applied to the area along University Avenue and portions of the major side streets between Lytton and Hamilton Avenues, in order to restrict the amount of ground floor area devoted to uses other than retail, eating and drinking or personal service. 7. Staff was directed to monitor the Downtown area in terms of development activity, vacancy rates, sales tax revenues, and commercial lease rates to facilitate evaluation of the effectiveness of the new regulations. 8. Staff was directed to undertake a site and feasibility study to evaluate an additional public parking structure elsewhere in the Downtown, to consider development of a parking facility on public lots S, L and F, and to explore the possibility of leasing or purchasing privately-owned vacant lots suitable as parking structure sites. 9. Policies and regulations were adopted which encourage Planned Community (PC) zoning for parking structures and limit underground parking to two levels below grade, unless there is proof that regular pumping of subsurface water will not be necessary. 10. A Twelve-Point Parking Program was adopted to increase the efficiency of existing parking. 11. Traffic policies were adopted which prohibit new traffic signals on portions of Alma Street and Middlefield Road, and prohibit a direct connection from Sand Hill Road to Palo Alto/Alma Street. In addition, new signs were approved directing through traffic off of University Avenue and onto Hamilton and Lytton Avenues. 12. Staff and the Architectural Review Board (ARB) were directed to consider the possibility of an Urban Design Plan for Downtown and to develop design guidelines for commercial structures in neighborhood transition areas and for driveways which cross pedestrian walkways. 13. A temporary Design and Amenities Committee was created and charged with developing an incentive program (including FAR increases of up to 1.5) to encourage private development to provide a variety of public amenities in the Downtown area. 14. Staff was directed to study possible restrictions on the splitting and merging of parcels as well as the establishment of minimum lot sizes in the new CD district. COMMERCIAL DOWNTOWN (CD) ZONE DISTRICT MAP ATTACHMENT B o • , ATTACHMENT C LIST OF PARCELS ADDED AND REMOVED FROM CD-C (GF) P DISTRICT The following properties were added to the Ground Floor (GF) Combining District: 200-228 Hamilton Avenue---APN 120-27-008 230-238 Hamilton Avenue---APN 120-27-009 240-248 Hamilton Avenue---APN 120-27-010 412 Emerson Street---APN 120-26-106 420 Emerson Street---APN 120-26-025 430 Emerson Street---APN 120-26-026 The following properties were removed from the Ground Floor (GF) Combining District: 115-119 University Avenue---APN 120-26-108 102-116 University Avenue---APN 120-26-039 124 University Avenue---APN 120-26-043 125 University Avenue---APN 120-26-138 525 Alma Street---APN 120-26-093 529 Alma Street---APN 120-26-110 535-539 Alma Street, 115 Hamilton Avenue---APN 120-26-091 135 Hamilton Avenue---APN 120-26-111 440 Cowper Street---APN 120-15-014 437 Kipling Street---APN 120-15-020 443 Kipling Street---APN 120-15-019 DOWNTOWN MAP SHOWING THE ZONE CHANGES ATTACHMENT D o :~ o .~ , 1 ATTACHMENT E CD NON-RESIDENTIAL CHANGE IN SQUARE FOOTAGE 09/01/86 TO 08/31/11 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in non- Residential Floor Area 520 Ramona Street A CDCGFP 11/20/84 - 400 +400 220 University Avenue CDCGFP 2/5/87 - 65 +65 151 Homer Avenue CDSP 3/17/88 - - -9,750 314 Lytton Avenue CDCP 5/5/88 - - -713 247-275 Alma Street CDNP 8/4/88 - - +1,150 700 Emerson Street CDSP 9/15/88 - - +4,000 431 Florence Street CDCP 9/15/88 - 2,500 +2,500 156 University Avenue CDCGFP 12/15/88 - 4,958 +4,958 401 Florence Street CDCP 3/2/89 - 2,407 +2,407 619 Cowper Street CDCP 5/6/89 - - +2,208 250 University Avenue PC-3872 5/15/89 11,000B 300 +20,300 2 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in non- Residential Floor Area 550 University Avenue CDCP 6/1/89 - - -371 529 Bryant Street PC-3974 5/3/90 2,491C 2,491 +2,491 305 Lytton Avenue CDCP 9/28/90 - 200 +200 550 Lytton AvenueDE CDCP 10/22/90 - - +4,845 531 Cowper Street PC-4052 5/21/91 9,000 475 +9,475 540 Bryant Street CDCGFP 3/24/92 - 404 +404 530/534 Bryant Street CDCGFP 4/15/93 - 432 +432 555 Waverley Street/425 Hamilton AvenueE CDCP 9/21/93 - - +2,064 3 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in non/Residential Floor Area 201 University Avenue CDCGFP 11/18/93 - 2,450 +2,450 518 Bryant Street CDCGFP 3/3/94 - 180 +180 245 Lytton Avenue CDCP 7/21/94 - - -21,320 400 Emerson StreetEF PC-4238 9/19/94 - 200 +4,715 443 Emerson Street CDCGFP 1/5/95 - 26 +26 420 Emerson Street CDCP 3/16/95 - 125 +125 340 University Avenue CDCGFP 4/6/95 - - -402 281 University Avenue CDCGFP 4/20/95 - - -2,500 456 University Avenue CDCGFP 5/18/95 - 7,486 +7,486 536 Ramona Street CDCGFP 7/11/95 - 134 +134 725/753 Alma Street PC-4283 7/17/95 - - -1,038 4 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in non/Residential Floor Area 552 Emerson Street CDCGFP 7/18/95 - 177 +177 483 University Avenue G PC-4296 10/2/95 3,467C 2,789 +7,289 424 University Avenue CDCGFP 9/21/95 - 2,803 +2,803 901/909 Alma Street E,F PC-4389 8/1/96 - - +4,425 171 University Avenue CD-C(GF)(P) 9/19/96 - 1,853 +1,853 401 High Street CD-C(P) 10/3/96 - 350 +350 430 Kipling Street D,H CD-C(P) 10/22/96 - 200 +1,412 460-476 University Avenue CD-C(GF)(P) 3/20/97 - 1,775 +1,775 400 Emerson Street D PC-4238 3/21/97 - - +2,227 275 Alma Street CD-N(P) 7/8/97 - 200 +3,207 390 Lytton Avenue PC-4436 7/14/97 8,420C 689 +17,815 411 High Street H CDCP 12/18/97 - 2,771 +2,771 5 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in Non Residential Floor Area 530 Ramona CDCGFP 05/20/99 - 2852 +2852 705 Alma St CDSP 09/21/99 - 2814 +2814 200 Hamilton Ave CDCP 10/21/99 - 10913 +10913 550 Lytton Ave CDCP 08/11/00 - - +93 437 Kipling St CDCGFP 02/01/01 - - +945 701 Emerson St CDSP 05/29/01 - - +434 723 Emerson St CDSP 05/29/01 - - +400 880 - 884 Emerson St CDSP 05/29/01 - - +312 539 Alma St CDCGFP 10/23/01 - 2,500 +2,500 270 University Ave CDCGFP 11/01/01 - 2,642 +2,642 901 High St. E, F CDSP 12/12/02 - - +12,063 800 High St. I PC-4779 02/03/03 - - -15,700 6 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in Non Residential Floor Area 164 Hamilton Ave CDCP 01/13/05 - - -2,799 335 University Ave CDCGFP 08/10/05 - 4,500J +5,249 382 University Ave CDCGFP 07/27/06 - 194 +194 102 University Ave CDCGFP 10/10/2006 - - +8 325 Lytton Ave CDCP 5/2006 - - +17,515 310 University Ave CDCGFP 07/31/2008 - 7,481 +7,481 317-323 University Ave CDCGFP 01/2008 - 2,500 +3,290 564 University Ave CDCP 7/2008 - 2,500 +4,475 278 University CDCGFP 11/2008 - - +137 265 Lytton CDCP 7/2010 - 3,712 +21,151 340 University CDCP 12/2010 - - -1,360 524 Hamilton CDCP 2/2011 - 5,200 +9,345 7 Project Address Zoning Date Approved Public Benefit Bonus Non Residential Square Footage Seismic, Historic, or Minor Bonus Square Footage Net change in Non Residential Floor Area 630 Ramona CDCP 6/2011 - 437 +437 668 Ramona CDCP 7/2011 - 4,940 +4,940 661 Bryant CDCP 2/2011 - 1,906 0 Totals 1986-2011 34,378 93,931 173,356 A: Project approved during the Downtown Moratorium (9/84 to 9/86), but was not included in the Downtown EIR’s “pipeline projects.” As a result, the project is counted among the CD District’s nonresidential development approvals since the enactment of the Downtown Study Policies in 1986 B: Through Assessment District project provided additional 64 public parking spaces as part of public benefit instead of required 44 private spaces C: Project exceeded square footage otherwise allowed by zoning D: Project converted residential space to non-residential space. Net non-residential space counts toward the 350,000 square foot limit E: Project included covered parking that counts as floor area but not counted 350,000 square foot limit F: Project was approved pursuant to PAMC Sections 18.83.120 or 18.83.130 which allow for a reduction in the number required parking spaces for shared parking facilities, joint use parking facilities, or substitution of 8 bike parking spaces for one vehicle space. G. In addition, project paid in-lieu fee for loss of 2 on-site parking spaces H: In addition, projects paid in-lieu fee for loss of 4 on-site spaces I: Part of the SOFA 2 CAP J: Transfer of Development Right (TDR) agreement with 230 and 232 Homer Avenue. 5000 total sq ft of TDR but only 4,500 sq. ft used for Non Residential Floor Area. Page 1 ATTACHMENT F CD PARKING DEFICIT 9/1/86 to 8/31/2011 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 1986 deficit 1,601 520 Ramona StreetA CDCGFP +400 2 0 0 +2 1,603 220 University Avenue CDCGFP +65 0 0 0 0 1,603 151 Homer Avenue CDSP -9,750 0 11 0 -50 1,553 314 Lytton Avenue CDCP -713 0 0 0 -3 1,550 247-275 Alma Street CDNP +1,150 5 5 0 0 1,550 700 Emerson Street CDSP +4,000 16 16 0 0 1,550 431 Florence St CDCP +2,500 10 0 10 +10 1,560 Page 2 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 156 University Avenue CDCGFP +4,958 20 0 20 +20 1,580 401 Florence Street CDCP +2,407 10 0 10 +10 1,590 619 Cowper Street CDCP +2,208 9 9 0 0 1,590 250 University Avenue PC-3872 +20,300 103 131B 0 -28 1,562 550 University Avenue CDCP -371 0 0 0 -1 1,561 529 Bryant Street PC-3974 +2,491 10 0 10 +10 1,571 520 Webster StreetC PC-3499 0 0 163 0 -163 1,408 305 Lytton Ave CDCP +200 1 0 1 +1 1,409 550 Lytton Avenue CDCP +4,845 19 19 0 0 1,409 Page 3 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT Downtown Extensive restriping by Transportation Division of on and off/street parking -96 1,313 531 Cowper Street PC-4052 +9,475 38 0 2 +38 1,351 540 Bryant Street CDCGFP +404 2 0 2 +2 1,353 530/534 Bryant Street CDCGFP +432 2 0 2 +2 1,355 555 Waverley Street/425 Hamilton AvenueD CDCP +2,064 8 0 0 +8 1,363 201 University Avenue CDCGFP +2,450 10 0 10 +10 1,373 518 Bryant Street CDCGFP +180 1 0 1 +1 1,374 245 Lytton Ave CDCP -21,320 90 149 0 -59 1,315 400 Emerson Street PC-4238 +4,715 18 5 1 +14 1,329 Page 4 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 443 Emerson Street CDCGFP +26 0 0 0 0 1,329 420 Emerson Street CDCP +125 1 0 1 +1 1,336 340 University Avenue CDCGFP -402 0 0 0 -2 1,334 281 University Avenue CDCGFP -2,500 0 0 0 -10 1,324 456 University Avenue CDCGFP +7,486 30 0 30 +30 1,354 536 Ramona Street CDCGFP +134 1 0 1 +1 1,355 725-753 Alma Street PC-4283 -1,038 7 7 0 -11 1,344 552 Emerson Street CDCGFP +177 1 0 1 +1 1,345 483 University Avenue PC-4296 +7,289 29 -2E 11 +31 1,376 Page 5 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 424 University Avenue CDCGFP +2,803 11 0 11 +11 1,387 901/909 Alma StreetD PC-4389 +4,425 18 18 0 0 1,387 171 University Avenue CDCGFP +1,853 7 0 7 +7 1,394 401 High Street CDCP +350 1 0 1 +1 1,395 430 Kipling Street CDCP +1,412 5 -4E 1 +10 1,405 460/476 University Avenue CDCGFP +1,775 7 0 7 +7 1,412 400 Emerson Street PC-4238 +2,227 9 0 0 +9 1,421 275 Alma StreetF CDNP +3,207 0 0 1 +1 1,422 390 Lytton Avenue PC-4436 +17,815 74 50 3 +27 1,449 Page 6 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 411 High Street CDCP +2,771 0 -4E 11 +15 1,464 530 Ramona CDCGFP 2852 11 0 11 +11 1475 705 Alma St CDSP 2814 11 0 11 +11 1486 200 Hamilton Ave CDCP 10,913 44 3E 35 +41 1527 550 Lytton Ave CDCP 93 0 0 0 0 1527 528 High St PF 0 0 211 G 0 -211 1316 445 Bryant PF 0 0 688G 0 -688 628 437 Kipling St CDCGFP 945 4 0E 2 +4 632 701 Emerson St CDSP 434 2 1 1 +1 633 723 Emerson St CDSP 400 2 2 0 0 633 Page 7 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 880 / 884 Emerson St CDSP 312 2 5 0 -3 630 539 Alma St CDCGFP 2,500 10 0 10 +10 640 270 University Ave CDCGFP 2,642 11 0E 11 +11 651 SUBTOTAL 86-02 106,930 672 1483 236 -578 651 901 High St. CDSP 12,063 59D 60 0 -1 650 800 High St. H PC-4779 -15,700 0 63 0 -63 587 164 Hamilton Ave CDCP -2499 0 0 0 0 587 335 University AveI CDCGFP 5,249 0 0 0 0 587 Page 8 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 382 University Ave CDCGFP 194 0 0 1 +1 588 102 University Ave CDCGFP 8 0 0 0 0 588 310 University Ave CDCGFP 7,481 30 0 30 +30 618 317-323 University Ave CDCGFP 3,290 0 0 0 0 618 564 University Ave CDCP 4,475 10 0 10 +10 628 325 Lytton Ave CDCP 17,515 110 6 0 -6 622 265 Lytton CDCP 21,151 106 52 0 +54 676 278 University CDCGFP +137 1 0 1 +1 677 340 University CDCP -1,360 0 0 0 0 677 524 Hamilton CDCP +9,345 31 8 23 +23 700 Page 9 PROJECT ADDRESS ZONING NET CHANGE IN NON/ RESIDENTIAL FLOOR AREA ADDED PARKING REQUIRED NET ADDED PARKING SPACES PARKING EXEMPTIONS PER 18.52.060 OF PAMC NET DEFICIT CHANGE TOTAL CUMULATIVE DEFICIT 630 Ramona CDCP +437 2 0 2 +2 702 668 Ramona CDCP +4,940 20 0 20 +20 722 661 Bryant CDCP 0 0 0 0 0 722 TOTAL 173,356 911 1672 323 649 722 A: Project approved during the Downtown Moratorium (9/84 to 9/86, but was not included in the Downtown EIR’s “pipeline projects.”) As a result, the project is counted among the CD District’s nonresidential development approvals since the enactment of the Downtown Study Policies in 1986 B: Through Assessment District project provided additional 64 public parking spaces as part of public benefit C: Addition of 2 levels of parking to Cowper/Webster garage D: Project was approved pursuant to PAMC Sections 18.83.120 or 18.83.130 which allow for a reduction in the number required parking spaces for shared parking facilities, joint use parking facilities, or substitution of 8 bike parking spaces for one vehicle space. E. Project removed existing on-site spaces or met required parking by paying in-lieu fee F: Site had existing parking sufficient to allow expansion G: Construction of 2 city parking lots. 528 High completed on Aug. 2003 and 445 Bryant completed on Nov. 2003 H: Part of the SOFA 2 CAP I: As per PAMC 18.87.055, the TDR area transferred to the site does not increase the number of automobile parking spaces required for the additional floor area. Page 10 ATTACHMENT G Commercial Downtown (CD) and SOFA 2 CAP Floor Area by Use Category (Rounded to the nearest 25,000 square feet) * The above table is rounded to the nearest 25,000 square feet and was based on a table originally prepared in 1986. Over the years, because of the rounding to 25,000 square foot increments, the table has had a greater margin of error. Staff attempted to update the table from the beginning in 1998; therefore the numbers may not compare directly to tables prepared prior to the 1998 report. Use Category Area (October 1986) Area (October 2011) Area Change, percentage 1. Offices 1,100,000 1,350,000 23% 2. Retail 500,000 625,000 25.00% 3. Eating & Drinking 150,000 275,000 83.33% 4. Financial Services 200,000 200,000 0.00% 5. Business Services 150,000 175,000 16.67% 6. Basement Storage 175,000 100,000 -42.86% 7. Hotels 100,000 150,000 50.00% 8. Personal Services 75,000 125,000 66.67% 9. Utility Facility 150,000 100,000 -33.33% 10. Public Facilities 50,000 75,000 50.00% 11. Automotive Services 150,000 50,000 -66.67% 12. Recreation/Private Club 25,000 50,000 100.00% 13. Theaters 50,000 25,000 -50.00% 14. Warehousing & Distribution 50,000 25,000 -50.00% 15. Manufacturing 50,000 0 -100.00% 16. Religious Institutions 50,000 25,000 -50.00% 17. Multi-Family Residential 250,000 400,000 50.00% 18. Single Family Residential 50,000 25,000 -50.00% 19. Vacant & Under Construction 150,000 50,000 -66.66% 20. Vacant & For Sale 0 0 21. Vacant & Available 150,000 100,000 -33.33% Total 3,625,000 3,875,000 5.52% ADJUSTED TOTAL: (Deduct residential uses, religious institutions, vacant & for sale and vacant & under construction.) 3,125,000 3,350,000 City of Palo Alto (ID # 3242) City Council Staff Report Report Type: Action ItemsMeeting Date: 11/5/2012 Summary Title: Parking Program Update Title: Update of Parking Program and Review and Direction on Parking Policy Strategies From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council review this Parking Program Update and provide direction to staff on the Parking Policy Strategies outlined, focused on parking supply options, technology and residential improvements. Executive Summary In the spring of 2011, the City began extensively monitoring downtown parking utilization in response to resident concerns that downtown parking structures were underutilized and on- street parking was intruding into adjacent residential neighborhoods. Extensive parking data collection efforts began immediately in both the Downtown and California Avenue Business Districts so that parking utilization baselines and strategies could be developed for Council consideration along with input from business and residential interests. On July 16, 2012, the City Council discussed a range of proposed work efforts by staff, but focused on potential residential permit parking program (RPPP) for the Professorville neighborhood. The Council directed staff to not proceed with the RPPP at this time and instead to focus on several other parking and zoning efforts. The Council asked for more specifics and an update of the efforts prior to the end of the year. This update provides a summary of parking strategies implemented-to-date within the Background section and outlines policy strategies for enhanced parking supply, technology solutions, and residential improvements in the Discussion section for consideration of the Council. Staff will be making substantive progress on these items over the coming 3-6 months subsequent to Council direction. Background The Council directed at the July 16, 2012 meeting that staff would not move forward with the trial Residential Permit Parking program for Professorville at this time, but would proceed with additional studies and actions related to parking in downtown, including but not limited to: a. Study of potential new public parking garage sites, capacities and costs; b. Methods to increase capacity in existing garages, such as attendant parking and adjustments to the permit/public distribution of spaces; c. Technology enhancements, such as gate controls, parking space identification systems, and parking permit processing improvements, etc.; d. Zoning studies and revisions, including study of the downtown cap on nonresidential space, the use of bonuses and transfer rights, variable parking ratios for office uses, and how to treat non-conforming parking sites; and e. Evaluation of paid parking options. Amendments to the main motion further directed that staff should evaluate: a. Parking exemptions; b. A Transportation Demand Management Program for downtown; c. Underutilized private parking garages; d. Funding options for new public parking garage sites; e. Zoning disincentives to having two car garages; f. Selective parking for those homes without a driveway or garage; and g. The use of the $250,000 from the Lytton Gateway Project earmarked for neighborhood parking preservation. Council asked that Staff to return to Council in three months with check in and return with an update before the end of the year. The Council’s July 16 Action Minutes are included as Attachment D and the full minutes are included as Attachment E. The remainder of this Background section recounts efforts to date and the Discussion section outlines the programmatic effort to address parking in the next 3-6 months. Parking Assessment Districts Both the Downtown and California Avenue Business Districts include parking assessment districts that provide parking for the respective areas. The parking assessment districts include fees paid by property owners/merchants to help repay city bonds issued to cover the cost of parking garage construction and permit fees that are used to cover the operations and maintenance costs of the parking programs including staff costs for the distribution of permits and parking enforcement. In the downtown, fees from parking permits also help to pay for police enforcement. Table 1 provides the current fee structure program for the Downtown and California Avenue Business Districts – Parking Assessment Programs. The table also provides a brief comparison of parking permit fees to those from Redwood City, San Jose, and San Francisco for Council reference. Table 1 Downtown and California Avenue Business Districts Parking Assessment Fee Program Parking Fee Palo Alto Local Agency Comparisons Downtown District California Ave District Redwood City San Jose San Francisco Assessment Fee $1.11/SQ FT * - - - Permit (Monthly) $45.00 $14.33 $30 to $60 $100 $215 to $395 Permit (Annual) $420.00 $123.00 $330 to $660 $1,200 $2,580 to $4,740 Day Permit $16.00 $7.00 None None None * Cal Av Assessment Fee varies by Parcel. Local employees working within the Districts are allowed to purchase parking permits to park in garages or on surface lots pending permit availability. Employees working outside of the assessment districts, however, are not allowed to purchase parking permits, but can purchase Day Passes to park within the facilities. When the two assessment districts were formed, the assessment districts allowed the City to issue bonds for the construction of parking structures and provided a guaranteed revenue mechanism through the assessment fee to pay the bonds back. Assessment districts are not common for jurisdictions, as many more typically opt to fund parking garage construction on their own and then recover the cost of construction strictly through monthly permit sales. Parking Permits In 2011 the City began evaluating changes in the parking permit distribution process in order to better allocate permits to employees within the districts, to fill up underutilized parking garage space, and to reduce parking intrusion to adjacent residential neighborhoods. The following parking permit program changes were implemented: Establish Monthly Parking Permits Distribution Thresholds Permits were previously distributed on a quarterly basis based on parking occupancy counts counted by the City’s parking enforcement unit. The amount of permits available at each lot varied per quarter depending on the results of the parking occupancy counts. Using historical data, the City established a maximum number of permits that should be released at any given time and the City continues to monitor parking occupancy to determine whether the threshold should be increased or decreased. The maximum number of permits released at any given time and the percentage of permits over supply by parking facility is provided in Table 2. Permit sales in the Downtown were up 9% in 2011 compared to 2010 and up 13% in 2012-to-date compared to 2010. In the California Avenue Business District permit sales have remained consistent with prior years. Permit Wait List Management Previously, anyone wishing to obtain a permit within a district could sign up for as many sites as they wanted in efforts to obtain a permit as quickly as possible. This resulted in unusually high wait list numbers at each facility or district in the case of the California Avenue Business District where a parking permit allows a permit holder to park at any parking garage or surface lot. The City now only allows a person getting on the wait list for a parking permit to do so once, and for only one site. In addition, the City charges a $10.00 fee to get onto a wait list, which is credited towards the ultimate first purchase of a parking permit. The number of persons waiting for a parking permit within the two assessment districts is provided in Table 3; the changes in permit wait list management are beginning to have a positive impact with shorter wait lists now than in previous years. California Avenue District – Permit Distribution Previously, because there was no limit on the number of permits or types of permits that a person could obtain within a district, it was not uncommon for someone in the California Avenue District to be on the wait list multiple times. Signing up on the wait list multiple times was a common practice of start-up owners trying to get permits for future employees. With the policy change to only distribute one permit per person, people who are on the wait list multiple times are contacted for permit availability, but only allowed for one permit to be registered to them. For the additional permits that the person may have been waiting for, the permits are allowed to be distributed to members of the same company but the permits are registered to the other individuals directly. This practice does allow for “hopping” of the wait list but there were only a few individuals who were on the wait list multiple times and staff anticipates that this condition will be phased out over the next six months. Unlike Downtown, previously distributed permits in the California Avenue Business District did not require permit holder validation at the time of renewal. People leaving the district simply passed their permits to other people, thereby delaying permit availability for people legitimately on the wait list. This resulted in unusually long permit wait times, sometimes in excess of one year. The City now requires a person renewing a parking permit to prove that they are a valid permit holder to whom the permit was originally distributed. If the person cannot show proof that they are the original permit holder, they are only being allowed a one-time renewal warning and then are required to get on the wait list as the permit will be cancelled at the end of the permit term. Online Permit Management System In the spring of 2012 the City awarded a contract to Progressive Solutions to develop and implement an online permit management system for the City. Using the maximum permit thresholds established by the City, the City can now release permits weekly (instead of quarterly) as they become available. The system also allows for monthly permit renewal versus the traditionally available quarterly or annual renewal options; the monthly permits costs shown in Table 1 reflect the current quarterly fee divided by three. Implementation of the system was delayed through the fall while the online wait list form was being developed. The City also just finalized hosting details for the system server. The wait list module is scheduled to be completed in October and the system should be launched in November. Persons are still required to return to City Hall to obtain their first permit and to validate proof of employment within their business district; the requirement to return to Revenue Collections may eventually be phased out and permits distributed by mail as additional technology enhancements are made. Table 2 Parking Permit Distribution Thresholds Lot Name # Hourly Spaces # Permit Spaces Total # Spaces Max # Permits % Permits to Supply Downtown - Parking Garages Q Alma/High (North) - 134 134 205 153% R Alma/High (South) 77 134 211 200 149% S/L Bryant St 381 307 688 575 187% WC Cowper/Webster 201 388 589 630 162% CC City Hall 187 519 706 820 158% B Ramona/University 63 - 63 - - 800 High Street 10 53 63 85 160% Downtown – Surface Parking Lots O Emerson/High 78 - 78 - - A Emerson/Lytton 68 - 68 - - C Ramona/Lytton 50 - 50 - - F Florence/Lytton 46 - 46 - - H Cowper/Waverly 90 - 90 - - D Hamilton/Waverly 86 - 86 - E/G Gilman St - 87 87 130 149% P High/Hamilton 51 - 51 - - KT Lytton/Kipling-Waverly 40 67 107 96 143% N Emerson/Ramona 48 - 48 - - X Sheridan Hotel - 36 36 55 153% California Avenue Business District California Avenue* 915 30 945 710 75% * Parking permits valid for any garage or lot. Table 3 Parking Permit Wait List as of October 18, 2012 Lot Wait List Lot Wait List CC 99 R 93 CW 152** S 70 EG 41 X 11 KT 4 Q 27 CAL AVE 333 ** Permit distribution temporarily suspended due to active construction at lot. Day Permits The Bryant Street (Lot S/L) and Cowper/Webster (Lot C/W) garages have permit machines that allow drivers to purchase daylong parking permits. Use of the machines has been extremely successful with each unit averaging $8,000 in sales per month each. Each of the downtown parking garages offer three (3) hours of free hourly parking, but requires rigorous enforcement to identify and cite violators. Day Permits may also be purchased at Revenue Collections in City Hall at a cost of $16.00 per day for Downtown and $7.00 per day for California Avenue. The City has also switched to “scratcher” day permits in 2012 in both districts to curb violators who were photocopying the previous paper permit formats. Parking Way-Finding Signage The City deployed 49 parking banners throughout the Downtown in January 2012 to help better guide motorists to surface parking lots and garages. The banners were reviewed and approved by the Architectural Review Board prior to implementation. The City also fabricated signs that matched the banners. However, the signs were ineffective due to the architectural color tones used and sign implementation stopped. There are 125 existing guide signs to parking facilities throughout the Downtown and 40 around the California Avenue Business District. The same parking banners used in Downtown will be presented later this fall to the California Avenue merchants as part of the California Avenue – Transit Hub Corridor Streetscape Project for input so that deployment in that district can occur before next Spring; the City estimates 40 up to 20 banners can be deployed around the existing California Avenue area parking structures and surface lots. The City is continuing its research on effective parking guide signs as discussed further in this report. Neighborhood Parking Preservation Staff spent the first half of the year trying to develop draft policies and pilot projects for a Professorville Residential Permit Parking (RPP) program. The general community consensus on a Professorville RPP pilot program showed that such a program was not supported by the broader neighborhood and Council directed that staff should focus on identifying a range of parking solutions within the Downtown core area and to identify appropriate technologies and strategies to advance as part of a comprehensive parking program for the City. The remainder of this report focuses on proposed parking strategies and policies for Council consideration to help improve the efficiency of parking operations and conditions in residential neighborhoods as a comprehensive parking program is further developed and implemented. The recommendations in the Discussion section are priotized in a time line provided in Attachment A. Discussion The modifications to the City’s permit management program are showing a positive change in the City’s ability to more quickly distribute permits. The impact has been more profound in the Downtown Business District where permits are managed by lot, rather than the California Avenue Business District, where permits can be used at any surface lot or garage and where changes in permit distribution will have a gradual effect over the next year. Permit management has also been the focus of the City’s efforts to get vehicle users to obtain and use permits. Permit management will be ongoing for efficiency purposes but new strategies beyond permit management are now required to enhance the parking program in both districts. It should be noted that in the Downtown District, the Cowper-Webster Garage (Lot C/W) is currently undergoing facade improvements that have resulted in the temporary loss of permit parking through the construction period. Persons with permits for the Cowper-Webster Garage are being temporarily allowed to park at the Bryant Street Garage (Lot S), further slowing down permit distribution at that garage as well. Construction at the Cowper-Webster Garage should be complete before the start of the Holiday shopping season. Several other key efforts are underway to enhance parking supply, more efficiently use available supply, reduce parking demand, and address the impacts of new development. Downtown Parking Garage and Attendant Parking Study The City completed a Request for Proposals (RFP) solicitation in October and will be awarding a contract this fall to complete a feasibility study for an additional parking structure(s) in the Downtown. The study will focus on five surface parking lot sites including: Lot D Hamilton Avenue & Waverley Street Lot EG Gilman Street Lot P High Street between University Avenue & Hamilton Avenue Lot O High Street between University Avenue & Lytton Avenue Caltrain Lot Urban Lane between University Avenue and PAMF For each of the sites the feasibility study will identify potential Parking Garage Footprints, Parking Space Counts, 3D Modeling of Parking Structure Massing, Constructability Factors, and Engineer’s Estimates. Staff will also evaluate potential funding options in its report-out to Council. The Constructability Factors will include elements to determine which sites provide the best value for parking versus construction constraints, such as: parking space count; private property impacts (during and post-construction); construction staging impacts; number of driveway/pedestrian access points for convenience measure; cost; adjacent land uses to determine whether a preferred long-term land use opportunity would be lost if garage construction were pursued; and utility relocation impacts. The study will also include an Attendant Parking Study to determine whether the deployment of a parking attendant program may be a viable option to temporarily or permanently supplement the City’s parking permit program needs. The Attendant Parking Study will determine the number of additional parking spaces that can be gained at each of the existing parking garages in Downtown and provide program outlines to implement them on a trial basis including key-return stations. Two options for attendant programs are typically used: a) where a motorists parks the vehicle themselves, guided by an attendant, and the keys are then handed over to the attendant in case the vehicles needs to be moved; or b) a motorists leaves the vehicle with the attendant who then parks the vehicle. In other cases, a motorist may be issued a valet card to confirm car release later and the vehicles are typically parked behind other parked cars. The study will also focus on likely hours of operation to maximize benefit and minimize cost. The Palo Alto Downtown (PAD) Business and Professional Association – Parking Committee, which is responsible for helping the City provide oversight on the Downtown Parking Assessment District, has indicated a preference towards immediately implementing an attendant pilot project, focused on permit parking. Staff believes such a trial for permit spaces should proceed, however, only after the work on the Cowper-Webster garage is complete and all spaces are then available, and probably after the Holiday season, to avoid any confusion for shoppers. Funding for the trial would come from the Downtown Permit Fee program. The study will take up to 6 months to complete and the results presented to the City Council in the spring. The study is funded substantially by a community benefit contribution from the Lytton Gateway Project, which provided $60,000 to complete the study. The study will cost $100,000 and the gap is being funded by the City through the Capital Improvement Program (CIP), PL-12000 (Transportation & Parking Improvements). The results of the study will be used to determine whether the City should pursue construction of a new parking structure using its own local funding, enterprise funding to build a parking structure in conjunction with additional office facilities, or to pursue a private partnership with land developers to help build a parking facility. The City currently has approximately $2.6 million in the Downtown In-Lieu Parking Fee program (once the building permit is issued for Lytton Gateway, expected prior to the end of the year). During the July 2012 discussion on parking the Council expressed interest in also pursuing opportunities to make available private structure parking for public parking. Staff surveyed the existing private lots around downtown and found them either fully parked or inaccessible due to security procedures. Recommendation No. 1: Direct staff to implement a trial Parking Attendant Valet Parking Program for permit parking in at least one garage, beginning shortly after the first of the year in 2013. The study should monitor operations, estimate costs, and identify benefits/challenges with implementation. Downtown Cap Study Staff is currently developing a Request for Proposals to study the land use types, densities, and recent and projected development around the Downtown to determine future land use and parking needs/strategies to support land use changes. The study is a requirement of the City’s Zoning and Comprehensive Plan, which establishes a Downtown Cap of 350,000 square foot net increase since the adoption of the 1986 Downtown Plan. The Zoning Ordinance requires a re- evaluation of the cap when a 235,000 square foot “study threshold” is met. That threshold is nearly met with the approval of the Lytton Gateway project approved earlier this year and will be exceeded if the 135 Hamilton Avenue and 636 Waverley projects are approved. While the 27 University project is not within the bounds of the Downtown zone prescribed in the 1986 study, staff will be reviewing ways to appropriately consider it in the Downtown study and specific impacts would be considered in that project’s Environmental Impact Report . Staff expects that the Downtown Cap Study will cost approximately $100,000-$150,000 and will take approximately 6 months to complete. The budget does not currently include funding for the study, but staff proposes that at least some of the funding come from the Lytton Gateway “Neighborhood Parking Preservation” benefit (of a total $250,000) and perhaps be supplemented by other development project contributions. Recommendation No. 2: Direct staff to pursue the RFP for the Downtown Cap study, and report back to Council in six months regarding results and recommendations. Zoning/Parking Revisions and Transportation Demand Management (TDM) Program Staff will, simultaneous with the Downtown Cap study, review a variety of zoning provisions related to parking, particularly in Downtown. Staff has recently proposed and Council has enacted a moratorium on one such zoning provision that exempted up to 1.0 floor-area ratio from parking requirements for certain properties. Staff expects to also evaluate: a. Other exemptions from parking requirements, including but not limited to transfer of development rights (TDR); b. Parking reductions for transit proximity, mixed use, transportation demand management (TDM) measures, and for affordable and senior housing; c. Appropriate ratios of parking, particularly for office development, more reflective of recent employee densities, and possible parking incentives for retail over office uses; d. How conversions of existing uses to more intense office uses are treated/managed in the zoning requirements; and e. The relationship between required/covered parking and floor area, particularly for homes (e.g., to avoid discouraging garages, though respective of historic issues where applicable) Planning and Transportation staff also will work with on-call transportation consultants to initiate a Transportation Demand Management (TDM) Program for the City and its employees to demonstrate exemplary means of reducing work and non-work trips. This effort will be a precursor to facilitating a downtown-wide TDM program, coordinated with the Palo Alto Downtown and area businesses to take advantage of programs that can benefit the Downtown as a whole. Recommendation No. 3: Direct staff to develop zoning ordinance revisions to address parking impacts from development, including: a) parking ratios, b) parking exemptions, c) requirements for both TDM programs for new development; and to work with the Downtown businesses to develop a coordinated downtown area TDM effort. Technology Enhancement: Garage Parking Access and Revenue Control Equipment The City’s new Permit Management System will allow the City to more easily distribute permits but when used in combination with garage parking access controls (gates) the City will also be able to track parking permit usage to further manage the permit program. For example, the City currently does not have any data that shows how regularly people use their parking permits. Later this fiscal year, the City will release its first ever transportation survey that aims to measure transportation mode use by region of the City. The high percentage of permits sold over supply (Table 2) shows that within the Downtown, people are likely regularly using another form of transportation to get to work such as Caltrain or are choosing to park elsewhere when it’s more convenient, even though they have a permit. Garage Parking Access control is another step the City can take in the long-term management of its parking infrastructure by helping to reduce operations costs for enforcement. The access controls regulate entry and exit from a garage and allow visitors to continue to enjoy the current three hours of free parking to support downtown business activities, but include Revenue Control equipment that allow visitors to stay parked beyond the free 3-hour period at a fee up to the $16.00 day permit fee. Staff has a prepared a Draft Request for Proposals (RFP) so that cost estimates can be determined and to “bring the best of the technology” to the city for review with participation from the Downtown Parking Committee. The Draft RFP proposes conversion of the Bryant Street Garage (Lot S/L) to gate control with revenue collection elements but identifies the Alma Street/High Street Garage (Lot R) as an alternative site for inclusion depending on bid results. The City estimates the cost of installing Garage Parking Access and Revenue Control Equipment at each garage at approximately $250,000. The RFP proposes unique technology development through the use of QR Codes in combination with apps for processing of payments as a convenience alternative to motorists. The same technology would allow businesses to establish convenient validation alternatives for visitors, patron and employee parking needs. The RFP was shared with the Palo Alto Downtown (PAD) Parking Committee during its September and October 2012 meetings. Concerns have been expressed about the controls being the first step to imposing “paid” parking on downtown, but staff believes that this technology actually provides flexibility for a wider range of parking options, with no increase in parking costs for those visitors staying less than 3 hours. Revenue realized from the metering beyond the free 3- hour period could be partially dedicated towards the Parking In-Lieu Fee program to help fund construction of future parking facilities, consistent with the setup of typical assessment district programs. Funding for a trial garage parking access and revenue control equipment project is available within the existing CIP but, if interested, funding through the current Parking Assessment or Parking In-Lieu fee program are viable alternatives. Recommendation No. 4: Direct staff to release an RFP for Garage Parking Access and Revenue Control Equipment for near-term deployment, and to involve the Downtown Parking Committee in the operations and design process. Technology Enhancement: Parking Occupancy Tracking and Dynamic Way-Finding Directing motorists immediately to available parking helps to reduce greenhouse gas emissions, enhances the customer experience in the downtown, improves the economic vitality of the downtown, and improves safety for bicyclists and pedestrians. The City currently does not have any mechanism in place to monitor parking occupancy “real-time,” so deployment of dynamic way-finding with accurate information is not feasible, nor is pushing parking availability information online feasible either. The City has outreached to three vendors over the past year to help develop new technology to monitor parking occupancy and tabulate information that can be made available to the public online, through apps, and to Parking Guidance Systems that offer dynamic way-finding technology. Unfortunately, no viable option has yet been identified. The City was approached by Streetline Networks in partnership with Cisco Systems over the summer to deploy their technology to monitor and push parking occupancy information online but that was not desirable due to the high on-going annual operations cost. The Streetline Networks/Cisco System solution included one free year of service and included maintenance of field equipment, but the solution though would cost the City over $350,000 per year. Solutions such as that of Streetline Networks only make sense at locations where metering is utilized to offset the cost of the technology, as is the case in the cities of San Francisco and Los Angeles. Staff is not recommending metering on-street parking spaces at this time, but does want to identify parking monitoring solutions that can be City-owned solutions versus leased to reduce long- term operations costs. Effective monitoring of parking occupancy also introduces the ability to consider congestion-pricing parking on-street if the Council wants to consider that type of technology in the future. Being immediately adjacent to the second largest Caltrain Station along the Peninsula supports that type of activity by making alternative modes of transportation more attractive to people over driving. The City will continue to try and outreach to technology firms to develop new market solutions for the City. The Gate Parking Access and Revenue Control Equipment would allow for dynamic way-finding to be deployed, highlighting parking availability at parking structures. Alternative solutions may include establishing detection technology only now, that may be used later by future Garage Parking Access technology, to estimate garage occupancy. In the meantime, the City will continue its seasonal parking occupancy data collection of the Downtown and California Avenue Business Districts, that includes counting each vehicle parking space on-street and within each parking facility by time-of-day to track changes in parking patterns. The City collected parking occupancy data in the Spring/Fall/Winter 2011 and is scheduled to collect data gain in early November. Data collection includes monitoring parking occupancy between 12AM-2AM, 8AM-10AM, 12PM-2PM, and 7PM to 9PM on a weekday and 12PM-2PM on a Saturday. Recommendation No. 5: Direct staff to continue research of technology-based parking solutions to monitor parking occupancy. Electric Vehicle Parking The City currently has 7 electric vehicle charging stations available in the Downtown at the Civic Center Parking Garage (Lot CC – Level A, 3 chargers), Bryant Street Garage (Lot S/L – Level 2, 3 chargers), and the Alma/High North (Lot R – Level 2, 1 charger). The charging stations are extremely popular and realize regular occupancy usage throughout a typical week. There are no charging stations available in the California Avenue Business District. The City has considered the development of a Request for Proposals for the development of a privately- owned network of electric vehicle charging stations network. The Stanford Shopping Center currently has 3 charging stations including Northern California’s only Rapid Charging (Level 3) Charger. The Stanford Shopping Center chargers are privately owned and require a fee-per-use to charge. Development of a private network of chargers in Palo Alto would operate under the same model and convert the existing charging stations into the private network to avoid competition with the private network given the high cost to install the network. To meet the immediate demand for electric vehicle charging in the City, staff recommends conversion of at least five (5) parking spaces in the California Avenue Business District to electric vehicle charging spaces and an additional six (6) parking spaces in the Downtown. Staff recommends additional Level 2 Chargers similar to those currently deployed that can charge a vehicle in as fast as 2 hours. The Downtown Library, which was renovated last year, includes infrastructure for providing electric vehicle charging stations in its parking lot; this could be a location for some of the additional Downtown spaces. The City has 6 electric charging stations included as part of development conditions of approval for the 101 Lytton Gateway Project (4 chargers) and the Edgewood Plaza (2 Chargers) shopping center. These stations will not be available until next year when construction at each site is complete. Recommendation No. 6: Direct staff to pursue the installation of 6 additional electric vehicle charging stations in Downtown and up to 5 electric vehicle charging stations around California Avenue. Bicycle Parking and Bicycle Share Programs The City has approximately 150 bicycle racks (250 bicycle capacity) in the Downtown. This includes 6 recently deployed bicycle corrals deployed around Downtown which offer up to ten bicycle parking spaces in lieu of one on-street parking space. Downtown has an additional three bicycle corrals planned for installation this calendar year as part of the New Apple Store construction at University Avenue & Florence Street (2 bicycle corrals) and one at Lyfe Kitchen, which requested installation by the City this fall. The City offers free installation of bicycle corrals upon submittal of an application (Attachment B) and investigation by the City, including outreach to adjacent businesses to validate support for installation of the facility. In the California Avenue Business District, the City has 24 existing bicycle racks (77 bicycle capacity). The City has a dozen additional bicycle parking facilities identified for the California Avenue Business District for a future bicycle parking capacity of up to 130 bicycles as part of the active California Avenue Transit Hub Corridor Streetscape project including 6 bicycle corrals. Business owners may request free installation of bicycle racks within the public right-of-way following an engineering investigation by staff. Where installation of bicycle racks within the public right-of-way is not feasible for convenient, the City offers free bicycle racks to business and property owners for their installation on their private property; persons interested in free bicycle racks may simply contact the city via email at transportation@cityofpaloalto.org. The Valley Transportation Authority (VTA) Bicycle Share Program will be providing 100 bicycle share bicycles to Palo Alto as part of its partnership program with the Metropolitan Transportation Commission (MTC) to deploy a program along the Peninsula. The program was delayed due to technology development but should return to the City with a deployment schedule by the end of the year. The sites reviewed by the Architectural Review Board include: University Avenue & Emerson Street (adjacent to Lytton Plaza in an on-street Parklet), King Plaza at City Hall, University Avenue & Cowper Street, the University Avenue Caltrain Station, and the California Avenue/Park Boulevard Park Plaza. Additional facilities will be provided around the Stanford Campus as part of the program. As part of the bicycle share investigation, staff identified dozens of additional potential bicycle share sites including the Stanford Research Park, libraries and community centers, senior facilities, and Midtown but during this initial deployment both MTC and the VTA request to keep the deployment focused along the Caltrian stations. As bicycle share deployment continues, staff will outreach to existing business parks to solicit and encourage participation in the program. Recommendation No. 7: Direct staff to pursue additional bicycle parking stations around both the Downtown and California Avenue Business Districts. Residential Parking Policies During the discussion of the Professorville trial Residential Permit Parking (RPP) program in July, the Council requested that staff consider options to allow designated on-street parking spaces for historic homes within the Professorville neighborhood that do not have on-site parking (driveways and/or garages), since consideration for RPP programs is being deferred until a broader parking program is put in place. In response to the Council request, staff has developed two policy approaches focused more collectively to the entire neighborhood concerns: 1) On-Street “Disabled Accessible” Parking Spaces The City does not currently have a policy to allow for the installation of on-street parking spaces for the disabled within residential neighborhoods. Staff recommends Council consider a policy allowing for residents to apply the consideration of on-street accessible parking spaces in front of their homes for convenience and quality of life benefits. If the Council is supportive of this concept, staff will return with a draft policy and application for the Council’s review to define the criteria and investigation that staff would be required to complete to ensure consistent distribution of accessible parking spaces. The policy would address factors including costs of installation and maintenance of the accessible parking, proof of “accessibility” need, and compliance and misuse/removal procedures if abused. The accessible spaces would not be designated spaces for the applicant but by providing the space immediately in front of one’s residence increases the likelihood of having the space available for use by the resident. As an accessible space, however, the parking could be used by any motorist displaying a valid accessible placard issued by the State of California. 2) Neighborhood Short-Term and Commercial Loading Zones One of the frequent concerns from residents adjacent to business districts includes the lack of parking for service vehicles such as landscapers, plumbers, etc., who are trying to provide basic services to residents but cannot do so at times depending on parking availability. Professorville residents who do not have any on-site parking facilities feel an even greater impact. Staff recommends consideration of the deployment of Neighborhood Short-Term and Commercial Loading Zone spaces around the Professorville and Downtown North neighborhoods, at least one per block and spaced a maximum of 500-FT apart to allow for parking availability to accommodate basic service vehicles and short-term parking needs. The spaces can be either a short-term parking restriction (30-minutes) or commercial/service vehicle use (2-hours) to support residents. This solution provides an equitable solution for all residents regardless of whether the homes are historic or not. If the Council is supportive of this concept, staff will provide outreach to neighborhood groups to identify the appropriate on-street parking spaces to support these activities and then will return to the Council following input from the Planning & Transportation Commission for implementation of a demonstration project in the Spring. 3) On-Street Parking Spaces in the Professorville Area During the July 2012 parking discussion, the Council requested that staff consider options to help alleviate parking impacts to homes around the Professorville area without garages, driveways, or other on-site parking. Staff has identified eleven homes around that Professorville area without on-site parking (see Attachment C), additional sites may exist. The proposed Neighborhood Short-Term/Commercial Loading Zone spaces would offer solutions equitably to the community, but may not be enough for residents of these particular homes. If the Council is supportive of such a solution staff will initiate outreach with affected residents and return with a policy for adoption. Staff expects that any related implementation would be on a trial basis. Recommendation No. 8: Direct staff to return to the City Council for consideration of an On-Street Accessible Parking Space Policy. Recommendation No. 9: Direct staff to initiate outreach to residents in Professorville and Downtown North to develop short-term parking space strategies. Recommendation No. 10: Discuss and provide direction for On-Street Parking Permits for homes in the Professorville area without parking or driveways. Parking Permit Management Regular parking permit management and recent enhancements have proven effective to date to more quickly get permits to vehicle users and should be continued. Permit management has benefited the Downtown Business District more quickly than the California Avenue Business District due to the permits being designated to individual facilities. The California Avenue Business District has two parking garages, each of which realize high occupancy during peak noon periods on top floors, but much lesser use at other times. The availability of new parking permits in the California Avenue Business District that can be used only at top floors of each garage may be helpful in more quickly distributing permits to motorists and help to fill underutilized portions of the garages and allow for premium first floor parking to be retained for visitors until after the noon peak hour. Recommendation No. 11: Direct staff to begin discussions with California Avenue merchants focused around the development of new parking permit strategies. Timeline This report recommends several project and policy considerations for the Council focused around further developing parking strategies to develop a comprehensive Parking Program for the City. Staff will return to the Council within three months with a more defined schedule for the implementation of solutions the Council identifies as appropriate for further consideration or immediate implementation. Resource Impact Two new contracts are being pursued as part of the Parking Program, including a $100,000 contract for a Downtown Parking Garage and Attedant Valet Study and $100,000-$150,000 for the Downtown Cap/TDM Study. Each contract will be submitted separately to Council for approval, along with any necessary Budget Amendment Ordinances. This staff report includes recommendations for helping to develop a Parking Program Master Plan. After Council provides feedback on which recommendations to pursue, staff will return to the Council within 3 months with a more refined cost program. Environmental Review This report requests direction from Council on parking strategies that it would like staff to pursue, but at this time no specific projects affecting the environment ar being approved. Each project within the Parking Program may require additional environmental review for compliance with CEQA requirements and will be evaluated prior to implementation. Attachments: Attachment A: Summary of Parking Work Program (PDF) Attachment B: Bicycle Corral Application (PDF) Attachment C: Professorville Homes w/No Driveways - Oct 2012 (PDF) Attachment D: City Council Action Minutes of July 16, 2012 (PDF) Attachment E: City Council Full Minutes of July 16, 2012 (PDF) Attachment F: Public Comments (PDF) Prepared By: Jaime Rodriguez, Chief Transportation Official Department Head: Curtis Williams, Director City Manager Approval: ____________________________________ James Keene, City Manager 1 Nov ‘11 Dec Jan ‘12 Feb Mar Apr May Jun FY2014 Tasks Permit Management Garage Study - Garage Analysis - Valet Analysis Pilot Valet Study Downtown Cap Study Neighborhood Programs - ADA On-Street - Short Term Alternatives/Homes with No Off-Site Parking Technology Solutions Cal Ave Parking Program Parking Program Task Timeline Pending Council Input On‐Street Bicycle Corral Application Bicycle Corrals are enhanced bicycle parking facilities installed on‐street within a traditional vehicle parking space or appropriate on‐street location. The bicycle corral includes a green textured pavement treatment to help designate the space from adjacent vehicle parking spaces with a 10‐bike, bicycle rack. Yellow parking blocks are installed on each end of the bicycle corral to prevent vehicle parking intrusion. The City of Palo Alto installs bicycle corrals to help promote bicycling activity and to help provide visible and secured bicycle parking in high‐use bicycle areas. The bicycle corral installations are a partnership between the City of Palo Alto and the adjacent property owners/businesses through a maintenance agreement (attached). The City provides installation of the bicycle corrals while the property owners/businesses take on maintenance around the bicycle corrals. For a bicycle corral to be considered in front of your business or property, please complete the application below and return to the City of Palo Alto – Transportation Division. Business Owner Property Owner – (Optional) Company Name: Contact Person: Address: Palo Alto, CA 94301 Day Phone: Email: Signature/Date: 1. Preferred Bicycle Corral Location 2. Estimated amount of bicycle activity on weekday and weekends Note: After submission of the application, Transportation staff will contact the applicant to discuss location feasibility and determine if bicycle parking demand exists. Submit to: City of Palo Alto – Transportation Division Staff Review: 250 Hamilton Avenue Date: Palo Alto, CA 94301 O: (650) 329‐2441 F: (650) 329‐2154 Recommend Install: Yes transportation@cityofpaloalto.org No Director Approval: Professorville Historic Neighborhood Homes without accessible Off-Street Parking October 23, 2012 EXCERPT FROM CITY COUNCIL ACTION MINUTES OF JULY 16, 2012 ATTACHMENT D Water, Gas, Wastewater, Storm Drain and Public Works Construction Inspection Services. 10. Resolution 9274 entitled "Resolution of the Council of the City of Plao Alto Placing an Initiative Measure on November 2012 Ballot to Permit Three Medical Marijuana Dispensaries to Operate in Palo Alto. 11. Approval of Contract for Goods (Purchase Order) for the Acquisition of Toshiba Laptops. 12. Approval of Fiscal Year 2012 Re-appropriation Requests to be Carried Forward into Fiscal Year 2013. MOTION PASSED: 5-0 Burt, Klein, Scharff Schmid absent AGENDA CHANGES, ADDITIONS, AND DELETIONS MOTION: Mayor Yeh moved, seconded by Council Member Shepherd to not hear Agenda Item No. 15. -±-5-;-CONFERENCE V/ITH LABOR NEGOTIATORS City DeSignated Representatives: City ~4anager and his designees pursuant to ~4erit System Rules and Regulations (James Keene, Pamela Antil, Dennis Burns, Lalo Perez, Joe Saccio, Kathryn Shen, Sandra Blanch, ~4arcie Scott, Darrell ~4urray) Employee Organization: Palo Alto Police Officers Association (PAPOA) Authority: Government Code Section 54957.6(a) MOTION PASSED: 8-0 Schmid absent ACTION ITEMS 13. Direction on Downtown Parking Strategies and Approval of Trial Residential Permit Parking Program In and Around the Professorville Neighborhood. MOTION: Mayor Yeh moved, seconded by Council Member Holman to not move f6rward with the trial Residential Permit Parking Program, however to: 1. Direct Staff to proceed with additional studies and actions related to parking in downtown, including but not limited to: a. Study of potential new public parking garage sites, capacities and costs; b. Methods to increase capacity in existing garages, such as attendant EXCERPT FROM CITY COUNCIL ACTION MINUTES OF JULY 16, 2012 ATTACHMENT D parking and adjustments to the permit/public distribution of spaces; c. Technology enhancements, such as gate controls, parking space identification systems, and parking permit processing improvements, etc.; d. Zoning studies and revisions, including study of the downtown cap on nonresidential space, the use of bonuses and transfer rights, variable parking ratios for office uses, and how to treat non- conforming parking sites; and e. Evaluate paid parking options. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER TO INCLUDE: 1) parking exemptions, 2) TDM Program, and 3) to direct Staff to look at underutilized private parking garages. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER TO INCLUDE to direct Staff to return to Council in 3 months with check in and return with an update before the end of the year INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER. AND SECONDER to direct Staff to: 1) return with funding options for new public parking garage sites, and 2) include that the zoning studies would evaluate disincentives to having two car garages. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to evaluate the use of $250k currently budgeted in the Lytton Gateway Project. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to include "Professorville at this time" after "Residential Permit Parking Program" in the first part of the Motion. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to direct Staff to evaluate selective parking for those homes without a driveway or garage. MOTION: Council Member Klein moved, seconded by Vice Mayor Scharff to call the question. MOTION PASSED: 5-3 Espinosa, Price, Shepherd no, Schmid absent MOTION PASSED: 6-2 Espinosa, Price no, Schmid absent EXCERPT FROM CITY COUNCIL MINUTES OF JULY 16, 2012 MINUTES ATTACHMENT E ACTION ITEMS 13. Direction on Downtown Parking Strategies and Approval of Trial Residential Permit Parking Program In and Around the Professorville Neighborhood. Curtis Williams, Director of Planning and Community Environment, said one of the main pOints he wanted to make was that while they would probably spend most of the time that evening discussing the trial permit program in the Professorville area that it was a small but important part of a more comprehensive look at the downtown parking situation. There were a number of efforts related to parking management, supply, and demand that the City had worked on. There was an active permit management system they re~ently put into place to distribute permits. Staff was beginning a parking garage study to look at the supply issue as well as more efficient ways to use the garages and parking lots. They were looking at a number of technologies and parking enhancements to more efficiently use the spaces and publicize and provide mobile technology for information purposes. They were before Council to discuss the trial program for a portion of Professorville but would then go into a larger look at areas of downtown including Downtown North. They also had a bicycle share program parking efforts that they were undertaking to study bike parking as well as vehicular parking. In terms of the parking garage study the Staff was looking at using some of the funding provided by the Lytton Gateway project to complete a feasibility study of three or four parking lot sites in the downtown area. The study would determine the feasibility of construction of additional garages at those locations and the capacity and construction costs. Staff was also looking at a trial of attendant parking in some of the garages to see if there was away to provide more spaces and increase the use of the garage space the City had more efficiently. He said they would continue to evaluate the balance of permit and hourly spaces in those garages. They had already converted some hourly spaces to permit spaces which had helped create more parking supply for permits. On the technology side they looked at parking guidance systems which let people know how many spaces were available. They also looked at evaluating gate controls to allow for metered parking and longer stays downtown. Specifically related to the proposed residential parking permit trial program in Professorville, Staff visited with the Council in fall 2011 regarding the broad parking program efforts. Many people attended the meeting who were concerned about the parking impacts from downtown on the Professorville area. He said they convened a Staff generated group to discuss those issues further and included a handful of active residents and representatives from downtown businesses. There were also Staff members and one Council Member and one Planning and Transportation Commissioner in the group. They met monthly for Page 6 of 47 City Council Meeting Minutes: 7/16/12 MINUTES approximately the past six months with the aim of looking at trial parking programs and how the City monitored the effects of the other parking strategies on the neighborhood. He said they also tried to evaluate why people parked on the street as opposed to in garages and parking lots. From there they outlined potential opportunities for residential permit parking programs. Some of the concerns they heard were how parking impacted the quality of life in residential neighborhoods and the parking availability for residents. He stressed the need to balance those concerns with the needs of employee parking in the downtown area because the streets were also public resources. He recognized that they worked with a group they invited to meet with them and not the broader neighborhood of Professorville or the entire downtown residential community. He said that they were looking at a fairly small area, but it was Staff's feeling that it was extremely important to put together something that could be looked at to ascertain the balance of how much residential protection was necessary versus how much employee parking could be allowed without creating an extreme impact one way or the other. They thought a localized program allowed them to beta test the approach. Staff recognized there would be a broader effort following the three to six month trial period. Jaime Rodriguez, Chief Transportation Officer, said it was important to look at the effort Staff made over the last year with the parking issues. He showed a slide of available parking spaces within the downtown corridor. Staff used that data to educate itself about the supply and to try to find ways to maximize on-street spaces. As an example, through analysis, Staff added 32 on-street spaces, reduced red zones, and converted inefficient parking allocations. Staff also measured the occupancy of on-street throughout the greater downtown area from Palo Alto Avenue down to Embarcadero to Alma to Middlefield because they needed it for the permit parking process. on-street Staff used data in conjunction with research from the residents to determine the correct corridor to look at a potential residential permit parking (RPP) study project. The downtown core of Lytton, University, and Hamilton had about 1,100 parking spaces on-street. He said that Staff took the data and guided the discussions held by the working group. They recommended a framework of four specific items to the working group as they developed the RPP program. One was to provide a buffer of at least one block between commercial uses and residential use to allow for transition and change in use. When they considered RPP streets they focused on the streets that were local and not arterial. For example, Alma or Middlefield were not appropriate streets for a RPP. At the same time, residential arterials such as Homer and Channing also moved traffic in and out of the downtown so those were streets that were not appropriate for consideration of RPP. Staff suggested that RPP's should focus on-streets that were more single family home based versus multifamily unit based. Page 7 of47 City Council Meeting Minutes: 7/16/12 MINUTES When the land uses were majority multifamily use it automatically generated a high demand for parking. Streets with those uses did not lend themselves to programs such as the RPP. Staff also wanted to make sure that whatever program was recommended in an RPP form was cost neutral and sustained itself without impacting or drawing from existing City resources. Thinking more globally, Staff tried to pool all of the RPP districts into one fund to help maintain costs for RPP permits around the City, rather than try to manage several RPP funds. Different tiers of RPP only created inequity in the community. He showed the proposed boundary for the proposed RPP district that the working group reached consensus on. It was south of Channing, Addison, Lincoln, Ramona, and Emerson and represented approximately 190 on-street parking spaces. The working group discussed details on how the RPP would work and they came to consensus on several factors. One was that offering one permit to residents was a way to demonstrate what the long term benefit of RPP was because if the program were implemented long term those residents would want to purchase the permits long term. They also wanted to ensure that there were permits available to residents beyond the one free permit. They recommended a cost of $50.00 for each additional specific vehicle or every additional permit that could be hung from a rear view mirror for guests. They recommended random enforcement to help measure the type of compliance they received through changes in regulatory signage as well as citation revenue for future long term operation and sustainability. One of the unique elements of the program was that they wanted to make sure there was a balance between the resident uses and the existing next door commercial uses. One of the items the working group reached consensus on was making a small portion of on-street spaces available for neighboring uses through the sale of non-resident permits at the same cost of $50.00 throughout the trial period. Multi-guest or day passes were also available at the cost of $1.00 per permit. They also discussed the length of the program and decided the trial program should be a minimum of three months and should last up to six months. Because they had collected strong baseline data for the program, it was simple for Staff to measure any impact from people moving from one street onto a street that was outside the RPP area. Once the working group built a consensus on the boundaries and elements of the RPP program it surveyed the people that lived within the area. They sent out approximately 103 surveys and received back about 68 responses. Of the 68 responses, 82 percent supported the implementation of a trial project. He showed the survey that the residents were asked to respond to and noted that a follow up survey was sent, which helped them get to the 68 responses they received. There was much conversation about how to measure the success of a trial. The first and foremost way to measure the success was the parking occupancy on the street. They had the baseline data and they needed a measure to determine if the program provided a benefit or caused an impact to the Page 8 of 47 City Council Meeting Minutes: 7/16/12 MINUTES adjacent streets. They recommended trying to achieve a goal of a maximum of 80 percent occupancy by implementing the RPP trial. He explained that would create more yellow zones within the area. Yellow zones meant that a motorist should be able to find a parking space on the street they wanted to park on. Staff would study what happened to the adjacent streets and see if there were adverse effects. Staff also wanted to measure demand for permit sales not just for the residents but also for the non-residents. They talked about making 51 permits available, but they needed to know if there was demand by the neighboring community for those permits. With respect to measuring parking compliance he said that many times simple regulatory signage went a long way in implementing behavioral change. However, if that was not followed up by enforcement the City would not realize a long term benefit in permanent change. He said that measuring parking compliance helped them measure whether or not they saw cars adhering to the proposed two hour parking restriction which was available for anyone to park in the area, and whether or not they were forced to issue citations as a community to those who did not adhere to the rules. He said that many residents discussed quality of life. The only way to measure that was quality versus quantity based. Staff wanted to survey residents and invite them to participate in community outreach meetings as they contemplated the longer term vision of the RPP. The last thing the working group looked at was the operations cost. There were several factors related to parking compliance which fed into the measure, but the largest piece was the permit sales. If the City had an RPP area but was not selling permits it was not going to be a successful area. The objective was not to simply push people out. The RPP program's purpose was to provide parking to residents. He said that the community received a $250,000 contribution from the Lytton Gateway project for downtown parking preservation projects. Staff discussed dedicating $125,000 of the contribution for projects for the area south of Forest Avenue. Professorville was one option. Another option was to dedicate $125,000 towards projects in Downtown North. He said a pilot Professorville RPP program could cost up to $50,000. That covered the cost of signage, of Revenue Collection Staff to purchase and administer the distribution of permits, of random enforcement by the parking compliance Staff, and allowed the City to measure the long term cost of a RPP in the community. Mr. Williams said the Council was very aware that the parking zoning issues meshed with the recent permit activity, the development downtown and the discussions that went on over some of the projects. Some of the issues relative to those projects were exemptions laid out in the ordinance and parking reductions that were allowed as well as transfer development rights which were used in several projects over the past few years. He thought that had been a successful program in getting historic rehabilitation and Page 9 of 47 City Council Meeting Minutes: 7/16/12 MINUTES seismic upgrades in the downtown area. However, they were 2,500 or 5,000 square feet buildings that did not require the parking that went along with the square footage. He said that as Staff reported with the Lytton Gateway project there was a development cap in the zoning code downtown of 350,000 square feet of nonresidential space which was established in 1985 as part of the downtown study. That study also indicated that when the City reached a total of 235,000 square feet that it should study the appropriate total nonresidential square footage and the associated parking issues. Staff reported during the Lytton Gateway project that the City was at about 220,000 square feet and Staff knew there were one to two other projects that would soon put the City beyond the 235,000 study threshold. Staff wanted to start that analysis immediately regarding the potential and how to better match the parking with the amount of development and the exemptions that were allowed. He said that the zoning regulations in general had parking ratios for office use that deserved to be reevaluated. The City saw office occupancies that were considerably more than one person per 250 square feet. The old model had not held up and it was appropriate to reevaluate those ratios and how the City treated nonconforming parking uses. Finally, Staff thought it was appropriate to look at a downtown transportation demand management program. The City had several downtown employers that did a good job and were on the cutting edge. He thought Lytton Gateway was a building like that, but noted that there were many others including smaller businesses that could not put together their own programs. He thought it was incumbent on the City to help coordinate that effort and provide opportunities for everyone to participate in programs that would enhance transit use, bicycling, walking, and bike shares. That was part of the program Staff intended to flesh out over the next six months along with the parking garage study. Staff's recommendation to Council was to authorize Staff to proceed with the trial program for three to six months. They wanted to run the program for three months and then meet with the working group and report to the Council as to how things were going and see if another three months would be worthwhile or if there was a reason to immediately shift gears. Staff also wanted input and direction related to the studies. If Council was ok with Staff looking at the zoning issues then they wanted approval for that in order to get started on that work. Ray Dempsey spoke on behalf of residents that participated in the study group. He said that the RPP was not the solution but a test case for a broader solution. There were four issues that were brought up by the residents with respect to the RPP: 1) private parking on a public street; 2) size and length of time of the RPP; 3) forcing parking into adjacent areas; and 4) cost and accessibility of permits. With regard to the private parking on a public street the United States Supreme Court ruled in Arlington vs. Page 10 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Richards that the character and safety of neighborhoods trumped intrusive parking. There was a right there and numerous lower courts upheld that ruling. He said that as far as the size and length of the time of the RPP it was determined by the City and not by the business people or residents. It was based on available assets, including financial assets. The City would monitor results and could modify the pilot program. He said that forcing parkers into other areas was another major problem. As mentioned the pilot was not a solution, it was a test for a solution. Many residents noted that there were packed streets and wondered where the relocated cars would park. He said it would obviously move the parked cars out somewhat, but it was temporary and the six months was better than the six years the residents had experienced with the problem. After the RPP, the next step was to apply what was learned to the larger region. The cost and accessibility of permits after the first free permit, the $50.00 charge per permit, was a charge only to users. He said that if a person did not need the permit, they did not have to pay for it. Many people had driveways and garages, some did not. He said that at least the cost was borne by the users and not by all residents of the City as would be the case if the City absorbed the cost. The nonresident permits were negotiated to help bridge long term solutions. He said that if residents wanted an RPP program it would not happen without the pilot program as it was presented. Barbara Gross said that she and Chop Keenan were representing the Palo Alto Downtown Business Association. Chop Keenan, Russ Cohen, and herself were seated on the City sponsored Parking Committee that discussed the public/private parking interests of the downtown commercial district and the neighborhood of Professorville. She said parking was a complicated issue that had a direct influence on the success of the business district and had overflow impacts on surrounding residential areas. She said that there was always a parking deficit in the downtown and there was always a mixed use of space which spilled over into the residential area. There was also always a parking deficit in Professorville as garages were converted to other uses, driveways were eliminated to expand gardens, and garages in the back alleys were too small for modern vehicles or had been converted to other uses. She said that office space changed over the past years to accommodate more Staff. She said that families had increased the number of cars per household and most could no longer self-park on their own property. Representatives of the Professorville neighborhood communicated multiple messages. They said the streets were filled with nonresidential parked cars that remained there throughout the business day. That created a crowding· on the streets which did not allow residents the ability to park near their homes or re-park their cars during the day. She said that created a safety issue with drivers behaving poorly while looking for parking spaces and parking too close together causing vehicle damage and blocking Page 11 of 47 City Council Meeting Minutes: 7/16/12 MINUTES driveways. Equally as important it had changed the feeling of the neighborhood, making it look and feel less residential and negatively impacting housing values. Representatives of the business community began conversation with the fact that three public parking garages had been built to accommodate more customers and downtown employees in the last 10 years. Parking permits for emj)loyees were oversold by a minimum of 25 percent for all garages at a cost of $420.00 annually. Employee spillover to the surrounding neighborhoods had always been a reality and there were ongoing parking improvements in the downtown district. She said that the City was investigating electronic signage to direct cars to available spaces. The parking assessment district suggested stacking cars in select areas of the garages to further increase the number of permit spaces in each garage. That required the use of a valet attendant. She Said that all day parking ticket machines were being added to all garages to offer more options. She said that there was not a way to make things perfect for everyone and there was not going to be one single solution. Professorville was nota walled community situated in a rural setting; it was and always had been adjacent to the downtown. She said they were talking about public streets and who had the rights to access them. The business community could not force everyone working in the downtown to purchase a permit if that was their means of transportation. The negative impacts to the viability of the business district could change the attractive nature of the downtown as a place to do business which could have financial ramifications. It was said that if everyone walked away from a mediation not getting everything they asked for the settlement was successful. She said that everyone was moderately happy with the proposed RPP. The RPP addressed offering residents a guarantee that not all parking spaces would be filled with parked cars and therefore opened the congested feeling of the streets. The proposed RPP also guaranteed that not all parking spaces would be filled with nonresidential cars and offered the opportunity for traffic control. Opening· the RPP door in one community was a gateway for other communities to expect the same program and that became a vast and complicated problem. Chop Keenan said he wanted to fill in data pOints regarding the self-help of the downtown parking district. The downtown parking district met once a month for the last twelve years. It was a 90 minute meeting with a packed agenda and did not work on autopilot. They successfully built two parking structures with 900 spaces over that 12 year period. There were two costs associated with the structures. One was the cost to build them, which was financed by the property owners in the assessment district. That was $0.18 per foot per month, so a 2,000 square foot store paid $360.00 per month for the capital cost of servicing the bond. He said those funds did not guarantee the store a parking space. Spaces were on a first come first served basis Page 12 of 47 City Council Meeting Minutes: 7/16/12 MINUTES and downtown employees paid an incremental $420.00 per year for the operation and maintenance of the district. That was for things such as sweeping and security and totaled $1.2 million per year. He said that it took approximately 90 to 270 days to clear a waiting list. All the garages had waiting lists except for Cowper/Webster. He stated that with stacked parking they might add 300 to 400 more spaces, which was more effective than the $65,000 per space cost of building another structure. He said that parking equaled prosperity and that it was a fragile parking ecosystem that could not take radical disruption. They supported the Staff report. It was a long process and they did not know how it was going to turn out but they anticipated knowing more in six months. He said they would probably return to Council to discuss course correction at that time. Ethan Atwood spoke against the RPP. He said he lived in Palo Alto for 20 years, mostly in Barron Park, but had moved to Downtown North three years ago so he could take the train to work. He loved the vibrant downtown, but paid for that with drunken students and a fair amount of noise and difficulty parking. He said that was part of the deal when he moved to the area and thought that everyone who lived in Professorville near the downtown also understood that was part of the deal. He was annoyed and unhappy about people who tried to keep others from parking in their neighborhood. When he lived in Barron Park he drove to Professorville, parked, and walked downtown. What the RPP did was take away a right from other Palo Alto residents who lived in other neighborhoods and wanted to get downtown and park. The permits went to people of wealth, people who were professionals that lived downtown, and the people who were nurses at Lytton Gardens, Webster House, and Channing House, but the stock men and women at Whole Foods would not get permits and would be hurt by the RPP. He said those people would simply walk four more blocks. He said that RPP hurt the little people and to the rest of Palo Alto. He urged the Council to vote against the RPP. Richard Brand recommended that the Council take a serious look at how the plan would be implemented as it dealt with longer term issues. He supported residential parking permits but did not believe the RPP was ready. One of the issues was that if one did the math they would see that 103 residences ended up with 101 spaces available for one permit. He asked where he would go to purchase an additional permit. People had asked Staff how they measured the success of the program. He did not understand that either and believed it needed to be well delineated in writing so that everyone understood how the RPP was judged. He supported the idea in principle, but thought the program needed further review. Page 13 of47 City Council Meeting Minutes: 7/16/12 MINUTES Beth Bunnenberg said she was speaking as an individual. She said that there was a time when the Stanford Shopping Center had opened and the big stores moved out there and only the banks and a few stalwarts remained downtown. She said that there were boarded up store fronts and empty lots that stayed that way for some time. After David Packard restored the Stanford Theatre people went downtown to the movies and parked close to . the theatre because deserted streets were creepy. Little by little Palo Alto put together a mix of old and new structures and created a unique downtown. The City's transfer of development rights was probably the· strongest support for the historic restorations that had occurred. The architects came in and said that transfer of development rights made it financially possible to redo the buildings and that was how Palo Alto got its historical buildings renovated. She said that it was a balancing act and asked that they understand that in terms of the historic downtown buildings transfer of development rights was very important and Professorville was a very important district. . Rob Steinberg said he was an Urban Designer and Architect who lived on Bryant Street. He concurred with everyone that there was a parking problem in Professorville that needed to be addressed and appreciated the City's willingness to take the issue on. He was concerned that the displaced parked cars from the RPP program would gravitate to adjacent blocks and neighborhoods that were not part of the RPP program. He asked what assurances the City could offer the neighbors that were not part of the RPP program that their streets would not be the recipient of the displaced cars. He hoped there was consensus among the Council that simply moving the problem was not a satisfactory solution. Dena Massar said she had heard that Palo Alto used to be a peaceful place to live but had changed and parking permits would not stop inevitable change. She also heard that some people wanted to park in front of their homes, but permits would not provide that certainty. She heard that Palo Alto High School students were a problem, but parking permits were not a substitute for a conversation with the School District about their parking policies. She heard that the biggest parking problem that neighbors faced was that nonresidents carelessly blocked driveways. She suggested signage and enforcement to solve that problem. She heard that the proposed trial area was not large enough, but there were no stated criteria that helped her decide where the boundaries should be. She heard that it was technology employees or Sirius employees or developers, the City's own policies, or even the neighbors themselves who had caused the problem. She said that issuing parking permits did not get to the root causes. She heard that residents should have free parking permits, Staff said that the cost of permits in a permanent system would be based on cost recovery, but there Page 14 of 47 City Council Meeting Minutes: 7/16/12 MINUTES was no information about those costs and therefore no consensus about the worth of the parking permit. Professorville was not the only neighborhood that wanted permits. She asked if it was the appropriate time to ask if Palo Alto wanted to be a parking permitted community and if so then the community dialogue should come first to establish appropriate policies and set the-rules for implementation. She asked how they got to the place where the area south of Forest Avenue was converted to a test tube. Staff had asked Council to approve a program that had no specified goals, no problem statement, no established criteria that defined success, and would negatively affect residents that lived outside of the trial boundaries. She said the trial had negative consequences for service employees who worked for local retailers, restaurants, coffee shops, and markets. Those services enhanced the livability of Professorville. She said that if the Council decided that· parking permits were necessary she asked that they make sure to establish a process that would ensure an open public dialogue that represented the community's broad interests. Mark Alguard said he opposed the proposal. He lived on Waverley Street 50 feet from Addison. He anticipated that all of the cars displaced from the Addison and Scott blocks would find his house to be the best place to park. He was not being provided a residential parking permit so that he could park. around the corner on Addison, which would probably be the only parking that was available. He suffered the consequences and did not get any of the benefits of the trial and that had been expressed by other people as well. He was also concerned about the survey that was done because he was not surveyed. The only people that were surveyed were in the proposed area. He acknowledged there were parking problems but stated that they bought that when they bought their houses. He did not have much sympathy for people who converted their garages or turned their driveways into gardens. He felt that the City should not reward those people; it should have programs that encouraged homeowners to restore their garages and driveways and move toward off street parking. He said that Menlo Park did not allow overnight on-street parking and asked what would happen if Palo Alto had a program like that. Don Barr spoke against the proposal, not because he was against permits but because he was disappointed in the process. He said that· he spent significant time working on Palo Alto issues. The RPP program process was neither open nor representative. He said that he lived in a house on the historic registry across the street from the district and the first he heard of the RPP was a letter posted July 3, 2012, which he received on July 5, 2012. The letter indicated the program was a done deal and that it was being discussed at Council. He asked why there were not announced, publicized, noticed, open meetings. He asked why it was not a representative process. Page lSof47 City Council Meeting Minutes: 7/16/12 MINUTES He said that the self-appointed representatives on the study group were not representative of the community. Professorville was 15 square blocks; the proposed area was two and a half square blocks, not all of which was in Professorville. He said that most of the homes in the residential parking district had garages and many of them had been converted. Parking in the -City streets was a social good that belonged to all the people of Palo Alto, residents and employees alike. In his opinion residents had no more right to a parking space than a worker. He said that there also needed to be a conversation about the difference between a $12.00 an hour worker and someone who made $120,000 per year. David Epstein said he lived on the one block of Emerson just beyond the proposed trial area toward Embarcadero. One of his problems was not just the downtown area, but the high school students that parked there during the school year. Many high school students did not want to pay for parking so they parked on his block. He said that the trial was a severe burden on his block because residents could not park a street over due to the trial and the displaced cars would park on his block. He said that it pushed both the downtown workers and the high school students to his block. He found it interesting that the RPP provided no solution. He asked where the cars would go. The RPP pushing them out of one area and all that happened was they were moving to another area. He was also disturbed by the process and did not hear about it until several people showed him the. completed survey which did not take into account those that were negatively affected by the trial. He found it unfortunately caviler to say that it was simply a trial and not to worry about it. It was dealing with people's lives over the next six months. He suggested they use computer simulations rather than experimenting on real people. He wanted a more global solution and urged Council not to pass the proposal. Steven Cohen lived on Addison and was between the pilot area and the downtown. He would not receive any benefits from the pilot program or any permanent program. He was against permit parking and was happy living in a vibrant and diverse area where people from downtown could park. After he found out by accident about the implementation of the program he did a casual survey with his neighbors, which looked at the available spaces for the residents. When he walked around at 1 :00 p.m. on several occasions he noticed that out of the 66 driveways with 125 spaces there were about 37 cars parked. He said that many of the garages were repurposed and that in that area there were only about 4 homes that had no garage or driveway. From his perspective the City was subsidizing the bad behavior of those with underutilized driveways and garages at the expense of the public. Page 16 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Ben Cintz said· he lived on Kipling Street with his family. Before that for about 15 years he lived on Alma Street in the affected area. He owned residential property in that area as well as some commercial property What . made Palo Alto and the downtown vibrant was that it was a changing area with many uses for that area. There were many changes over the years. He wasn't sure a· parking permit program in the absence-of additional parking was going to create a solution that could be addressed in six months. He said that 66 percent of the people surveyed responded and of that 80 percent approved. For part of the time he lived on Alma he commuted to San Francisco and took his bike to the train station, and then rode to San Francisco and back. He saw people doing that in the reverse direction now and was concerned that unless the City had solutions the pilot program was not going to give them many answers. Alan Petersen lived in on High Street where there were 12 cars parked on the street at 9:00 a.m. on Sunday morning and 27 parked on .the street at 9:00 a.m. Monday morning, which was basically total capacity. On his block the lifetime of an empty parking space was best measured in seconds. He said that he was sure many people were familiar with that problem. He found it surprising that his block was specifically excluded from not only the pilot program but the entire test region. It was perhaps because there were several duplexes on the block and therefore they were second class citizens in a single family discussion. Nevertheless, parking was clearly a persistent and difficult problem. He was personally ambivalent about parking permits. He enjoyed the vibrant downtown and realized he did not own the City streets. However, he endured aggravation daily. What bothered him most about the RPP program was expressed very well by previous speakers and that was the lack of transparency, fairness, and measurable objectives in the process. He urged the Council to defer the implementation of the RPP until there was a better plan. Justin Birnbaum said that it was striking to him that so many people were present so late in the game expressing concerns about the RPP. It was painfully apparent to him that the process was flawed. People were there to speak to Council because they had not been part of the discussion. The group surveyed was not representative of the broader spectrum of views in Professorville. He was not surprised that the people surveyed lived in the pilot area. He said that the folks who were the loudest about the problem, placed cones in front of their homes, and did not use their garages for parking got what they wanted in part because of some bad behavior. He looked at the data with Mr. Rodriguez and at the very worst time of day people. only had to park a block and a half from their home. He did not feel that was so bad. Page 17of47 City Council Meeting Minutes: 7/16/12 MINUTES Michelle Arden lived on Lincoln Avenue in Professorville. Unusually her home was newly built. She said that many people who chose to live in the area did so because of the proximity to downtown and downtown services. It was because of the urban amenities, which were a huge benefit to the neighborhoods that surrounded the core of Palo Alto. The benefit had consequences, which were that the streets were more urban because they needed to support the workers that provided those urban services. She thought that the City could reward people for using their garages and their Floor Area Ratio (FAR) space to build two car garages, as she had. She suggested Planning could think about that while also considering some of the other initiatives that offered a great deal of promise. Michael Havern lived about six blocks down the street on Ramona and had for 26 years. He had a garage that was not converted with a driveway and used both every day because he could not use the spaces in front of his .' house. He did not suffer as much as the people in his neighborhood that did not have those things. The historic character of the neighborhood that he bought into 26 years earlier was substantially marred and that only alluded to the visual pollution, not to the day to day hassles of the out of control parking situation. He did not think there was a pilot required for the permit program; he thought it was something that should be instituted immediately. He said the City was trying to encourage heavier development near transit hubs, but continued to provide free all day parking. He thought that they should go to no all-day parking anywhere close to the areas where they were trying to encourage transit heavy development and do away with the pilot, which causing several problems by itself. Paul Goldstein lived on Emerson Street in the trial area. He said that the plan before Council was developed by a few self-appointed residents and had not been discussed with the community. He had seen more public outreach around moving a stop sign then there was on the RPP. He was not aware of a single community meeting about the RPP. The Staff report stated there was a downtown community issue in March, but he did not remember receiving a mailing and he looked back at the archives on the Palo Alto Weekly and did not see notification there either. Most of his neighbors had no knowledge of the meeting. In June 2012 letters announcing the trial were sent to the trial residents only. Adjacent residents were notified first through the July 2, 2012 mailing. Some details of the plan were first disclosed in the Staff report. Additionally, he thought the summer was a poor time to survey the neighborhood as many community members were away. He understood that the City was in a difficult position because some vocal residents demanded immediate relief and there was pressure to do something fast, however the only solution to the problem was a comprehensive program developed through an open and inclusive public Page 18of47 City Council Meeting Minutes: 7/16/12 MINUTES process. Given sufficient time and community meetings the impacted groups including businesses and employees could likely come up with a workable solution. He recognized that would take time and City resources, but the people of the neighborhood had lived with the issues for years and they had the time. He urged the Council to reject the trial and if they wished to proceed with it to they create a legitimate, inclusive process moving forward. Irvin Dawid said a residential parking permit was an effective tool used to manage parking, reduce driving and car ownership, promote affordable housing, and to reduce a city's carbon footprint. His apartment building was a great example. They had 107 units and the parking ratio was.5, so there were approximately 53 parking spaces for 107 people. He did not know much about what happened when his building went in in 1993, but the neighbors could have complained and asked what was to prevent the residents from parking in the adjacent neighborhood. That became a reason why one used an RPP. A previous speaker asked where the cars would go. The way he saw it the RPP was not being presented as an effective tool to manage parking. Another speaker used the term parking deficit, which was a term that made no sense anymore. There was no parking deficit; the City had mismanaged parking and parking in garages that went unused as well as a segregated system of permitted parking and free parking. The City needed to use the parking it had effectively, which meant pricing it. They needed to eliminate the permit and have long and short term parking using meters like other cities. The City had people currently buying parking permits and not using them so the spaces went empty. He asked that they use permit parking as a tool and not as a solution. Sandra Martignetti said she lived on Cowper Street and everyone had garages and driveways. Most people used those spaces to park. She said that in the last nine months they were invaded by people who parked and walked downtown. Her neighborhood was different. She said that if they were wondering if cars would be displaced to adjacent streets, it had already happened. She was ambivalent about parking permits. It was a strange concept to her that she would have to pay to park her extra car. What she wanted to have the City do was move forward with innovative ideas such as the ones discussed by Mr. Keenan. She would rather see· money spent on stacked parking, additional garages, and innovation downtown. Adia Levin said she worked in downtown Palo Alto for six years and utilized the permits and was painfully familiar with the permit parking garage system that induced employees to park on the street. She currently lived in Menlo Park and visited Palo Alto often, almost always on her bicycle. She was glad that the Professorville residents raised the parking issue but did not Page 19 of 47 City Council Meeting Minutes: 7/16/12 MINUTES believe that the proposed RPP would solve the problem. She was happy that Staff was working on a set of comprehensive solutions for optimizing downtown parking including allowing businesses to purchase and subsidize permits, using permits for multiple workers, enabling online and kiosk purchases of permits, day passes, digital signs, open data, but she thought there was still a parking management problem. Several people said that the reason they did not pay for parking was that on-street parking was free. She suggested they set the prices so that there was an incentive for people that wanted to park to park at a garage and a disincentive to park on the street. Doria Summa said she lived on Yale Street in College Terrace. She thanked the Council for approving their permit parking program which had been a huge success. She served on the committee that worked with Staff to design that program and continued to serve on another group that worked with Staff to keep the program running smoothly. She supported a similar residential parking program for Downtown North and South. The program allowed anyone to park for two hours during business days. What she did not support about what the City proposed was a program that discriminated against residents that lived in multiunit dwellings and their neighbors. For example Attachment H of the Staff report had the program guidelines for the general RPP going forward. She said that if the City attempted to apply that in College Terrace it would literally exempt all of the parts of College Terrace that had been formerly the most impacted by parking problems from being in any RPP. Additionally, the experience in College Terrace showed that a comprehensive RPP supported the needs of both businesses and residents. Living on Yale Street at the edge of the mixed use zone she could tell the Council that in addition to employee parking businesses needed short term parking. When employees parked everything up, businesses did not have the short term parking either. Residents needed parking spots sufficiently close for themselves and their visitors to their houses. She thought that a RPP in Downtown North and South would support the long term transportation goals of the City, which were to get people to come to the City through alternate modes of transportation. Herb Borock said the main reason there was a parking problem was that the Council kept supporting more intensified development for proposals that exceeded the zoning. The second problem was the intensification of existing development. He stated that for those who were concerned about how to get residents to use their driveways and garages the way to do it was to prohibit parking in residential zones between 2:00 a.m. and 6:00 a.m. He said that was how the system used to work and that back then you could get a hardship permit, but someone would have come out to check to see how long your driveway was and what it accommodated. He stated that the Page 20 of 47 City Council Meeting Minutes: 7/16/12 MINUTES particular proposal was not Professorville; it included the 1000 block of Emerson Street, and the other side of Addison which were not in Professorville. He said that Ken Alsman was the main advocate of intensive development. For example when 800 High Street was on the ballot Mr. Alsman said it would provide enough parking to eliminate business and customers from four or five blocks. Mr. Alsman had also supported 355 Alma. He said that Mr. Alsman thought he was going to get a permit for a spot in front of his house. The Staff report did not say if the permit was for individual spaces or for the whole neighborhood. He hoped they were for the whole neighborhood. The program should not be done for the reasons mentioned by quite a few speakers. John Woodfill said he was a resident of Downtown North where they had a parking issue as well. He was not as worried about the parking issue as he was about the frantic drivers going around looking for spaces in the neighborhood. He felt that the Professorville trial was treating a symptom, not the overall problem. He agreed with those who proposed trying to simultaneously control parking outside of downtown and manage the parking structures that existed better. He understood that the Bryant Street garage was often half full during the day, so if the garages were managed better there would be more reason for people to park elsewhere and if they had a RPP or meters in the outside neighborhoods then the parking might move inward and reduce the traffic. Martin Bernstein said he was the Chair of the Palo Alto Historic Resources Board (HRB). He said that Ms. Gross mentioned a parking deficit in downtown Palo Alto. They had one in 1924 and that was why the underground parking underneath University was built when the Cardinal Hotel was constructed. Mr. Williams mentioned historic preservation and a very successful program of transfer development rights. He suggested that program remain intact and unchanged as it had been very successful. The HRB had seen many applications that benefited from that program. In addition to historic preservation itself as a benefit, two other direct benefits of that program were the seismic retrofitting which aided public safety, and contributing to the economic vitality of downtown Palo Alto. The most specific example was the historic Ramona district where there had been several successful projects and the economics of downtown Palo Alto and Ramona Street in particular had been very important for the vitality of the City. Vice Mayor Scharff thanked the people who served on the committee. He said it was important to note that it was a very contentious committee and there was a lot of tension and difficulty at times between the two groups and certain members of the groups. It was one of those processes where the Page 21 of 47 City Council Meeting Minutes: 7/16/12 MINUTES groups wanted to come together and finally agreed on what they wanted. He thought the agreement was driven significantly by what each group wanted. Downtown parking interests wanted to have parking spaces and permits, whereas the residential group wanted not to have cars in front of their houses. That was something for Council to keep in mind as it reviewed the proposal. Staff had a different proposal at the time, which was to make one side of the street RPP and the other side of the street 4 hour parking. There were concerns amongst the residential group that the 4 hour parking would be in front of their house. He thought that was why Staff's proposal was defeated. He was not sure that was what should drive the discussion. He thought the Council needed a more comprehensive view so he thought it was important for his colleagues to get a sense of what the meetings were like. Council Member Burt said they were calling it a trial, but it was not clear to him if it was· being tried whether or not they would have a permitted program, the form of a permitted program if they were to have one, or the area covered by a permitted program if they were to have one. Mr. Williams said they were looking at a broader area than the trial but from a management standpoint the pilot area was manageable and did not have many cost issues. They were trying to determine what the balance was between the residential component of the use of the streets and the nonresidential component. In other words, assuming there was a restriction on the nonresidential component, they needed to determine if residential component was such that it would take up most of the parking spaces on the street by itself, or would there be empty streets that could accommodate a better balance of resident and nonresident type of parking. That was the number one thing tested. Secondly they were testing if there was an impact on the neighboring areas and to what dfrection it went and again, keeping the area fairly focused they thought would minimize the impacts rather than doing it on a larger scale. After the trial was completed Staff would return with a program that better addressed the overall impacts. Council Member Burt said that it sounded like the intention had some elements of a trial and some of a pilot. The pilot being a reduced scale of something that was anticipated would most likely ultimately be a larger geographic area than what was piloted. The trial was both about the formula that was used and also of spillover impacts, which intersected with the pilot. He thought that laid out for Council what they were talking about even if it did not provide solutions. He saw that Staff recommendation number one in the third line said that within six months Staff would return to Council with the recommendations for a permanent program. He asked if Page 22 of 47 City Council Meeting Minutes: 7/16/12 MINUTES that was really the intention of what Council would be directing that evening based on Staff recommendations. Mr. Williams thought that was a better way to word it because Staff might return with a completely different direction. Council Member Burt said Vice Mayor Scharff mentioned that initially Staff had a different concept of where one side of the street was permitted and the other was not and then there was an agreement between the neighborhood representative subgroup and the downtown business interest to go to the formula proposed. He was interested in what would happen if the City's trial included both forms. He thought there were enough blocks to try separate formulas and asked if there was any reason why they could not do a hybrid trial. Mr. Williams said there was nothing prohibiting a hybrid trial but it might not be advisable because the pilot was a pretty small area and they would only get one or two streets one way and one or two the other which could be confusing for people. What he thought would work better was for the pilot area to take one approach and a second small area take another approach so that they were physically distinctive from each other. Council Member Burt said he saw the downside to having two options tried at once and that those were tradeoffs that needed to be considered. He said there were a number of comments about the representation of the group. He knew the neighborhood well, and when they had the initial South of Forrest Avenue project they had very extensive public participation and it was very open. There were committees and subcommittees and meetings that were neighborhood based meetings, some of which were City sponsored and others were neighborhood sponsored in a very open, inclusive process. He said that for a variety of reasons that did not happen in this scenario. He asked what the thought process was for having the representation solely by those who were in the trial area and advocating a RPP rather than a mixture of options. It seemed from the survey that most people in the trial area favored the trial. He noted that the people outside the trial area who would potentially be in the spillover group were not surveyed. Those people maybe had a moderate parking problem which could become an acute problem as a result of the trial. He explained that those people may not favor a permit program at all because the status quo was better for them than the cure. Mr. Williams said Staff had started with a much larger study area and focused it down. He did not know that he realized as they focused it down that everyone in the group still was within the focused area, but it did go Page 23 of47 City Council Meeting Minutes: 7/16/12 MINUTES there and Staff relied on them to get the word out to the much larger group. There were discussions along the way about getting broader input and even including Downtown North. However they focused it down and Staff should have been more forceful about having broader community knowledge of what was going on even if there was not more participation on the committee. Council Member Burt asked for a rough estimate of the cost of the future program. He saw the cost for the temporary program and asked if the future program would be comparable. Mr~ Williams said the cost of the future program depended on how many participants there were and how many bought permits, what the level of enforcement was, and other factors. Assuming they did not have the funding from the Lytton Gateway project they were estimating permit costs of $200 to $300 per year per household. Council Member Burt said that begged another question because they could get one response level to the program based on pricing. One could imagine the higher pricing, but it could skew responses. If people paid $50 or $100 per year they may favor the program while if they had to pay $200 or $300 they may not. He said that it favored the neighborhood if there were fewer business permits bought because they were more expensive than in the trial. Since Staff was trying to dial the parking to 80 percent occupancy that could be skewed as well if they changed the economic forces. Mr. Williams said they were aware of that and the major goal was to get a sense of how the residential/nonresidential balance was and then assuming they could better equate that then take the next step of what the price sensitivity was. Council Member Burt said he remained concerned that they were adopting a broader policy on a de facto basis. He said it was not a certainty; they had a Downtown North street closure that was repealed after a year and a half or two years. Things were not necessarily permanent, but that was significant wasted time and effort and he did not want to see a repeat of that. He was not saying that he was convinced that the City should not consider a RPP but he was worried about making a broader policy decision and convincing themselves that they were just making a trial decision. Council Member Klein asked if Staff believed the City had a problem, and if so how if was defined. Page 24of47 City Council Meeting Minutes: 7/16/12 MINUTES Mr. Williams said they had defined a problem based on occupancy maps. There were substantial areas with close to 100 percent parking occupancy during at a good portion of the day. Council Member Klein reframed his question and asked if the residents had a problem. Council heard testimony both ways. Some residents said that they did not have a problem and that they lived in the area and only had to park a block and a half away. Others described it as intolerable. He asked if there was a standard that defined a problem if he had to park more than a certain number of blocks away and it took more than a certain amount of time to find a space. Mr. Rodriguez said that they did not use that type of a measure when they went through the process. What Staff typically used when they looked at transit oriented development type of standards was that a half a mile was a comfortable radius for people to walk. Council Member Klein asked how many blocks a half mile was. Mr. Williams said they did not have that kind of criteria. He thought it was a perception issue and Staff felt there was a strong perception among a number of the residents that there was an issue. It was ultimately subjective as to whether it was a problem. There was no traffic problem or traffic hazard in the City. It was a personal convenience issue. Council Member Klein said that he was torn because he heard conflicting testimony as some people said there was a problem. James Keene, City Manager, agreed with Mr. Williams that they did not have any existing quantifiable standard that said if it was the distance, density, or experience that defined it was a problem. People had different reactions. Staff had performed counts and there were locations that were more impacted than others and it was not just a perception issue based on imagined changes. There certainly appeared to be more parking and more impact in the neighborhood. Two blocks was a real problem if someone needed to unload groceries. He said that the way the process unfolded was that a group of neighbors came together and said they had a real problem that they wanted to bring to the City's attention. The City responded to a particular complaint and had a different perspective from the business community so the Staff put those groups together. As difficult as that was he did not know how they would have expanded it to a much larger conversation which possibly involved people that had not expressed any concerns. He thought it made sense for the Staff to try to keep meeting and resolve the issue. Given the testimony that evening this was not just a Page 25 of47 City Council Meeting Minutes: 7/16/12 MINUTES neighbor to the City issue, this was a neighbor to neighbor issue, and a neighbor to the business community issue. Council Member Klein said that was why it was a difficult issue. He did not understand the reference to 500 feet. He assumed that the usual block was a tenth of a mile and therefore he was talking about a five block radius. Mr. Rodriguez said he used 500 feet as an example. Council Member Klein heard that neighbors had placed their own orange cones out to indicate that people should not take a parking space in front of their house. He asked if that was true. Mr. Rodriguez said that happened. Council Member Klein said that was a vigilante act and that the Police ought to prevent people from doing that. He asked if they had any instructions to that effect. Mr. Williams said that he was not aware that they had reports, but they certainly would send the Police out if they had. Council Member Klein said that he did not want to encourage people taking the law into their own hands. He said that there were various comments about how everyone had equal access to the streets and he agreed with that, but did not think that the question was one of Constitutional law. He accepted the idea that the US Supreme Court told cities they could restrict parking in one area of town compared to others. He said there needed to be a compelling reason for different rules form one neighborhood to another. That was why he asked the questions about if there was really a problem. He asked why residents were not charged under the pilot project. Mr. Williams said that they were charging for more than one vehicle, but were not charging for the first vehicle. Staff wanted to see if residents had unlimited access to the streets what kind of load that meant for the street. Staff kept hearing comments about the nonresidential vehicles occupying all the streets and residents not having places to park their cars. Making it easy for the residents for at least the first vehicle in the trial was something that allowed Staff to better visualize the potential balance between the residential and nonresidential use of the street. Council Member Klein said he read that, but he still did not understand. It seemed that it would be a better test if they charged for the first car because presumably that was what would happen if they adopted a Page 26of47 City Council Meeting Minutes: 7/16/12 MINUTES permanent project. For example he could see someone who had a driveway and a garage taking advantage of the permit if it was free, but if they had to pay for it they would not. He was not persuaded by the free first vehicle at all. He had not heard any mention of the experience of other communities and he knew there were many residential permit programs around the country. He asked if Staff looked at and learned from any of those programs. Mr. Rodriguez thought that the specific elements they recommended within the program took advantage of the lessons learned from other communities. That was one of the reasons they did the first two elements of the program. They wanted to define a buffer zone to allow the transition from land use that generated parking to a residential community. The buffer transition was their method of ensuring that they were following a best practice determined by other communities as well as making sure they were protecting arterial streets which served multiple uses. One of the other major successful elements of a RPP program within many communities was that they pulled funds together to help reduce the long term cost of permits for the whole city. Those were the limits or restrictions. The rest were things that they needed to consider and discuss such as single family homes versus multiuse homes. Those were things that they needed to look at when they worked with the community. The attachment that was in the Staff report that talked about the framework really was geared toward trying to define the process that the community needed to follow but was limited to a couple of factors to help define the pattern of a RPP. Council Member Klein thought it was useful to see programs from several other cities that seemed as similar as possible to the Professorville area. Mr. Williams said he did not think they needed to look at if any other cities had done that kind of residential and nonresidential permit combinations. He said it was pretty standard to focus on the residential and then have two hour parking for everyone else. They started with a discussion of that in the group and that was a major impact on the employers so they backed off. Mr. Keene said that Staff would conduct more research. He said that he was previously the City Manager of Berkeley and had lived in Rockridge for quite some time and he did not recall any neighborhood moving to secede from RPP because it was a problem. In general people felt RPP's were essential to living in their neighborhood. He thought Berkeley brought in about $7 million in metered parking revenue and probably about $7 million in parking fines at the same time. So it was a fairly comprehensive program. Page 27 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Council Member Shepherd knew there was good work on the RPP, but was very hesitant to move forward on the pilot. She asked if Council moved forward on the second half of the Staff recommendation would that get Staff closer to answering Council Member Klein's question about if there was a problem. She asked if Staff needed the information from the outcome of the pilot. Mr. Williams said the programs would get them closer to the answers, but they also would take quite a bit of time to get implementation that gave a sense of how much relief was provided. The question was if Staff should try to do something immediately to provide relief in the residential areas or should they hold off and wait to see how some of the things came along. Staff already captured 50 new spaces in downtown, changed parking garage levels from hourly to permit, and did new signage to get people to the garage. Some of those things helped to some extent, but there was still concern in the neighborhood. Council Member Shepherd confirmed the pilot took them out of anecdotal information and into real information. She asked if Staff planned to return to Council after three months to see if there needed to be any course correction in the pilot. Mr. Williams said they planned to report back to the Council in three months. Staff told the working study group that it would meet again and check in at that pOint. If there did not seem to be major problems, they might just let Council know that but otherwise they would report problems and suggest changes or whether to abandon the program~ Council Member Shepherd said she knew there were apartment complexes between the pilot area and downtown that were probably not fully parked. She asked what happened to those cars. Mr. Williams said right now those streets were not part of the program. Apartment complexes were more complicated with respect to a RPP because there was a concentration that could be from under parking or that people used the streets because it was more convenient. Council Member Shepherd said that either the apartment dwellers would park in the unpiloted area or would have to park on the other side of the piloted area. She said Staff had not checked to see if the apartments had garages, so that could be a parking option. Mr. Rodriguez said it could be a combination of all the things Council Member Shepherd mentioned, but Staff did not know. Page 28 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Council Member Shepherd was concerned about some of the comments from the public. Her concern focused on the comments relating to circumventing the permit area and parking somewhere else. She saw both sides of the argument. She asked how impacted Downtown North was because the pilot would shift employees over there. They were already fully parked and impacted so it was the other areas that were in question. She confirmed that was what Staff was trying to look at. Mr. Williams said yes. He said Downtown North was already heavily impacted. Secondly he thought the distance from the trial area to Downtown North was such that people would find spaces closer than Downtown North to park. Council Member Shepherd stated people who work in downtown have to park one way or the other. If they had to walk further they would. Mr. Williams said the trial area was just a small part of the area south of downtown. There were other blocks and that was what the neighbors were talking about that people would park in some place that did not have the RPP restriction rather than going up to the Downtown North. Council Member Shepherd said that was already impacted, so it looked like the only thing Staff would be able to find out was if people went one more block closer to Embarcadero Road. If they did that and the City released the parking permits to the residents and 20 percent of businesses, she asked if the trial area would still be parked up with the two hour parking in front of people's homes in addition to impacting the blocks further out. She questioned if the information was really useful. Dividing the neighborhood concerned her. Mr. Keene thought Staff acknowledged from the beginning preference for the other model, but both groups preferred the current model so Staff went with it. Staff understood that it was imperfect. At the same time, there was a core group of citizens that said parking was a real problem that needed alternatives. Staff found very often in other areas that there was a challenge getting behavior change. There was the challenge of behavior change for businesses and their employees as to how they would have more uptake on Transportation Demand Management (TDM) or how they would maximize use of garages. Staff would have to deal with issues of if RPP programs in a more expanded version if it was something that people wanted. He said that Council Member Klein's points were valid. If they did not price the pilot properly then they might not collect the data they needed. From the beginning Staff understood that it was going to displace parking Page 29 of47 City Council Meeting Minutes: 7/16/12 MINUTES further down the road and require neighbors to come forward and ask for something specific in their neighborhoods as well. He guessed that the situation would probably improve for the six blocks in the pilot. He said that the problem ultimately was the fact that they did not want to ruin the vibrant downtown. The timeframe to plan for new parking or TDM programs were long term issues. They had a dilemma and there-were always consequences in a dilemma that were unsatisfactory. He said the Council meeting was transparent and part of the process. Things were often elevated and people paid more attention at the Council level than the outreach that Staff could do. The Council was free to send Staff back, to put qualifications on the program, or whatever they needed to do. It was not a done deal just because Staff presented an option to the Council. Council Member Shepherd asked if the program went away when the trial ended or if Staff intended that it become an entitlement for that particular configuration of Professorville. She did not mind gathering data for a time period but she thought it was important for it to revert to see if trends went back to the way they were before. She felt that would be informative. Mr. Williams agreed. He said Staff was comfortable saying that the trial ended in six months and it was incumbent on Staff to return to Council with a recommendation to extend set parameters for how to move forward with the community on a broader program. If that did not happen then the program ended at that pOint. Council Member Shepherd asked if they would put up temporary signs. Mr. Williams said they were temporary and the sign would be removed pending a determination of what the ultimate program was if there was one. Vice Mayor Scharff said he wanted to follow up on what Council Member Klein and Council Member Burt said about pricing. One of the things that Staff continually reiterated during the meetings was that if there was a full RPP it had to be cost neutral. He had the sense that the committee did not listen to that part. He thought they could do a disservice to the neighborhood because they were surveyed based on the notion of a free permit for one car and then only $50 for a second permit. The reality of the situation was more in the $200-300 range for a permit. He thought they should survey people with a realistic version of the cost. If they said $250 and they received feedback from 40 percent saying they were interested with 60 percent saying no, that was different information. People would be angry if the cost difference was so great. He thought they should return and complete surveys with realistic numbers. He knew there was a push to get an RPP done as soon as possible and that Staff was under significant Page 30 of47 City Council Meeting Minutes: 7/16/12 MINUTES pressure, but people needed a sense of what would really happen or the whole notion of a trial did not make sense. He also agreed with Council Member Shepherd that if it was a trial then it should have a specific end date. He thought it was better if they said that it ended no matter what and that the City would use the information to design a broader program. He said Staff did a good comprehensive job on the recommendation involving additional studies and actions related to parking in downtown. He wanted Staff to return with funding options for the public parking garage sites. One of the things he realized when sitting on the committee was that there was agreement that some workers should be able to park in the neighborhoods. That was one of the worthwhile things that came from the meetings. He thought people were saying that employees should be allowed to park in the neighborhoods but at a level that did not make life uncomfortable. That was what the City should strive to achieve, making life not uncomfortable. People bought homes in that neighborhood and area knowing that there were many impacts with downtown. They just did not want to feel that the impacts were extreme and he believed some people felt it had gotten extreme. That went back to Council Member Klein's question. He thought that was what people wanted to know; how many cars could be removed from the neighborhoods and how could the City get that done. Mr. Keene heard a difference between Council Member Klein's point of having a no cost first car parking permit and if the price should be closer to what the expected the ultimate was. His understanding was that this was a pilot that would not have the full level of enforcement. If they charged the $200-300 fee than the City risked having residents demand the same level of enforcement that was concomitant with that pricing. The issue of paying for at least every car so there was truly a litmus test was different. Staff wanted to price it in some way that people felt the trial was working into what it would be like based upon the price if it was a permanent program. He thought the sense was the City was not offering a program that mirrored what it would be if it were a permanent program. Vice Mayor Scharff said he thought they should get the trial as close as possible to what it would be like for people and survey them. He thought people were more price sensitive than enforcement sensitive and that Staff would receive push back at the $200-300 mark. If the City was not going to charge $200-300 because it was not going to have that level of enforcement then they should price the program according to the appropriate level. If they did not use the right information they would not receive the right data and they would leave the wrong impression with the community. Mr. Williams said the $200-300 figure assumed a full level of enforcement. It also included all the upfront costs which the City had the potential to Page 31 of 47 City Council Meeting Minutes: 7/16/12 MINUTES cover with the Lytton Gateway project. The figures also depended on the level of participation. He thought that if they did a survey they ought to lay out the options and not assume the highest case. They discussed some of those issues in the group. He also pOinted out that if it was a three month program, $50 equaled $200 per year. Again, they were not charging for the first permit so that sounded like an appropriate way to go. Council Member Holman said she used to live in the neighborhood and she could support those who said the situation had gotten worse and the neighborhood was more impacted. She said that it was a quality of life issue, a neighborhood character issue, and a business vitality issue. Part of the quality of life in the neighborhood was that it was near the business district. That said there were property value impacts and basic disruption. It was not as clean; the streets were not swept as well. There were all kinds of negative impacts on the streets the way there were now. She said that the 900 block of Ramona and the 1100 block of Emerson were full during the midday peak period yet were not included in the study area and asked why that was. Mr. Rodriguez said that when they started they looked at a larger area but worked it down to a symmetrical shape. It was a boundary that was put together with both Staff and resident input. They looked at parking occupancy of the street. If they were at 85 percent there was still open parking on that street so that was another factor. Council Member Holman said that she understood that if there was some space on the street that meant there was available parking but it was tight with 85 to 100 percent occupancy. She said that the pilot used $50,000 of the $100,000 allocated from the Lytton project. She asked if the City was better off using some of the money on the objectives for the recommendation to proceed with additional studies. She was not 100 percent clear on what they were doing. Attachment H, page 301 said "parking program guidelines." The word guidelines threw her because guidelines were not really defining a program they were parameters that could be implemented. There was also not a good description of what the program would be in the document that was the draft proposed RPP. She was not sure that everyone knew what was being proposed. Mr. Rodriguez said the survey focused on the one issue of a potential RPP pilot program. There were many good comments about additional information that could have been included in the survey including the costs of an ongoing long term program. He said that they were in the infancy of developing the RPP and there was significant positive change on the permit sales side and the distribution of permits. It would take more time to try Page 32 of 47 City Council Meeting Minutes: 7/16/12 MINUTES things. Mr. Keene and Mr. Williams both asked if it was the right time to try a RPP and if it should be done under the process Staff defined or in some other form, or if they should accelerate the other programs first and revisit the RPP another day. -Mr. Williams thought Council Member Holman's questions went to the specifics of the RPP. He agreed that the information was dispersed. The question she had about the use of the money going toward the other programs concerned him because he thought there was a commitment at the time of the approval of the Lytton Gateway project that the money was segregated and used specifically for residential protection or parking intrusion. He was not sure it was appropriate to move the money to another type of parking program. Council Member Holman said it seemed to her that without answers to some of these questions they would not have good enough information to deploy. She shared the concerns that this was not an open process. Council could not make changes that evening based on information it just learned. The process could have been improved. There were some things that were added more appropriately or more clearly described in the presentation than were listed in the Staff report. Someone told her that Palo Alto High School was charging for parking which was causing more parking in the neighborhood. She asked if that was correct. She said that Council Member Shepherd just told her that they had always charged for parking .. She said that they might want to work with the School District and Stanford on that. She listed off modes of transportation that were added and asked how those items would be funded or if they could be funded. Mr. Rodriguez thought the concept was a Staff developed toolkit of downtown transportation management tools to be taken advantage of by existing or future development. One of the elements they thought of was a future expansion program participation into a shuttle program which would allow the City to provide new service to the area and help connect it with other residences within the community. He said that participating in a shuttle program could be a way to provide more connections through transit use that did not currently exist through the Santa Clara Valley Transit Authority (VTA) or other resources. Mr. Williams said Staff was not ready to tell Council how it planned to fund anything listed under that option. Council Member Holman said she would add opportunities with underutilized and over parked buildings in the downtown area. She said that other communities managed liability issues and that seemed to never get Page 33 of 47 City Council Meeting Minutes: 7/16/12 MINUTES addressed in Palo Alto. She wanted Staff to look at that as part of the solution. She asked why the overnight parking restriction was no longer in effect. When she moved to the City in 1975 you could not park on the street overnight. She wondered if it was imposed again if it would force people to use their driveways. Mr. Williams said he did not know the background, but he knew as far as the RPP that was not a problem. Council Member Holman said she understood, but it was a little piece because people said that others had converted their driveways as well as their garages to other uses. That was a way to perhaps make people use their driveways again for the intended purpose. She did not have any evidence that there was outreach to the business community to see what the workers behavior was as a response to a RPP if the City moved forward. That was important. She asked if Staff could return in six months with a new and improved pilot that was better informed. Mr. Williams said that if that was Council's -request Staff would accommodate. He felt the recommendation would be more informed in six months' time. Council Member Holman was interested in moving forward with something but what the Council had before them currently was ill defined and did not contain broad enough input. She thought six months was a good time frame to ask Staff to return with a plan. Mr. Keene said that Council's directive needed to be clear about wh'at additional information Council wanted so that Staff was able to respond. Council Member Price was inclined to go ahead with the trial on the RPP because she thought they needed additional information regarding the parameters that were laid out. She thought if they said after all the months of work that further study was needed she was not sure that would move the City forward in addressing the stated problem. She appreciated Staff's comments and the discourse on the additional studies and hoped that when those came back that there was some sense of the cost and the relative priority. She was not asking for an answerimmediately but based on what other communities had done she wanted to know which elements could yield information that could be used in concert with a potential RPP. She appreciated the comments regarding best practices and asked if the draft in Attachment H which had preliminary guidelines was based on an extension of what was in the Staff report, or if Staff looked at guidelines or equivalents that were used successfully in other communities. Page 34of47 City Council Meeting Minutes: 7/16/12 MINUTES Mr. Rodriguez said it was the latter. Council Member Price was inclined to go along with the comments about how if they proceeded with the pilot program that it should have some fee structure associated with it. Issuing free permits was a false or inaccurate litmus test. She said that people who did not need the permit might use it simply because it was free. It made sense to charge some reasonable fee for the parking permits. She said that the price could be scaled or less than what the potential long term would be, but it needed to be recognized in further communication with residents in the trial area about what the likely range of costs were if the program was implemented. With the discussion of under zoning and planning there was a reference to TDM and other options. Within that language it said other options would be examined and she wanted to clarify if Staff was thinking about auto restricted zones or on- street metered parking. Mr. Williams had not thought about auto restricted zones but they would at least look at pricing issues to see if that was something the community and Council wanted to look at. He said that it could be brought forward as part of the menu. Council Member Price said there were many hybrid programs used in different places and every community was different. She encouraged everyone to read the book "The High Cost of Free Parking" by Donald Shoup. Mr. Shoup made the case that free parking inflated parking demand and played into issues related to parking requirements and the zoning code. She clarified that on the College Terrace program there was an opt-out scenario. Mr. Williams clarified that there were two ways. One was not buying a permit, and the second was that whole blocks could opt out if more than 50 percent wanted to opt out. If that happened they would not have the signage on the street. Mr. Rodriguez said that when the College Terrace program was initiated the blocks voted to opt in or out. Afterward they had the opportunity to vote per block and opt out again. Council Member Price said she concurred with all the comments made about the noticing of the public. She thought the City needed to be very mindful of that at every stage. If there was a trial or a post-trial or any discussion of the strategies the public should be noticed. She knew the Staff observed that as well but she thought it was extremely important. Page 35 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Mayor Yeh knew that there were many considerations and iterations of the RPP. Ultimately he did not support the pilot program or really even the development of a RPP because he thought conducting additional studies was the smartest approach. He asked Staff to define what they meant by long term. He discussed the amount of Staff who would have to work on the various options. Mr. Rodriguez said that over the next six months there were many things Staff could move forward on. Some of the initial things were studying the existing surface laws to determine where they could build more garages and if attendant parking made sense in the existing garages. There were many factors including if the structures would support the weight of additional cars. Staff could advance those studies because of a separate contribution from the Lytton Gateway project. Staff also committed to advancing within the next six months the development of some sort of RFP to help them collect data about what they could do with technology deployment within the garages. They also wanted to share more information with the Parking Committee. There was a strong interest within the business community and they had formed the assessment district to help advance many of the solutions that were already in place and the City needed to respect that process and solicit that input before they came back and made a strong recommendation to Council. Mr. Williams thought that some of the things that could be implemented in the next six months were attendant parking, or at least a trial of that somewhere, and some technology efforts. He said that building a parking garage took longer, but in six months Staff would have good study information on that. Mr. Keene had also discussed a public/private garage that would be a faster track than the City building a structure on its own. Mayor Yeh appreciated the thought that went into the pilot, but his greatest concern was that it moved the problem and did not really address or create a systemic solution. He said he favored a systemic solution. MOTION: Mayor Yeh moved, seconded by Council Member Holman to not move forward with the trial Residential Permit Parking Program, however to: 1. Direct Staff to proceed with additional studies and actions related to parking in downtown, including but not limited to: a. Study of potential new public parking garage sites, capacities and costs; b. Methods to increase capacity in existing garages, such as attendant parking and adjustments to the permit/public distribution of spaces; Page 36 of 47 City Council Meeting Minutes: 7/16/12 MINUTES c. Technology enhancements, such as gate controls, parking space identification systems, and parking permit processing improvements, etc.; d. Zoning studies and revisions, including study of the downtown cap on nonresidential space, the use of bonuses and transfer rights, variable parking ratios for office uses, and how to treat non- conforming parking sites; and e. Evaluate paid parking options. Mayor Yeh said he met with residents that .were the strongest proponents of the RPP program and shared with them that he could not support an RPP program in isolation. He felt it was moving a problem around and his greatest concern was that the neighbors not in the trial zone would be negatively impacted for the duration of the pilot. He thought the energy could be more positively channeled to maintain the urgency that was identified in the problem and focus ona systemic and comprehensive solution and to move forward as quickly as possible. He acknowledged that there was a problem and he lived in the Evergreen neighborhood where they looked to College Terrace for having created a problem across EI Camino Real in Evergreen. That was the kind of issue that he did not like. He wanted to focus more on a great set of solutions and evaluations. Council Member Holman said that she was supportive of finding relief for the neighborhood but was not comfortable with what was brought to Council. She said that Staff's time was not a wasted effort, but the RPP was not ready for trial. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER TO INCLUDE: 1) parking exemptions, 2) a Tran~portation Demand Management Program, and 3) to direct Staff to look at underutilized private parking garages. Council Member Holman said that there were parking garages in the downtown area that were underutilized during both the daytime and in the evening. She suggested Staff speak to the property owners to see how the garages could be better utilized. Mayor Yeh agreed with Council Member Holman's additions. Council Member Holman believed that the intention was for Staff to report back in six months. She did not want the business community or residents to feel that this was something that would continue for an unlimited amount of time. She wanted a report in six months. Page 37 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Mr. Rodriguez thought that six months was feasible. Staff started many things and wanted to involve the downtown merchants and allow the community to participate in what the content of the RFP would be so that when Staff solicited cost information for projects or programs they knew they were inquiring about things that were of interest to the community. He thought that within six months Staff could develop the RFP's. Six months gave Staff the opportunity to meet Council's expectations. Mr. Keene agreed with the six month timeframe with the understanding that Staff would return before then with more of a detailed scope of what it was they were asked to do. He said that even though Mr. Rodriguez responded to some of the initial requests he did not believe it gave them a good measure of what the outcomes or percentage of the perceived problem it addressed in whatever period of time. It could be a multiyear effort that Staff would make progress on, but that progress would still be unseen. He suggested returning in the fall with· a more detailed report on what Staff thought the timeframe was on the different components and what they thought the yield was in relation to the problem. If they had to build multiple parking structures that was a different issue than installing some technology to update the existing capacity. He requested that they add something to return to Council in three months. He wanted it to say something about an assessment report. That was very different than having implemented everything. Then Staff would return in six months. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER TO INCLUDE to direct Staff to return to Council in three months with check in and return with an update before the end of the year Council Member Holman said that she hoped that within six months Staff would return with a progress update and identified a better program for a RPP. Mayor Yeh said that his Motion was to remove the consideration of an RPP. Council Member Holman confirmed that Mayor Yeh meant that none of the exercises were intended to lead to a RPP. Mayor Yeh said yes, that the Motion did not include the Staff Recommendation to evaluate an RPP. Council Member Holman said that related to Downtown North. Page 38 of47 City Council Meeting Minutes: 7/16/12 MINUTES Mayor Yeh said his Motion was to not move forward with the Professorville RPP. Everything in the remaining Motion could reset the baseline for what downtown parking would look like. Council Member Holman said her hope and understanding was that gOing through this process would lead the City toward what it should do with an RPP. Mayor Yeh was not open to that and asked if she did not want to second the Motion. Mr. Keene said that there was always the possibility that the report would have an impact on how the Council looked at an RPP. The Motion began with not wanting Staff to work on an RPP and supporting any RPP process, partly because it could be in conflict with the effort invested in the alternatives. Council Member Holman asked Mr. Williams if the information Staff provided in three to six months would include what advancements had been made and what Staff anticipated to see in terms of relief for Professorville so at that pOint in time Council could look at if they wanted to move forward with an RPP. Mr. Williams said Staff would provide Council with an assessment of which components of the work they were doing that would provide or had provided relief to Professorville. At that point Council could revisit whether to try the RPP. He thought Staff would have a real concern trying to retool a whole new RPP program while they were looking at the other ~hings. Council Member Holman said she would maintain her second to the Motion but with the intention that RPP was still on the horizon. Mayor Yeh confirmed he was not open to that. Vice Mayor Scharff said he would support the Motion and suggested language additions to the Motion. He said they change the verbiage to reflect zoning studies and revisions as a concern from the public. He wanted the City to evaluate that issue. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to direct Staff to: 1) return with funding options for new public parking garage sites, and 2) include that the zoning studies would evaluate disincentives to having two car garages. Page 39 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Council Member Holman was hesitant because the neighborhood was built up and much of it was Professorville she did not believe it would have much of an impact. Vice Mayor Scharff said they were looking at more than Professorville. The Council was basically doing a comprehensive for Downtown North and South. He thought they were looking at it on a comprehensive basis and was not suggesting that there should be an outcome, just that it be evaluated as one of the concerns. Council Member Holman said she was comfortable as the seconder of Motion now that it included the Incorporation. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to evaluate the use of $250k currently budgeted in the Lytton Gateway Project. Vice Mayor Scharff said that the other comment that Council Member Holman made was related to the $250,000. He was not suggesting they use it immediately, but the Council never agreed to do an RPP so they could not have placed the funds aside for that. He thought the question was should that money be used and could it be used to get relief. If Staff had that money to use, he asked if they would make faster and better progress. He stressed that he simply wanted to evaluate how to use the money. He thought the Council was taking a good approach and trying to solve the problem on a comprehensive basis. Staff's efforts needed to be focused on the comprehensive basis because they did not have time to do both. It was not saying no to an RPP permanently, it was focusing on the comprehensive basis for six months. Mr. Keene said the intent of the Motion was that unless the Council redirected Staff in the six month time frame that they were taking work on and assessments of RPP as a part of the solution off the table and shifting the attention to see if Staff could identify solutions that may not require an RPP program. Staff would look at ways to solve the problem though TDM, additional parking, and other means knowing that at the end of the six month period Staff would have enough information presented to Council that Council would know what it would take to move forward on that front or if it wanted to bring back up RPP. Council Member Holman clarified the language by addihg the phrase "at this time." She felt that made Council's intentions more clearly stated. Page 40of47 City Council Meeting Minutes: 7/16/12 MINUTES INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to include "Professorville at this time" after "Residential Permit Parking Program" in the first part of the Motion. Council Member Burt agreed with the Motion and thought that if Council -looked at an RPP in the future that it should be more comprehensive. As they looked at what prompted the problem he thought the most legitimate one was that there were 11 homes in the broader study area that had no driveways or garages. He stated that as the spillover grew the problem became more acute. He asked if the City ever looked at simply giving relief to those 11 homes through curb striping. Mr. Williams said that was not evaluated. Council Member Burt asked if Mr. Williams saw any problems if the City went in the direction of a spot program that provided relief to homes without a driveway. He said that those spots could be either the resident's permit or two hour parking. Mr. Williams said Staff had to discuss that and see if it was feasible. He thought one of the issues was that he did not know if those were the people that were complaining about not having spaces. Council Member Burt offered the language to be incorporated into the Motion. He thqught that would not be disruptive to the downtown parking district and would address the most acute problem. He thought that was the most legitimate complaint. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to direct Staff to evaluate selective parking for those homes without a driveway or garage. Council Member Price said she would not support the Motion although she appreciated the modifications because clearly a more aggressive comprehensive plan was important. She thought they needed to have the RPP trial as one element of a comprehensive approach. The other approaches were important, but based on comments from both sides residential parking was a concern to a sufficient number of people. She felt that if a pilot program were done that charging a fee for it made more sense. She said that if the Council really wanted to be comprehensive it would retain the RPP as part of the ambitious list. She said that the RPP was not a panacea, none of the options discussed were a panacea, but the question was if the City was looking at the whole picture comprehensively. Page 41 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Council Member Holman' said that they were doing this because there were concerns from the neighborhood about spill over parking. Council indicated that perhaps addressing some of the issues might alleviate the parking in the neighborhoods but there were many comments that evening about the lack of transparency. She asked about the process moving forward and if it was going to be an open process with public input. Mr. Williams said it depended on the item, but he thought most of them would be put together and a community meeting would be noticed before Staff returned to Council. That would probably not happen before Staff returned with the programmatic information, but it would before the end of the year session. Council Member Holman confirmed that the community meeting would include more than the pilot area. Mr. Keene said that they did not know the parameters of it at that point, but _ the emergent neighborhood complaints alerted Staff that there was a large challenge. Whatever was mitigated ten years ago when PAMF moved had reemerged and Council was asking Staff to look at the parking challenge accommodation of the 2010-2020 decade. There were many issues that would touch many stakeholders. That required engagement and outreach. Council Member Holman suggested more than one community meeting. The reason she suggested not just the area that was included in the pilot was because some of the people in that area were the most invested in the dialogue. She wanted to make sure that it was not a self-selected group again. MOTION: Council Member Klein moved, seconded by Vice Mayor Scharff to call the question. MOTION PASSED: 5-3 Espinosa, Price, Shepherd no, Schmid absent MOTION PASSED: 6-2 Espinosa, Price no, Schmid absent Council Member Shepherd asked a question about the downtown cap and the boundaries of the downtown cap. She said that the Arrillaga project could be coming forward and she wanted to know how that was going to be handled. She knew it was outside the boundary of the downtown cap and asked if Staff would bring that analysis when they returned with the item. Page 42 of 47 City Council Meeting Minutes: 7/16/12 MINUTES Mr. Williams said they probably would, but that he thought Council would see some of the Arrillaga project before that came back. He said they would see the extent to which it was parked. Council Member Shepherd said she was concerned about traffic and parking. She said it was tangential and important for Council to review at the same time. Mr. Williams said they indicated in the Staff report that they would be embodying that but whether it was actually part of the number on the cap was to be determined. 14. Utilities Advisory Commission Recommendation that Council Approve a Definition of Carbon Neutrality in Anticipation of Achieving a Carbon Neutral Electric Supply Portfolio by 2015. James Keene, City Manager, said the Staff was ready to answer questions and that the Chair of the Utilities Advisory Commission (UAC) was present. James Cook, Chair UAC said the item was about the definition. They were not debating the pros and cons or items about carbon neutrality, but the definition. Staff confirmed that this was the industry standard definition, so for the UAC it was a short item and they felt the definition was good. The definition did not preclude a later discussion about how to achieve carbon neutrality or when to do it. This was the framework to start with and the UAC passed it unanimously. He urged the Council to pass the definition. MOTION: Vice Mayor Scharff moved, seconded by Council Member Klein to approve the following definition as the basis for the City's pursuit of a carbon neutral supply portfolio: A carbon neutral electric supply portfolio will demonstrate annual net zero greenhouse gas (GHB) emissions, measured at the citygate, in accordance with The Climate Registry's Electric Power Sector protocol for GHG emissions measurement and reporting. Vice Mayor Scharff said that Staff represented that the definition was achievable, credible, transparent and measurable as well as consistent with current industry standards for GHB accounting and reporting protocols and taking that representation to be true he thought it was the right definition. Council Member Klein asked where the citygate was. Monica Padilla, Senior Resource Planner, said citygate was where they interconnected with Pacific Gas & Electric (PG&E). Page 43 of47 City Council Meeting Minutes: 7/16/12 Gonsalves, Ronna From: Sent: To: Subject: rademps < rademps@aol.com> Saturday, October 27, 2012 3:47 PM Council, City Message from the City Council Home Page Dear Members of the City Council: 21 t;fl; y OUffh\ '5 "rtFl '" 12 OCT 29 AM fO: 42 I know that you are all fully aware of the parking problems plaguing residential areas north and south of University Avenue as well as the downtown area itself, and that the Council has instructed Staff to address the issue on a broad scale. In the meantime, I want to suggest something that would quickly alleviate the parking problem for some of the residents, particularly those in and near Professorville. That area has many older homes, homes that were designed before the great automobile era, homes that have no garage and no driveway. There isra feeling among some in government and among some residents that it is wrong for residents to ask for what amounts to private parking on a public street; however, those homes that have a driveway do have the equivalent of a private parking spot on a public street since no one can park in front of their driveway. The result is, those of us with no driveway suffer from de facto discrimination since the city does not provide us with a parking spot in front of our homes. I'm sure there are a dozen reasons that will come to mind why the City cannot do it, but I am equally sure that with a simple change of polic y the city could make it legal to have a 'virtual driveway" in front of every home that has no real driveway. In our case, we do have access to parking via an alley in back of our home; however'it is ' less safe and less convenient to use than parking a few blocks away. It is very narrow and difficult to enter the carport, more difficult to back out without damaging our back- neighbor's fence. The alley is not lit at night. Because workme~ often use it to park it is not always accessible, unlike a street space, and is sometimes littered with construction materials such as nails and screws. Further, our sliding gate is exceptionally heavy (my wife cannot open it) and the two motorized openers we have had installed over the years have burned out at great cost to us. I would ask the Council members to do some creative thinking about a policy that would allow us to drive away and have the same access to return to our homes that residents with driveway do. Regards, Ray Dempsey 1 036 Bryant Street Palo Alto 10 City of Palo Alto (ID # 3183) City Council Staff Report Report Type: Action ItemsMeeting Date: 11/19/2012 Summary Title: Maybell Ave. Acquisition Loan Request Title: Adoption of Budget Amendment Ordinance, Approval of a Loan to Palo Alto Housing Corporation in the Amount of $3,220,220, and Direction to Staff Regarding an Additional $2.6 Million Short Term Loan to Palo Alto Housing Corporation for the Acquisition of 567-595 Maybell Avenue for Purposes of Constructing a Below Market Rate Senior Housing Project (continued from November 13, 2012) From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council: 1. Adopt the attached Budget Amendment Ordinance (BAO) increasing the Fiscal Year 2013 Grants and Subsidies budget of the Commercial Housing In-Lieu Fund by $400,000, transferring $720,220 from the Stanford University Medical Center (SUMC) Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund to the Residential Housing In-Lieu Fund, and increasing the Grants and Subsidies budget of the Residential Housing In-Lieu Fund by $720,220; and 2. Approve and authorize the City Manager or designee to execute in substantially identical form the attached Acquisition and Development Agreement (ADA) (with attached form of promissory note, deed of trust and security agreement) with Palo Alto Housing Corporation (PAHC) to provide a loan of $3,220,220; and 3. Authorize the City Manager or designee to execute all other documents required to implement the Agreements, including escrow instructions and to approve all necessary subordination agreements and direct the City Manager or designee to administer the provisions of the Agreements; and 4. Provide direction to staff whether to authorize an additional, short term (2-3 year) loan to PAHC in the amount of $2,600,000, to be funded by the SUMC Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund and, if so, to return with that loan agreement and budget amendment as a future Consent Calendar item. Executive Summary Council approval of the recommended actions will provide a $3,220,220 million loan from the City’s housing funds 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 15-unit market rate single family residential subdivision. Staff is also requesting direction from Council whether to extend a separate $2.6 million short term (two to three year) loan from the City’s Stanford University Medical Center (SUMC) Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund to complete funding for the purchase. 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 funding limitations of the City, PAHC now requests a long-term loan amount of approximately $3.2 million and a subsequent short-term loan of $2.6 million, with the possibility of converting the short term loan into a long-term loan if the City receives the same amount of new housing fees before the term expires. Discussion PAHC Purchase Agreement for Site The PAHC California Park Corporation 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, which include the following key provisions: Purchase price of $15,580,000 for the 2.46-acre parcel; Close of escrow, and transfer of title to PAHC must occur by November 30, 2012; Seller will pay all escrow fees, county transfer taxes and the cost of a ALTA title insurance policy; and Seller and Buyer split payment of the city transfer taxes. 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. 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 sq. ft. with residence sizes between 2,000 - 3,200 sq. ft. In order to avoid parking impacts on Maybell and Clemo Ave., 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 - Multifamily residences (Arastradero Park owned by PAHC) East- Multifamily residences (The Tan Plaza Continental) South- Briones Park $3,220,220 Long term Loan Agreement The proposed long term Loan Agreement details the terms of the City $3,220,220 loan, which will be evidenced by a Note and Deed of Trust secured by the property. The Note will bear simple interest at 3% per annum, and payments will be made from residual receipts over and above the project’s net operating income expenses and will be divided among other funding agencies based on the City’s proportionate share of its funding to total development costs. All City loan agreements also 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 sources of funds to be used for the long term loan are as follows: Fund 233 (Residential Housing Fund) $1,000,000 Fund 234 (Commercial Housing Fund) $1,500,000 SUMC Funds $ 720,220 Total of Funds $3,220,220 Due to the deep affordability of the rents, it is not expected that cash flow will be sufficient to pay the annual interest in full. The proposed project will be affordable to extremely low and low income senior households, and the affordability restrictions will be in place for a minimum of 55 years after the issuance of a certificate of occupancy. Three key provisions of the City’s standard loan terms required modification to meet the requirements of two of the other lenders, LISC and LIIF. These modifications create some risk to the City because the proposed revised terms offer less protection for the City’s investment. First, the City proposed a consent provision that would give the City the right to approve any third party developer in order to ensure that the buyer has the capability and experience to construct high quality housing that conforms to the City’s rules, policies and ordinances. Although this is a relatively common provision, particularly given the amount of the City’s contribution and the fact that the City has a unique interest because the project will be constructed in our community, the other lenders refused to lend to PAHC if this provision is included in the City’s agreement. Instead, the parties agreed that PAHC would provide the City with 45 days notice prior to selling to a developer chosen by PAHC. This notice will give the City the opportunity to discuss concerns with PAHC, and the City and PAHC have a long history of working cooperatively, however, it is important to note that it provides the City with less protection and control than the original consent language. Second, the City’s forms included a provision that required the remainder parcel (where the senior housing will be built) to appraise at or above the value of the City’s loan before the market rate parcel could be sold. LISC and LIFF would not agree to any prerequisite for sale of the market rate parcel, and PAHC objected because it did not believe it would be possible to meet this condition. Based on PAHC’s experience with recent projects, market value decreases substantially once affordability conditions are placed on a property. Therefore, they believe it is likely that the remainder parcel will appraise for less than the value of the City’s loan. As an alternative to the appraisal, the City proposed requiring PAHC to provide proof of construction financing as a way to help ensure that the senior housing project would be constructed. However, PAHC also objected to that alternative because it can take several applications to be awarded the tax credit financing that they intend to use to finance construction, and they would like to sell the market rate parcel as soon as entitlements are approved. Because the parties could not find an acceptable compromise, this provision has been deleted from the agreement. However, not including such a provision creates a clear risk for the City that the collateral may not equal the value of the City’s loan. While staff believes that its standard loan provisions provide the best protections for the City’s investment, staff also recognizes the City’s longstanding commitment to affordable housing and history of successful partnerships with PAHC on affordable projects. It is up to the Council to decide whether that commitment outweighs the risks in this particular agreement. If the Council approves the agreement with these revisions, staff believes that there are a range of conditions that may be considered in the entitlement process to help ensure that the affordable portion of the project will be constructed. $2,600,000 Proposed Short Term Loan The PAHC requires a total of approximately $5.8 million in loans from the City to enhance the likelihood of obtaining needed State tax credits for the project. The City does not currently have sufficient funds available in the commercial and residential housing funds to lend the full amount. However, this project would be a permissible use of the SUMC funding. In addition, staff estimates that up to $6 million in funds will potentially be added to the City’s housing funds through fees anticipated over the next two years, including fees from recently approved development and depending on the outcome of pending litigation by one housing developer. Staff is therefore requesting direction from the Council on whether to extend a second loan to PAHC in the amount of $2,600,000. Staff proposes that this second loan would have a shorter term of 2 years, 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 structure the funding for this short term loan effectively as an advance to the affordable housing fund 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, funding for those fees would be substituted for the SUMC funds, effectively replenishing the SUMC fund. The short-term loan likely will then be converted to a long-term loan and/or combined with the first long-term loan. An interim letter of credit will allow PAHC to make up the $2.6 million and close escrow on the purchase by November 30. If Council chooses not to move forward with the short-term loan, however, PAHC will need to find other funding to complete its financing needs, likely from private sources. It is important to note that if additional City funding (for a total of $5.8 million from the City) is not available before June of 2013, PAHC will likely have a much more difficult time obtaining the tax credits needed to finance the construction. 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 loan for affordable housing may defer the availability of the full complement of SUMC funding for this period. This housing project, however, is a key opportunity to fulfill City housing goals with a project comprised of senior housing units expected to have little effect on traffic and school capacity. If the Council provides direction for staff to move forward with the $2.6 million loan, staff will prepare the required BAO and loan documents for consideration at the December 3, 2012 Council meeting. 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 Rd. 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. 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 City currently has approximately $4.7 million in the Residential Housing In-Lieu Fund. Approximately $3.7 million, however, has been earmarked for other uses or cannot be spent until ongoing litigation is resolved, leaving approximately $1.0 million available for grants and subsidies. The Commercial Housing In-Lieu Fund balance is approximately $1.6 million, of which $1.1 million is allocated for grants and subsidies. The Stanford University Medical Center (SUMC) Fund provided $1,720,488 dedicated to affordable housing only. Council recently committed $1,000,000 of this dedicated payment to the Stevenson House rehabilitation, leaving $720,488 available. To fund the loan, staff proposes to use the budgeted $1,000,000 from the Residential Housing In-Lieu Fund, $1.5 million (of which $1.1 million is budgeted) from the Commercial Housing In- Lieu Fund and $720,220 from the SUMC Fund for the Maybell site acquisition. This requires a Budget Amendment Ordinance (BAO) to appropriate an additional $400,000 to the Grants and Subsidies budget of the Commercial Housing In-Lieu Fund and to appropriate and transfer $720,220 from the SUMC Fund to the Residential Housing In-Lieu Fund. The SUMC Funds will be transferred to the Residential Housing In-Lieu Fund to avoid making loans directly 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 $20,800,333 in SUMC public benefit funds as of June 30, 2012 of which $7.7 million was deposited in the SUMC Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund. The SUMC Parties will pay an additional $11.7M in public benefit funds upon issuance of the first hospital foundation permit, expected in early December 2012, of which another $7.7 million will be placed in the SUMC Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund for a total of $15.4 million in the fund. An additional payment of $11.7M upon issuance of the first hospital occupancy permit, is expected in 2018 in which the final $7.7 million will be deposited into the Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing Fund. 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 Other funding (possible City 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 Financing for the development is expected from the following funding sources: 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 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 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, foster and preserve 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. 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 (DOCX) Attachment B: Loan Agreement (PDF) County SAHF loan $ 2,759,780 $ 45,996 Other Source (possible City loan) $ 2,600,000 $ 43,333 total $ 21,126,035 $ 352,101 Attachment C: City Council minutes of September 18, 2012 (PDF) Prepared By: Tim Wong, Senior Planner Department Head: Curtis Williams, Director City Manager Approval: ____________________________________ James Keene, City Manager ORDINANCE NO. ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING THE BUDGET FOR FISCAL YEAR 2013 TO PROVIDE ADDITIONAL APPROPRIATION OF $400,000 FROM THE COMMERCIAL HOUSING IN-LIEU FUND AND ADDITIONAL APPROPRIATION OF $720,220 FROM THE STANFORD UNIVERSITY MEDICAL CENTER (SUMC) INFRASTRUCTURE, SUSTAINABLE NEIGHBORHOODS AND COMMUNITIES, AND AFFODABLE HOUSING FUND TO BE LOANED 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. The City desires to make a long-term loan 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. The loan totals Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220); 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. Available balance in the Affordable Housing portion of the Infrastructure, Sustainable Neighborhoods and Communities, and Affordable Housing Fund is Seven Hundred Twenty Thousand Four Hundred Eighty-eight dollars ($720,488); and F. One Million Dollars ($1,000,000) has already been appropriated by Council in the Residential Housing In-Lieu Fund; and G. One Million One Hundred Dollars ($1,100,000) has been appropriated by Council in the Commercial Housing In- Lieu Fund; and H. An additional appropriation of Four Hundred Thousand Dollars ($400,000) is needed for the Commercial Housing In-Lieu Fund; and I. An appropriation in the amount of Seven Hundred Twenty Thousand Two Hundred Twenty Dollars ($720,220) is needed for the SUMC Fund to be transferred to the Residential Housing In-Lieu Fund for the loan to Palo Alto Housing Corporation (PAHC); and J. A summary of the funding needed is shown in the table below Source of funds Already budgeted Needs appropriation Total to project Residential Housing In-Lieu $1,000,000 $0 $1,000,000 Commercial Housing In-Lieu $1,100,000 $400,000 $1,500,000 SUMC affordable housing only $720,220 $720,220 Total loan $3,220,220 ;and K. City Council authorization is needed to amend the Fiscal Year 2013 Operating Budget as hereinafter set forth. SECTION 2. The sum of Four Hundred Thousand Dollars ($400,000) is hereby appropriated to Grants and Subsidies in the Commercial Housing In-Lieu budget and the available balance of the Commercial Housing In-Lieu Fund is hereby reduced to Eighty-one Thousand Six Dollars ($81,006). SECTION 3. The sum of Seven Hundred Twenty Thousand Two Hundred Twenty Dollars ($720,220) is hereby appropriated to Grants and Subsidies in the Residential Housing In-Lieu Fund and the Affordable Housing portion of the SUMC Infrastructure, Sustainable Neighborhoods and Communities, and Affordable Housing balance is reduced to Two Hundred Sixty-eight Dollars ($268) 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 Council of the City of Palo Alto hereby finds that amending the budget to provide the loan to PAHC this is not a project under the California Environmental Quality Act. By approving the 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. INTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: __________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: ___________________________ City Manager __________________________ ___________________________ Senior Deputy City Attorney Director of Planning and Community Environment __________________________ Director of Administrative Services 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 ,2012 TABLE OF CONTENTS ARTICLE 1 DEFINITIONS AND EXHIBITS 2 Section 1.1 Definitions ......................................................................................................... 2 Section 1.2 Exhibits~ ............................................................................................................ 6 ARTICLE 2 LOAN PROVISIONS 6 Section 2.1 LOaIl ................................................................................................................... 6 Section 2.2 Interest ............................................................................................................... 6 Section 2.3 Use of Funds ...................................................................................................... 7 Section 2.4 Security ............................................................................................................. 7 Section 2.5 Subordination .................................................................................................... 7 Section 2.6 Disbursement Requirements -Acquisition LOaIl ............................................. 9 Section 2.7 Subordination to Construction FinaIlcing ....................................................... 1 0 Section 2.8 Subordination to PennaIlent FinaIlcing ........................................................... 12 Section 2.9 Repayment of the City LOaIl ........................................................................... 12 Section 2.10 Non-Recourse ............................................................................................... 15 ARTICLE 3 PREDEVELOPMENT ACTIVITIES 15 Section 3.1 Predevelopment Activities .............................................................................. 15 Section 3.2 LaIld Use Approvals aIld CEQA Review ....................................................... .l6 Section 3.3 Tax Credit aIld Other FinaIlcing Applications ............................................... .l6 Section 3.4 FinaIlcing PlaIl ................ : ............................................................................... 17 Section 3.5 Building Permit ............................................................................................... 18 ARTICLE 4 ONGOING OBLIGATIONS 18 Section 4.1 Periodic Reports .............................................................................................. 18 Section 4.2 Information ..................................................................................................... 18 Section 4.3 Records ........................................................................................................... 18 Section 4.4 Audits ............................................................................................................... 18 Section 4.5 CompliaIlce with Laws; Prevailing W·ages ..................................................... 19 Section 4.6 Relocation ........................................................................................................ 19 Section 4.7 Hazardous Materials ....................................................................................... 20 Section 4.8 MaintenaIlce aIld Damage ............................................................................... 22 Section 4.9 MechaIlics Liens, Stop Notices, aIld Notices of Completion .......................... 23 Section 4.10 Fees and Taxes .............................................................................................. 23 Section 4.11 Notices .......................................................................................................... 24 Section 4.12 Non-Discrimination ...................................................................................... 24 Section 4.13 InsuraIlce Requirenlents ................................................................................ 24 Section 4.14 Transfer ......................................................................................................... 25 Section 4.15 Other Indebtedness and Liens ....................................................................... 26 Section 4.16 Use as Affordable Housing ........................................................................... 26 121115 sh 8262008 TABLE OF CONTENTS (continued) ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF BORROWER 26 Section 5.1 Representations and Warranties ..................................................................... .26 Section 5.2 Survival of Representations and Warranties ................................................... 28 ARTICLE 6 TERMINATION, DEFAULT AND REMEDIES 28 Section 6~ 1 Tennination of Agreement. ............................................................................. 28 Section 6.2 Events of Default ............................................................................................ 29 Section 6.3 Remedies ......................................................................................................... 31 Section 6.4 Option to Purchase, Enter and Possess .............................................................. 31 Section 6.5 Right of Contest .............................................................................................. 32 Section 6.6 Remedies Cumulative .................................................................................... .33 ARTICLE 7 GENERAL PROVISIONS 33 Section 7.1 Agreement Coordination ................................................................................ .33 Section 7.2 Relationship of Parties ................................................................................... .33 Section 7.3 No Claims ........................................................................................................ 34 Section 7.4 Amendments ................................................................................................... 34 Section 7.5 Entire Understanding of the Parties ............................................................... .34 Section 7.6 hldemnification ............................................................................................... 34 Section 7.7 N on-Liability of CITY and CITY Officials, Employees and Agents ............. 34 Section 7.8 No Third Party Beneficiaries .......................................................................... 35 Section 7.9 Action by the CITY; Amendments ................................................................ .35 Section 7.10 Waivers .......................................................................................................... 35 Section 7.11 Notices, Demands and Communications ...................................................... 35 Section 7.12 Applicable Law and Venue ........................................................................... 36 Section 7.13 Parties Bound ................................................................................................ 36 Section 7.14 Attorneys' Fees .............................................................................................. 36 Section 7.15 Severability ............. ~ ..................................................................................... 37 Section 7 .16 Force Majeure ............................................................................................... 37 Section 7.17 Conflict of Interest. ....................................................................................... 37 Section 7.18 Time of Essence ............................................................................................ 3 8 Section 7.19 Title of Parts and Sections; Exhibits ............................................................ .38 Section 7.20 Multiple Originals; Counterpart .................................................................... 3 8 Section 7.21 Recording of Memo of Agreement. .............................................................. 38 Section 7.22 Further Actions ............................................................................................. 38 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 Perfonnance EXHIBIT F: Assignment of Documents EXHIBIT G: Insurance Requirements 895\05\1232792.2 10/29/2012 ii ACQUISITION AND DEVELOPMENT LOAN AGREEMENT AND OPTION TO PURCHASE (Maybell Orchard Apartments, 567-595 Maybell Avenue, Palo Alto, California) This Acquisition and Development Loan AS!:eement and Option to Purchase (the -"Agreement") is made and entered into on 20) (the "Effective Date"), 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) forthe 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 Proj ect. C. To secure the Property for possible use as affordable housing, BORROWER wishes to borrow' from the CITY and the CITY wishes to extend to the BORROWER a loan of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) (the "City Loan") to assist in the acquisition of the Property. The City Loan will be evidenced by a promissory note (the "Note", attached as Exhibit B) executed by the BORROWER in favor of the CITY and 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. D. 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, 1 121115 sh 8262008 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. E. CITY has established the Affordable 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 Affordable Housing Fund Guidelines. 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. F. 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. 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 perfomlance 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: 2 121115 sh 8262008 (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 1 00 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"). (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. 3 121115 sh 8262008 (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. G) "CITY" is defined in the first paragraph of this Agreement. (k) "City Council" means the City Council of the CITY. (1) "City Loan" is defined in paragraph C of the Recitals. The City Loan is more pru1icularly 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. (0) "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. (P) "Construction Contractor" is defined in Section 2.7 below. (q) "Deed of Trust" is defined in Recital C. 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) "Effective Date" is defined in the first paragraph of this Agreement. (u) "Financing Plan" has the meaning set forth in Section 3.4 below. (v) "Force Majeure" is defined in Section 7.16 below. (w) "General Contractor" is defined in Section 2.7 below. (x) "Gross Revenue" is defined in Section 2.9 below. (y) "Hazardous Materials" has the meaning set forth in Section 4.9 below. (z) "Hazardous Materials Claim" has the meaning set forth in Section 4.9 below. (aa) "Hazardous Materials Law" has the meaning set forth in Section 4.9 below. (bb) "Land Use Approvals" is defined in Section 3.2 below. 4 121115 sh 8262008 (cc) "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 docunlent or agreement evidencing the City Loan. (dd) "Market-Rate Parcel" is defined in Recital B. (ee) "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. (ff) "Note" is defined in Recital C. The form of the Note is attached hereto as Exhibit B. (gg) "Notice of Exercise II has the meaning set forth in Section 6.4 below. (bb) "Option to Purchase" is defined in Sections 2.4 and 6.4 below. (ii) "Permanent Closing" means the date upon which all financing necessary for the operation of the Project on the Property c-loses, and any deeds of trust related to such financing are recorded against the Property. (jj) "Predevelopment Activities" means the activities to be performed by BORROWER during the Term, as further described in Article 3 below. (kk) "Project" is defined in Recital B. (11) "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. (mm) "Project Documents" are defined in Section 2.4(b) below. (nn) "Property" is defined in Recital A, and is more particularly described in the attached Exhibit A. (00) "Regulatory Agreenlent" 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. (Pp) "Residual Receipts" are defined in Section 2.9 below. (qq) "Schedule of Performance" is defined in Section 3.1 below, and IS more particularly described in Exhibit E. 5 121115 sh 8262008 (rr) "Senior Lenders" are defined in Section 2.5 below. (ss) "Senior Loan" is defined in Section 2.5 below. (tt) "TCAC" means the California Tax Credit Allocation Committee. (uu) "Term" is defined in Section 2.9 below. (vv) "Termination Notice" is defined in Section 6.1 below. (ww) "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. Subject to satisfaction of the conditions set forth in Section 2.6, the CITY shall loan to the BORROWER the City Loan in the principal amount of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) for the purposes set forth in Section 2.3 of this Agreement. The obligation to repay the Loan shall be evidenced by the Note in the form attached hereto as Exhibit B. - 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 6 121115 sh 8262008 Default is cured, at the default rate of the lesser of eight percent (8%) per annum, compoundeq 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 LIse Loan and the LIIF Loan. The BORROWER shall also cause or permit the Memo of Agreement to be recorded against the Property in a position superior to all other deeds of trust recorded against the Property except the LISC Loan and the LIIF Loan. (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 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. 7 121115 sh 8262008 (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 nlust provide to the CITY, in addition to any other information reasonably 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 8 121115 sh 8262008 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 hislher designee will be authorized to execute the approved subordination agreement without the necessity of any further action or approval. Section 2.6 Disbursement Requirenlents -Acquisition Loan. The CITY is not obligated to make any disbursement of the City Loan for the acquisition of the Property or take any other action under the Loan Documents unless all of the following conditions precedent are satisfied: (a) 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; (b) 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); ( c) 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; (d) BORROWER has furnished the CITY with evidence of the insurance coverage meeting the requirements of Exhibit G (e) 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; (f) 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; (g) 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; 9 121115 sh 8262008 (h) BORROWER has executed and delivered to the CITY all other documents, instruments, and policies required under the Loan Documents; (i) 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 G) The CITY has received a written draw request with complete documentation of acquisition expenses from the BORROWER, including all closing costs, demonstrating that the undi~bursed 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. (k) 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 (k) and subsections (a). Section 2.7 Subordination to Construction Financing. 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, denl0nstrating 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 (the "Developer Fee") based on submittal of the Final Budget to the City. City nlust 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 10 121115 sh 8262008 reputable and fmancially 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 Proj ect; 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. (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 AlA 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. 11 121115 sh 8262008 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 Pemlanent 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 and the City Loan commences as of the Effective Date, and expires, unless sooner terminated in accordance with this Agreement or extended pursuant to this subsection, on the earlier of: (i) May 31, 2013, if the Property has not been acquired by BORROWER, or (ii) the date that is fifty-five (55) years after the date of the Permanent Closing. The City Manager may extend the date for acquisition of the Property by up to an additional six months if, in the City Manager's reasonable judgment, the BORROWER is likely to be able to acquire the Property within the extended period. (b) Due in FulL BORROWER shall pay all 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 December 31, 2014 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, 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 loan, 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 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): 12 121115 sh 8262008 (1) "Annual Operating Expenses", with respect to a particular calendar year during the Tenn, 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 perfonned 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 pennanent 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 Lel).ders 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 nonnally paid from reserves, the amount of uninsured losses actually replaced, repaired or restored, and not nonnally 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 amounf expended from a reserve account. (2) "Gross Revenue," with respect to a particular calendar year during the Tenn, means all revenue, income, receipts, and other consideration actually received from operation and leasing of the Project. "Gross Revenue" shall include, but not be 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 inconle; 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 Tenn, means the amount by which Gross Revenue (as defined above) exceeds Annual Operating Expenses (as defined above). 13 121115 sh 8262008 (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 subsection (g) below then pending. (2) The receipt by the CITY of any statement pursuant to subsection (b) above 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 statement or such paymen( 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 14 121115 sh 8262008 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 enlinent domain or by reason of damage, loss or destruction to any portion of the Property. 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 December 31,2014, 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. 15 121115 sh 8262008 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 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 environnlental 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. 16 121115 sh 8262008 (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) of the Project. An operating pro forma for the first thirty (30) years of operation (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 Proj ect. (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 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. 17 121115 sh 8262008 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 Predevelopnlent 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 t~e 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 accotmting 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 Agreement. BORROWER shall further pernlit 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 18 121115 sh 8262008 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, 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 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, 19 121115 sh 8262008 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, II IIhazardous 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. (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 20 121115 sh 8262008 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 HazardQus 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 4.9, and Section 5.1 (i). 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 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 altenlative to such remedial action which 21 121 115 sh 8262008 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 environnlental 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 judgnlent, 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)(l), 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 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 22 121115 sh 8262008 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 anl0unt, 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. 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. II II 23 121115 sh 8262008 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 statenlents 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 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 nlaintain 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 24 121115 sh 8262008 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 andlor 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 hislher 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 pernlitted 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. (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 25 121115 sh 8262008 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. ARTICLES 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 carryon 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 26 121115 sh 8262008 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 instl1J.IDents 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 agre.ement 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. (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 27 121115 sh 8262008 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. G) Sufficient Funds. BORROWER holds sufficient funds and/or binding commitments for sufficient funds to conlplete 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. 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 December 31, 2014, 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 28 121115 sh 8262008 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 perfonnance 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 thirty (30) days after receipt of written notice thereof from the CITY to BORROWER or, if the breach cannot be cured within thirty (30) days, BORROWER is diligently undertakes to cure such breach within thirty (30) 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: (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. 29 121115 sh 8262008 (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 arrangenlent 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 (l) 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 Proj ect. 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, 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. G) 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. 30 121115 sh 8262008 (1) Applicability to General Partner. In the event BORROWER is a limited partnership or limited liability company, the occurrence of any of the events set foith 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 nlake 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. (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 31 121115 sh 8262008 be prosecuted diligently and in a manner unprejudicial to the CITY or the rights of the CITY hereunder. Section 6.6 Renledies 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 ot 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. (c) Each party nlay 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, wit1:.lholding 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. 33 121115 sh 8262008 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 wliom 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 requiremerits in any contracts entered into for the development of the Project. Section 7.4 Amendnlents. 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 council members, officers and employees, from all suits, actions, claims, causes of action, costs, demands, judgments and liens directly or indirectly 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 Agreenlent; (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 N on-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. II 121115 sh 8262008 34 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 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: II II 121115 sh 8262008 CITY: City of Palo Alto Office of the City Clerk PO Box 10250 Palo Alto, CA 94303 35 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 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. 36 121115 sh 8262008 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 Maj eure. 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 (l0) 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 7.1 7 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 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. II 37 121115 sh 8262008 Section 7.18 Time of Essence. Time is of the essence with respect to the performancy 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. II II II II II II II II II 38 121115 sh 8262008 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: ______________________ ~ Candice R. Gonzalez Executive Vice President Taxpayer I.D. No. ____________ _ 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 . 39 Signature Page 895\05\1232792.2 10/29/2012 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. 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. TRACTlWO: 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: 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. 280 48' E. ALONG SAID LINE OF MAYBELL AVENUE 13.00 FEET; THENCE LEAVING SAID LINE S. 61 0 12' E. 10.00 FEET; THENCE 5. 280 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 900 , AN ARC DISTANCE OF 15.71 FEET TO SAID NORTHEASTERLY LINE OF CLEMO AVENUE; THENCE ALONG SAID LINE N. 61 0 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 0 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. 280 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. 570 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. 280 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. 610 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 $3,220,220.00 EXHIBITB PROMISSORY NOTE 567-595 Maybell Avenue, Palo Alto, CA (APNNos. 137-25-108,137-25-109) Palo Alto, California ____ ,2012 FOR VALlTE RECEIVED, the undersigned Palo Alto Housing Corporation, a California non- profit public benefit corporation ("Borrower"), promises to pay to the order of the City of Palo Alto, a chartered city and municipal corporation ("City"), or order, the principal sum of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) plus interest thereon pursuant to Section 2 below. 1. Borrower's Obligation. This Note evidences Borrower's obligation to repay City the principal amount of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) plus interest for the funds loaned to Borrower by City to fmance the acquisition and. development of the Property pursuant to the Acquisition Loan Agreement and Option to Purchase between Borrower and City of even date herewith (the "Loan Agreement"). All capitalized terms used but not defined in this Note have the meanings set forth in the Loan Agreement. 2. Interest. (a) Subject to the provisions of subsection (b) below, this Note bears simple interest at a rate of three percent (3 %) per annum from the date of Permanent Closing until full repayment of all principal. (b) If a Default occurs, interest will accrue on all amounts due under this Note at the Default Rate until such Default is cured by Borrower or waived by City. 3. Term and Repayment Requirements. Principal and interest under this Note is due and payable as set forth in Section 2.9 of the Loan Agreement. The unpaid principal balance hereunder, together with accrued interest thereon, is due and payable no later than the date that is the earliest to occur of (i) any Transfer not authorized by the City, (ii) a Default, (iii) on December 31, 2014 or any extension of that date if the Agreement is terminated pursuant to Section 6.1 of the Loan Agreement, and (iv) the expiration of the Term, subject to extension pursuant to Section 2.9(b) of the Loan Agreement. 4. No Assumption. This Note is not assumable by the successors and assigns of Borrower without the prior written consent of City, except as provided in the Loan Agreement. 5. Security. This Note, with interest, is secured by the Deed of Trust. Upon execution, the D~ed of Trust will be recorded in the official records of Santa Clara County, 1 121115 sh 8262010 California. Upon recordation of the Deed of Trust, this Note will become nonrecourse to Borrower, pursuant to and except as provided in Section 2.10 of the Loan Agreement. The terms of the Deed of Trust are hereby incorporated into this Note and made a part hereof. 6. Terms of Payment. (a) Borrower shall make all payments due under this Note in currency of the United States of America to City at the Revenue Collections office of the City of Palo Alto, First Floor, 250 Hamilton Avenue, P. O. Box 10250, Palo Alto, CA 94303, or at such other place as City may from time to time designate. Except as otherwise set forth herein or in any other Loan Document, payments may be applied in such order and manner as City may determine in its sole and absolute discretion. (b) All payments on this Note are without· expense to City. Borrower shall pay all costs and expenses, including re-conveyance fees and reasonable attorney's fees of City, incurred in connection with the paynlent of this Note and the release of any security hereof. (c) Notwithstanding any other provision of this Note, or any instrument securing the obligations of Borrower under this Note, if, for any reason whatsoever, the payment of any sums by Borrower pursuant to the terms of this Note would result in the payment of interest that exceeds the amount that City may legally charge under the laws of the State of California, then the amount by which payments exceed the lawful interest rate will automatically be deducted from the principal balance owing on this Note, so that in no event is Borrower obligated under the terms of this Note to pay any interest that would exceed the lawful rate. (d) The obligations of Borrower under this Note are absolute and Borrower waives any and all rights to offset, deduct or withhold any payments or charges due under this Note for any reason whatsoever. 7. Default; Acceleration. (a) Upon the occurrence of a Default, the entire unpaid principal balance, together with all interest thereon, and together with all other sums then payable under this Note and the Deed of Trust will, at the option of City, become immediately due and payable without further demand. In addition to the right to accelerate the payment of this Note upon the occurrence of a Default, City shall have all rights and remedies described in "the other Loan Documents. (b) City's failure to exercise the remedy set forth in Subsection 7(a) above or any other remedy provided by law upon the occurrence of a Default does not constitute a waiver of the right to exercise any remedy at any subsequent time in respect to the same or any other Default. The acceptance by City of any paynlent that is less than the total of all amounts due and payable at the time of such payment does not constitute a waiver of the right to exercise any of the foregoing remedies or options at that time or at any subsequent time, or nullify any prior exercise of any such remedy or option, without the express consent of City, except as and to the extent otherwise provided by law. 2 121115 sh 8262010 8. Waivers. (a) Borrower hereby waives diligence, presentment, protest and demand, and notice of protest, notice of demand, notice of dishonor and notice of non-payment of this Note. Borrower expressly agrees that this Note or any payment hereunder may be extended fronl time to time, and that City may accept further security or release any security for this Note, all without in any way affecting the liability of Borrower. (b) Any extension of time for payment of this Note or any installment hereof made by agreement of City with any person now or hereafter liable for payment of this Note must not operate to release, discharge, modify, change or affect the original liability of Borrower under this Note, either in whole or in part. 9. Miscellaneous Provisions. (a) All notices to City or Borrower are to be given in the manner and at the addresses set forth in the Loan Agreement, or to such addresses as City and Borrower may therein designate. (b) Borrower promises to pay all costs and expenses, including reasonable attorney's fees, incurred by City in the enforcenlent of the provisions of this Note, regardless of whether suit is filed to seek enforcement. (c) This Note is governed by the laws of the State of California. (d) The times for the performance of any obligations hereunder are to be strictly construed, time being of the essence. ( e) This Note is one of the Loan Documents. This Note may not be modified except upon the written consent of the parties. (f) Every provision of this Note is intended to be severable. In the event any term or provision of this Note is declared by a cO\lrt of competent jurisdiction to be illegal, invalid or unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability will not affect the balance of the terms and provision hereof, which ternlS and provisions will remain binding and enforceable, and this Note will be construed as if such illegal, invalid or unenforceable provision had not been contained herein. [signatures on following page} 3 121115 sh 8262010 IN WITNESS WHEREOF, Borrower is executing this Promissory Note as of the day and year first above written. PALO ALTO HOUSING CORPORATION, a California nonprofit public benefit corporation By: Candice R. Gonzalez Its: Executive Vice President 121115 sh 8262010 4 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Palo Alto Office of City Attorney 250 Hamilton Avenue Palo Alto, CA 94301 RECORDED WITHOUT CHARGE GOVERNMENT CODE §§ 6103,27383 EXHIBITC DEED OF TRUST WITH ASSIGNMENT OF RENTS, SECURITY AGREEMENT, AND FIXTURE FILING 567 -595 Maybell Avenue, Palo Alto, CA (APN Nos. 137-25-108, 137-25-109) THIS DEED OF TRUST WITH ASSIGNMENT OF RENTS, SECURITY AGREEMENT, AND FIXTURE FILING ("Deed of Trust") is made as of __ , 2012, by and anlong Palo Alto Housing Corporation,· a California nonprofit public benefit corporation ("Trustor"), First American Title Company, a California corporation ("Trustee"), and the City of Palo Alto, a municipal corporation ("Beneficiary"). FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and conditions hereinafter set forth, Trustor's fee interest in the property located in the County of Santa Clara, State of California, that is described in the attached Exhibit A, incorporated herein by this reference (the "Property"). TOGETHER WITH all interest, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Property and the rents; TOGETHER WITH all easements, rights-of-way and rights used in connection therewith or as a means of access thereto, including (without limiting the generality of the foregoing) all tenements, hereditaments and appurtenances thereof and thereto; TOGETHER WITH any and all buildings and improvements of every kind and description now or hereafter erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the Property; 121115 sh 8262009 1 TOGETHER WITH all building materials and equipment now or hereafter delivered to said property and intended to be installed therein; TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter acquired, in and to any land lying within the right-of-way of any street, open or proposed, adjoining the Property, and any and all sidewalks, alleys and strips and areas of land adjacent to or used iIi connection with the Property; TOGETHER WITH all estate, interest, right, title, other claim or demand, of every nature, in and to such property, including the Property, both in law and in equity, including, but not limited to, all deposits made with or other security given by Trustor to. utility companies, the proceeds from any or all of such property, including the Property, claims or demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor now has or may hereafter acquire, any and all awards made for the taking by eminent domain or by any proceeding or purchase in lieu thereof of the whole or any part of such property, including without limitation, any awards resulting from a change of grade of streets and awards for severance damages to the extent Beneficiary has an interest in such awards for taking as provided in Section 4.1 herein; TOGETHER WITH all of Trustor's interest in all articles of personal property or fixtures now or hereafter attached to or used in and about the building or buildings now erected or hereafter to be erected on the Property which are necessary to the complete and comfortable use and occupancy of such building or buildings for the purposes for which they were or are to be erected, including all other goods and chattels and personal property as are ever used or furnished in operating a building, or the activities conducted therein, similar to the one herein described and referred to, and all renewals or replacements thereof or articles in substitution therefor, whether or not the same are, or will be, attached to said building or buildings in any manner; and TOGETHER WITH all of Trustor's interest in all building materials, fixtures, equipment, work in process and other personal property to be incorporated into the Property; all goods, materials, supplies, fixtures, equipment, machinery, furniture and furnishings, signs and other personal property now or hereafter appropriated for use on the Property, whether stored on the Property or elsewhere, and used or to be used in connection with the Property; all rents, issues and profits, and all inventory, accounts, accounts receivable, contract rights, general intangibles, chattel paper, instruments, documents, notes drafts, letters of credit, insurance policies, insurance and condemnation awards and proceeds, trade names, trademarks and service marks arising from or related to the Property and any business conducted thereon by Trustor; all replacements, additions, accessions and proceeds; and all books, records and files relating to any of the foregoing. All of the foregoing, together with the Property, is herein referred to as the "Security." To have and to hold the Security together with acquittances to the Trustee, its successors and assigns forever. FOR THE PURPOSE OF SECURING THE FOLLOWING OBLIGATIONS (the "Secured Obligations"): 121115 sh 8262009 2 A. Payment to Beneficiary of all sums at any time owing under or in connection with the Note (defined in Section 1.4 below) until paid or cancelled and any other amounts owing under the Loan Documents (defined in Section 1.3 below). Said principal and other payments are due and payable as provided in the Note or other Loan Documents, as applicable. The .Note and all its terms are incorporated herein by reference, and this conveyance secures any and all extensions thereof, however evidenced; B. Payment of any sums advanced by Beneficiary to protect the Security pursuant to the terms and provisions of this Deed of Trust following a breach of Trustor's obligation to advance said sums and the expiration of any applicable cure period, with interest thereon as provided herein; C. Performance of every obligation, covenant or agreement of Trustor contained herein and in the Loan Documents; and D. All modifications, extensions and renewals of any of the Secured Obligations (including without limitation, (i) modifications, extensions or renewals at a different rate of interest, or (ii) deferrals or accelerations of the required principal payment dates or interest payment dates or both, in whole or in part), however evidenced, whether or not any such modification, extension or renewal is evidenced by a new or additional promissory note or notes. AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR COVENANTS AND AGREES: ARTICLE 1 DEFINITIONS In addition to the terms defined elsewhere in this Deed of Trust, the following terms have the following meanings in this Deed of Trust. All capitalized terms used but not defined in this Deed of Trust have the meanings set forth in the Loan Agreement. Section 1.1 The term "Loan" means the loan made by the Beneficiary to the Trustor in the amount of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220). Section 1.2 The term "Loan Agreement" means that certain Acquisition Loan Agreement and Option to Purchase between Trustor and Beneficiary, of even date herewith, as such may be amended from time to time, providing for the Beneficiary to loan to Trustor Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220). Section 1.3 The term "Loan Documents" means this Deed of Trust, the Note, the Loan Agreement, the Assignment of Documents, the Regulatory Agreement, and any other agreement or instrument given to evidence or further secure payment and perfQrmance of the Secured Obligations, the terms and conditions of which are incorporated herein by this reference. Section 1.4 The term "Note" means the Promissory Note in the principal amount of Three Million Two Hundred Twenty Thousand Two Hundred Twenty Dollars ($3,220,220) of 121115 sh 8262009 3 even date herewith, executed by Trustor in favor of the Beneficiary, as it may be amended or restated, the payment of which is secured by this Deed of Trust. (A copy of the Note is on file with the Beneficiary and terms and provisions of the Note are incorporated herein by reference.) Section 1.5 The term "Principal" means the amount required to be paid under the Note. ARTICLE 2 MAINTENANCE AND MODIFICATION OF THE PROPERTY AND SECURITY Section 2.1 Maintenance and Modification of the Property by Trustor. The Trustor agrees that at all times prior to full payment and performance of the Secured Obligations, the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Security or cause the Security to be maintained and preserved in good condition. The Trustor will from time to time make or cause to be made all repairs, replacements and renewals deemed proper and necessary by it. The Beneficiary has no responsibility in any of these matters or for the making of improvements or additions to the Security. Trustor agrees to pay fully and discharge (or cause to be paid fully and discharged) all claims for labor done and for material and services furnished in connection with the Security, diligently to file or procure the filing of a valid notice of cessation upon the event of a cessation of labor on the work or construction on the Security for a continuous period of thfrty (30) days or more, and to take all other reasonable steps to forestall the assertion of claims of lien against the Security or any part thereof.· Trustor irrevocably appoints, designates and authorizes Beneficiary as its agent (said agency being coupled with an interest) with the authority, but without any obligation, to file for record any notices of completion or cessation of labor or any other notice that Beneficiary deems necessary or desirable to protect its interest in and to the Security or the Loan Documents; provided, however, that Beneficiary exercises its rights as agent of Trustor only in the event that Trustor fails to take, or fails to diligently continue to take, those actions as hereinbefore provided. . Upon demand by Beneficiary, Trustor shall make or cause to be made such demands or claims as Beneficiary specifies upon laborers, materialmen, subcontractors or other persons who . have furnished or claim to have furnished labor, services or materials in connection with the Security. Nothing herein contained requires Trustor to pay any clainls for labor, materials or services which Trustor in good faith disputes and is diligently contesting provided that Trustor shall, within thirty (30) days after the filing of any claim of lien, record in the Office of the Recorder of Santa Clara County, a surety bond in an amount 1 and 112 times the amount of such claim item to protect against a claim of lien. Section 2.2 Granting of Easements. Trustor may not grant easements, licenses, rights-of-way or other rights or privileges in the nature. of easements with respect to any property or rights included in the Security except those required or desirable for installation and maintenance of public utilities including, without 121115 sh 8262009 4 limitation, water, gas, electricity, sewer, cable, telephone and telegraph, or those required by law, and as approved, in writing, by Beneficiary. Section 2.3 Assignment of Rents. As part of the consideration for the indebtedness evidenced by the Note, Trustor hereby absolutely and unconditionally assigns and transfers to Beneficiary all the rents and revenues of the Property including those now due, past due, or to become due by virtue of any lease or other agreement for the occupancy or use of all or any part of the Property, regardless of to whom the rents and revenues of the Property are payable, subject to the rights of senior lenders. Trustor hereby authorizes Beneficiary or Beneficiary's agents to collect the aforesaid rents and revenues and hereby directs each tenant of the Property to pay such rents to Beneficiary or Beneficiary's agents; provided, however, that prior to written notice given by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the Loan Documents, Trustor shall collect and receive all rents and revenues of the Property as trustee for the benefit of Beneficiary and Trustor to apply the rents and revenues so collected to the Secured Obligations with the balance, so long as no such breach has occurred, to the account of Trustor, it being intended by Trustor and Beneficiary that this assignment of rents constitutes an absolute assignment and not an assignment for additional security only. Upon delivery of written notice by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the Loan Documents, and without the necessity of Beneficiary entering upon and taking and maintaining full control of the Property in person, by agent or by a court-appointed receiver, Beneficiary shall immediately be entitled to possession of all rents and revenues of the Property as specified in this Section 2.3 as the same becomes due and payable, including but not limited to, rents then due and unprud, and all such rents will immediately upon delivery of such notice be held by Trustor as trustee for the benefit of Beneficiary only; provided, however, that the written notice by Beneficiary to Trustor of the breach by Trustor contains a statement that Beneficiary exercises its rights to such rents. Trustor agrees that commencing upon delivery of such written notice of Trustor's breach by Beneficiary to Trustor, each tenant of the Property shall make such rents payable to and pay such rents to Beneficiary or Beneficiary's agents on Beneficiary'S written demand to each tenant therefor, delivered to each tenant personally, by mail or by delivering such demand to each rental unit, without any liability on the part of said tenant to inquire further . as to the existence of a default by Trustor. Trustor hereby covenants that, except to senior mortgage lenders, Trustor has not executed any prior assignment of said rents, that Trustor has not performed, and will not perfonn, any acts or has not executed and will not execute, any instrument which would prevent Beneficiary from exercising its rights under this Section 2.3, and that at the time of execution of this Deed of Trust, there has been no anticipation or prepayment of any of the rents of the Property for more than two (2) months prior to the due dates of such rents. Trustor covenants that Trustor will not hereafter collect or accept payn1ent of any rents of the Property more than two (2) months prior to the due dates of such rents. Trustor further covenant that Trustor will execute and deliver to Beneficiary such further assignments of rents and revenues of the Property as Beneficiary may from time to time request. Upon Trustor's breach of any covenant or agreement of Trustor in the Loan Documents, Beneficiary may in person, by agent or by a court-appointed receiver, regardless of the adequacy 121115 sh 8262009 5 of Beneficiary's security, enter upon and take and maintain full control of the Property in order to perform an acts necessary and appropriate for the operation and maintenance thereof including, but not linlited to, the execution, cancellation or modification of leases, the collection of all rents and revenues of the Property, the making of repairs to the Property and the execution or termination of contracts providing for the management or maintenance of the Property, all on such terms as are deemed best to protect the security of this Deed of Trust. In the event Beneficiary elects to seek the appointment of a receiver for the Property upon Trustor's breach of any covenant or agreement of Trustor in this Deed of Trust, Trustor hereby expressly consents to the appointment of such receiver. Beneficiary or the receiver will be entitled to receive a reasonable fee for so managing the Property. All rents and revenues collected subsequent to delivery of written notice by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the Loan Documents are to be applied first to the costs, if any, of taking control of and managing the Property and collecting the rents, including, but not limited to, attorney's fees, receiver's fees, premiums on receiver's bonds, costs of repairs to the Property, premiums on insurance policies, taxes, assessments and other charges on the Property, and the costs of discharging any obligation or liability of Trustor as lessor or landlord of the Property and then to the sums secured by this deed of Trust. Beneficiary or the receiver is to have access to the books and records used in the operation and maintenance of the Property and will be liable to account only for those rents actually received. Beneficiary is not liable to Trustor, anyone claiming under or through Trustor or anyone having an interest in the Property by reason of anything done or left undone by Beneficiary under this Section 2.3. If the rents of the Property are not sufficient to meet the costs, if any, of taking control of and managing the Property and collecting the rents, any funds expended by Beneficiary for such purposes will become part of the Secured Obligations pursuant to Section 3.3 hereof. Unless Beneficiary and Trustor agree in writing to other terms of payment, such amounts are payable by Trustor to Beneficiary upon notice from Beneficiary to Trustor requesting payment thereof and will bear· interest from the date of disbursement at the rate stated in Section 3.3. If the Beneficiary or the receiver enters upon and takes and maintains control of the Property, neither that act nor any application of rents as provided herein will cure or waive any default under this Deed of Trust or invalidate any other right or remedy available to Beneficiary under applicable law or under this Deed of Trust. This assignment of rents of the Property will terminate at such time as this Deed of Trust ceases to secure the Secured Obligations. ARTICLE 3 TAXES AND INSURANCE; ADVANCES Section 3.1 Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or cause to be paid, prior to the date of delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility company that are or nlay become a lien affecting the Security or any part thereof; provided, however, that Trustor is not required to pay and discharge any such tax, assessment, charge or levy so long as (a) the 121115 sh 8262009 6 legality thereof is promptly and actively contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any liabilities contested pursuant to this Section 3.1. With respect to taxes, special assessments or other similar governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien therefor on any part of the Security; provided, however, if such taxes, assessments or charges can be paid in installments, Trustor may pay in such installments. Except as provided in clause (b) of the first sentence of this paragraph, the provisions of this Section 3.1 may not be construed to require that Trustor maintain a reserve account, escrow account, impound account or other similar account for the payment of future taxes, assessments, charges and levies. In the event that Trustor fails to pay any of the items required by this Section to be paid by Trustor, Beneficiary may (but is tmder no obligation to) pay the same, after the Beneficiary has notified the Trustor of such failure to pay and the Trustor fails to fully pay such items within seven (7) business days after receipt of such notice. Any amount so advanced therefor by Beneficiary, together with interest thereon from the date of such advance at the maximum rate permitted by law, will become part of the Secured Obligations secured hereby, and Trustor agrees to pay all such amounts. Section 3.2 Provisions Respecting Insurance. Trustor agrees to provide insurance conforming in all respects to that required under the Loan Documents during the course of construction and following completion, and at all times until all amounts secured by this Deed of Trust have been paid, all Secured Obligations secured hereunder have been fulfilled, and this Deed of Trust has been reconveyed. All such insurance policies and coverages are to be maintained at Trustor's sole cost and expense. Certificates of insurance for all of the above insurance policies, showing the same to be in full force and effect, are to be delivered to the Beneficiary upon demand therefor at any time prior to Trustor's satisfaction of the Secured Obligations. Section 3.3 Advances. In the event the Trustor fails to maintain the full insurance coverage required by this Deed of Trust or fails to keep the Security in accordance with the Loan Documents, the Beneficiary, after at least seven (7) days prior notice to Trustor, may (but is under no obligation to) (i) take out the required policies of insurance and pay the premiums on the same, and (ii) make any repairs or replacements that are necessary and provide for payment thereof. All amounts so advanced by the Beneficiary will become part of the Secured Obligations (together with interest as set forth below) and will be secured hereby, which amounts the Trustor agrees to pay on the demand of the Beneficiary, and if not so paid, will bear interest from the date of the advance at the lesser often percent (10%) per annum or the maximum rate permitted by law. II II II 121115 sh 8262009 7 II II 121115 sh 8262009 8 ARTICLE 4 DAMAGE, DESTRUCTION OR CONDEMNATION Section 4.1 Awards and Damages. Subject to the rights of senior lenders, all judgments, awards of damages, settlements and compensation made in connection with or in lieu of (1) the taking of all or any part of or any interest in the Property by or under assertion of the power of eminent domain, (2) any damage. to or destruction of the Property or any part thereof by insured casualty, and (3) any other injury or damage to all or any part of the Property (collectively, the "Funds") are hereby assigned to and are to be paid to the Beneficiary by a check made payable to the Beneficiary. The Beneficiary is authorized and empowered (but not required) to collect and receive any Funds and is authorized to apply them in whole or in part to any indebtedness or obligation secured hereby, in such order and manner as the Beneficiary determines at its sole option. The Beneficiary is entitled to settle and adjust all claims under insurance policies provided under this Deed of Trust and may deduct and retain from the proceeds of such insurance the amount of all expenses incurred by it in connection with any such settlement or adjustment. All or any part of the amounts so collected and recovered by the Beneficiary may be released to Trustor upon such conditions as the Beneficiary may impose for its disposition. Application of all or any part of the Funds collected and received by the Beneficiary or the release thereof will not cure or waive any default under this Deed of Trust. The rights of the Beneficiary under this Section 4.1 are subject to the rights of any senior mortgage lender. The Beneficiary shall release the Funds to Trustor to be used to reconstruct the improvenlents on the Property provided that Beneficiary reasonably determines that Trustor (taking into account the Funds) has sufficient funds to rebuild the improvements in substantially the form that existed prior to the casualty or condemnation. ARTICLES AGREEMENTS AFFECTING THE PROPERTY; FURTHER ASSURANCES; PAYMENT OF PRINCIPAL AND INTEREST Section 5.1 Other Agreements Affecting Property. The Trustor shall duly and punctually perform all terms, covenants, conditions and agreements binding upon it under the Loan Documents and any other agreement of any nature whatsoever now or hereafter involving or affecting the Security or any part thereof. Section 5.2 Agreement to Pay Attorneys' Fees and Expenses. In the event of any Event of Default (as defined in Section 7.1) hereunder, and if the Beneficiary employs attorneys or incurs other expenses for the collection of amounts due hereunder or the enforcement of performance or observance of an obligation or agreement on the part of the Trustor in this Deed of Trust, the Trustor agrees that it will, on demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Beneficiary. Any such amounts paid by the Beneficiary will be added to the Secured Obligations, and will bear interest from the date such expenses are incurred at the lesser often percent (10%) per annum or the maximum rate permitted by law. 121115 sh 8262009 9 Section 5.3 Payment of the Principal. The Trustor shall pay to the Beneficiary the Principal and any other payments as set forth in the Note in the amounts and by the times set out therein. Section 5.4 Personal Property. To the maximum extent·permitted by law, the personal property subject to this Deed of Trust is deemed to be fixtures and part of the real property and this Deed of Trust constitutes a fixtures filing under the California Commercial Code. As to any personal property not deenled or permitted to be fixtures, this Deed of Trust constitutes a security agreement under the California Commercial Code. Section 5.5 Financing Statement. The Trustor shall execute and deliver to the Beneficiary such financing statements pursuant to the appropriate statutes, and any other documents or instruments as are required to convey to the Beneficiary a valid perfected security interest in the Security. The Trustor shall perform all acts that the Beneficiary reasonably requests so as to enable the Beneficiary to maintain a valid perfected security interest in the Security in order to secure the payment of the Note in accordance with its terms. The Beneficiary is authorized to file a copy of any such financing statement in any jurisdiction(s) as it deems appropriate from time to time in order to protect the security interest established pursuant to this instrument. Section 5.6 Operation of the Security. The Trustor shall operate the Security (and, in case of a transfer of a portion of the Security subject to this Deed of Trust, the transferee shall operate such portion of the Security) in full compliance with the Loan Documents. Section 5.7 Inspection of the Security. At any and all reasonable times upon seventy-two (72) hours' notice, the Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, may inspect the Security, without payment of charges or fees. Section 5.8 Nondiscrimination. The Trustor herein covenants by and for itself, its heirs, executors, administrators, and assigns, and all persons claiming under or through them, that there will be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, age, sex, sexual orientation, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Security, nor will the Trustor itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Security. The foregoing covenants run with the land. 121115 sh 8262009 10 ARTICLE 6 HAZARDOUS WASTE Trustor 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. Trustor 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"). Trustor shall cause any tenants and other 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. Trustor shall immediately notify the Beneficiary 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 Trustor, any tenant, 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 Trustor, any tenant, 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) Trustor'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. The Beneficiary 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 Trustor. Trustor shall indemnify and hold harmless the Beneficiary and its councilmernbers, 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, 121115 sh 8262009 11 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 oth~r property); and (v) the breach of any representation of warranty by or covenant of Trustor in this Article, and Section 5.l(h) of the Loan Agreement. 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 Beneficiary in connection with clauses (i) and (ii), including but not limited to reasonable attorneys' fees and consultant fees. This indenmification applies whether or not any government agency has issued a cleanup order. Losses, claims, costs, suits, liability, and expenses covered by this indemnification provision include, but are not limited to: (l) losses attributable to diminution in the value of the Property; (2) loss or restriction of use of rentable space on the Property; (3) adverse effect on the marketing of any rental space on the Property; and (4) penalties and fines levied by, and remedial or enforcement actions of any kind issued by any regulatory agency (including but not limited to the costs of any required testing, remediation, repair, removal, cleanup or detoxification of the Property and surrounding properties). This obligation to indemnify shall survive reconveyance of this Deed of Trust and shall not be diminished or affected in any respect as a result of any notice, disclosure, knowledge, if any, to or by the Beneficiary of Hazardous Materials. Without the Beneficiary's prior written consent, which shall not be unreasonably withheld, Trustor 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 Trustor, any tenant, or the Property relating to damage, contribution, cost recovery compensation, loss or injury resulting from any Hazardous Materials, which renledial action, settlement, consent decree or compromise might, in the Beneficiary's reasonable jUdgment, impair the value of the Beneficiary's security hereunder; provided, however, that the Beneficiary'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 Beneficiary'S consent before taking such action, provided that in such event Trustor shall notify the Beneficiary as soon as practicable of any action so taken. The Beneficiary 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) Trustor will or may be subjected to civil or criminal sanctions or penalties if it fails to take a required action; (iii) Trustor establishes to the reasonable satisfaction of the Beneficiary that there is no reasonable alternative to such remedial action which would result in less impairment of the Beneficiary'S security hereunder; or (iv) the action has been agreed to by the Beneficiary. The Trustor hereby acknowledges and agrees that (i) this Article is intended as the Beneficiary's written request for information (and the Trustor'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 Deed of Trust or any of the other 121115 sh 8262009 12 Loan Documents (together with any indemnity applicable to a breach of any such representation and warranty) with respect to the environmental condition of the property is intended by the Beneficiary and the Trustor to be an "environmental provision" for purposes of California Code of Civil Procedure Section 736. 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.S(e)(3» or to be an "affected parcel" (as that term is defined in California Code of Civil Procedure Section 726.S(e)(1», then, without otherwise limiting or in any way affecting the Beneficiary's or the Trustee's rights and remedies under this Deed of Trust, the Beneficiary may elect to exercise its rights under California Code of Civil. Procedure Section 726.S(a) to (1) waive its lien on such environmentally impaired or affected portion of the Property and (2) exercise ( a) the rights and remedies of an unsecured creditor, including reduction of its claim against the Trustor to judgment, and (b) any other rights and remedies permitted by law. For purposes of determining the Beneficiary's right to proceed as an unsecured creditor under California Code of Civil Procedure Section 726.S(a), the Trustor will 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.S( d)(l), 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 the Trustor 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 Beneficiary in connection with any action commenced under this paragraph, including any action required by California Code of Civil Procedure Section 726.S(b) to determine the degree to which the Property is environmentally impaired, plus interest thereon at the default rate specified in the Loan Agreement until paid, will be added to the indebtedness secured by this Deed of Trust and will be due and payable to the Beneficiary upon its demand nlade at any time following the conclusion of such action. ARTICLE 7 EVENTS OF DEFAULT AND REMEDIES Section 7.1 Events of Default. Any of the events listed in Section 6.2 of the Loan Agreement as a "Default" also 'constitute an Event of Default under this Deed of Trust following the expiration of any applicable notice and cure periods (each an "Event of Default"), including, but not limited to failure to make any payment or observe or perform any of Trustor's covenants, agreements, or obligations under any Secured Obligations. Section 7.2 Acceleration of Maturity. If an Event of Default has occurred and is continuing; then at the option of the Beneficiary, the amount of any payment related to the Event of Default and all unpaid Secured Obligations are immediately due and payable, and no omission on the part of the Beneficiary to exercise such option when entitled to do so may be construed as a waiver of such right. 121115 sh 8262009 13 Section 7.3 The Beneficiary's Right to Enter and Take Possession. If an Event of Default has occurred and is continuing, the Beneficiary may: (a) Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the Property and take possession thereof (or any part thereof) and of any of the Security, in its own name or in the name of Trustee, and do any acts that it deems necessary or desirable to preserve the value or marketability of the Property, or part thereof or interest therein, increase the income therefrom or protect the security thereof. The entering upon and taking possession of the Security will not cure or waive any Event of Default or Notice of Sale (as defined in Section 7.3(c), below) hereunder or invalidate any act done in response to such Event of Default or pursuant to such Notice of Sale, and, notwithstanding the continuance in possession of the Security, Beneficiary will be entitled to exercise every right provided for in this Deed of Trust, or by law upon occurrence of any Event of Default, including the right to exercise the power of sale; (b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof; (c) Deliver to Trustee a written declaration of an Event of Default and demand for sale, and a written notice of default and election to cause Trustor's interest in the Security to be sold ("Notice of Sale"), which notice Trustee or Beneficiary shall cause to be duly filed for record in the Official Records of Santa Clara County; or (d) Exercise all other rights and remedies provided herein, in the instruments by which the Trustor acquires title to any Security, or in any other document or agreement now or hereafter evidencing, creating or securing the Secured Obligations. Section 7 .4 Foreclosure By Power of Sale. Should the Beneficiary elect to foreclose by exercise of the power of sale herein contained, the Beneficiary shall deliver to the Trustee the Notice of Sale and shall deposit with . Trustee this Deed of Trust which is secured hereby (and the deposit of which will be deemed to constitute evidence that the Secured Obligations are immediately due and payable), and such receipts and evidence of any expenditures made that are additionally secured hereby as Trustee may require. (a) Upon receipt of the Notice of Sale from the Beneficiary, Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Sale as is then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after the lapse of that amount of time as is then required by law and after recordation of such Notice of Sale as required by law, sell the Security, at the time and place of sale set forth in the Notice of Sale, whether as a whole or in separate lots or parcels or items, as Trustee deems expedient and in such order as it determines, unless specified otherwise by the Trustor according to California Civil Code Section 2924g(b), at public auction to the highest bidder, for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to such purchaser or purchasers thereof its good and sufficient deed or deeds conveying the property so sold, but 121115 sh 8262009 14 without any covenant or warranty, express or inlplied. The recitals in such deed or any matters of facts will be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee or Beneficiary, may purchase at such sale. (b) After deducting all reasonable costs, fees and expenses of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale to payment of: (i) the unpaid Principal amount of the Note; (ii) all other Secured Obligations owed to Beneficiary under the Loan Documents; (iii) all other sums then secured hereby; and (iv) the remainder, if any, to Trustor. ( c) Trustee may postpone sale of all or any portion of the Property by public announcement at such time and place of sale, and from time to time thereafter, and without further notice make such sale at the time fixed by the last postponement, or may, in its discretion, give a new Notice of Sale. Section 7.5 Receiver. If an Event of Default occurs and is continuing, Beneficiary, as a matter of right and without further notice to Trustor or anyone claiming under the Security, and without regard to the then value of the Security or the interest of Trustor therein, may apply to any court having jurisdiction to appoint a receiver or receivers of the Security (or a part thereof), and Trustor hereby irrevocably consents to such appointment and waives further notice of any application therefor. Any such receiver or receivers will have all the usual powers and duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of entry as provided herein, and will continue as such and exercise all such powers until the date of confirmation of sale of the Security, unless such receivership is sooner terminated. Section 7.6 Remedies Cumulative. No right, power or renledy conferred upon or reserved to the Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy will be cumulative and concurrent and will be in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity. Section 7.7 No Waiver. (a) No delay or omission of the Beneficiary to exercise any right, power or remedy accruing upon any Event of Default will exhaust or impair any such right, power or remedy, and may not be construed to be a waiver of any such Event of Default or acquiescence therein; and every right, power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time to time and as often as may be deemed expeditious by the Beneficiary. Beneficiary'S express or implied consent to breach, or waiver of, any obligation of the Trustor hereunder will not be deemed or construed to be a consent to any subsequent breach, or further waiver, of such obligation or of any other obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, will not constitute a waiver by the Beneficiary of its right hereunder or impair any rights, power or remedies consequent on any Event of Default by the Trustor. 121115 sh 8262009 15 (b) If the Beneficiary (i) grants forbearance or an extension of time for the payment or performance of any Secured Obligation, (ii) takes other or additional security or the payment of any sums secured hereby, (iii) waives or does not exercise any right granted in the Loan Docwnents, (iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms, covenants, conditions or agreements in the Loan Documents, (v) consents to the granting of any easement or other right affecting the Security, or (vi) makes or consents to any agreement subordinating the lien hereof, any such act or omission will not release, discharge, modify, change or affect the original liability under this Deed of Trust, or any other obligation of the Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor will any such act or omission preclude the Beneficiary from exercising any right, power or privilege herein granted or intended to be granted in any Event of Default then made or of any subsequent Event of Default, nor, except as otherwise expressly provided in an instrument or instruments executed by the Beneficiary, will the lien of this Deed of Trust be altered thereby. Section 7.8 Suits to Protect the Security. The Beneficiary has the power to ( a) institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Security and the rights· of the Beneficiary as may be unlawful or any violation of this Deed of Trust, (b) preserve or protect its interest (as described in this Deed of Trust) in the Security, and (c) restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement for compliance with such enactment, rule or order would impair the Security thereunder or be prejudicial to the interest of the Beneficiary. Section 7.9 Trustee May File Proofs of Claim. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting the Trustor, its creditors or its property, the Beneficiary, to the extent permitted by law, will be entitled to file such proofs of claim and other docwnents as may be necessary or advisable in order to have the claims of the Beneficiary allowed in such proceedings and for any additional amount that becomes due and payable by the Trustor hereunder after such date. Section 7.10 Waiver. The Trustor waives presentment, demand for payment, notice of dishonor, notice of protest and nonpayment, protest, notice of interest on interest and late charges, and diligence in taking any action to collect any Secured Obligations or in proceedings against the Security, in connection with the delivery, acceptance, performance, default, endorsement or guaranty of this Deed of Trust. 121115 sh 8262009 16 ARTICLE 8 MISCELLANEOUS Section 8.1 Amendments. This Deed of Trust cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by Beneficiary and Trustor. Section 8.2 Reconveyance by Trustee. Upon written request of Beneficiary stating that all Secured Obligations have been paid or forgiven, and all obligations under the Loan Documents have been performed in full, and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee shall reconvey the Security to Trustor, or to the person or persons legally entitled thereto; provided that, City shall also reconvey the Security for the Market-Rate Parcel pursuant Section 4.14(d) of the Loan Agreement. Section 8.3 Notices. If at any time after the execution of this Deed of Trust it becomes necessary or convenient for one of the parties hereto to serve any notice, demand or communication upon the other party, such notice, demand or communication must be in writing and is to be served personally or by depositing the same in the registered United States mail, return receipt requested, postage prepaid and (1) if intended for Beneficiary is to be addressed to: 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 and (2) if intended for Trustor is to be addressed to: Palo Alto Housing Corporation 725 Alma Street Palo Alto, CA 94301 Attn: Executive Director Any notice, demand or communication will be deemed given, received, made or communicated on the date personal delivery is effected or, if mailed in the manner herein specified, on the delivery date or date delivery is refused by the addressee, as shown on the return receipt. Either 121115 sh 8262009 17 party may change its address at any time by giving written notice of such change to Beneficiary or Trustor as the case may be, in the manner provided herein, at least ten (10) days prior to the date such change is desired to be effective. Section 8.4 Successors and Joint Trustors. Where an obligation created herein is binding upon Trustor, the obligation also applies to and binds any transferee or successors in interest. Where the terms of the Deed of Trust have the effect of creating an obligation of the Trustor and a transferee, such obligation will be deemed to be a joint and several obligation of the Trustor and such transferee. Where Trustor is more than one entity or person, all obligations of Trustor will be deemed to be a joint and several obligation qfeach and every entity and person comprising Trustor. Section 8.5 Captions. The captions or headings at the beginning of each Section hereof are for the convenience' of the parties and are not a part of this Deed of Trust. Section 8.6 Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court or other body of competent jurisdiction, such illegality or invalidity will not affect the balance of the terms and provisions hereof, which terms and provisions will remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, will be considered to have been first paid or applied to the full payment of that portion of the debt that is not secured or partially secured by the lien of this Deed of Trust. Section 8.7 Governing Law. This Deed of Trust is governed by the'laws of the State of California. Section 8.8 Gender and Number. In this Deed of Trust the singular includes the plural and the masculine includes the feminine and neuter and vice versa, if the context so requires. Section 8.9 Deed of Trust. Mortgage. Any reference in this Deed of Trust to a mortgage also refers to a deed of trust and any reference to a deed of trust also refers to a mortgage. 121115 sh 8262009 18 Section 8.10 Actions. Trustor shall appear in and defend any action or proceeding purporting to affect the Security. Section 8.11 Substitution of Trustee. Beneficiary may from time to time substitute a successor or successors to any Trustee named herein or acting hereunder to execute this Trust. Upon -such appointment, and without conveyance to the successor trustee, the latter will be vested with all title, powers, and duties conferred upon any Trustee herein named or acting hereunder. Each such appointment and substitution is to be made by written instrument executed by Beneficiary, containing reference to this Deed of Trust and its place of record, which, when duly recorded in the proper office of the county or counties in which the Property is situated, will be conclusive proof of proper appointment of the successor trustee. Section 8.12 Statute of Limitations. The pleading of any statute of linlitations as a defense to any and all obligations secured by this Deed of Trust is hereby waived to the full extent permissible by law. Section 8.13 Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law, the Trustee is not obligated to notify any party hereto of a pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee is a party unless brought by Trustee. Section 8.14 Effect of Tax Credit Financing. Notwithstanding anything to the contrary contained herein or in any documents secured by this Deed of Trust or contained in any subordination agreement, the Beneficiary acknowledges and agrees that, if the Project is the subject of a regulatory agreement with the Califonlia Tax Credit Allocation Committee, in the event of a foreclosure or deed-in-lieu of foreclosure (collectively, "Foreclosure") with respect to the Property, the following rule contained in Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986, as amended ("Code"), shall apply: For a period of three (3) years from the date of Foreclosure, with respect to any unit that had been regulated by the regulatory agreement with the California Tax Credit Allocation Committee, (i) none of the tenants occupying those units at the time of Foreclosure may be evicted or their tenancy terminated (other than for good cause), (ii) nor may any rent be increased except as otherwise permitted under Section 42 of the Code. 121115 sh 8262009 19 IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written. 121115 sh 8262009 PALO ALTO HOUSING CORPORATION, a California nonprofit public benefit corporation By: Candice R. Gonzalez Its: Executive Vice President 20 STATE OF CALIFORNIA COUNTY OF SANTA CLARA ) ) ) On _,2012, before nle, ,Notary Public, personally appeared, who proved to me on the basis of satisfactory evidence to be the person( s) whose name is subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hislher/their authorized capacity, and that by hislher/their signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNES S my hand and official seal. Signature _____________ _ STATE OF CALIFORNIA COUNTY OF SANTA CLARA ) ) ) (seal) On _,2012, before me, ,Notary Public, personally appeared, who proved to me on the basis of satisfactory evidence to be the person( s) whose name is subscribed to the within instrument and acknowledged to me that he/she/they executed the sanle in hislher/their authorized capacity, and that by hislher/their signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify UNDER PENALTY OF PERJlTRYunder the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature _____________ _ (seal) 121115 sh 8262009 EXHIBIT A LEGAL DESCRIPTION The land is situated in the State of California, County of Santa Clara, City of Palo Alto, and is 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 ENTn-LED, "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. TRACTlWO: 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: 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 INTERSEerION 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; THENCEALONG 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 TRAer", 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 INTERSEerION THEREOF WITH THE NORTHEASTERLY LINE OF LOT 10, AS SAID AVENUE AND LOT ARE SHOWN UPON THE MAP OF MAYBELL TRAer 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 SOUTHEASrERLY LINE, N. 28° 48' E. 60.17 FEET TO THE POINT OF BEGINNING. ALSO EXCEPT[NG THEREFROM: PORTION OF LOT 10, MAP OF MAYBELL TRAer, FILED JUNE 19, 1905, BOOK K OF MAPS AT PAGE 88, SANTA CLARA COUNTY RECORDS, DESCRIBED AS FOLLOWS: BEGINNING AT THE INTERSEerION 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 wrrH 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 COUN1Y 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 COUN1Y 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 19.PR()"FORMA Budget Line It_ GrOwth Year Year Year Year Year' Year Year Year Year Year Year Year Year Year Year Factor 1 2 3 4 5 6 7 8 , 10 11 12 13 14 15 INCOME: Tenant Payment or Underwriting llents 2.50% 592,188 606,993 6~168 637,122 653,665 670,006 686,757 703.925 721,524 739.562 758,051 m,002 ,796.427 ' 816,338 836.7~ Rent Subsidy,(Specify) ,2.50% 0 0 0' 0 0 0 0 0 0 '0 0 0 0 0 (] Other Income -(Laundry) 2.50% 2,880 2,952 3.026 3.101 3,119 3,258 3.340 3.423 3,509 3.597 3.1587 3,779 3.873 3.970 4,069 GROSS SCBEDULIID INCOME 595,0Ci8 -,945 625,1'3 648,823 fi56,844 ,673,265 6,.,,096 707,349 725,033 743,1S8 '161,737 '180,781 --82O,3OS 840,816 LESS: Vacancy Rate @ 5% (29,753) (30,497) (31,260) (32,041) (32,842) (33,663) (34,505) (35.367) (36.252) (37,158) (38,087) (39.039) (40,015) (41,015) (42,041) EFFECl1.VE GROSS INCOME 565,315 519,447 593,.934 608,78:2 624,ool 639,602 655,592 671,981 688,781 706,000 723,650 741,742 7Q),285 779,192 7_775 Operating Expenses 3.50% 329.820 341,364 353,311 3<iS,677 378,476 391,723 405,433 419.623 434,310 449,511 465.244 481,527 498.381 515.824 533.878 - Property Taxes and Assessments 3.50% 6,000 6,210 6.427 6,652 6,885 7.126 7,376 7,634 7,90l' 8,171 8.464 8.760 9,066 9.384 9,712 On-Site SupporIive ServioeCoordination 3.50% 42,000' 43.470 44,991 " 46,566 48,196, 4!J,883 51,629 53,436 55,306 57,242 59,245 61,319 63,465 65,686 67.985 : AHF Annual Fee @ 0.30% 8,279 8.279 8,279 8,279 8,279 8,279 8.279 8,279 8,279 8,279 ' 8,279 8,279' 8,279 8,279 8,279 Total Opera ..... Ezpeuses --399,323 413_ 427,17~ 441,836 457,011 477,716 -,912 505,796 523,209 541,231 559,_ 579,191 99,173 61'_ NET OPERATING INCOME: 179,216 180;125 180,924' 181,ti07 18:2,165 182,591 182;8'15 183,010' 182,985 182,'192 182,419 181,857 181,894 1BO,120 178,921 Replacement Reserve Deposits 30.000 30,000 30,000 ,30,000 30,000 30.000 30.000 30.000 30,000 30,000 30,000 30.000 30.090 30.000 30,000 0peraI:irig Reserve Deposits 0 0 0 0 o. 0 0 0 0 0 0 0' 0 0 0 Other Reserves: (Specify) 0 0 0 0 0 0 0 (:) 0 0 0 0 ,0 0 0 NEI' OPERA1'.ING ING'OME LESS 149,%16 1.50,125 150,924 151,6W 152.U:i5 152,591 152,875 153,010 152,985 152,792 152,41' 151,85'7 ~1,094 .150,120 148:,921 RESERVFS Permanent Loan 124.351 124,351 124,351 124,351 124,351 124,351 124,351 124,351 124.3~1 124,351 124.351 124,351 124,351 124.j51 124,351 Total Debt Service 124,351 124,351 124,351 i24,351 11.4,351 124,351 124,351 ~ l24,351 124,351 , 124,351 124,351 124,351 124,3S1 124,351 Cash Flow 24,865 25,774 26,573 ri,2!6' 27,8l4 28,240 28,524 28,65' 28,634 28;441 28,068 1t1_ 26,743 25,"9 24,570 IAIMt Management Fee 5,4)00 5,150 5,305 5,464 5,628 5,796 5,970 6,14' 6;334 6,S24 6,720 6,921: 7,12' 7,3'43 ,7,563 PartDenbip Fee 1',865 20,624 21,269 21,793 22,1tr1 .22.444 22,554 22,509 22,300 21,917 21,348 20_ 1',615 18,42(i 17PfY/ DEBT SERVICE COVERAGE: 1.20 1.21 1.21 1.22 1.22 1.23 1.23 1.23 1.23 1.23 1.23 1.22 1.22 1.21 1.20 EXHIBITE 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 1.' Application -Land Use Approvals. BORROWER shall submit a complete application for the CITY Land Use Approvals, including CEQA review. 2. Receipt-Land Use Approvals. BORROWER shall obtain the CITY Land Use Approvals. 3. Application -Tax Credits. BORROWER shall submit an application to TCAC for a preliminary reservation of 9% tax credits. 4. Application -Building Permit. BORROWER shall .apply for a building permit from CITY. 5. Receipt -Tax Credits. BORROWER receives approval for tax credit allocation. 895\05\1235759.1 10/29/2012 F-7 Date By January 15, 2013. By July 1,2013. July 2013 (if Land Use Approvals are approved) September 15,2013 October 31, 2013 Action 6. Receipt -First Building Permit. BORROWER shall obtain the first building permit from City. 7. Submission -Final Construction and Permanent Financing Plan. BORROWER shall prepare and submit the Construction Financing Plan for CITY approval. 8. Construction Loan Closing. BORROWER shall satisfy all conditions in Section 2.7 and commence construction. 9. Permanent Loan Closing and Complete Rent-Up and Occupancy. 895\05\1235759.1 10/29/2012 F-8 Date October 31, 2013 Within 30 days after receipt of tax credit allocation from TCAC. November 31, 2013 to close construction loans. TCAC deadline to start construction April 2014. April 30, 2015. EXHIBITF ASSIGNMENT OF AGREEMENTS, PLANS AND SPECIFICATIONS, AND APPROVALS FOR VALUE RECEIVED, the undersigned, Palo Alto Housing Corporation, a California non-profit public benefit corporation (the "Borrower"), hereby assigns and transfers to the City of Palo Alto, a chartered city and a municipal corporation (the "City") (the "Assignment"), all of its right, title and interest in and to: (1) All architectural, design, engineering, and construction contracts and development agreements, and any and all amendments, modifications, supplements, addenda and general conditions thereto (collectively "Agreements"), heretofore or hereafter entered into by any Contractor (as de~ned below); (2) All written reports, studies, investigations, analyses, plans and specifications, shop drawings, working drawings, amendments, modifications, changes, supplements, general conditions, other documents, and addenda thereto (collectively "Plans and Specifications") heretofore or hereafter prepared by any Contractor (as defined below); and (3) All land use approvals, building permits, and other governmental approvals of any nature obtained for the Project (collectively, the "Governmental Approvals"). This Assignment is made pursuant to the terms of that Acquisition Loan Agreement and Option to Purchase, executed as of , entered into between the Borrower and the City (the "Loan Agreement"). Capitalized terms used but not defined in this Assignment shall have the meanings set forth in the Loan Agreement. The Property with respect to which the City has made the City Loan to the Borrower under the Loan Agreement is described in Exhibit A attached to this Assignment. For purposes of this Assignment, the term "Contractor" means any architect, construction contractor, engineer, consultant or other person or entity entering into Agreements with the Borrower or preparing Plans and Specifications for the Borrower with respect to the Project. The Borrower hereby irrevocably appoints the City as its attorney-in-fact (which agency is coupled with an interest) to, upon the occurrence of a Default or termination of the Loan Agreement as defined in Sections 6.1 and 6.2 of the Loan Agreement, demand, receive, and enforce any and all of the Borrower's rights with respect to the Plans and Specifications, Agreements, and Governmental Approvals, and perform any and all acts in the name of the Borrower or in the name of the City, as applicable, with the same force and effect as if performed by the Borrower in the absence of this Assignment. As further provided in Section 2.4 of the Loan Agreement, the City shall not have any obligation under any of the Agreements unless and until the City expressly agrees in writing to be bound by such Agreement(s). Upon the occurrence of a Default or termination of the Loan Agreement as defined in Sections 6.1 and 6.2 of the Loan Agreement, the City may use any of 895\05\1235759.1 10/2912012 F-9 the Agreements assumed by the City and any of the Plans and Specifications and Governmental Approvals 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 this Assignment and shall immediately deposit with the City all the Agreements, Plans and Specifications, and Governmental Approvals. The Borrower represents and warrants to the City that no previous assignment(s) of its rights or interest in or to the Plans and Specifications, Agreements, or Governmental Approvals has or have been nlade, and the Borrower agrees not to assign, sell, pledge, transfer, mortgage, or hypothecate its rights or interest therein (without prior written approval of the City Manager) so long as the City holds or retains any security interest under the Loan Agreement. This Assignment is made to secure: (1) payment to the City of all sums now or hereafter owing under the Note dated as of the date hereof made by the Borrower to the order of the City, and any and all additional advances, modifications, extensions, renewals and amendments thereof; and (2) payment and performance by the Borrower of all its obligations under the Loan Agreement. This Assignment shall terminate upon the Construction Closing. This Assignment shall be governed by the laws of the State of California, and the Borrower agrees that the Superior Court of the County of Santa Clara shall be the site and have jurisdiction for the filing and maintenance of any action arising hereunder and further agrees that the prevailing party in any such action shall be entitled, in addition to any other recovery, to reasonable attorneys' fees and costs. This Assignment shall be binding upon and inure to the benefit of the heirs, legal representatives, assigns, and successors-in-interest of the Borrower and City; provided, however, this shall not be construed and is not intended to waive the restrictions on assignment, sale, transfer, mortgage, pledge, hypothecation or encumbrance by the Borrower contained in the Loan Agreement. Exhibit A, the Architect's Consent, the Landscape Architect's Consent, and the Engineer's Consent are attached hereto and incorporated herein by reference. 895\05\1235759.1 . 10/29/2012 F-10 Executed by the Borrower on _____ '--, 2012. 895\05\1235759.1 10/29/2012 BORROWER: PALO ALTO HOUSING CORPORATION, a California nonprofit public benefit corporation By: Candice R. Gonzalez Its: Executive Vice President F-ll 895\05\1235759.1 10/29/2012 EXHIBIT A PROPERTY DESCRIPTION F-12 EXHIBITF ASSIGNMENT OF AGREEMENTS, PLANS AND SPECIFICATIONS, AND APPROVALS FOR VALUE RECEIVED, the undersigned, Palo Alto Housing Corporation, a California non-profit public benefit corporation (the "Borrower"), hereby assigns and transfers to the City of Palo Alto, a chartered city and a municipal corporation (the "City") (the "Assignment"), all of its right, title and interest in and to: (l) All architectural, design, engineering, and construction contracts and development agreements, and any and all amendments, modifications, supplements, addenda and general conditions thereto (collectively "Agreements"), heretofore or hereafter entered into by any Contractor (as defined below); (2) All written reports, studies, investigations, analyses, plans and specifications, shop drawings, working drawings, amendments, modifications, changes, supplements, general conditions, other documents, and addenda thereto (collectively "Plans and Specifications") heretofore or hereafter prepared by any Contractor (as defined below); and (3) All land use approvals, building permits, and other governmental approvals of any nature obtained for the Project (collectively, the "Governmental Approvals"). This Assignment is made pursuant to the terms of that Acquisition Loan Agreement and Option to Purchase, executed as of , entered into between the Borrower and the City (the "Loan Agreement"). Capitalized terms used but not defined in this Assignment shall have the meanings set forth in the Loan Agreement. The Property with respect to which the City has made the City Loan to the Borrower under the Loan Agreement is described in Exhibit A attached to this Assignment. For purposes of this Assignment, the term "Contractor" means any architect, construction contractor, engineer, consultant or other person or entity entering into Agreements with the Borrower or preparing Plans and Specifications for the Borrower with respect to the Project. The Borrower hereby irrevocably appoints the City as its attorney-in-fact (which agency is coupled with an interest) to, upon the occurrence of a Default or termination of the Loan Agreement as defmed in Sections 6.1 and 6.2 of the Loan Agreement, demand, receive, and enforce any and all of the Borrower's rights with respect to the Plans and Specifications, Agreements, and Governmental Approvals, and perform any and all acts in the name of the Borrower or in the name of the City, as applicable, with the same force and effect as if performed by the Borrower in the absence of this Assignment. As further provided in Section 2.4 of the Loan Agreement, the City shall not have any obligation under any of the Agreements unless and until the City expressly agrees in writing to be bound by such Agreement(s). Upon the occurrence of a Default or termination of the Loan Agreement as defined in Sections 6.1 and 6.2 of the Loan Agreement, the City may use any of 895\05\1235759.1 10/29/2012 F-1 ARCHITECT'S CONSENT The undersigned architect ("Architect")hereby consents to the foregoing Assignment of Agreements, Plans and Specifications, and Approvals ("Assignment"), of which this Architect's Consent ("Consent") is a part, and acknowledges that there presently exists no unpaid claims presently due to the Architect except as disclosed to the City arising out of the preparation and delivery of the Plans and Specification to the Borrower or the performance of the Architect's obligations under the Agreements, as the term "Agreements" is defined in the Assignment. Architect agrees that if, at any time, the City elects to undertake or cause the completion of construction of the Project on any of the Property, in accordance with the Plans and Specifications, and gives Architect written notice of such· election; then so long as the Architect has received, receives or continues to receive the compensations called for under the Agreements, the City may, at its option, use and rely on the Plans and Specifications for the purposes for which they were prepared, and Architect will continue to perfoml its obligations under the Agreements for the benefit and account of the City in the same manner as if performed for the benefit or account of the Borrower in the absence of this Assignment. The City may assign its rights pursuant to this paragraph to another development entity in its discretion. Architect further agrees that, in the event of a breach by the Borrower of the Agreements, or any agreement entered into with Architect in connection with the Plans and Specifications, so long as the Borrower's interest in the Agreements and Plans and Specifications is assigned to the City, Architect will give written notice to the City at the address shown below of such breach. The City shall have thirty (30) days from the receipt of such written notice of default to remedy or cure said default; provided, however, nothing herein shall require the City to cure said default or to undertake completion of construction of the Improvements. Architect warrants and represents that itlhe/she has no knowledge of any prior assignment(s) of any interest in either the Plans and Specifications or the Agreements. Except as otherwise defined herein, the terms used herein shall have the meanings given them in the Assignment or the Loan Agreement, as applicable. . Signature page City Promissory Note 895\05\1235826.1 10/2912012 13 Executed by the Architect on ______ , 2011. Address of City : City of Palo Alto Office of the City Clerk PO Box 10250 Palo Alto, CA 94303 Signature page City Promissory Note 895\05\1235826.1 10/29/2012 Address of Architect: By: _______________ _ Its: ------------------ 14 LANDSCAPE ARCHITECT'S CONSENT The undersigned landscape architect ("Landscape Architect") hereby consents to the foregoing Assignment of Agreements, Plans and Specifications, and Approvals ("Assignment"), of which this Landscape Architect's Consent ("Consent") is a part, and acknowledges that there presently exists no unpaid claims presently due to the Landscape Architect except as disclosed to the City arising out of the preparation and delivery of the Plans and Specification to the Borrower or the performance of the Landscape Architect's obligations under the Agreements, as the term "Agreements" is defined in the Assignment. Landscape Architect agrees that if, at any time, the City elects to undertake or cause the completion of construction of the Project on any of the Property, in accordance with the Plans and Specifications, and gives Landscape Architect written notice of such election; then so long as the Landscape Architect has .received, receives or continues to receive the compensations called for under the Agreements, the City may, at its option, use and rely on the Plans and Specifications for the purposes for which they were prepared, and Landscape Architect will continue to perform its obligations under the Agreements for the benefit and account of the City in the same manner as if performed for the benefit or account of the Borrower in the absence of this Assignment. The City may assign its rights pursuant to this paragraph to another development entity in its discretion. Landscape Architect further agrees that, in the event of a breach by the Borrower of the Agreements, or any agreement entered into with Landscape Architect in connection with the Plans and Specifications, so long as the Borrower's interest in the Agreements and Plans and Specifications is assigned to the City , Landscape Architect will give written notice to the City at the address shown below of such breach. The City shall have thirty (30) days from the receipt of such written notice of default to remedy or cure said default; provided, however, nothing herein shall require the City to cure said default or to undertake completion of construction of the Improvements. Landscape Architect warrants and represents that itlhe/she has no knowledge of any prior assignment(s) of any interest in either the Plans and Specifications or the Agreements. Except as otherwise defined herein, the terms used herein shall have the meanings given them in the Assignment or the Loan Agreement, as applicable. Signature page City Promissory Note 895\05\1235826.1 10/29/2012 15 Executed by the Landscape Architect on ______ , 2012. Address of City: City of Palo Alto Office of the City Clerk PO Box 10250 Palo Alto, CA 94303 Signature page City Promissory Note 895\05\1235826.1 10/29/2012 Address of Landscape Architect: By: _________ ~ ______________ ___ Its: ------------~----------------- 16 ENGINEER'S CONSENT The undersigned engineer ("Engineer") hereby consents to the foregoing Assignment of Agreements, Plans and Specifications, and Approvals ("Assignment"), of which this Engineer's Consent ("Consent") is a part, and acknowledges that there presently exists no unpaid claims presently due to the Engineer except as disclosed to the City arising out of the preparation and delivery of the Plans and Specification to the Borrower or the performance of the Engineer's obligations under the Agreements, as the term "Agreements" is defined in the Assignment. Engineer agrees that if, at any time, the City elects tounderfake or cause the completion of construction of the Project on any of the Property, in accordance with the Plans and Specifications, and gives Engineer written notice of such election; then so long as the Engineer has received, receives or continues to receive the compensations called for under the Agreements, the City may, at its option, use and rely on the Plans and Specifications for the purposes for which they were prepared, and Engineer will continue to perform its obligations under the Agreements for the benefit and account of the City in the same manner as if performed for the benefit or account of the Borrower in the absence of this Assignnlent. The City may assign its rights pursuant to this paragraph to another development entity in its discretion. Engineer further agrees that, in the event of a breach by the Borrower of the Agreements, or any agreement entered into with Engineer in connection with the Plans and Specifications, so long as the Borrower's interest in the Agreements and Plans and Specifications is assigned to the City, Engineer will give written notice to the City at the address shown below of such breach. The City shall have thirty (30) days from the receipt of such written notice of default to remedy or cure said default; provided, however, nothing herein shall require the City to cure said default or to undertake completion of construction of the Improvements. Engineer warrants and represents that itlhe/she has no knowledge of any prior assignment( s) of any interest in either the Plans and Specifications or the Agreements. Except as otherwise defined herein, the terms used herein shall have the nleanings given them in the Assignment or the Loan Agreement, as applicable. Signature page City Promissory Note 895\05\1235826.1 10129/2012 17 Executed by the Engineer on ______ , 2012 . Address of City: City of Palo Alto Office of the City Clerk PO Box 10250 Palo Alto, CA 94303 Signature page City Promissory Note 895\05\1235826.1 10129/2012 . Address of Engineer: By: __ ~ ________________________ ___ Its: ------------------------ 18 POLICY NUMBER: PHPK843325 COMMERCIAL GENERAL LIABILITY CG 20 1811 85 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - MORTGAGEE, ASSIGNEE, OR RECEIVER This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name of Person or Organization: City of Palo Alto Designation of Premises: Purchasing and Contract Admin. P.O. Box 10250 Palo Alto, CA 94303 USA (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable' to this endorsement.) 1. WHO IS AN INSURED (Section II) is amended to include as an insured the person(s) or organization(s) shown in the Schedule but only with respect to their liability as mortgagee, assignee, or receiver and ariSing out of the ownership, maintenance, or use of the premises by you and shown in the Schedule. 2. This insurance does not apply to structural alterations, new construction and demolition operations performed by or for that person or organization. CG 201811 85 Copyright, Insurance Services Office, Inc., 1984 SUPPLEMENT TO CERTIFICATE OF I~SURANCE DATE 10/10/2012 NAME OF INSURED: Palo Alto Housing Corporation Additional Descri(2tion of O(2erationsiRemarks from Page 1 : Additional Information: SUpp (05/04) CITY OF PALO ALTO CITY COUNCIL MINUTES EXCERPT ATTACHMENT C Page 1 of 2 City Council Meeting September 18, 2012 Preliminary Review of Proposed Palo Alto Housing Corporation (PAHC) Affordable Senior Housing Development at 567-595 Maybell Avenue The Advance Planning Manager gave a brief overview of the potential use of the 567-595 Maybell Avenue property as an affordable housing site with 60 units of senior affordable rental housing targeted to very low income households and 15 market rate for-sale single family homes. He described how Staff was seeking feedback from the Council about the proposed development. He introduced Palo Alto Housing Corporation (PAHC) Executive Director Candice Gonzales and she gave a brief summary of PAHC’s history and the community need for this type of housing. Lauri Moffet-Fehlberg, the project architect, presented the initial design concepts for the project including its circulation and design components. Jessica De Wit, Sr. Project Manager described the anticipated financing for the proposed project, noting that PAHC has submitted a $6.5 million loan request with the City. The Council Members discussed the conceptual plans. Several Council Members commented on proposed circulation of the project and its impact on Maybell Avenue and Arastradero Road, particularly the nine single family dwellings that will use Maybell Avenue for ingress/egress. Other concerns were expressed regarding lack of public transit in the area, the “cookie cutter” design and forward facing garages of the residences, and the uniform parcel sizes and their compatibility with the surrounding neighborhoods. To insure that there would not be a future increase of density on the property, a number of Council Members preferred that PAHC submit a Planned Community zone change rather than a zone change to Multiple Family Residential, RM-40. Other comments included orienting the buildings to focus on a common open space, possibly including a community garden, and the proposed cost of the development. Herb Borock stated the Zoning Code had a process called pre-screening that protected the public and allowed the Council to provide non-binding comments to applicants. That process required the same public noticing as an application. The Council did not follow the pre-screening process the prior week for the Police Building. He explained his understanding of the pre-screening process. This proposed application and plans were available MINUTES EXCERPT Page 2 of 2 City Council Meeting Minutes Excerpt: 9/18/12 in time for the process to be followed. The Council should direct the City Manager to follow the proper procedure for pre-screening. City of Palo Alto (ID # 3256) City Council Staff Report Report Type: Action ItemsMeeting Date: 11/19/2012 Summary Title: Lytton Plaza Amplified Sound Ordinance Title: Recommendation of the Parks and Recreation Commission Concerning Amendment of Section 22.04.180 of Chapter 24.04 of Title 22 [Park And Recreation Building Use And Regulations] of the Palo Alto Municipal Code and Amendment of Park and Open Space Regulations R1-4, R1-5a, R1-5b, and R1-10b to Impose Time Use Limitations on Sound Amplification Equipment at Lytton Plaza. From: City Manager Lead Department: Community Services Recommendation: The Parks and Recreation Commission recommends that Council 1) Adopt the amendment to Palo Alto Municipal Code 22.04.180 to Title 22 of the Palo Alto Municipal Code (Attachment A) to impose time and use limitations for sound amplification equipment at Lytton Plaza, and 2) Approve the amendments to the Park and Open Space Rules and Regulations R1-4, R1-5A, R1-5B, and R1-10B (Attachment B) to establish the specific times frames for amplified sound and the rules for the management of amplified music at Lytton Plaza (Attachment B). Executive Summary: Since October 25, 2011, Community Services Department staff and the Parks and Recreation Commission have been working with concerned stakeholders and residents to develop a plan to manage amplified sound at Lytton Plaza. After reaching out to musicians, youth advocates, and the local business community, staff and the stakeholders crafted a plan for modifying the Palo Alto Municipal Code and Park and Open Space Rules and Regulations to allow for limited opportunities of first-come, first- served amplified music and permitted amplified sound that will minimize the perceived disturbance to residents and the business community while still allowing musicians to perform at the site. On August, 28, 2012, the Parks and Recreation Commission voted 5-1 to recommend to Council the adoption of an ordinance, amending and updating the Park and Open Space Rules and Regulations. Background: Lytton Plaza was renovated in 2009. During the park renovation several electrical outlets were added to the plaza for the production of City-sponsored events and activities. The electrical outlets were intended to be used primarily for special events. Shortly after the renovation, Lytton Plaza became the site of a City-sponsored Farmer‟s Market. Live, electric amplified music accompanied the Farmer‟s Market events. In addition to their playing for the Farmer‟s Market, musicians also played at Lytton Plaza on other days (without authorization or permits). The Farmer‟s Market was discontinued in 2010, however, the unpermitted live music has continued and expanded. Individual musicians, as well as groups, utilize Lytton Plaza to perform amplified music at all hours of the day and night. The open access to the electrical outlets in the plaza has had unintended consequences. People have used the outlets to power portable stereos, heaters, stoves, and various other household electronic devices. The plaza has become a „draw‟ for people seeking use of „free‟ electricity. Community Services and Police staffs have received complaints from the surrounding businesses regarding amplified music at the plaza during daytime hours. There were registered complaints from residents about loud music being played late at night at the plaza. Staff tried to use the existing regulations and Municipal code provisions (laws, Attachment C) to deal with the complaints. However, the existing laws are not written in a manner to specifically address the concerns presented. Park Regulation (R1-34) prohibits the use of electrical receptacles in parks without a special use permit. However, there are several musicians that use battery powered amplifiers at Lytton Plaza. Staff also tried to curb the use of the electrical outlets by locking the outlet covers, but repeated acts of vandalism have made it difficult to fully secure the outlets. Palo Alto Municipal Code section 22.04.180 prohibits amplified sound in parks when the sound levels exceed 15 dB above the ambient at a distance of 25 feet. Unfortunately, the amplified music is perceived to disturb the surrounding businesses even if the noise level emissions fall below this threshold. Police and Parks Departments staffs have contacted some of the musicians to seek their assistance and input in dealing with the noise issues. In some cases there has been cooperation, but the sense is there has not occurred enough to adequately address the problem. Furthermore, the Police Department lacks the staffing to respond (and take the necessary decibel noise readings) to the frequent noise complaints of street musicians playing at Lytton Plaza. Staff brought this issue to the Parks and Recreation Commission on October 25, 2011, with a recommendation to prohibit amplified sound without a permit and limit the amplified sound from 5:00pm to 9:00pm on Sundays through Thursdays, and 5:00pm to 11:00pm on Fridays through Saturdays. The proposed permit fee was $300. The Commission did not support the recommendation, as written, and suggested that a Commission subcommittee be formed to work the issue. (Attachment D- October 25, 2011 Staff Report) The subcommittee met with musicians and youth advocates on January 4, 2012. The outcome was that the musicians want a place to perform amplified music with as few restrictions as possible and with no fees. Similarly, youth advocates want a place for youth to perform music and gather. The subcommittee met with stakeholders from the business community on February 9, 2012. The business community stakeholders explained that the amplified music during business hours is disruptive as the sound carries into nearby offices. They did not express concerns with high amplified sound after 5:00 pm on weekdays. They also explained that the 24-hour unfettered access to the electrical outlets has produced other negative consequences, namely, the perception that Lytton Plaza is not a safe place. The business community complained that people seeking the free electrical power are „camping out‟ at the plaza, creating a mess, and creating an unwelcoming environment for other visitors. They reported that the Palo Alto Police Department has responded to 195 calls for service at Lytton Plaza in 2011; and there were 59 calls for service in the first three months of 2012 (Attachment E). Due to the ongoing vandalism and complaints about amplified sound, the City Manager‟s Office requested that staff turn off the power at Lytton Plaza on April 29, 2012. Approximately once per week since then, the Plaza‟s electrical outlets and the Plaza trees‟ twinkle lights have been vandalized. Staff also has had to increase the frequency of pressure-washing the Plaza due to increases in unsightly stains and unwanted debris. Discussion: The subcommittee provided an update to the Parks and Recreation Commission at the March 27, 2012 meeting. A proposed plan for managing amplified music at the Plaza was shared at the meeting. The plan included free first-come, first-served hours for amplified music (Monday through Thursday from 5pm to 10pm, Friday from 5pm to 11pm, and Saturday noon to 11pm and Sunday from noon to 10pm. Some of the feedback from the Commission include (a) the permit fees for amplified music outside of the free first-come, first-served ($150) still seemed too high, (b) the piped-in music from Pizza My Heart is somewhat undesirable, and (c) more community outreach would be helpful. Staff contacted the musicians and the business community stakeholders to seek additional input regarding a slightly revised plan. Both groups agreed to the proposed plan, including a permit fee of $90, and the addition of a statement, qualifying the three-hour performance limit only if another musical group was waiting to perform. Staff followed the Commission‟s direction and conferred with musicians and the business community stakeholders to seek additional input, which was used to create the following plan for managing amplified sound at the Plaza. The Plan For Managing Amplified Sound At The Plaza This is the plan that staff and the Parks and Recreation Commission recommend that the Council should approve: Amplified sound at Lytton Plaza would be allowed on a first-come, first-served basis on: Monday through Thursday 5pm to 10pm Friday 5pm to 11pm Saturday noon – 11pm Sunday noon -10pm There would be no permit, insurance or fees required during these standard hours - unless a group wants to reserve the Plaza in advance for amplified music during these hours. To reserve a time in advance a permit must be obtained by submitting a permit request to the City‟s Special Event Team- headed by the Police Department. The permit fee is $90. Amplified sound outside of these standard approved hours might also be available via the existing permit process. To obtain a permit for amplified sound outside of the hours listed above, a permit request must be submitted to the City‟s Special Event Team. The permit fee is $90. City-sponsored and permitted events will have priority, and musicians without a permit would not be able to use the plaza during the permitted event. The City will post information relating to permitted events to the City‟s Web page (Lytton Plaza web page) so that musicians can check to see if there is a conflict with their events. Businesses can also check the website to see when music events will take place during business hours and plan their work around the disturbance accordingly. Only one outlet will be available for events, and the outlet will only be powered during the times listed above (unless with an approved permit). The outlet will not be locked. The power to the outlet would be remotely controlled and set on a timer. Only one musical group may perform at a block of time. For musicians without permits there is a three-hour limit on performing, should there be another musical group which is waiting to perform. This will be a self-enforced limit. The available outlet is limited to 20 amps. If the circuit is overloaded and the breaker is tripped, power will not be restored until the following work day. The outlet will be labeled “Do not exceed 20 amps”. This plan allows for 47 hours a week of free amplified music, which is 2,444 hours per year. Acoustic music would be allowed anytime in the plaza. The existing noise ordinance will apply to all music (amplified or acoustic) at all times. It should also be noted that if the group is going to have more than 25 people present for an event, Palo Alto Municipal Code section 22.04.040 would require the group to acquire a special use permit without regard to whether the music is amplified. Palo Alto Municipal Code section 22.04.160, prohibiting commercial activity in city parks, applies to all music in the plaza. Feedback From The Musician Stakeholders Regarding The Proposed Plan For Managing Amplified Sound At Lytton Plaza ●The proposed hours for Lytton Plaza power hours are just fine and very appropriate. Good compromise for this challenging multi-use area, and we can support this plan. Please ensure that the rules apply to everyone that uses the Plaza. There should be no special treatment for religious or other groups. ●The proposed ordinance seems overly broad. Feedback From The Business Community Regarding The Proposed Plan For Managing Amplified Sound At Lytton Plaza ●The plan and the proposed hours for live amplified music seem like a good compromise. ● Problems persist and action is needed. There was very loud amplified music with drums on May 2, 2012 that negatively impacted business affairs. ●This ordinance should address “live” amplified music. The piped in music via Pizza My Heart should be allowed under a City sponsored permit. ●Friends of Lytton Plaza researched successful urban parks across the country - providing background music was one of the key elements of making a park welcoming and highly utilized. During the construction, negotiations with the Pizza My Heart building owners and special contributions for additional speakers to be installed for this purpose were a significant part of the building process. The park use was highly scrutinized by various interest groups and this was something that appealed to all – legal agreements were drawn up to enable this benefit to occur. This public private partnership cannot have the rules changed after the project has been completed. The Park music should not be confused with live musicians or special events! ● (Echoed the preceding sentiments). As a side note as a business that is close to the park, the piped-in background music is not, and has not been, an issue. The musicians that set up are different. Their music is significantly louder than the background music and can be disruptive to business let alone conversation at the park. If I had been the private party of the private/public partnership I would be very concerned about a change to that partnership. The greater issue here is if that agreement changes we would be sending the wrong message to business regarding going into a public/private partnership! ● I served on the original committee that re-developed Lytton Plaza. We worked closely with Pizza My Heart to provide music for our guests on the plaza – we remain extremely grateful for our partnership - as music in urban parks is a contributing factor to its success. Two important factors are that the volume needs to be kept low and discreet – the melodic background is meant to relax visitors and not interfere with what they are doing. The type of music needs to be soft, easy and familiar to all so there is a level of comfort and familiarity. Piped-In Music at the Plaza The Friends of Lytton Plaza explained that the piped-in music, which is controlled by the Pizza My Heart staff, was included in the plaza design that was approved by the City. Their research showed that piped-in music could help create a quieter presence in the park. The Friends pointed out that piped-in music in not uncommon in public places. The City and the Friends of Lytton Plaza Park entered into a contract in 2009, whereby the Friends constructed improvements at Lytton Plaza and the City assumed the responsibility for maintaining it. The contract included the audio speakers for piped-in music into the Plaza (See Attachment E). The policy question of whether piped-in music should be allowed in the Plaza was decided by Council when they approved the agreement between the owners of 22 University Avenue (Pizza My Heart is the tenant) and the City for various improvements at Lytton Plaza, including the audio speakers for the piped-in music. Additional Outreach Community Services staff made 11 visits to the Plaza (from March 27 to April 5) and spoke with 60 Plaza visitors and asked the following questions: 1. Do you enjoy the piped-in music into the plaza? Yes- 41 people No- 10 people (most said they prefer other kinds of music, some said they prefer quiet); Don‟t care- 9 people 2. Are you in favor of the following limitations on amplified music (I explained the proposed hours)? Yes- 33 people (several comments mentioned enjoying live music on weekends) No- 7 people (4 prefer quiet; 3 want live music all the time); I don‟t know/ don‟t care- 20 people. Opportunities for Youth Some of the stakeholders who were involved in discussions for how to manage amplified sound at Lytton Plaza discussed the importance of providing a place for teens to perform. In addition to the 2,444 hours per year that would be free of charge (first- come, first-served), an additional idea is to offer three free City co-sponsored events with the Teen Arts Council. The Teen Arts Council is in close contact with the local high schools, and already hosts monthly open mic events, which typically draw approximately 200 people in attendance. Their events are so well attended that they frequently have to turn people away. Beta Testing the Planned First-Come, First-Served Hours On June 22, 2012, staff began the test of the planned first-come, first-served hours. There was one initial problem with the power shutting off early due to a programming error, but staff quickly corrected it. There have been no reports of problems or issues from the business community, musicians, or plaza users. Parks and Recreation Commission’s Recommendation On August 28, 2012, the Commission voted 5-1 to recommend the attached amendment to Palo Alto Municipal Code section 22.04.180(Attachment A) to impose time and use limitations for sound amplification equipment at Lytton Plaza, and the attached update to the Parks Rules and Regulations R1-4, R1-5A, R1-5B, and R1-10B (Attachment B) to provide the specific times frames for amplified sound and some of the ground rules for how amplified music will be managed at Lytton Plaza (Commission meeting minutes -Attachment F). Commissioner Walsh dissented; she thought the outreach and compromise was well done, but she wasn‟t pleased with the end result. She explained that Lytton Plaza seems a little too loud. Policy Implications: The proposed amendments are consistent with Goal N-8 and Policy N-40 Policy N-40 of the Natural Environment element of the Comprehensive Plan that encourages an environment that minimizes the adverse impacts of noise, and calls for staff to evaluate the potential for noise pollution and ways to reduce noise impacts when reviewing development and activities in Palo Alto and surrounding communities. Resource Impact: Neither new staff nor an increase in the number of patrols is proposed to enforce the permit requirement and time use limitations for sound amplification equipment at Lytton Plaza. The penalty fee imposed for an administrative citation ($250) for violation of this ordinance would cover the cost of staff time to issue and process the citation. To implement this ordinance, $250.00 would be used from the Parks operating budget to design, fabricate, and install new signage. Environmental Review: This proposed amendment to a City ordinance is not a project subject to California Environmental Quality Act (CEQA) requirements. Attachments: ATTACHMENT A-- Ordinance Lytton Plaza Amplified Sound (PDF) ATTACHMENT B-- Parks and Open Space Regulations (PDF) ATTACHMENT C (PDF) ATTACHMENT D-- Parks and Recreation Commission Lytton staff report 10-25-11 (PDF) ATTACHMENT E-- Lytton Plaza Police Calls for Service (PDF) ATTACHMENT F-- Parks and Recreation Commission August 28, 2012 Meeting Minutes (PDF) Prepared By: Daren Anderson, Department Head: Greg Betts, Director, Community Services City Manager Approval: ____________________________________ James Keene, City Manager *NOT YET APPROVED* 1 120821 dm 007100556 ORDINANCE NO. ________ ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO TO AMENDING SECTION 22.04.180 OF CHAPTER 22.04 (PARKS AND RECREATION BUILDING USE AND REGULATIONS) OF TITLE 2 OF THE PALO ALTO MUNICIPAL CODE PERTAINING TOAMPLIFIED NOISE IN LYTTON PLAZA R E C I T A L S The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Section 22.04.180 of Chapter 22.04 of Title 2 of the Palo Alto Municipal Code is amended in its entirety to read: “22.04.180 Amplified Sound. (a) No person shall operate any device or sound amplification equipment in city parks or open space lands, emitting sound in excess of the limits allowed under Section 9.10.050 of this code. (b) The director may restrict the use of sound amplification devices in connection with any activity for which a permit is required, and such restrictions may include constraints on capacity, volume, emission spectrum, location and arrangement, when such restrictions are designed to reduce the noise impact on adjacent land uses. (c) No person shall operate any device or sound amplification in Lytton Plaza, except as provided by the director by permit and in accordance with park and open space regulations and Section 9.10.050 of this code.” SECTION 2. Regulations R1‐4, R1‐5 and R1‐16 are amended, and R1‐10B Lytton Plaza Noise Regulations is added, to the Park and Open Space Regulations, and they are attached to this ordinance. SECTION 3. The City Council finds that this ordinance is not a project for CEQA purposes and, upon that basis, it determines that no environmental assessment is required. *NOT YET APPROVED* 2 120821 dm 007100556 SECTION 4. This ordinance shall be effective on the commencement of the thirty‐first day after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: ___________________________ City Manager ____________________________ Senior Asst. City Attorney ___________________________ Director of Community Services 120821 dm 00710062 Attachment A PARK AND OPEN SPACE REGULATIONS R1-1. DEFINITIONS The following words and phrases, whenever used in these regulations, shall be construed as defined in these regulations. A. "city" means the City of Palo Alto. B. "department" means the Department of Community Services of the City. C. "facility" or "park facility" means any body of water, land, campsite, garden, trail, levee, recreation area, building, structure, system, equipment, machinery or other appurtenance owned, managed, controlled or operated by the Community Services Department. D. “director” means the Director of Community Services of the City. R1-2. APPLICABILITY The provisions of these regulations apply to all facilities under the jurisdiction of the Community Services Department. R1-3. CLOSURE OF FACILITIES-AUTHORITY The director shall have the authority to close any park facility or portion thereof and require the exit of all persons therein when he or she determines that conditions exist in said facility or portion thereof which presents a hazard to the facility or to public safety. No person shall use, enter or remain in any facility, park or open space which has been posted as being closed under this authority. A. The Open Space, Parks and Golf Division Manager shall have the authority to close open space trails which have been designated as “seasonal trails” when weather conditions predispose the trail or surrounding habitat to damage or erosion. Such trail closures will be posted on park bulletin boards and at the affected trail junction. B. The Open Space, Parks and Golf Division Manager shall have the authority to temporarily close open space trails or facilities when the damage of flora or fauna are threatened by humans or their pets. Such facility closures will be posted on park bulletin boards and at affected trail junctions or facilities. R1-4. CONTENTS OF PERMIT APPLICATION; SUBMISSION Whenever a permit other than a city-wide special event permit is required by provision in this chapter, an application shall be filed with the director stating: A. The name of each applicant, sponsoring organization and the person(s) who is in charge of or responsible for the proposed activity; B. The address and telephone numbers of each person and/or entity named in subsection (A); C. The name of the park, open space land, building, field or tennis courts requested for the activity, specifically identifying the location of the activity within the park or room within the building; D. The date and starting time of the proposed activity, together with the anticipated arrival time of guests; E. The finish time of the proposed activity, including cleanup; F. The number of persons expected to attend the activity; G. Additional City facilities requested, such as personnel, tables, chairs, etc; H. The nature of the proposed activity or activities, including equipment and vehicles to be brought into the park or open space lands; nature and duration of the use of such equipment; nature and duration of the use of any amplified sound; whether fees or donations for service will be solicited or collected; and whether alcohol will be served. I. Proof of Palo Alto residency may be required for the permit application. The permit application shall be filed with the director by no later than seven (7) days prior to the date of the proposed activity. R1-5A. ACTION ON PERMIT APPLICATION The director shall issue a permit other than a city-wide special event permit within five (5) business days after submission of a completed application if: A. The proposed activity or use of the facility will not unreasonably interfere with or detract from the 120821 dm 00710062 general public enjoyment of the facility; B. A facility with the required occupancy load capacity is available; C. All conditions, including, where applicable, the payment of fees, approval of the Director of Community Services and insurance coverage, security deposits and/or requirements are met; D. The proposed activity or use will not entail unusual, extraordinary or burdensome expense or security operation by the department; E. If the proposed special event will have more than twenty-five people, involve road closures, traffic control, or the need for inter-departmental review (such as for fun runs), an additional City-wide special event application from the Police Department may be required for the event. City-wide special event permit applications are not generally required for standard picnic reservations. FE. The facilities desired have not been reserved for other use; GF. Special conditions requested in applications are reasonable and feasible.; HG. The proposed activity will not negatively impact habitat, wildlife, or vegetation in the park or open space area.; and IH. Residency requirements, if any, have been satisfied. R1-5B. ACTION ON SPECIAL EVENT PERMIT APPLICATION. The City shall issue a permit within sixty (60) business days after submission of a completed application: A. If the proposed city-wide special event will have more than twenty-five (25) individuals in attendance or will involve road closures, traffic control, or the need for inter-departmental review (for example, for a “fun run” or a “live music” event), an additional city-wide special event permit application from the Police Department will be required for the event. The city-wide special event permit application is not required for standard picnic reservations. A completed application for a city-wide special event permit may be filed as early as one (1) year prior to the requested date of the special event, but it must be filed by no later than thirty (30) days prior to the requested date of the special event and by no later than ninety (90) days prior to the requested date of the special event if a street closure will be required in order to stage the special event. R1-6. FOOTHILLS PARK RESIDENCY REQUIREMENTS Admittance and use of park facilities within Foothills Park have additional residency requirements. Only residents of the city and regular or part-time City employees, members of their households related by blood, marriage, domestic partnership, or adoption, and their accompanied guests are entitled to enter and remain in Foothills Park. An "accompanied guest" is one who enters Foothills Park in the presence of a resident of the city or a regular or part-time City employee or members of their household as described above. A special use permit will not be granted until these special requirements have been satisfied: A. In the case of Foothills Park Wedding Use Permits, one member of fifteen guests of the guest list must be Palo Alto residents. B. In the case of Foothills Park Day Use Reservations for the Oak Grove Group Area or the Interpretive Center, or Foothills Park Towle Camp Reservations, one member of fifteen guests of the guest list must be a Palo Alto resident. A guest list which includes the home address of the guests must be received one week prior to the proposed activity or activities. C. In the case of Foothills Park Special Use/Group Permits or for groups of more than 24 persons, one member of fifteen guests seeking admittance to the park accompanied by the permit applicant must be a Palo Alto resident. (A guest list is not required for this type of permit.) R1-7. PERMIT--EXHIBITION No person shall fail to produce and exhibit a permit he or she claims to have upon request of any department employee, contracted park ranger or any public or peace officer who desires to inspect the permit for the purpose of enforcing compliance with any regulations of this chapter. R1-8. HOURS OF PARK CLOSURE For purposes of enforcement of the park and open space closure restrictions promulgated in Title 22 of the Palo Alto Municipal Code, the terms “sunset” and “sunrise” are defined with reference to a table of times that is determined annually and posted at open space facilities. Closure times specified in Title 22 as implemented by this regulation shall be posted prominently at each park or open space facility and shall be posted on the City’s web site. 120821 dm 00710062 R1-9. HAZARDOUS GAMES OR ACTIVITIES The playing of games and/or activities involving propelled or thrown objects which are sharp or heavy (such as stones, shot puts, arrows or javelins) are prohibited except when a permit is issued by the director in areas compatible for such use. Except in designated areas of Mitchell Park where inflatable structures can be used by City staff or designated contractors as part of a City-sponsored program, inflatable structures, miniature trains designed or used for passengers, pony rides, and dunking tank attractions are prohibited in parks or open space areas. (Revised 6/28/04) R1-9A. USE OF METAL DETECTORS IN PARKS Metal detectors for the purpose of scavenging can only be used within park facilities in such a fashion where turf or landscaped areas are not disturbed, cut or dug into. R1-10. PICNIC SITE USAGE Group picnic site reservations at Foothills Park Oak Grove; Mitchell Park Arbor, East Meadow, Pine Grove and Redwood areas; and Rinconada Park Sequoia area are available to Palo Alto residents only. No more than 60 individuals shall occupy a group picnic site at Mitchell Park Arbor, East Meadow and Redwood areas; 100 individuals at the Pine Grove picnic area; 75 individuals at Rinconada Park Sequoia picnic area; or 150 individuals at Foothills Park Oak Grove. No more than 15 individuals shall occupy any table in an individual picnic site at Mitchell Park and Rinconada Park. With the exception of the two table/one barbecue at individual picnic sites of Mitchell Park, each group of participants shall not occupy more than one individual site. (Revised 6/28/04) R1-10A LYTTON, COGSWELL AND KING PLAZA A. Use of tables: For permitted events and activities, no more than four six-foot tables are permitted at one time at Cogswell Plaza; no more than ten six-foot tables are permitted at Lytton Plaza; and no more than twenty six-foot tables are permitted at King Plaza. Tables shall not be arranged in a configuration longer than twelve-foot wide span and there must be a minimum of three-feet between sets. B. The City shall be compensated the full cost of replacement of any chair, tables or other furnishings damaged by the event or special use. C. Special event organizers must cover existing trash receptacles and provide their own waste stations (compost/recycle/trash) that they will then be responsible for removing after the event. D. Damage deposits may be required for any special event or use at the discretion of City staff. E. No tables, tents or other structures shall be set up closer than ten-feet from the nearest structure. F. Shade canopies may be authorized in a permit so long as the shade structure measures ten-foot by ten-foot, or less. G. Stage platforms shall be no higher than twenty-four inches tall and ten-feet by twelve-feet in maximum area. H. As per the Palo Alto Municipal Code, no alcoholic beverages may be served or consumed at these plaza parks. I. No barricades or cordoning off areas of the plaza. J. No jump/bounce houses are permitted on plaza. K. Special event organizers must supply a layout of all items to be placed within plaza and be approved by City staff before the event. L. As per Palo Alto Municipal Code 22.04.160, no commercial solicitation or business transactions other than those associated with and supportive of city programs or city-sponsored activities for which a permit has been issued by the director is permitted in parks or plazas. R1-10B LYTTON PLAZA NOISE REGULATION A. No permit or special event permit application is required of any person in accordance with Palo Alto Municipal Code sections 22.04.040 and 22.04.050 in order to engage in the playing of an amplified musical instrument at Lytton Plaza, which meets the requirements of sections 9.10.050 and 22.04.180, subject to the playing of an amplified musical instrument which may occur on a first-come, first-served basis during the following days and times of day: (a) Monday through Thursday, 5:00 PM to 10:00 PM; (b) Friday, 5:00 PM to 11:00 PM; (c) Saturday, noon to 11:00 PM; and (d) Sunday, noon to 10:00 PM. The term “first-come, first-served” means the first person or group of persons to commence playing an amplified musical instrument at Lytton Plaza shall be entitled to play to the exclusion of all others for a period not exceeding three (3) consecutive hours. 120821 dm 00710062 B. A city-wide special event permit application is required of any person seeking to engage in the playing of an amplified musical instrument at Lytton Plaza outside of the days and times of day specified in paragraph A above. No amplified musical instrument, for which a permit is not required, may be played during the period of time for which a person holds a city-wide special event permit to play an amplified musical instrument. C. Paragraph A notwithstanding, a person may file an application for a city-wide special event permit to play an amplified musical instrument within the time period specified in paragraph A of this Rule. If a city-wide special event permit is issued, the permit holder’s right to play any musical instrument at Lytton Plaza will take precedence over any person claiming the right to play under the first-come, first-served condition specified in paragraph A of this Rule. D. The director will post or caused to be posted to the department’s web site the days and times of days for which permits and city-wide special events permits to play musical instruments have been obtained. E. The preceding paragraphs A through D notwithstanding, the playing of any acoustic musical instrument at Lytton Plaza is permitted during posted park use hour or, if no hours are posted, during the regular park use hours. F. The noise ordinances set forth in Palo Alto Municipal Code chapters 9.10 and 22.04 shall apply to all persons playing amplified and acoustic musical instruments at Lytton Plaza. R1-11. TENNIS COURT USAGE Any person or group using a City tennis court shall do so according to the following rules: A. No person shall operate, drive or ride a bicycle, unicycle, roller skates, roller blades, skateboard or other coasting device on City owned tennis courts. B. No person shall provide or offer tennis lessons for compensation on City owned tennis courts except as part of a City-sponsored program, class or camps. C. City owned tennis courts may be reserved for City programs and tournament play only. D. All players must use the court control board to determine which court they shall play on and their playing position. E. No individual person can occupy a court by him or herself if other persons are waiting to play. F. Unleashed dogs are not permitted within tennis courts. G. No person shall play a sport other than tennis on City-owned tennis courts unless expressly allowed via permit issued by the City’s Recreation Division. (Revised 6/28/04) R1-12. ATHLETIC FIELD USE Any person or group using a City athletic field shall do so according to the following rules: A. No activity other than softball (or Little League baseball) is permitted at El Camino Park softball field unless expressly allowed by permit. B. No activity other than baseball is permitted at Baylands Athletic Center Baseball Field unless expressly allowed by permit. C. No activity other than softball is permitted at Baylands Athletic Center Softball Field unless expressly allowed by permit. D. No person shall use an athletic field which is posted (on-site, on-line, or by voice message) as being closed, whether the closure is for excess rainfall or for field maintenance or other reason. E. Field markings applied to athletic fields shall be allowed by permit only and must follow City of Palo Alto Open Space, Parks and Golf Division guidelines. F. Soccer goals must be anchored at all times when located on the playing fields. When goals are not being utilized for play, they must be secured off the playing fields in a manner which will not permit tipping or any hazardous condition that might cause injury to any person. When a field is being utilized for multiple purposes, goals that interfere with the intended use of the field shall be provided by the user groups that require the use of a soccer goal. These goals must be assembled 120821 dm 00710062 and disassembled before and after each event. The storage of these goals can be coordinated with the Recreation Division. Any goal left on site will be removed and stored until a removal/storage fee of $75.00 is paid. R1-13. PEERS PARK AND JOHNSON PARK VOLLEYBALL USE Any person or group playing volleyball or related game at Peers or Johnson Parks shall do so according to the following rules: A. Drop-in volleyball or related game play is permitted only in the posted area at Johnson Park or on the north end of Peers Park. B. The volleyball area may be reserved for volleyball play, by permit, only on the first Saturday and first Thursday of each month. The director may make additional weekend days available for reservation during the months of June, July and August. R1-14. SKATEBOARD FACILITY The Skateboard Facility, located in John Lucas Greer Park, is for skateboard use only. Use of roller blades, scooters, bicycles, or any other equipment, other than skateboards is prohibited. Any person using or playing upon the skateboard facility shall do so according to the following rules: A. Each person skateboarding in the Skateboard Facility must wear a helmet, elbow pads and knee pads. B. Use of roller blades, scooters, bicycles, or any other equipment, other than skateboards is prohibited. C. No more than seven persons shall skate in the bowl at any given time. D. No person shall do a body flip while riding a skateboard. E. No person shall ride a skateboard facing entirely backwards. F. Two or more persons may not ride on the same skateboard. G. No person shall ride a skateboard on their knees. H. No person shall cause a skateboard to shoot out away from their feet or body. I. No persons shall skateboard in tandem within three feet in front or behind another rider. J. No glass containers are allowed in the facility. K. No skateboarding is allowed when the facility is wet or while it is raining. L. Trash receptacles are to be used to dispose of waste or any other unwanted items. No person shall use, remain in or enter the Skateboard Facility outside of regular park hours between 10:30 PM and sunrise (PAMC 22.04.320) No person shall enter or remain in the Skateboard Facility when that facility is posted as being closed, whether such closure is because of excess moisture or hazard or for any other reason. R1-15. GOLF COURSE Any person or group using or playing upon the golf course shall do so according to the following rules: A. No person shall use the golf course, or any portion thereof, without first having obtained a receipt or other written authorization in due form so to do. B. No golf player shall cut in on, or double back over, any portion of the course, or to play upon the course without a receipt duly issued for the round being played. C. No golf player shall refuse to or fail to show such golf receipt or other written authorization to any employee connected with the municipal golf course, when requested to do so. D. No person shall willfully or maliciously injure any turf on the golf course or in any way destroy or injure property thereon, or remove property or equipment from the golf course. E. Privately owned power golf carts are not allowed to be used on the municipal golf course. R1-16. SWIMMING No person shall swim, bathe or wade in any water or waterways within any park facility when such activity is prohibited and so posted by the director. No person shall use, remain in or enter the Rinconada Pool facility between the hours listed as follows: January 1 through June 15 9 p.m – 6 a.m. June 16 through December 31 10 p.m. – 6 a.m. Rules for the safe use of the Rinconada Swimming complex: 1. Children 7 years of age and younger must be directly supervised by a chaperone 16 years of age and 120821 dm 00710062 older. Chaperones must wear a swimsuit, accompany the child in the water and be within arm’s length at all times. Children may not be left unattended in the facility at any time. 2. All swimmers must wear swimsuits. Clothing including undergarments is not permitted. Clean over shirts are permitted for modesty or sun protection as long as they are worn over swimsuits. Infants and toddlers who are not yet toilet trained must wear swim diapers. 3. Flotation devices including water wings, padded swimsuits and inner-tubes are not permitted except US Coast Guard approved lifejackets. 4. Flippers, snorkel masks, and hard balls are not permitted. 5. All persons entering the facility must pay, including those not intending to swim, except children 2 years of age and younger. 6. Patrons must pay again to reenter the facility after leaving. 7. Walk at all times on the pool deck. 8. Bicycles, rollerblades, scooters, and skateboards are not permitted on the pool deck. 9. Dogs, cats and other animals are not permitted on the pool deck. 10. Fighting, roughhousing, chicken fighting, screaming, profane language, and pretending to drown is not permitted in the facility. 11. Patrons are not permitted to sit on guard chairs, lane lines, starting blocks or railings. 12. Barbecues, alcohol and glass/breakable containers are not permitted in the facility. 13. Food and drinks must be consumed at picnic tables, on grass or farther than 10 feet from poolside. 14. Heed instructions from Lifeguards and overhead announcements at all times. 15. Aquatics staff reserves the right to ask anyone who violates these rules to leave the facility. 16. To maintain a safe environment, pool rules are subject to change at anytimeany time. Lap Pool: 17. Swimmers must be able to swim competently for at least one lap to enter the deep end and/or use the diving boards. Lifeguards have sole discretion. Please ask for a swim test. 18. Lap swimmers using lap lanes during recreation swim may use flippers, kickboards and snorkels as needed. Flippers, kickboards and snorkels are not permitted outside of the lap swim lanes. Non-lap swimmers are not permitted to swim across lap lanes. 19. Diving boards: • One person on the board and ladder at a time. • Wait to dive until area is clear. • Walk or perform a proper diving approach. Do not run on the diving board. • Bounce only once and jump/dive off the end of the board facing forward. • Divers may not jump to anyone in the pool and must swim to the wall unassisted. After diving, swim out toward the closest ladder. Do not swim under, between or in front of the diving boards. Wading Pool: 120821 dm 00710062 20. Swimmers must be able to reach the foot pedals to use the “Aquaducks.” Pedaling with hands is not permitted. 21. Swimmers may not sit on or otherwise block the water pressure of the fountains. 22. Slide: Swimmers must be no taller than the slide to use it. One person is permitted on the slide and ladder at a time. Form line on the ground. Do not stand, jump or push other swimmers off the top of the slide. Swimmers must go down slide sitting, feet first. R1-17. BOAT USE A. The dock at Foothills Park and the sailing platform at the Baylands Nature Preserve is intended for the hand launching of canoes, kayaks, small inflatable boats and boats less than sixteen feet in length. The launching of any larger vessel is prohibited. While hand carts may be used to carry boats from the parking lot to the dock or sailing platform, hand carts or other personal equipment may not be used on the docks or left unattended in the immediate vicinity of the dock or sailing platform. Items left unattended will be impounded by a park ranger or police officer. B. Sail boards, sail craft and motorized boats are prohibited on Boronda Lake in Foothills Park. R1-18. BICYCLES, SKATEBOARDS AND ROLLER SKATES A. Bicycles are prohibited on unpaved trails of Foothills Park. Skateboards, roller skates or blades, or other coasting devices are prohibited in Foothills Park. B. Bicycles are prohibited on unpaved trails of open space parks and preserves, unless designated for bike access within the Pearson-Arastradero and Baylands Preserves. Skateboards, roller skates or blades, or other coasting devices are prohibited in open space parks and preserves, except on paved, multi-use bike paths. C. Helmets: No person shall operate a bicycle or similar device on parks or open space preserves without wearing an A.N.S.I. or Snell-approved bicycle helmet for head protection. No parent or guardian shall allow any child under the age of 18 to ride a bicycle without a helmet. D. Unsafe operation: No person shall operate a bicycle in a reckless or negligent manner so as to endanger public property, or the life, limb, or property of any person or animal. No person shall ride in or upon a portion of a bicycle not intended for passengers. No person shall operate a bicycle while wearing earphones that interfere with hearing ambient noise. E. No person shall leave a bicycle, scooter or skateboard in any place or position where other persons may trip over or be injured by it. R1-19. HUMAN FLIGHT No person shall hang-glide, parachute, parasail or engage in any human flight on, over, or into park or open space, except by written permit in designated areas. R1-20. TRAIL USE SPEED LIMIT The maximum speed for all trail uses is 15 miles per hour, unless a lesser maximum speed is posted, and no person shall exceed the maximum speed on any trail; however, no person shall operate a bicycle, or ride a horse or other such animal at a speed greater than is reasonable, prudent, or safe. Bicyclists and equestrians are required to slow to 5 miles per hour when passing others or approaching blind turns. R1-20A. USE OF DESIGNATED TRAILS, PATHS AND RECREATIONAL LAWN AREAS IN OPEN SPACE LANDS No person other than authorized City staff or other persons specifically authorized by City staff shall walk, run or tread in any open space lands except on designated trails, paths, recreational lawn areas or roads, unless expressly permitted to do so pursuant to park regulations or a special use permit. “Designated trails” is defined as those trails which appear on current City of Palo Alto park maps, planning documents, trail guides and/or those trails marked with City directional signs. (Adopted 6/28/04) R1-21. COMMERCIAL ACTIVITIES AND SOLICITATION Commercial activities, commercial solicitation, and solicitation for donations (including banners and signage), not associated with and supportive of City programs or City-sponsored activities for which a permit has been issued by the director, are prohibited. 120821 dm 00710062 R1-21A. COMMERCIAL PHOTOGRAPHY AND FILMING No person shall operate a still, motion picture, video, or other camera for commercial purposes on City lands except pursuant to a permit authorizing such activity or except for those activities associated with and supportive of City programs or City-sponsored events. This section shall not apply to the commercial operation of cameras as part of the bona fide reporting of news. (Adopted 6/28/04) A. Applications shall be submitted not less than ten (10) working days before the proposed use. B. No sound amplification equipment, which will disturb the peace, may be used in connection with any photo shoot, except when used by City employees or safety officers for purposes of crowd control. C. No permit shall be granted for any event between the hours of 8:00 pm and 9:00 am without the prior approval of the Director. D. No permit shall be granted when the closure would result in hampering prompt access to an area or location by emergency vehicles. E. Wherever appropriate, the City will require the applicant to provide and erect barricades according to City specifications for public safety. The person or persons making the application shall be responsible for placing and dismantling all barricades. All barricades shall be removed within one-half (1/2) hour of the ending time of the event. Barricades shall also be immediately removed upon request of any authorized officer or employee of the City. In some situations, the Permittee may be required by the City to provide traffic control and a qualified flag person if City streets or parking lots are involved. R1-22. RESTROOMS Male persons shall not enter any restroom or washroom set apart for females, and female persons shall not enter any restroom or washroom set apart for males; except, this shall not apply to persons with special needs or their accompanying attendants or children under the age of six years old who are accompanied by a person who is of the sex designated for that facility and who has reason to be responsible for such person. R1-23. UNAUTHORIZED USE OF KEYS OR LOCKS No person other than one acting under the direction of the director shall duplicate or cause to be duplicated a key used by the department for a padlock or door lock of any type or description, nor shall any person divulge the combination of any lock so equipped to any unauthorized person. No person, other than the one acting under the direction of the director, shall use a key to access any park and/or open space facilities. The director may issue keys to user groups. Said user groups must use the keys for permitted activity only and return issued keys to the City upon completion of the activity. No person shall place a lock upon any gate or fence in any park or open space area without prior permission from the Director. R1-24. WATER POLLUTION While within the boundaries of any park facility, no person shall throw, discharge or otherwise place or cause to be placed in the waters of any fountain, pond, lake, stream, bay or other body of water or in any tributary, stream or drain flowing into such waters any substance, matter or thing, liquid or solid, including but without limitation to, particles or objects made of paper, metal, glass, garbage, rubbish, rubber, fuel, plant material, food matter, fiber and plastics. R1-25. HARMFUL SUBSTANCES No person shall possess, place, or apply any substance harmful to any person, property, wildlife, or vegetation on park or open space lands. R1-26. LITTERING Depositing refuse or other waste on or into fire rings, barbecues or other devices used to contain fires or for cooking is prohibited. R1-27. DISPOSAL OF EFFLUENT No person shall deposit waste water, sewage or effluent from sinks, portable toilets, or other fixtures upon or into the ground or water. R1-28. SMOKING No person shall smoke any substance in any public places or any area that is within twenty feet of bleachers, backstops, or play structures or any area designated as a playground, nature trail or nature area or in or on any park facility where smoking is posted as being prohibited. Pursuant to Palo Alto Municipal Ordinance 9.14.010 (i), public places are defined as: "Public places" means enclosed areas 120821 dm 00710062 within publicly and privately owned buildings, structures, facilities, or complexes that are open to, used by, or accessible to the general public. Public places include, but are not limited to, stores, banks, eating establishments, bars, hotels, motels, depots and transit terminals, theaters and auditoriums, enclosed sports arenas, convention centers, museums, galleries, polling places, hospitals and other health care facilities of any kind (including clinics, dental, chiropractic, or physical therapy facilities), automotive service centers, general business offices, nonprofit entity offices and libraries. Public places further include, but are not limited to, hallways, restrooms, stairways, escalators, elevators, lobbies, reception areas, waiting rooms, indoor service lines, checkout stations, counters and other pay stations, classrooms, meeting or conference rooms, lecture rooms, buses, or other enclosed places that are open to, used by, or accessible to the general public. R1-29. FIREWORKS No person shall possess, give, sell, discharge, set off, or cause to be discharged, on or into any portion of park or open space lands any firecrackers, missiles, rockets, fireworks, or explosives. R1-30. ANIMALS No person other than public or peace officers, rangers, city naturalists, animal control officers in the discharge of their duties shall: A. Hunt, molest, harm, provide a noxious substance to, frighten, kill, trap, chase, tease, shoot or throw missiles at any animal within the boundaries of any park facility, nor remove nor have in his possession the young, eggs or nest of any such creature; B. Abandon any animal, dead or alive, within any park facility; C. Remove any animal not his own from within any park facility; exception is made to the foregoing in that proper season, fish may by fished and removed from areas designated for fishing by licensed persons, in accordance with the California Fish and Game Code and other related laws, and boarded horses may be removed from a park facility, upon proper notification to the department; D. Bring into or maintain in or upon any park facility any dog, cat or other animal unless such animal at all times is kept on a leash and under full control of its owner or custodian; provided, however, the director may designate areas and times within which persons may exercise, show, demonstrate or train unleashed animals under full control or their owners or custodians. No person shall allow a dog, cat, or domesticated animal, even if leashed, to disturb, chase, molest, injure, or take any kind of native wildlife, whether living or dead, or remove, destroy, or in any manner disturb the natural habitat of any animal on parks or open space land. E. Permit cattle, sheep, goats, pigs, or other animals owned by him/her or in his/her possession to graze within the boundaries of any park facility without express approval of the director; F. No person shall keep or raise cattle, horses, sheep, or other livestock on park or open space land, unless pursuant to a lease, license, or other entitlement of use granted by the City of Palo Alto. G. Ride or lead a horse, pony, mule, burro or other animal onto or over any park facility, other than at times and upon roads or trails designated for riding of animals; except with approval of the director. H. No person owning or having custody or control of any dog shall permit such dog to defecate on any public street, sidewalk, park or parkway without immediately removing the resulting excrement at the time of occurrence. The excrement so removed shall not be disposed of on any property listed in this chapter except in public refuse receptacles. Persons using Seeing-Eye dogs are exempt from this section. I. No person owning or harboring any dog or other animal shall allow or permit such dog or animal to swim, bathe or wade in any water or waterways within any park facility when such activity is prohibited and so posted by the director. R1-31. NUISANCE DOGS No person shall allow or have on park or open space land a dog that is threatening or a nuisance to people, other animals, or property. This includes, but is not limited to growling, barking, bearing of teeth, or challenging in any manner, people, animals, or property. R1-32. DOG EXERCISE AREA Dogs may be allowed off leash in the dog exercise areas, designated as such, in Herbert Hoover Park, John Lucas Greer Park and Mitchell Park. No person, with or without a dog, shall be in a dog exercise area before sunrise or after 10:30 PM, consistent with normal park hours. City 120821 dm 00710062 employees performing their assigned duties are exempt from this restriction. No dog is to be left unattended in any dog exercise area. A muzzle shall be securely attached over the mouth of all aggressive dogs. Any person with a dog in the dog exercise area shall properly dispose of any dog fecal matter by placing it in the provided receptacles. All dogs shall be placed on a leash upon leaving any dog exercise area. Violations of these regulations may result in a citation and /or limiting the use of the dog exercise area. R1-33. UNAUTHORIZED CONSTRUCTION ACTIVITIES No person shall deposit any earth, sand, rock, stone or other substance within any park facility, nor shall he/she dig or remove any such material from within any park facility, nor shall he/she erect or attempt to erect any building, wharf or structure of any kind by driving or setting up posts or piles, nor in any manner appropriate or encumber any portion of the real property owned by, operated, controlled or managed by the department without a permit from the director. R1-34. USE OF UTILITIES A. Electrical, phone, data communication, and cable receptacles in parks and open space spaces may only be used or accessed for private use within the terms of a special use permit granted by the Community Services Department. B. Gas fixtures, water faucet spigots and irrigation water outlets that require a key or opening device in parks and open space spaces may only be used or accessed for private use within the terms of a special use permit granted by the Community Services Department. C. Sanitary sewers or storm drains in parks or open space areas may not be used for the clean-out of personal septic systems under any circumstances. R1-35. GATHERING WOOD IN OPEN SPACE AREAS Gathering wood from or possessing wood that has been gathered from Open Space areas is not permitted. R1-36. PARKING RESTRICTIONS No person shall park a motor vehicle, except an authorized emergency vehicle, or when in compliance with the directions of a peace officer, ranger, or City employee, in any of the following places: A. In areas where prohibited by "NO PARKING" or “FIRE LANE - DO NOT BLOCK” signs. B. On any fire trail. C. On any equestrian or hiking trail. D. In such a place or manner as would block or obstruct any gate, entrance, or exit. E. In such a place or manner as to take up more than one marked parking space in any authorized parking area. F. In such a place or manner as to block or obstruct the free flow of traffic. G. Within 15 feet of a fire hydrant. H. Adjacent to any curb painted red. I. In any park or open space land after sunset except pursuant to a written permit. J. In areas signed for permit parking on park or open space land without a written permit. K. In any other place on park or open space land not designated by the City as an authorized area. L. The gravel parking lot at the Towle Campground at Foothills Park may only be used for parking by persons with camping reservations. There is a limit of 2 vehicles for the eight person campsites and 4 vehicles for sixteen person campsites. The parking area is restricted to passenger vehicles and small trucks. Recreational vehicles, trailers or other self-contained vehicles (regardless of size, weight or number of axles) are not allowed in the Towle Campground parking lot or beyond the gate at the edge of Orchard Glen Picnic Area. Recreation vehicles or other self-contained vehicles may not be parked in Foothills Park over-night. Non-camping guests should park in the available day-use parking lots. R1-37. OPERATION OF MOTOR VEHICLES No person shall operate, propel, or leave standing any motor vehicle on park or open space land, except: A. Emergency vehicles operated within the scope of official use. B. Upon roads, trails, or paths, which may from time to time be set aside and posted by the City for the use of specifically designated vehicles. C. Upon roads and parking areas open to the public during regular open hours. D. Motor vehicle includes, but is not limited to, any vehicle as defined by section 415 and/or 670 of 120821 dm 00710062 the California Vehicle Code, motorcycles, off-road vehicles, "dirt bikes", and similar vehicles. E. This section shall apply to all motorized bicycles, carts, scooters and electric personal assistive mobility devices (Segway or similar device) except those devices used by handicapped persons. R1-37A. VEHICLE WEIGHT LIMIT ON BAYLANDS ROADS AND PARKING LOTS No person shall operate or park any vehicle in excess of 6,000 pounds weight on Harbor Road or within any parking lot of the City-owned Baylands or John Fletcher Byxbee Recreational Areas. (Adopted 6/28/04) R1-38. VIOLATION - PENALTY A. The director shall have authority to revoke a permit upon a finding of violation by the permittee or persons acting under the permit of any regulation contained in this chapter or upon a finding of violation of other City ordinance or law of this state in the exercise of the permit. B. The director or designee shall have the authority to eject from any park facility any person acting in violation of regulations contained in this chapter. R1–39. COMMUNITY GARDEN The City of Palo Alto provides, subject to a license agreement, space for Palo Alto residents to enjoy organic gardening on a first-come, first serve basis as space allows. The Palo Alto Community Gardens are designated for the use of Palo Alto residents only. Gardeners and prospective gardeners must provide sufficient proof of residency (i.e., utility bill in the name of the gardener, driver’s license, etc.) and sign a license agreement with the City. A post office box will not be accepted as a resident address. A. No non-organic pesticides, herbicides, chemical fertilizers, or chemically treated wood products are to be used in any garden site. Any gardener installing wood borders or planters may be required to show proof that the wood has not been chemically treated. Violation of this rule will be cause for termination of the Community Garden License Agreement and participation in the garden program. B. Gardeners shall not contract for, or perform, any type of electrical or irrigation work without the written permission of the Garden Coordinator. C. Plots and walkways shall be kept free of weeds, debris and trash year-round. Any gardener composting is restricted to the confines of their assigned plot. The entire garden plot must be cultivated and contain an average planting density when it is not being mulched. A chair or small bench is acceptable for use as a resting place, but no patio sets, furniture, tables, bar-b-ques, sheds, or other structures or furnishings are allowed. D. Gardeners are to keep one-half of the width of all the walkways around their garden plot free of weeds and vegetation. . E. All gardeners are expected to help on scheduled workdays. The Community Garden Volunteer Liaison is responsible for scheduling garden workdays. The number of workdays per year will vary according to size of the garden and the amount of maintenance required to keep the garden site well groomed. Gardeners are required to attend at least two workdays per year. Those gardeners who consistently avoid doing their share of community garden work are subject to verbal or written warning, and possible loss of the garden plot. F. Garden plots are confined to the assigned locations and a gardener may occupy only one garden plot. No person may use a vacant plot or other area in the gardens without the prior written approval from the Community Garden Coordinator. The Garden Coordinator may make exceptions in unusual circumstances (i.e., extremely small plot or sunlight has deteriorated due to shade trees). No garden plot shall be traded, divided, shared, sub-leased, or otherwise changed from the original plot assigned and licensed to the signatory gardener. If any change is desired, contact the Community Garden Coordinator. All requests will be reviewed and decided on an individual basis. An exchange of plots is an option, but must be approved by the Community Garden Coordinator before any exchange occurs. G. Only vegetables, flowers, berries and herbs may be grown in the plots. Produce from the plot shall not be used for commercial profit. Tall plants, such as corn, berries and tall vines should be located so that they do not produce shade on adjacent plots, and do not extend into pathways. Permanent plants (i.e., rose bushes) are not to be over 5’ in height. Berries are to be trimmed and maintained. Fruit trees and bushes are not permitted because of their invasive roots and shading 120821 dm 00710062 potential. H. In the interest of water conservation, gardeners are required to remain in the vicinity of their plots while watering and are requested to turn off faucets at unattended plots. I. Automatic watering systems prevent other gardeners from accessing the community water supply and contribute to low water pressure problems at some sites. Therefore, automatic watering systems are not permitted unless each plot in the garden has a designated water faucet. Automatic watering systems (drip systems preferred) will be allowed in some instances upon request and only by the written permission of the Community Garden Coordinator. The approved systems must be checked on a weekly basis and any system found leaking will be removed. Please contact the Garden Coordinator for written approval before installing any type of watering system. J. Plot holders are expected to conduct themselves in a safe, respectful and courteous manner toward other garden residents. Garden conflicts should be taken to the Garden Liaison for resolution. In the event that the Garden Liaison cannot resolve the issue, the problem is to be taken to the City’s Garden Coordinator for resolution. Non-compliance with this rule may subject the offending gardener to immediate expulsion from the garden program and termination of license agreement. K. Dogs are not allowed inside any Community Garden site, either on or off a leash. Dispensation will be granted in special cases (i.e., handicapped, blind, etc.). Please contact the Community Garden Coordinator for dispensation consideration. L. The amount of the fee associated with the right to cultivate any plot will be calculated by quarter on a calendar year basis. If a garden plot is assigned during the year, payment will be made for the remaining quarters and the remaining initial quarter, if the plot is assigned during the first 44 days of the quarter. If the plot is assigned after the first 44 days of the quarter, only the remaining quarters in the calendar year will be charged. M. Any gardener who is 60 years of age or older, is eligible to receive a 25% discount. The gardener is responsible for informing the Community Garden Coordinator that he or she is eligible to receive the discount. The gardener must provide proof of age. N. Invoices for the current year’s fees will be mailed in January. Fees are due within 30 days of receiving the invoice. Bills will be considered past due 60 days after the invoice date and a late fee of $10.00 (ten dollars) will be charged. Gardeners who fail to pay are subject to revocation of their license to garden. O. In the event of early termination of the License Agreement to cultivate a plot, the Community Garden Coordinator is to be contacted in writing by the gardener and a refund will be issued for the remaining quarter(s) of the calendar year. No refunds will be given for a part of a quarter (3 months) and no refunds of less than $10.00 (ten dollars) will be issued. In the event of early termination of the license agreement (even if no refund is made) the garden plot will be available for reassignment to the next applicant on the waiting list. P. Pursuant to Palo Alto Municipal Code 22.04.320, no person shall use, remain in or enter any Community Garden (Main Garden; Eleanor Pardee Garden, Johnson Park Garden or Timothy Hopkins Creekside Garden) between 10:30 p.m. and sunrise. Closure times specified in Title 22 as implemented by this regulation shall be posted prominently at each garden. Violation of any Community Garden Rule may subject the gardener to a verbal or written warning and/or possible revocation of his/her license to use a garden plot. If sufficient improvement is not demonstrated on an on-going basis, the plot will be posted as abandoned, and the license to garden the plot will be revoked. The plot will be issued to the next person on the waiting list. Any items remaining in the plot will be given to the person taking the plot. The good faith judgment of the Community Garden Coordinator will be sufficient cause for enforcement of the Community Garden Rules, including revocation of the license to garden. Adopted by City Council June 24, 2002; Revised June 28, 2004; Revised January 24, 2005. Revised February 3, 2006. Revised April 14, 2008. Revised March 14, 2011. Revised _________, 2012. PAMC 22.04.180 Amplified Sound No devises or sound amplification equipment in City parks or open space lands emitting sound in excess of the limits allowed under Section 9.10.050 of this code. Director may restrict the use of sound amplification devices in connection with any activity for which a permit is required. PAMC 9.10.050 Public Property Noise Limits a) No person shall produce, suffer or allow to be produced by any machine or device, or any combination of same, on public property, a noise level more than fifteen dB above the local ambient at a distance of twenty-five feet or more, unless otherwise provided in this chapter. b) Sound performances and special events not exceeding eighty dBA measured at a distance of fifty feet are exempt from this chapter when approval therefore has been obtained from the appropriate governmental entity. Park Rules and Regulations R1-34. USE OF UTILITIES A. Electrical, phone, data communication, and cable receptacles in parks and open space spaces may only be used or accessed for private use within the terms of a special use permit granted by the Community Services Department. TO: PARKS AND RECREATION COMMISSION FROM: COMMUNITY SERVICES DEPARTMENT DATE: OCTOBER 25, 2011 SUBJECT: AMENDMENT OF ORDINANCE 22.04.180 OF CHAPTER 24.04 OF TITLE 22 [PARK AND RECREATION BUILDING USE AND REGULATIONS] OF THE PALO ALTO MUNICIPAL CODE TO IMPOSE A PERMIT REQUIREMENT AND TIME USE LIMITATIONS ON SOUND AMPLIFICATION EQUIPMENT AT LYTTON PLAZA. RECOMMENDATION Staff recommends that the Parks and Recreation Commission recommend that Council adopt the attached amendment to Palo Alto Municipal Code 22.04.180 to Title 22 of the Palo Alto Municipal Code to impose a permit requirement and time use limitations for sound amplification equipment at Lytton Plaza. The amendment to 22.04.180 adds section (c): (c) No person shall operate any device or sound amplification equipment in Lytton Plaza, unless the director issues a permit for such operation. The operation of such device or sound amplification equipment in Lytton Plaza shall be limited to 5:00 PM and 9:00 PM on Sundays through Thursdays and 5:00 PM and 11:00 PM on Fridays through Saturdays. Sound amplification shall not exceed fifteen dB above the local ambient noise level measured at a distance of twenty-five feet or more from the park boundary of Lytton Plaza. BACKGROUND Lytton Plaza was renovated in 2009. During the renovation several electrical outlets added to the plaza. The electrical outlets were intended to be used for special events. Shortly after the renovation, Lytton Plaza became the site for a City sponsored Farmer’s Market. Live, electric amplified music accompanied the Farmer’s Market events. In addition to playing for the Farmer’s Market, musicians also played at Lytton Plaza on other days (without authorization or permits). The Farmer’s Market was discontinued in 2010, however, the unpermitted live music CMR:159:05 Page 1 of 2 CMR:159:05 Page 2 of 2 has continued and expanded. Individual musicians, as well as groups, utilize Lytton Plaza to perform amplified music. DISCUSSION Community Services and Police staff have received numerous complaints over the past year from the surrounding businesses regarding amplified music at the plaza during day time hours. There have also been complaints from residents about loud music being played late at night at the plaza. Staff tried to use the existing regulations and municipal codes (Attachment B) to deal with the problem. However the existing regulations and codes are not adequate to address the problem. Park Regulation (R1-34) prohibits the use of electrical receptacles in parks without a special use permit. However, there are several musicians that use battery powered amplifiers at Lytton Plaza. Staff also tried to curb the use of the electrical outlets by locking the outlet covers, however repeated vandalism has made it difficult to secure the outlets. Palo Alto Municipal Code 22.04.180 prohibits amplified sound in parks when the sound levels exceed 15 dB above the ambient at a distance of 25 feet. Unfortunately, the amplified music can disturb the surrounding businesses even if the noise level is below this threshold. Police and Parks staff have contacted some of the musicians to seek assistance in dealing with the noise issues. In some cases there has been cooperation, but not enough to adequately address the problem. Furthermore, the Police lack the staffing to respond (and take the necessary decibel noise readings) to frequent noise complaints of street musicians playing at Lytton Plaza. Police, Community Services, and City Manager’s Office staff have conferred with the Executive Director of the Palo Alto downtown Business and Professional Association, Russ Cohen, and agreed that it would be best to have amplified music by permit only, and limited to the aforementioned hours. Russ Cohen consulted with several members of the business community located around Lytton Plaza. Acoustic music would continue to be welcome in the plaza at any time without a permit. Staff believes that prohibiting amplified sound without a permit will be a useful tool in reducing noise complaints, and will help keep the park and surrounding area enjoyable for everyone. RESOURCE IMPACT Neither new staff nor an increase in the number of patrols is proposed to enforce the permit requirement and time use limitations for sound amplification equipment at Lytton Plaza. The penalty fee imposed for an administrative citation ($250) for violation of this ordinance would cover the cost of staff time to issue and process the citation. To implement this ordinance, $250.00 would be used from the Parks operating budget to design, fabricate, and install new signage. POLICY IMPLICATIONS The proposed amendments are consistent with Goal N-8 and Policy N-40 Policy N-40 of the Natural Environment element of the Comprehensive Plan that encourages an environment that minimizes the adverse impacts of noise, and calls for staff to evaluate the potential for noise pollution and ways to reduce noise impacts when reviewing development and activities in Palo Alto and surrounding communities. The proposed use of permits and limited hours is consistent with how rentals are handled at our community centers and at the Art Center. ENVIRONMENTAL ASSESSMENT This is not a project subject to California Environmental Quality Act (CEQA) requirements. ATTACHMENTS Attachment A: Draft Ordinance Attachment B: Existing Palo Alto Municipal Code Ordinances and Park Rules and Regulations related to amplified sound at Lytton Plaza. PREPARED BY:__________________________________________________________ DAREN ANDERSON Division Manager, Open Space, Parks, and Golf ATTACHMENT B PAMC 22.04.180 Amplified Sound No devises or sound amplification equipment in City parks or open space lands emitting sound in excess of the limits allowed under Section 9.10.050 of this code. Director may restrict the use of sound amplification devices in connection with any activity for which a permit is required. PAMC 9.10.050 Public Property Noise Limits a) No person shall produce, suffer or allow to be produced by any machine or device, or any combination of same, on public property, a noise level more than fifteen dB above the local ambient at a distance of twenty-five feet or more, unless otherwise provided in this chapter. b) Sound performances and special events not exceeding eighty dBA measured at a distance of fifty feet are exempt from this chapter when approval therefore has been obtained from the appropriate governmental entity. Park Rules and Regulations R1-34. USE OF UTILITIES A. Electrical, phone, data communication, and cable receptacles in parks and open space spaces may only be used or accessed for private use within the terms of a special use permit granted by the Community Services Department. Calls For Service @ Lytton Plaza January-December 2011 Incident Date Call Type Location Rec Time 7/14/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 00:05:31 5/14/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 00:08:43 2/12/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 00:10:29 11/15/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 00:10:46 1/14/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 00:19:40 7/14/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 00:24:27 1/29/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 00:28:40 11/15/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 00:51:19 6/15/2011 UTILITIES INFO CALL UNIVERSITY AV / EMERSON ST 00:51:28 1/29/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 00:58:45 8/7/2011 DISTURBING:UNK PROB UNIVERSITY AV / EMERSON ST 01:10:11 10/15/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:11:51 9/25/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:13:10 12/5/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 01:14:43 6/18/2011 DIRECTED PATROL 200 UNIVERSITY AV 01:26:11 5/7/2011 MEET CITIZEN 200BLK UNIVERSITY AV 01:33:47 11/19/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 01:33:48 10/22/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:36:52 11/24/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 01:39:11 3/12/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:40:23 4/30/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:41:48 11/21/2011 FOUND PROPERTY LYTTON PLAZA @200 UNIVERSITY AV 01:42:00 1/9/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:42:01 6/18/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:42:38 11/5/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:43:37 6/26/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:46:12 10/8/2011 COMM POLICE SCHOOLS LYTTON PLAZA @200 UNIVERSITY AV 01:46:49 5/15/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:47:39 6/25/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:48:26 5/1/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:48:43 1/15/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:48:49 3/4/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:49:09 2/6/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:49:14 3/6/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:49:40 3/27/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:49:42 11/27/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:50:28 5/14/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 01:51:00 3/5/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:51:06 4/30/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:51:38 9/4/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:52:14 2/5/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:52:23 5/14/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:52:24 1/16/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:53:37 8/20/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:53:38 7/2/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:54:17 3/13/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:55:16 12/17/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:55:57 10/23/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 01:56:25 1/22/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:57:13 8/5/2011 DISTURBING:UNK PROB UNIVERSITY AV / EMERSON ST 01:58:28 5/1/2011 TRAFFIC PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:58:28 Page 1 of 4 Calls For Service @ Lytton Plaza January-December 2011 Incident Date Call Type Location Rec Time 1/23/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:58:38 2/12/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:59:28 2/5/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 01:59:35 11/26/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:00:52 7/9/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:01:14 8/6/2011 PARAMEDIC RESPONSE LYTTON PLAZA @200 UNIVERSITY AV 02:01:39 1/29/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:02:31 3/20/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:03:10 12/24/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:04:20 2/13/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:04:36 6/26/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:04:45 2/26/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 02:04:56 10/16/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:07:04 1/15/2011 DIRECTED PATROL 200BLK UNIVERSITY AV 02:08:36 10/8/2011 COMM POLICE SCHOOLS LYTTON PLAZA @200 UNIVERSITY AV 02:09:19 4/24/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:12:09 6/19/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:14:28 4/17/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:14:40 1/15/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:14:56 4/30/2011 INTOXICATED PERSON LYTTON PLAZA @200 UNIVERSITY AV 02:21:54 4/9/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 02:26:42 4/24/2011 FOUND PROPERTY LYTTON PLAZA @200 UNIVERSITY AV 02:33:49 8/7/2011 PRIS IN CUST LYTTON PLAZA @200 UNIVERSITY AV 02:34:14 4/24/2011 FOUND PROPERTY LYTTON PLAZA @200 UNIVERSITY AV 02:35:16 11/20/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 02:39:29 2/12/2011 INTOXICATED PERSON LYTTON PLAZA @200 UNIVERSITY AV 03:27:25 5/22/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 03:34:48 6/28/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 06:04:24 11/13/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 06:10:38 12/29/2011 MEET CITIZEN 200 UNIVERSITY AV 06:14:00 5/27/2011 REPORT ON CONDITIONS UNIVERSITY AV / EMERSON ST 06:38:10 4/11/2011 MISC SERVICE (DEPT) UNIVERSITY AV / EMERSON ST ; PW 08:49:58 7/11/2011 TRASH DUMP LYTTON PLAZA @200 UNIVERSITY AV 09:25:57 11/29/2011 TRASH DUMP LYTTON PLAZA @200 UNIVERSITY AV 09:59:05 9/6/2011 CITIZEN CRIME REPORT LYTTON PLAZA @200 UNIVERSITY AV 10:00:47 12/23/2011 STOLEN VEHICLE REPORT 200BK UNIVERSITY AV 10:10:25 6/29/2011 ACCIDENT PROP DAMAGE 200BLK UNIVERSITY AV 10:30:32 6/6/2011 CITIZEN CRIME REPORT UNIVERSITY AV / EMERSON ST 11:23:37 12/1/2011 CITIZEN CRIME REPORT LYTTON PLAZA @200 UNIVERSITY AV 11:26:52 11/2/2011 TRAFFIC PATROL 200BLK UNIVERSITY AV 11:29:01 3/14/2011 VANDALISM REPORT UNIVERSITY AV / EMERSON ST 11:29:39 10/15/2011 HEALTH&SAFETY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 12:08:42 10/19/2011 RECKLESS DRIVING UNIVERSITY AV / EMERSON ST ; EB 12:10:52 5/10/2011 PERSON DOWN LYTTON PLAZA @200 UNIVERSITY AV 12:45:59 11/8/2011 TRAFFIC PATROL 200BLK UNIVERSITY AV 12:47:04 10/15/2011 PARKING VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 12:47:29 11/3/2011 TRAFFIC PATROL 200BL UNIVERSITY AV 12:48:07 6/11/2011 DRIVE UNDER THE INFL UNIVERSITY AV / EMERSON ST ;WB 13:20:01 2/5/2011 SELF INITIATED CALL 200BLK UNIVERSITY 13:20:49 9/13/2011 NOISE VIOLATION UNIVERSITY AV / EMERSON ST ;W/B 13:32:51 4/25/2011 MISD HIT/RUN-REPORT UNIVERSITY AV / EMERSON ST 13:48:37 Page 2 of 4 Calls For Service @ Lytton Plaza January-December 2011 Incident Date Call Type Location Rec Time 12/3/2011 INFORMATION 200 UNIVERSITY AV 13:59:41 1/8/2011 STORED VEHICLE 200BL UNIVERSITY AV 13:59:45 9/17/2011 ON FOOT PATROL UNIVERSITY AV / EMERSON ST 14:34:01 6/8/2011 CITIZEN CRIME REPORT 200BL UNIVERSITY AV 14:41:32 2/15/2011 COMMUNITY POLICE LYTTON PLAZA @200 UNIVERSITY AV 14:57:17 7/7/2011 ON FOOT PATROL UNIVERSITY AV / EMERSON ST 15:25:03 7/27/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 15:33:17 10/27/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 15:33:58 3/30/2011 PARKING VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 15:34:28 1/8/2011 FOUND PROPERTY 200BLK UNIVERSITY AV 15:36:20 12/17/2011 WELFARE CHECK LYTTON PLAZA @200 UNIVERSITY AV 15:40:36 7/10/2011 BATTERY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 15:43:44 11/25/2011 POSS DEAD BODY LYTTON PLAZA @200 UNIVERSITY AV 15:45:55 4/22/2011 ONCALL SCADA OP CALL LYTTON PLAZA @200 UNIVERSITY AV 15:46:18 7/15/2011 ON FOOT PATROL UNIVERSITY AV / EMERSON ST 16:01:14 1/4/2011 INFORMATION UNIVERSITY AV / EMERSON ST 16:20:20 6/12/2011 HEALTH&SAFETY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 16:26:32 12/20/2011 ON FOOT PATROL 200BLK UNIVERSITY AV 16:27:17 12/4/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 16:28:11 12/9/2011 MISD HIT/RUN UNIVERSITY AV / EMERSON ST 16:34:25 8/8/2011 BATTERY IP/JO UNIVERSITY AV / EMERSON ST 16:38:44 10/13/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 16:38:47 12/9/2011 DIRECTED PATROL TEAM B LYTTON PLAZA @200 UNIVERSITY AV 16:57:19 12/15/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 17:14:02 7/16/2011 PARAMEDIC RESPONSE UNIVERSITY AV / EMERSON ST 17:27:01 8/12/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 17:35:46 7/7/2011 FOUND PROPERTY 200BL UNIVERSITY AV 17:43:32 3/20/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 17:52:01 11/2/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 18:16:57 11/16/2011 BATTERY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 18:18:58 6/12/2011 INTOXICATED PERSON LYTTON PLAZA @200 UNIVERSITY AV 18:24:55 10/5/2011 DISTURBING:UNK PROB 200BLK UNIVERSITY AV 18:25:18 2/17/2011 ACCIDENT PROP DAMAGE UNIVERSITY AV / EMERSON ST 18:29:27 7/22/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 18:43:32 2/23/2011 INTOXICATED PERSON LYTTON PLAZA @200 UNIVERSITY AV 18:45:28 5/29/2011 DISTURBANCE REPORT LYTTON PLAZA @200 UNIVERSITY AV 18:48:45 3/12/2011 PARAMEDIC RESPONSE LYTTON PLAZA @200 UNIVERSITY AV 18:50:34 7/22/2011 PARAMEDIC RESPONSE LYTTON PLAZA @200 UNIVERSITY AV 18:54:25 1/31/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 19:11:58 12/2/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 19:12:53 10/21/2011 PARKING VIOLATION UNIVERSITY AV / EMERSON ST 19:14:17 10/21/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 19:17:58 3/18/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 19:20:41 11/18/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 19:21:20 8/17/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 19:22:16 9/7/2011 STOLEN VEHICLE REPORT UNIVERSITY AV / EMERSON ST 19:24:34 2/5/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 19:31:00 7/8/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 19:33:48 9/22/2011 MUNI CODE:NOISE VIOL LYTTON PLAZA @200 UNIVERSITY AV 19:35:37 8/17/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 19:47:16 8/17/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 19:50:05 Page 3 of 4 Calls For Service @ Lytton Plaza January-December 2011 Incident Date Call Type Location Rec Time 1/13/2011 MISD HIT/RUN UNIVERSITY AV / EMERSON ST 19:51:05 2/6/2011 LOOKOUT FOR UNIVERSITY AV / EMERSON ST 20:02:55 8/30/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 20:11:10 1/24/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 20:24:17 11/3/2011 PARAMEDIC RESPONSE LYTTON PLAZA @200 UNIVERSITY AV 20:44:22 5/6/2011 WARRANT/PALO ALTO LYTTON PLAZA @200 UNIVERSITY AV 20:46:08 10/17/2011 MEET CITIZEN LYTTON PLAZA @200 UNIVERSITY AV 21:00:11 11/12/2011 RECKLESS DRIVING UNIVERSITY AV / EMERSON ST ; WB UNIV 21:01:14 12/21/2011 REPORT ON CONDITIONS LYTTON PLAZA @200 UNIVERSITY AV 21:02:13 5/8/2011 ATTEMPT TO CONTACT LYTTON PLAZA @200 UNIVERSITY AV 21:05:46 10/25/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 21:14:12 12/3/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 21:21:21 12/21/2011 EMERGENCY SHUT OFF LYTTON PLAZA @200 UNIVERSITY AV 21:28:27 9/30/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 21:35:07 4/16/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 21:39:15 2/11/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 21:40:54 12/10/2011 PARKING VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 21:46:13 9/24/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 21:52:26 4/12/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 22:06:52 9/16/2011 ON FOOT PATROL 200BLK UNIVERSITY AV 22:15:02 9/28/2011 ON FOOT PATROL LYTTON PLAZA @200 UNIVERSITY AV 22:26:41 11/12/2011 PARAMEDIC RESPONSE LYTTON PLAZA @200 UNIVERSITY AV 22:30:47 2/5/2011 HEALTH&SAFETY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 22:38:35 10/29/2011 PARAMEDIC RESPONSE UNIVERSITY AV / EMERSON ST 22:41:08 11/26/2011 MUNI CODE:NOISE VIOL LYTTON PLAZA @200 UNIVERSITY AV 22:43:04 6/6/2011 SUSPICIOUS PERSON 200BL UNIVERSITY AV 22:47:19 2/5/2011 SPOT CHECK LYTTON PLAZA @200 UNIVERSITY AV 22:49:05 2/11/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 22:56:32 12/21/2011 BATTERY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 22:58:23 11/12/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 23:00:38 10/24/2011 BATTERY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 23:00:46 4/22/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:02:30 6/20/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:09:43 2/11/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:12:58 5/6/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:19:27 10/23/2011 BATTERY IP/JO LYTTON PLAZA @200 UNIVERSITY AV 23:23:02 10/7/2011 PARKING VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:28:22 12/22/2011 WELFARE CHECK UNIVERSITY AV / EMERSON ST 23:40:23 3/11/2011 NOISE VIOLATION LYTTON PLAZA @200 UNIVERSITY AV 23:40:53 8/21/2011 WELFARE CHECK UNIVERSITY AV / EMERSON ST 23:54:13 12/16/2011 DIRECTED PATROL LYTTON PLAZA @200 UNIVERSITY AV 23:58:07 2/26/2011 DISTURBING:UNK PROB LYTTON PLAZA @200 UNIVERSITY AV 23:58:34 Page 4 of 4 APPROVED August 28, 2012 Draft Minutes 1 2 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 24 26 28 29 30 31 32 33 34 35 36 37 38 MINUTES PARKS & RECREATION COMMISSION REGULAR MEETING August 28, 2012 CITY HALL 250 Hamilton Commissioners Present: Stacey Ashlund, Deirdre Crommie, Jennifer Hetterly, Ed Lauing, Pat Markevitch, Daria Walsh Commissioners Absent: Paul Losch Others Present: Staff Present: Rob de Geus, Catherine Bourquin, Daren Anderson I. ROLL CALL CONDUCTED BY: Catherine Bourquin 23 II. AGENDA CHANGES, REQUESTS, and DELETIONS: 25 III. ORAL COMMUNICATIONS: None 27 IV. BUSINESS: 1. Approval of Draft Minutes from the July 24, 2012 special meeting – The Draft Minutes from the July 24, 2012 minutes were approved as amended. Passed: 4:2 abstentions (Commissioner Walsh and Crommie) 2. Recommendation to place limits on amplified sound at Lytton Plaza – Staff Anderson briefly spoke on the recommendation reminding the Commission what had taken place and what the new regulation entailed. The Commission then received public comment. Public Comment 39 40 41 42 43 44 Herb Borock – Mr. Borock spoke on the item and added that there might be the need for mitigation if approved by Council, referencing the advanced reservation portion of the regulation and having limitations added to it. Commissioners were given time for comment and questions. APPROVED August 28, 2012 Draft Minutes 2 Commissioner Vice-chair Walsh commented that she did not feel comfortable voting yes to the recommendation on the grounds that after observing the plaza on numerous occasions during this trial period, that she felt the music was still too loud. 45 46 47 Commissioner Chair Lauing – He commented that he was pleased with the survey outlining 11 visits. 48 49 Commissioner Crommie – She was pleased with the distinction between day and night uses and found that you could still find a quiet time during the day at Lytton Plaza. Her concern was on acoustic music playing during the hours amplified was allowed. She asked how acoustic music would be accommodated and staff responded that there is no restricted times for acoustic music. 50 51 52 53 54 Commissioner Hetterly – She commented that she was very pleased with the huge improvement on the revised wording in the Rules and Regulations that now clarifies the permitting process and how amplified music will be accommodated in Lytton Plaza. 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 Commissioner Markevitch made a motion to approve the recommendation to place limits on amplified sound at Lytton Plaza as defined in the staff report to the Commission, seconded by Commissioner Crommie. Motion: The Parks and Recreation Commission recommend to Council to approve the Recommendation to place limits on amplified sound at Lytton Plaza. Passed 5:1 (Commissioner Walsh) 3. Review draft amendment to the Comprehensive Plan – Natural Environment Element - Staff de Geus introduced Steve Turner, Advanced Planning Manager for the Planning and Transportation Department. Mr. Turner started the review off by acknowledging Ms. Chitralekha Moitra a planner in the department who has worked extensively on this component of the comprehensive plan. He provided some history on the Plan and what the next steps are for the plan. He advised the Commission that any written comments that they would like to provide can be emailed to him via staff de Geus and will be incorporated into the Draft before review by the Planning and Transportation Commission on September 12th. After this review the hope would be that it will be ready to go forward to Council. And then it would go out for an environmental analysis to bring it to its final stage in Spring of 2013. Public Comment 80 Eileen McLaughlin, Citizens Committee To Complete the Refuge spoke on the portion of the comprehensive plan as it pertains to Natural Eco systems. She wanted to make sure the “invasive species” removal was included in the plan. 81 82 83 84 85 86 The Ad hoc Committee consisting of Commissioner Crommie and Commissioner Hetterly provided a report on their review of the Comprehensive Plan – Natural APPROVED August 28, 2012 Draft Minutes 3 Environment Element. They went through their suggested changes/edits for the Commissions approval. (See attached). 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 After comments from the Commissioners a motion was made by Commissioner Hetterly to approve the recommended changes by the ad hoc committee and seconded by Commissioner Crommie. Motion: The Parks and Recreation Commission approve the recommended changes by the ad hoc committee as presented. Passed: 6:0 4. Review and comment on landscape renovation plans for Eleanor Pardee Park – Peter Jensen, Landscape Architect/Park Planner for the City of Palo Alto presented the plans for the renovation of Eleanor Pardee Park to the Commission. After his presentation the Commission was given time for questions and comments. Some questions and comments from the Commissioners included; will there be sand in the play area, why so many picnic tables without a restroom, why asphalt for pathways, what is the criteria for replacement of playground equipment, has a dog park been considered, revamping 9/11 memorial area, putting the two playgrounds together. Mr. Jensen commented that the next steps will be to further develop the plan by looking at some modifications that the commissioners have suggested. The plans will then be brought back to the Commission for further review. 5. Presentation and discussion on the Highway 101 Pedestrian/Bicycle overcrossing conceptual alignments at Adobe Creek and possible action recommending a letter of support to apply for funding through the County of Santa Clara Alternative Recreation Mitigation Projects Grant program – Holly Boyd, Project Engineer for the project provided a brief description of what the expectation is for this item tonight and introduced the consultant Casey Hildridge who presented a slide show on the project outlining the four conceptual alignments with various approach options under consideration. Commissioner Markevitch questioned the use of the private property for alignments A, B, and C. Discussion centered on the differences in the ramps for each of the alignments. Commissioner Hetterly emphasized the need to keep the tunnel available as well as the bridge. The Commission then discussed the letter of support from the Commission for the grant application to the Santa Clara County. Consultant Casey Hildridge explained the process for the grant. Commissioner Ashlund questioned why the inclusion of the other three projects for the grant funding. After some discussion a motion was agreed upon by the Commission. Motion made by Commissioner Crommie and seconded by Commissioner Hetterly. Motion: The Parks and Recreation agree to provide a letter of support for the City to apply for funding through the County of Santa Clara Alternative Recreation Mitigation Projects Grant program for approximately 6 million APPROVED August 28, 2012 Draft Minutes 4 for four projects Adobe Creek Pedestrian/Bicycle Bridge ($4M), Matadero Creek trail ($1.5M), Arastradero Road Trail Repaving and Upgrades ($250K) and Park Bicycle Boulevard ($250K) in order of this priority. 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 165 166 167 Passed: 5:1 (Commissioner Ashlund) 6. Preparation for September 10 Council Study Session – Chair Lauing lead the discussion on preparing for the Joint meeting with City Council. A draft Agenda for the meeting was provided and discussed. The Commission explored ways to express the importance to the Council on PARC’s key goals for the present and future. 7. Parks and Recreation Commission Ad Hoc Committee and liaison updates – Chair Lauing requested updates from the Commissioners ad hoc committees and liaison representatives. IRBC – Commissioner Markevitch commented that they will be getting back together in early October to get an update on what Council has been doing. Julia Morgan building sub-committee – Commissioner Markevitch commented that they met with Steve Emslie, Deputy City Manager and put together a matrix on the possible location options they found. Cubberley committee – Commissioner Hetterly commented that the committee is meeting every other week and are in the data collection stage still. They have been told that the timeline has been moved up to February 2013 and the Committee is feeling that they might not have enough time to finish there report by then. Byxbee committee – Commissioners Crommie, Hetterly, and Walsh stated that they did a walk through with staff Anderson and reviewed the new trails which looked good. They had a follow up meeting with the stakeholders at the water treatment plant with Public Works. Field Use Policy committee – Staff de Geus reported that they will be meeting on Thursday and possibly have something to bring back to the Commissions next meeting. Golf Course – Staff de Geus spoke and informed the Commission that the design work is continuing and that the current Committee for this will be meeting again shortly. V. COMMENTS AND ANNOUNCEMENTS 164 1. Commissioner Walsh had a question on the Cogswell Plaza readings from the Important Dates sheet. The response was that there are always two readings that occur with Council on ordinance requests. APPROVED August 28, 2012 Draft Minutes 5 2. Commissioner Markevitch commented that she would like to emphasize the importance of scheduling meetings that relate to the Commission on nights that they do not have their regular meetings. 168 169 170 171 172 173 174 175 177 178 179 180 181 182 183 184 186 187 188 3. Commissioner Hetterly reported on the Public Arts Commission informing the Commission that they met on the Hoover Park art selection and has narrowed it down to 5 proposals. 4. Staff de Geus announced that the Enjoy catalog has been released. VI. TENTATIVE AGENDA FOR NEXT REGULAR MEETING 176 Chair Lauing reported that the September 25th meeting will have to be moved and discussed the options of a new date. September 10th, September 18th was suggested. Agenda items suggested included: 1. Magical Bridge 2. Julia Morgan Building relocation 3. Urban Forestry 4. Santa Clara Valley Audubon Society VII. ADJOURNMENT 185 Meeting adjourned in honor of Russ Wright, Recreation instructor who passed away. 11:20pm