HomeMy WebLinkAboutStaff Report 6358
City of Palo Alto (ID # 6358)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 4/4/2016
City of Palo Alto Page 1
Summary Title: SUMC Annual Report
Title: Stanford University Medical Center Annual Report and Compliance with
the Development Agreement
From: City Manager
Lead Department: Planning and Community Environment
Recommendation
Staff recommends that the City Council:
1. Find that the Stanford University Medical Center (SUMC) Parties (Stanford Hospitals &
Clinics, Lucile Packard Children’s Hospital, and Stanford University) have complied in
good faith with the terms and conditions of the Development Agreement for the 2014-
2015 reporting period; and
2. Find that the SUMC Parties are not in default with the terms and conditions of the
Agreement.
3. Accept the City of Palo Alto’s (City) Annual Accounting Report regarding the funds
received by the SUMC Parties as required under Section 12(d) of the Development
Agreement. (Attachment C.)
Executive Summary
The City Council is required to review the Development Agreement between the SUMC Parties
and the City of Palo Alto on an annual basis to ascertain compliance with the terms of the
agreement. The SUMC Parties have submitted the annual report for the 2014-2015 period
summarizing construction activities and other actions taken to fulfill the obligations of the
Agreement. Of particular note, the SUMC has achieved a 36.3% alternative transportation
mode split which exceeds the Alternative Mode Share target of 35.1% for 2025. Also, as
described in the supplement to the annual report, the SUMC Parties have paid approximately
$32.5 million in public benefit fees to the City since June 6, 2011, although there were no
required payments from Stanford during this reporting period. During the 2013-2014
monitoring period, the City Council reviewed and approved the revised Infrastructure project
funding proposal allocating future use of the SUMC Infrastructure and Sustainability funds to a
prioritized list of projects.
City of Palo Alto Page 2
Background
On June 6, 2011, the City Council approved Comprehensive Plan amendments, zoning changes,
a conditional use permit, annexation and design applications for the Stanford University
Medical Center Facilities Renewal and Replacement Project (the “Projects”). The Projects
include the construction of a new Stanford Hospital and clinics buildings, an expansion of the
Lucile Packard Children’s Hospital, construction of new School of Medicine buildings,
renovation of the existing Hoover Pavilion, construction of a new medical office building and
parking garage at Hoover Pavilion, roadway improvements along Welch Road and Durand Way,
and SUMC design guidelines. A Development Agreement (the “Agreement”) vesting these
approvals was entered into between the SUMC Parties and the City and was deemed effective
on June 6, 2011 and continues for thirty (30) years from the effective date. The Agreement
requires annual City Council review of the SUMC Parties compliance. This report covers the
SUMC Parties activities during 2014-2015, the fourth year of the Agreement.
Discussion
As described in Section 12, “Periodic Review of Compliance,” the City Council is to review the
Agreement annually to ascertain the SUMC Parties’ compliance with the terms of the
Agreement. Section 12 also includes the reporting requirement for the SUMC Parties and the
City to demonstrate good faith compliance with the Agreement. The attached 2014-15 Annual
Report (Annual Report) dated July 6, 2015 (Attachment A) from SUMC describes the SUMC
Parties’ activities related to implementation of the Agreement.
Construction Activities
Construction activities in past periods included:
Hoover Pavilion Renovation- Site work and renovation of the exterior and interior features
of the building have been completed and in December 2012, Hoover Pavilion re-opened,
providing a modern medical office and clinics to the SUMC community. The renovation
project is considered to be complete.
Hoover Pavilion Parking Garage- Site work and construction for the new 1,084-stall parking
garage was completed in the Fall of 2013. It is now open for use by patients and staff.
Welch Road Utilities Project- This project involves the replacement and installation of
utilities to support the New Stanford Hospital and the Lucille Packard Children’s Hospital
expansion. The project was considered to be complete in 2013. Two-way automobile traffic
currently operates on Welch Road.
Construction activities during this period included:
Hoover Medical Office Building “Neuroscience Health Center” - Construction is nearing
completion for the new medical building, located adjacent to Quarry Road, and the City of
Palo Alto electrical sub-station. Grading and excavation permits were issued in March 2014,
followed by the core and shell building permit in May 2014. The new Neuroscience Health
Center is targeted for completion in the Fall of 2015.
City of Palo Alto Page 3
Lucile Packard Children’s Hospital- Construction of the hospital expansion is underway and
significant construction progress has been made including completion of deck placement,
installation of precast concrete panels on the building exterior and construction of a tunnel
connector from the new Hospital to the existing Hospital is almost complete.
New Stanford Hospital (NSH) - Substantial project progress has been made since the 2013
issuance of the Office of Statewide Health Planning & Development (OSHPD) foundation
permit and core and shell permit for the NSH and the City’s issuance of the building permit
for the New Stanford Hospital Garage. The steel superstructure for the hospital is now in
place, mechanical, electrical and plumbing work is now underway, and construction of the
exterior building enclosure has begun. The adjacent New Stanford Hospital Garage exterior
façade installation is underway and a temporary Certificate of Occupancy was issued to
allow for contractor parking during construction.
School of Medicine Building- This project involves the replacement of the Stanford
University School of Medicine building with new state-of-the-art facilities. The School of
Medicine development is not yet underway.
No new square footage has been constructed during this reporting period. Approximately
133,731 square feet of floor area has been demolished on the main and children’s hospital
sites, as well as the Hoover Pavilion site.
Compliance with Development Agreement Obligations
In addition to the construction summary and the summary of net new square footage added
within the past year, the Annual Report also summarizes the SUMC Parties’ progress in meeting
the terms described in Section 5 of the Agreement, “SUMC Parties’ Promises.” This section of
the Annual Report describes the SUMC Parties’ obligations with respect to the following items:
Health Care Benefits;
Fiscal Benefits;
Traffic Mitigation and Reduced Vehicle Trips;
Pedestrian, Bicycle and Automobile Linkages;
Infrastructure, Sustainable Neighborhoods & Communities, Affordable Housing, and
Climate Change.
The Annual Report summarizes the activities within the reporting year. The obligations are
further summarized in Table 1: Development Agreement, Section 5 – SUMC Parties’ Promises
(Attachment B). City staff has reviewed the information within the Annual Report and has
determined that it is complete and correct.
Traffic Mitigation and Reduced Vehicle Trips
The SUMC Parties have made substantial progress in meeting the traffic and alternative
transportation obligations of the Agreement. Specifically, they have accomplished the
following:
City of Palo Alto Page 4
Purchased CalTrain Go Passes annually for all eligible employees as of January 1, 2012, three
years ahead of the September 1, 2015 requirement as stated in the Agreement. Annual
passes were purchased again for all eligible existing and new employees for 2015;
Purchased additional shuttle buses for the Marguerite Shuttle service which now includes
five renewable diesel-electric hybrid buses and three all-electric buses, along with plans to
add up to 20 additional all electric buses over the next two years;
Hired a Transportation Demand Management (TDM) coordinator on March 13, 2012, three
years ahead of the September 1, 2015 requirement as stated in the Agreement, and
Achieved a 36.3% alternative transportation mode split during this reporting year for the
hospital employees, meaning 36.3% of employees are using alternative modes to get to
work rather than driving alone. This figure increased and employs the new calculation
methodology implemented in the last monitoring period. The new weighted survey analysis
methodology is more accurate and intended to be more representative of the general
Hospital employee population. The past year’s mode split were recalculated using the new
methodology and is shown in the table below.
Year Past Methodology New Methodology
2012 39% 32.5%
2013 40.9% 33.4%
2014 N/A 34.4%
2015 N/A 36.3%
The 36.3% mode split exceeds the Alternative mode share targets for 2018, 2021, and 2025.
The SUMC Parties and City staff will continue to monitor the TDM program throughout the
term of the Agreement and will report annually to the Council.
Supplement to the Annual Report
In addition to the SUMC Parties’ submittal of the Annual Report, City staff is to prepare a
supplement to the Annual Report (the “Supplement”), as described in Section 12(d) of the
Agreement. The supplement is to include an accounting of the funds received from the SUMC
Parties to satisfy the obligation outlined in Section 5 of the Agreement, a description of the
account balances, and a summary and description of expenditures from the funds. The
Supplement is contained in Attachment C.
In summary, the SUMC Parties have contributed $32,533,666 in public benefit funds as of June
30, 2015. Interest income during the reporting period was $566,862. The SUMC Parties will pay
an additional $11.7M upon issuance of the first hospital occupancy permit, expected in early
2018.
During the reporting period, the City has committed funds for the following:
City of Palo Alto Page 5
$392,798 under the “Community Health & Safety” cost center for the Project Safety Net
Program. Project Safety Net Program is specifically identified in the Agreement as a
community health program that would be an appropriate program for the use of this
fund. Funds spent during the reporting period were allocated to salaries/benefits for
Project Safety Net staff and other expenses relating to the operation of the program.
$1.2 million was reported committed during the last monitoring period under the
“Expansion Cost Mitigation” cost center for City Capital Projects, specifically the
implementation of the Bicycle & Pedestrian Transportation Plan which is included on
the approved prioritized list of infrastructure projects. These funds were supposed to
be under the “Climate Change and Sustainability cost center and both the “Expansion
Cost Mitigation” and the Climate Change and Sustainability cost centers were adjusted
accordingly for this monitoring period.
General Fund Sales and Use Tax revenues in calendar year 2014 resulting from construction-
related activities totaled approximately $568,755 based on the City Auditor’s review of the
Construction Sales & Use Tax Monitoring Report submitted by SUMC on June 30, 2015. The
City Auditor submitted a letter to SUMC (Attachment D) noting a discrepancy of $36,295 in the
Construction Sales & Use Tax Monitoring report, meaning SUMC reported $605,050 General
Fund Sales and Tax revenues in calendar year 2014 resulting from construction related
activities. The discrepancy mainly stems from taxes from calendar year 2013 reported in
calendar year 2014 and jurisdiction coding issues. The City will be working with SUMC to
resolve the discrepancy. Total General Fund Sales and Use Tax revenues from 2011 to 2014
now total $1,054,192.
Future Use of Development Agreement Funds
On June 9, 2014 (ID#4889), Council reviewed and approved the revised Infrastructure project
funding proposal allocating future use of the SUMC Infrastructure and Sustainability funds to a
prioritized list of projects including, but are not limited to, implementation of the
Bicycle/Pedestrian Transportation Plan, construction of the Public Safety Building, construction
of additional parking garages in the University Ave/Downtown and Cal Ave areas, Fire Stations
and Parks improvements. In addition to funds being appropriated from the Stanford
Sustainability account for the Bicycle and Pedestrian Bicycle Plan, funds have been and will be
requested for the design of a fire station replacement and for preliminary design for a new
Public Safety Building. These drawdowns from the Stanford Infrastructure Funds are reflected
in the City’s FY 2016 Adopted Capital Budget. During FY2015, use of Health and Safety Funds
allocated to Project Safety Net has been primarily focused on means restriction efforts along
the rail corridor, including track security, vegetation removal and the installation of higher
fencing along the eastern side of the corridor. In January, 2016, a new Executive Director for
Project Safety Net collaborative was hired. Her primary focus in the near term will be working
with the Center for Disease Control on the Epi Aid investigation into the teen suicide cluster in
Palo Alto and working with collaborative leadership to set up the needed infrastructure to
implement a collective impact approach to addressing suicide prevention and youth wellbeing
City of Palo Alto Page 6
efforts in Palo Alto.
Resource Impact
There are no negative impacts from the Agreement that affect the City’s General Fund. As
summarized above, the City has received approximately $35.1M in public benefit payments,
interest and unrealized gains and approximately $1,054,192 in construction sales taxes since
the start of the project based on the City Auditor’s review of the Construction Sales & Use Tax
Monitoring Report submitted by SUMC on June 30, 2015.
Policy Implications
This report does not represent any changes to existing City policies.
Environmental Review
Finding Stanford University’s compliance with the Terms of the Agreement is not a project
under the California Environmental Quality Act, and no environmental assessment for the
annual compliance review is required. An environmental impact report for the entire SUMC
project was prepared and certified by the City Council prior to approval of the Development
Agreement.
Attachments:
Attachment A: 2014-15 SUMC Annual Report (PDF)
Attachment B: Table 1 - Development Agreement, Section 5 (PDF)
Attachment C: SUMC Annual Report Supplement FY2015 (PDF)
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2014-15 ANNUAL REPORT
PREPARED FOR THE CITY OF PALO ALTO I JULY 6, 2015
Received
JUL 0 6 2015
Department of Planning
& Community Environment
ATTACHMENT A
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CONTENTS
EXECUTIVE SUMMARY
BACKGROUND AND PURPOSE 2
2014-2015 SUMMARY OF PROGRESS 3
HOOVER PAVILION SITE 3
LUCILE PACKARD CHILDREN'S HOSPITAL 4
NEW STANFORD HOSPITAL 5
( SCHOOL OF MEDICINE 6
(
NET NEW SQUARE FOOTAGE 6
( COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS 7
HEALTH CARE BENEFITS 7
( SECTION 5(a)(ii). FUND FOR HEALTHCARE SERVICES 7
SECTION 5(a)(iii). FUND FOR COMMUNITY HEALTH AND SAFETY PROGRAMS 7
(
( PALO ALTO FISCAL BENEFITS 8
SECTIONS 5(b)(i) AND 5(b)(ii). PAYMENT OF SALES AND USE TAXES 8
( SECTION 5(b)(iii). FUNDING OF OPERATING DEFICIT 9
( SECTION 5(b)(iv). PAYMENT OF UTILITY USER TAX 9
SECTION 5(b)(v). SCHOOL FEES 9
l TRAFFIC MITIGATION AND REDUCED VEHICLE TRIPS 10
( SECTION 5(c)(ii). MENLO PARK TRAFFIC MITIGATION 10
SECTION 5(c)(iii). EAST PALO ALTO VOLUNTARY MITIGATION 10
( SECTION 5(c)(iv). CONTRIBUTIONS TO AC TRANSIT 10
( SECTION 5(c)(v). OPTICOM PAYMENTS 11
SECTION 5(c)(vi). CALTRAIN GO PASSES 11
{ SECTION 5(c)(vii). MARGUERITE SHUTTLE SERVICE 11
( SECTION 5(c)(viii). TRANSPORTATION DEMAND MANAGEMENT COORDINATOR 11
SECTION 5(c)(ix). MONITORING OFTDM PROGRAMS 12
(
{ LINKAGES 13
( SECTION 5(d)(i). INTERMODAL TRANSIT FUND 13
SECTION 5(d)(ii). QUARRY ROAD FUND 13
( SECTION 5(d)(iii). STANFORD BARN CONNECTION 13
( INFRASTRUCTURE, SUSTAINABLE NEIGHBORHOOD S AND COMMUNITIES, AND AFFORDABLE HOUSING 14
( SECTION 5(e). 14
( CLIMATE CHANGE 14
( SECTION 5(f). CLIMATE CHANGE FUND 14
(
( SATISFACTION OF COND ITIONS OF APPROVAL 14
( CONCLUSION 15
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EXECUTIVE SUMMARY
On June 6, 2011 , the Stanford University Medical Center-comprised of Stanford Hospital and Clinics,
Lucile Packard Children's Hospital, and Stanford University-entered into a Development Agreement
with the City of Palo Alto, committing to provide a range of community benefits in exchange for vested
development rights to develop and use the SUMC Project facilities in accordance with the approvals
granted by the City, and a streamlined process for obtaining subsequent project approvals. The SUMC
Renewal and Replacement Project ("Renewal Project")-driven by a growing demand for healthcare
services, state-mandated seismic safety req uirements, and the need to rep lace outmoded facilities with
modern , technologically advanced spaces-holds the potential to transform the way that healthcare is
delivered and research is condu cted.
Today, four years after the execution of the Development Agreement, SUMC Renewal Project activities
are well underway. The New Stanford Hospital and the Lucile Packard Children's Hospital expansion are
beginning to take shape, with steel erection complete and exterior cladding installation underway on both
structures. Meanwhile, on the Hoover Pavilion site, construction of a new Neuroscience Health Center is
nearing completion, adjacent to the new parking structure and renovated Pavilion.
Against this backdrop, SUMC submits its Annual Report in compliance with Section 12(c) of the
Development Agreement, and looks forward to continued collaboration with the City of Palo Alto in
advancing the goals of both the Stanford University Medical Center and the broader community
ANNUAL REPORT 2014-15
BACKGROUND AND PURPOSE
The Palo Alto City Council's unanimous approval of the entitlements for the Stanford University Medical
Center Renewal and Replacement Project in July 2011 has paved the way for a historic investment in
new and replacement facilities at SUMC. The project approvals-including new zoning for the Project
sites, a conditional use permit, architectural review approval, and the execution of a Development
Agreement-allows for the construction of approximately 1.3 million net new square feet of hospital
facilities, clinics, medical offices, and medical research spaces, and will enable the hospitals to optimize
the delivery of healthcare services to patients, and maintain their position as leading providers of world-
class healthcare.
In order to facilitate this important replacement and expansion work, SUMC entered into a Development
Agreement with the City of Palo Alto, which includes a comprehensive package of community benefits
and voluntary mitigation measures. In exchange for these benefits, the City has vested for a period of 30
years SUMC's rights to develop and use the property in accordance with the project approvals, and will
streamline the process for obtaining subsequent approvals
The terms of the Development Agreement (Section 12(c)) provide for a periodic review of compliance,
and require that SUMC submit an Annual Report to the City of Palo Alto's Director of Planning and
Community Environment each year within 30 days of the anniversary of th e agreement effective date
(June 6, 2011 ). The Annual Report is to summarize the progress on the Renewal Project, including a list
of net new square footage for which a certificate of occupancy has been received , and a description of
the steps that SUMC has taken to comply with the obligations listed in the Development Agreement. With
this report, SUMC fulfi lls these requ irements. Within 45 days of receipt of this Annual Report, the City
wi ll prepare a Supplement to the Annual Report, to provide an accounting of the City's expenditures from
each of the City Funds and how they were used.
2 ANNUAl REPORT 2014-15
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2014-2015 SU MMARY OF PRO GRESS
The Renewal Project continues to progress , with construction activities for both Hospitals now well
underway. In the section to fo llow, SUMC provides an overview of central goals for the project elements
that presently are under construction or nearing construction, a synopsis of progress to date, as well as a
preview of near-term upcoming activities.
HOOVER PAVILION SITE
One of the first phases of the Renewal Project was the renovation of Hoover Pavilion to accommodate
modern medical offices and clinics. Renovation of the 1931 building-including structural improvements,
mechanical and plumbing upgrades, and restoration of historic architectural details-began in Summer
2011 , and completed in Fa ll 2012. Subsequently, construction of the Hoover Garage (PS-9) completed
in Fall 2013, and the garage is now open and serving patients, visitors, and staff. And finally, the
landscaping at the Hoover Medical Campus was transformed to include varied landscaped spaces,
including a lawn parterre, Redwood grove, and Oak grove The groves feature mature trees which have
been transplanted from other locations on the Hoover site, many of which had been boxed and stored
offsite during construction.
Currently, construction of a new Neuroscience Health Center is nearing completion on the Hoover
site, on Quarry Road immed iately west of the Hoover Pavilion , and northwest of the parking garage.
When complete, the Neuroscience Health Center will provide specialized outpatient services for people
with Alzheimer's, Parkinson's disease, brain tumors, multiple sclerosis, stroke and other neurological
disorders. Construction has progressed swiftly over the past year-the exterior envelope is now nearly
complete, and interior finishes are underway. Site work is in progress as well-and when complete will
feature new landscaped spaces, including a wildflower knoll. The new Neuroscience Health Center is
targeted for completion in Fall 2015.
ANNUAl REPORT 2014-15 3
2014-2015 SUMMARY OF PROGRESS
LUCILE PACKARD CHILDREN'S HOSPITAL
In response to growing community needs for specialized pediatric and obstetric care, Lucile Packard
Children's Hospital is opening an expanded facility. The new hospital, to be located adjacent to the
current Packard Children 's Hospital, will provide patients and doctors with the most modern clinical
advancements and technology, while also creating a more patient-and family-centered environment
of care, with additional single-patient rooms and more spaces for families to be with their child during
treatment and recovery.
The Packard Chi ldren's expansion will feature a new entrance lobby, public concourse with dining, three
floors of nursing units, and new patient rooms. Spaces have been designed with an attention to natural
li ght and views , and the exterior grounds-more than 3.5 acres of outdoor areas and gardens-will
provide a park-like setting for patients, families, and visitors.
In the past year, significant construction progress has been made on the LPCH expansion project-steel
erection and deck placement are now complete, and interior rough-ins are underway, along with the
installation of precast concrete panels on the building exterior. Meanwhile, site utilities work and the
construction of a tunnel connector from the new Hospital to the existing Hospital have been in progress
and are now nearing completion .
4 ANNUAl REPORT 2014-15
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2014-2015 SUMMARY OF PROGRESS
NEW STANFORD HOSPITAL
Stanford Hospital and Clinics is constructing new and replacement hospital facilities that will usher in a
new era of advanced patient ca re. Growth in patient volumes and rapidly changing medical technology
have rendered much of the existing midcentury hospital infrastructure inadequate, whi le new seismic
safety requirements have accelerated the need to construct rep lacement facilities.
The New Stanford Hospital will substantially increase capacity, and will also address a rapidly advancin g
medical landscape. High-tech spaces such as Surgery, Radiology, and Intensive Care wi ll be replaced
to accommodate the latest advances in medical technology, while still retaining the flexibility to adapt
to fu tu re innovations. Facilities wil l feature new patient rooms, an enlarged Level-1 trauma center
and Emergency Department, and new surgical, diagnostic, and treatment rooms. And foremost, the
new facility will create a healing environment res ponsive to the needs of patients, visitors, and staff.
Upper-level pavilions wi ll feature light-filled patient rooms, and a mid -level garden floor will offer dining,
conference, and educational facilities, as well as social and spiritual support spaces.
Substantial progress has been made on the New Stanford Hospital project over the past year. The
steel superstructure for the Hospital is now in place; mechanical, electrical and plumbing rough -ins are
underway; and preparation for the exterior building enclosure has begun. Meanwhile, at the adjacent
New Stanford Hospital Garage, exterior fac;:ade installation is underway and a temporary Certificate of
Occupancy has been issued to allow for contractor parking while construction continues.
ANNUAL REPORT 2014-15 5
2014-2015 SUMMARY OF PROGRESS
SCHOOL OF MEDICINE
The Stanford University School of Medicine will replace its outmoded research buildings with new
state-of-the-art facilities designed to support contemporary translational research. The new facilities
will accommodate 21st century medical advancements and enable the development of new medical
innovations. The new buildings will feature integrated laboratory suites, with easier access between
labs and support facilities, enabling transparency, flexibility, and collaboration. The new facilities will be
surrounded by landscaped areas and tree-l ined walkways.
The School of Medicine development is not yet underway. In the interim, part of the site that will
ultimately be developed is currently in use as a temporary va let parking area for Hospital patients and
visitors.
NET NEW SQUARE FOOTAGE
The following table summarizes the net new square footage for which a certificate of occupancy has
been issued.
PROJECT COMPONENT GROSS SQUARE
FOOTAGE
NEW STANFORD HOSPITAL
1101 Welch demolished (40, 1 00)
Total (40, 1 00)
LUCILE PACKARD CHILDREN'S HOSPITAL EXPANSION
701 Welch demolished (56,300)
703 Welch demolished (23,500)
Total (79,800)
SCHOOL OF MEDICINE
None 0
HOOVER PAVILION
Misc. shops and storage demolished (13,831 )
Total (13,831)
6 ANNUAL REPORT 2014-15
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COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
This section of the Annual Report summarizes the steps that SUMC has taken to comply with their
obligations in Section 5 of the Development Agreement.
HEALTH CARE BENEFITS
SUMC provides certain intrinsic benefits to the community, as both a global leader in medical care and
research, and as a community healthcare services provider. The Renewal Project enables SUMC to
continue its important work, and the addition of more beds for adults and ch ildren will help to alleviate
overcrowding. Additionally, the new hospital facilities will provide critical emergency preparedness and
response resources for the community in the event of an earthquake, pandemic, or other major disaster.
Section 5(a)(ii). Fund for Healthcare Services
The Hospitals have designated the amount of $3 million for Healthcare Services which will increase
to $5.6 million by December 31 , 2025. No further action is required until 2026. This amount wi ll be
reconciled with the construction tax use payments as described in Development Agreement Section 5(b)
(ii)(C).
Section 5(a)(iii). Fund for Community Health and Safety Programs
SUMC has contributed a single lump-sum payment of $4 million to establish a Community Health and
Safety Program Fund for the City of Palo Alto. This fund is to be distributed to selected community health
programs that benefit residents of the City, including the Project Safety Net Program, a community-based
mental health plan for youth well-being in Palo Alto. A joint committee is to be established to evaluate
proposals regarding the other specific programs to receive funding, composed of two representatives
selected by the SUMC Parties and two representatives selected by the City; this committee shall make
annual recommendations to the City Council regarding proposed disbursements from the Community
Health and Safety Program Fund, and the City Council shall use its reasonable discretion to decide
whether to accept, reject, or modify the joint committee recommendations.
SUMC provided the entire required contribution to the Community Health and Safety Program Fund
on August 25, 2011 . No further action is required by the SUMC to comply with this Development
Agreement provision. As required by Development Agreement Section 12(d), the City will provide yearly
Supplements to the Annual Report to provide an accounting of the City's expenditures from this fund, and
the purposes for which the expenditures were used.
ANNUAL REPORT 2014-15 7
COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
PALO ALTO FISCAL BENEFITS
The SUMC Renewal Project brings considerable fiscal benefits to the City of Palo Alto. The project is
expected to generate at least $8 .1 million in sales and use tax revenues for the City, and multiple mecha-
nisms have been put into place to ensure that this target is met The Development Agreement also
provides for further fiscal benefits to the City, including a payment by SUMC to fund the City 's operating
deficit, and the payment of utility user taxes and school fees.
Sections 5(b)(i) and 5(b)(ii). Payment of Sales and Use Taxes
As required by the Development Agreement, the SUMC submitted its annual Construction Sales and
Use Tax monitoring report to the City on June 30 , 2015. The SUMC parties will continue to submit such
a report annually during the construction period for the Renewal Project so that the City can determine
the share of construction use taxes that it has received as a result of the Renewal Project Each year,
within 60 days of receiving the monitoring report, the City will provide its determination of the amount
of construction use taxes that it has received as a result of the Renewal Project during the preceding
calendar year. In August 2026, the SUMC and the City will conduct a reconciliation process to confirm that
the City has received at least $8.1 million in construction use taxes as a result of the Project, as further
described in Development Agreement Section 5(b)(ii).
To date, SUMC has taken the fo llowing steps to maximize the City's allocation of sa les and use taxes
associated with Project construction and operation. Documentation of each of these items is included in
the 2014 construction use tax monitoring report already submitted.
8
·The SUMC Parties have obtained all permits and licenses necessary to maximize the City's allocation
of construction use taxes derived from the project, including California Seller's Permits and Use Tax
Direct Pay Permits. Copies of permits and licenses are attached to the 2014 monitoring report.
• SUMC has designated and required all contractors and subcontractors to designate the project site as
the place of sale of all fixtures furnished or installed as part of the project
• SUMC has designated and required all contractors and subcontractors to designate the project site as
the place of use of all materials used in the co nstruction of the project
• SUMC has required all contractors and subcontractors to allocate the loca l sales and use taxes
derived from their contracts directly to the city. SUMC has used best efforts to require contractors and
subcontractors to complete and file any forms required by the State Board of Equalization to effect
these designations.
• Both Hospitals have obtained use tax direct pay permits from the State of California for their existing
facilities in order to increase the City tax allocation for the Hospitals' purchases. The Hospitals will
maintain the use tax direct pay permit for the life of the project
• Finally, SUMC has assisted the City in establishing and administering a Retail Sales and Use Tax
Reporting District for the Renewal Project, to enable the City to track the generation, allocation,
reporting and payment of sales and use taxes derived from the Project
ANNUAL REPORT 2014-15
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COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
Section 5(b)(iii). Funding of Operating Deficit
In order to assure that City costs associated with the Renewal Project do not exceed revenues to the City
resulting from construction and operation of the project, SUMC has provided to the City a single lump
sum payment in the amount of $2,4 17,000. This payment was made on August 25, 2011 . No further
action is required by the SUMC to comply with this Development Agreement provision .
Section 5(b)(iv). Payment of Utility User Tax
SUMC will pay the City a utility user tax at a minimum rate of 5 percent of all electricity, gas, and water
charges allocable to new construction completed as part of the project for the life of the project This rate
may be increased by the City as provided by Section 2.35 .1 OO(b) of the Municipal Code. The 5 percent
utility user tax is currently being paid by SUMC.
Section 5(b)(v). School Fees
SUMC will pay to the City-who is then to forward to the Palo Alto Unified School District-school fees
upon issuance of each building permit from the City or OSHPD, in the amount that is generally applicable
to non-residential development at the time of payment based upon net new square footage, as defined in
the Development Ag reement
School fees were paid in 2012 for LPCH and SHC in the amounts of $188,815 and $153,802,
respectively. In July 2013, additional school fees were paid in the amount of $7,051 to account for
additional program square footage for the New Stanford Hospital and Garage. In May 2014, an additional
payment of school fees in the amount of $16,119 was made to account for the incremental square
footage associated with the Hoover Medical Office Building, beyond the 60 ,000 square feet originally
planned.
ANNUAL REPORT 2014-15 9
COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
TRAFFIC MITIGATION AND REDUCED VEHICLE TRIPS
SUMC has taken a number of steps to mitigate the potential traffic impacts projected at full project
buildout Already, SUMC provides a robust transportation demand management program, offering a
variety of incentives for employees to forego driving alone to work. As the Renewal Project moves
forward, SUMC wi ll take the following actions outlined below.
Section 5(c)(ii). Menlo Park Traffic Mitigation
SUMC has agreed to contribute to the City of Menlo Park a total of $3 ,699,000 for use in connection with
traffic mitigation, infrastructure enhancements, and the promotion of sustainable neighborhoods and
communities and affordable housing. This contribution is to be made in three equal payments; the first
payment of $1 ,233,000 was made on August 19, 2011 . The second payment of $1 ,233,000 was made
on December 5, 2012, following the November 2012 issuance of the first Hospital foundation permit The
final payment will be made within 30 days from issuance of the first Hospital occupancy permit
Section 5(c)(iii). East Palo Alto Voluntary Mitigation
SUMC has contributed a single lump sum payment of $200,000 to East Palo Alto to be used for roadway
and traffic signal improvements on University Avenue. This payment was made on August 19, 2011 . No
further action is req uired by the SUMC to comply with this Development Agreement provision. In the
event that the SUMC does not meet alternative transportation mode goals specified in the Development
Agreement by 2025 and is assessed a $4 million payment under Development Agreement section 5(c)(ix)
(B), the City will be required to remit $150,000 of such payment to the City of East Palo Alto.
Section 5(c)(iv). Contributions to AC Transit
The Hospitals have committed to offering the following contributions to AC Transit within 30 days from
issuance of the first Hospital occupancy permit
·The Hospitals will contribute a one-time payment of $250,000 to AC Transit to be used for capital
improvements to the U-Line to increase capacity (Section 5(c)(iv)(A)).
• The Hospitals will offer to make annual payments to AC Transit in a reasonable amount, not to exceed
$50,000, to be used for operating costs of the U-Line to maintain a load factor for bus service to
SUMC of less than 1 (Section 5(c)(iv)(B).
• In order to encourage Hospital employees living in the East Bay to use public transit for their
commute, the Hospitals have committed to using best efforts to lease 75 parking spaces at the
Ardenwood Park and Ride lot, or an equivalent location, at a cost not to exceed $45,000 per year
(Section 5(c)(iv)(C)). No action is required at this time; however, as of May 2014, a 1 00-space park-
and-ride facility on Kaiser Drive at Campus Drive in Fremont (0.9 mile from Ardenwood Park & Ride)
has been under lease for the use of Stanford University and Hospital commuters.
These offers have not yet been made to AC Transit because the first Hospital occupancy permit has not
yet been issued.
10 ANNUAl REPORT 2014-15
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COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
Section 5(c){v). Opticom Payments
Within 30 days from issuance of the first Hospital occupancy permit, the Hospitals will pay $11 ,200 to
the City of Palo Alto to be used for the installation of Opticom traffic control systems at the following
seven intersections El Camino Real/Palm Drive/University Avenue; El Camino Real/Page Mill Road;
Middlefield Road/Lytton Road; Junipero Serra/Page Mill Road ; Junipero Serra/Campus Drive West;
Galvez/Arboretum; and the Alpine/280 Northbound ramp. This payment has yet not been made because
the first Hospital occupancy permit has not yet been issued.
Section 5(c){vi). Caltrain GO Passes
The Development Agreement requires that the hospitals purchase annual Ca ltrain GO Passes for all
existing and new Hospital employees who work more than 20 hours per week at a cost of up to $1 .8
million per year, beginning on September 1, 2015. This obligation is to continue for a period of 51 years.
Hospital management accelerated the purchase of the annual GO Pass for Hospital employees, and
began providing free GO Passes to emp loyees commencing on January 1, 2012 . Further details
regarding the GO Pass purchase can be found in the SUMC Alternative Mode Share report, which was
submitted to the City on May 29 , 2015.
Section 5(c){vii). Marguerite Shuttle Service
The Hospitals will fund the reasonable costs , in an approximate amount of $2 million for the purchase
of additional shuttle vehicles for the Marguerite shuttle service, as and when required to meet increased
demand for shuttle service between the project sites and the Palo Alto lntermodal Transit Station. In
addition, the Hospitals will fund as annual payments the reasonable costs, in an approximate amount
of $450,000 per year, to cover the net increase in operating costs for the Marguerite Shuttle. Demand
for the Marguerite shuttle increased in 2012, and the Hospitals funded the purchase of two additional
shuttles to meet this increased demand.
Section 5(c){viii). Transportation Demand Management Coordinator
The Development Agreement requires that the Hospitals employ an on site qualified Transportation
Demand Management (TOM) Coordinator for SUMC, commencing on September 1, 2015, and continuing
through the life of the Renewal Project
Because the Hospitals accelerated the purchase of the Caltrain GO Pass, the Hospitals also accelerated
the hiring of the TOM Coordinator. This position was fi lled in March 2012, and the TOM Coordinator
has been working to raise awareness among SUMC commuters about alternative transportation options
and commute incentive programs. This individual is also responsible for providing alternative commute
planning assistance and responses to customer inquiries, writing and editing electronic and print
communications, and coordinating and staffing outreach events, such as free transit pass distributions
and employee fairs; and providing alternative transportation information at new employee orientations
when requested.
ANNUAL REPORT 2014-15 11
COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
Section S(c)(ix). Monitoring of TOM Programs
The Hospitals are required to submit annual monitoring reports showing the current number of employees
employed over 20 hours per week; the number of employees using an alternative transportation mode as
documented by a study or survey to be completed by the Hospitals using a method mutually agreeable
to the City, and the efforts used by the Hospitals to attempt to achieve the Alternative Mode Targets
identified in the Development Agreement The Development Agreement specifies payments to be made
in the event that such targets are not met during particular time periods. SUMC submitted its 2015
Alternative Mode Share Report to the City on May 29, 2015; this report shows an alternative mode split of
36.3% for the Hospitals. This mode split exceeds the Alternative Mode Share targets for 2018, 2021 , and
2025.
12 ANNUAL REPORT 2014-15
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COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
LINKAGES
To further encourage use of Caltrain, bus, and other transit services, and to enhance and encourage use
of pedestrian and bicycle connections between SUMC and Palo Alto, SUMC has funded or will fund the
following specific infrastructure improvements
Section 5(d)(i). lntermodal Transit Fund
SUMC has provided to the City one lump sum payment of $2.25 million for improvements to enhance
the pedestrian and bicycle connection from the Palo Alto lntermodal Transit Center to the existing
intersection of El Camino Real and Quarry Road. Up to $2 million of this amount is to be used by the City
for the development of an attractive, landscaped passive park/green space with a clearly marked and
lighted pedestrian pathway, benches, and flower borders. SUMC paid the entire required amount for the
lntermodal Transit Fund on August 25, 2011. No further action is required by the SUMC to comply with this
Development Agreement provision. As required by Development Agreement Section 12(d), the City will
provide yearly Supplements to the Annual Report to provide an accounting of the City's expend itures from
this fund, and the purposes for which the expenditures were used. The City is required to construct the
improvements prior to issuance of the first Hospital Occupancy Permit, currently anticipated to be issued in
Summer 2017 .
Section S(d)(ii). Quarry Road Fund
SUMC has provided to the City one lump sum payment of $400,000 for improvements to and within the
public right-of-way to enhance the pedestrian and bicycle connection from the west side of El Camino
Rea l to Welch Road along Quarry Road, including urban design elements and way finding, wider bicycle
lanes, as necessary, on Quarry Road, enhanced transit nodes for bus and/or shuttle stops, and prominent
bicycle facilities. SUMC paid the entire required amount for the Quarry Road Fund on August 25, 2011 .
No further action is required by the SUMC to comply with this Development Agreement provision. As
required by Development Agreement Section 12(d), the City wi ll provide yearly Supplements to the Annual
Report to provide an accounting of the City's expenditu res from this fund, and the purposes for which the
expenditures were used. The City is required to construct the improvements prior to issuance of the first
Hospital Occupancy Permit, currently anticipated to be issued in Summer 2017.
Section 5(d)(iii). Stanford Barn Connection
SUMC will construct up to $700,000 of improvements to enhance the pedestrian connection between
SUMC and the Stanford Shopping Center from Welch Road to Vineyard Lane, in the area adjacent to
the Stanford Barn. The SUMC is req uired to construct these improvements prior to issuance of the first
Hospital Occupancy permit, currently anticipated to be issued in Summer 201 7. SUMC has developed a
design for the pedestrian connection improvements, is incorporating preliminary City staff comments, and
plans to submit to the City for minor architectural review in late 2015.
ANNUAL REPORT 2014-15 13
COMPLIANCE WITH DEVELOPMENT AGREEMENT OBLIGATIONS
INFRASTRUCTURE, SUSTAINABLE NEIGHBORHOODS AND COMMUNITIES, AND
AFFORDABLE HOUSING
Section 5(e). Infrastructure, Sustainable Neighborhoods and Communities, and Affordable
Housing
SUMC will contribute a total amount of $23.2 million toward City of Palo Alto infrastructure, sustainable
neighborhoods and communities, and affordable housing. The Development Agreement requires this
amount to be contributed in three equal payments. The first payment, in the amount of $7 ,733,333 , was
made on August 25, 2011 ; the second payment of $7,733,333 was made on December 5, 2012, following
the November 2012 issuance of the first Hospital foundation permit; and the final payment is to be
made within 30 days from issuance of the first Hospital occupancy permit As required by Development
Agreement Section 12(d), the City will provide yearly Supplements to the Annual Report to provide an
accounting of the City's expenditures from this fund, and the purposes for which the expenditures were
used.
The City will use $1,720,488 of these funds in the same manner as funds collected under the City 's
housing fee ordinance.
CLIMATE CHANGE
Section 5(f). Climate Change Fund
SUMC wil l contribute a total amount of $12 million toward City projects and programs for a sustainable
community, including programs identified in the City's Climate Action Plan, carbon credits, and
investments in renewable energy and energy conservation . The Development Agreement requires this
amount to be contributed in three equal payments. The first payment, in the amount of $4 million, was
made on August 25, 2011 ; the second payment of $4 million was made on December 5, 2012, following
the November 2012 issuance of the first Hospital foundation permit; and the final payment is to be
made within 30 days from issuance of the first Hospital occupancy permit As required by Development
Agreement Section 12(d), the City wil l provide yearly Supplements to the Annual Report to provide an
accounting of the City's expenditures from this fund, and the purposes for which the expenditures were
used.
SATISFACTION OF CONDITIONS OF APPROVAL
SUMC will satisfy all Conditions of Approval by the dates and within the time periods required by the
project approvals, and has taken several steps in order to ensure that this requirement is met (Section
5(h)). The Conditions of Approval encompass conditions imposed by the Architectural Review Board ,
mitigation measures enumerated in the Mitigation Monitoring and Reporting Program, and conditions
attached to the Conditional Use Permit
In order to implement, monitor, and report on the implementation of this diverse array of conditions,
SUMC , with input from City planning staff, has created two Excel spreadsheet tracking and reporting
tools. These spreadsheets serve as a centralized repository for compliance monitoring information and
documentation , and are updated by the SUMC project teams on a regular basis , and reviewed by the
City.
14 ANNUAL REPORT 2014-15
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CONCLUSION
As the Renewal Project completes its fourth year, SUMC looks forward to continued engagement with the
City of Palo Alto as the project continues to forge ahead.
ANNUAL REPORT 2014-15 15
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Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
υ SUMC Development Agreement Compliance: 2014‐2015
DA Section Description Summary Activity Complies?
Health Care Benefits
5(a)(ii) Fund for Healthcare Services Financial assistance for Palo Alto
residents
Establishment of $3M SUMC
fund Yes
5(a)(iii) Fund for Community Health and
Safety Programs
$4M fund for selected
community health programs for
Palo Alto residents
Payment of $4M on 8/25/11 to
establish City fund Yes
Fiscal Benefits
5(b)(i), (ii) Payment of Sales and Use Taxes Activities to maximize sales and
use taxes paid to the City
General Fund sales and use tax
revenues in calendar year 2013
resulting from construction
related activities were
approximately $413,713 based
on the 2014 City Auditor’s
review of the Construction Sales
& Use Tax Monitoring Report
submitted by SUMC on June 30,
2014.
Ongoing
ATTACHMENT B
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
φ SUMC Development Agreement Compliance: 2014‐2015
DA Section Description Summary Activity Complies?
5(b)(iii) Funding of Operating Deficit $2.417M fund to address long‐
term deficits
Payment of $2.417M on
8/25/11 to establish fund. (B11)
Yes
5(b)(iv) Payment of Utility Users Tax
5% tax on all electricity, gas and
water charges on new
construction.
No new construction
completed; tax is not applicable
at this time.
NA
5(b)(v) School Fees Payment of PAUSD fees for net
new square footage
$342,617 fee paid for LPCH and
NSH expansion in 2012. $7,051
fee paid for NSH and NSH
Garage expansion in July 2013.
$16,119 fee paid for Hoover
Medical Office Building
expansion in May 2014.
Yes
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
χ SUMC Development Agreement Compliance: 2014‐2015
Traffic Mitigation and Reduced Vehicle Trips
DA Section Description Summary Activity Complies?
5(c)(ii) Menlo Park Traffic Mitigation
$3.7M payment for traffic
mitigation, infrastructure,
sustainable neighborhoods,
affordable housing
First of three $1.23M payments
made on 8/19/11. Second
payment of $1.23M made on
12/5/12. Final Payment to be
made within 30 days from
issuance of the first Hospital
Occupancy Permit.
Yes
5(c)(iii) East Palo Alto Voluntary
Mitigation
$200K for Roadway and single
improvements on University
Ave.
$200K payment made on
August 19, 2011. Yes
5(c)(iv) Contributions to AC Transit
U‐line capital improvements,
low load factor ratios, parking
spaces at Ardenwood Park &
Ride
No activity. Payment to be made
within 30 days from issuance of
the first Hospital Occupancy
Permit.
NA
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
ψ SUMC Development Agreement Compliance: 2014‐2015
DA Section Description Summary Activity Complies?
5(c)(v) Opticom Payments
$11,200 payment for Opticom
traffic control system at 7
intersections
No activity. Payment to be made
within 30 days from issuance of
the first Hospital Occupancy
Permit.
NA
5(c)(vi) CalTrain Go Passes
SUMC purchase of passes for all
hospital employees working
>20hrs/week
Go Passes have been purchased
per DA. (January 1, 2012) Yes
5(c)(vii) Marguerite Shuttle Service Purchase of additional shuttles
to meet demand
Purchased additional shuttle
buses for the Marguerite Shuttle
service which now includes five
renewable diesel‐electric hybrid
buses and three all‐electric
buses. Plans to add up to 20
additional all electric buses over
the next two years.
Yes
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
ω SUMC Development Agreement Compliance: 2014‐2015
DA Section Description Summary Activity Complies?
5(c)(viii)
SUMC Transportation Demand
Management (TDM)
Coordinator
SUMC hires coordinator to
promote alternative
transportation options
TDM Coordinator has been
hired. (March 2012) Yes
5(c)(ix) Monitoring of TDM Programs Yearly report regarding
alternative transit mode use
2015 Alternative Mode Share
Report submitted on May 29,
2015 indicates 36.3% of SUMC
employees using alt modes.
Yes
Linkages
5(d)(i) Intermodal Transit Fund
$2.25M payment to improve
pedestrian linkages to PA
Intermodal Transit Center
Payment of $2.25M on 8/25/11
to establish City fund. (C11) Yes
5(d)(ii) Quarry Road Fund
$400K payment to improve
pedestrian linkages along
Quarry Road
Payment of $400K on 8/25/11
to establish City fund. (D11) Yes
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
ϊ SUMC Development Agreement Compliance: 2014‐2015
DA Section Description Summary Activity Complies?
5(d)(iii) Stanford Barn Connection
SUMC budgets up to $700K for
pedestrian connections in the
vicinity of barn
SUMC has developed a design
for the pedestrian connection
improvements, is incorporating
preliminary City staff comments,
and plans to submit to the City
for minor architectural review in
late 2015. SUMC is required to
construct these improvements
prior to issuance of the first
Hospital Occupancy permit
NA
Infrastructure, Sustainable Neighborhoods and Communities, and Affordable Housing
5(e)
Infrastructure, Sustainable
Neighborhoods and
Communities, and Affordable
Housing Fund
$23.2M payment for these uses
First of three $7.3M payments
made on 8/19/11. (E11) Second
payment of $7.3M made on
12/5/12. (E13) Final Payment to
be made within 30 days from
issuance of the first Hospital
Occupancy Permit.
Yes
Table 1: Development Agreement, Section 5 ‐ SUMC Parties’ Promises φτυψ‐υω
ϋ SUMC Development Agreement Compliance: 2014‐2015
Climate Change (F11, F13)
DA Section Description Summary Activity Complies?
5(f) Climate Change Fund
$12M payment for climate
change‐related projects and
programs
First of three $4M payments
made on 8/19/11. (F11) Second
payment of $4M made on
12/5/12. (F13) Final Payment to
be made within 30 days from
issuance of the first Hospital
Occupancy Permit.
Yes
2014‐15 Annual Report Supplement
Prepared by the City of Palo Alto
March 1, 2016
Background and Purpose
On June 6, 2011, the City Council approved Comprehensive Plan amendments, zoning changes, a
conditional use permit, annexation and design applications for the Stanford University Medical Center
Facilities Renewal and Replacement Project (the “Projects”). The Projects include the construction of a
new Stanford Hospital and clinics buildings, an expansion of the Lucile Packard Children’s Hospital,
construction of new School of Medicine buildings, renovation of the existing Hoover Pavilion,
construction of a new medical office building and parking garage at Hoover Pavilion, roadway
improvements along Welch Road and Durand Way, and SUMC design guidelines. A Development
Agreement (the “Agreement”) vesting these approvals was entered into between the SUMC Parties and
the City and was effective on June 6, 2011 and continues for thirty (30) years from the effective date.
The Agreement requires an annual report, prepared by SUMC that outlines the activities of the
preceding year and the efforts to fulfill the obligations of the Agreement.
Per the requirements of sections 12(a) and 12(c) of the Agreement, The City of Palo Alto is to prepare a
supplement to the annual report that contains an accounting of the funds described in the Section 5 of
the Agreement (“SUMC Parties’ Promises”) including the fund balances and expenditures and the
purposes for which the expenditures were used.
This annual report supplement covers the period during the fourth year of the Agreement: June 6, 2015
through June 6, 2015. Accounting for the funds outlined in the attachment extends through the end of
the City’s Fiscal Year 2015, June 30, 2015.
Public Benefit Fund Accounting
Attachment A to this report contains a spreadsheet of the funds received and the use of those funds
pursuant to the Agreement as of June 30, 2015. In summary, SUMC have paid approximately $32.5
million in public benefit fees to the city. The first payment of $20,800,333 on August 11, 2011 was for
the following funds:
Fund for Community Health and Safety, Project Safety Net (Section 5(a)(iii));
Fund for SUMC Project Operating Deficit (Section 5(b)(iii));
ATTACHMENT C
Fund for Pedestrian and Bicycle Connections from Intermodal Transit Center to El Camino
Real/Quarry Road Intersection (Section 5(d)(i));
Fund for Public Right of Way Improvements to Enhance Pedestrian and Bicycle Connections on
Quarry Road (Section 5(d)(ii));
Fund for Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing
(Section 5(e)), and
Fund for Sustainable Programs Benefit (Section 5(f)(i))
An additional $11,733,333 payment was made on December 5, 2012 for the following funds:
•Fund for Infrastructure, Sustainable Neighborhoods and Communities and Affordable Housing
(Section 5(e)), and
•Fund for Sustainable Programs Benefit (Section 5(f)(i))
The specific funding amounts as shown on the spreadsheet are consistent with Section 5 of the
Agreement. These funds have been assigned a unique cost center number for accounting purposes. The
spreadsheet also contains the investment earnings and the earnings allocation to the various cost
centers.
Public Benefit Fund Expenditures
Expenditures during FY 15 through June 30, 2015, as shown on the spreadsheet, were made from the
following funds:
Fund for Community Health and Safety, Project Safety Net: $392,798.21 was utilized for the Project
Safety Net program which is specifically identified in the Agreement as a community health program
that would be an appropriate program for the use of this fund. Funds spent during the reporting
period were mainly allocated to salaries/benefits for Project Safety Net staff and restriction efforts
along the rail corridor, including track security, vegetation removal and the installation of higher
fencing along the eastern side of the corridor.
Fund for Expansion Cost Mitigation and Climate Change & Sustainability: The FY2014 Annual Report
Supplement indicated that $1.2 million was committed for the implementation of the Bicycle &
Pedestrian Transportation Plan under the “Expansion Cost Mitigation” cost center for City Capital
Projects. Upon further review, the $1.2 million committed should be under the “Climate Change
& Sustainability” cost center. The necessary adjustments were made to rectify the accounting
of the funds as shown on the attached spreadsheet.
No other expenditures were made during the reporting period from the other funds as part of the
Agreement.
ATTACHMENT A
City of Palo Alto
Stanford Medical Center Development Agreement (Fund 260)
Jul 2014 ‐ June 2015, Final Balances
Expansion Cost Intermodal Transit Quarry Road Infrastructure & Climate Change Community Total FY 2015 FY 2015
Mitigation Improvements Afford Housing & Sustainability Health & Safety Actuals Budget
cost centers 26000000 60260010 60260020 60260030 60260040 80260010
Beginning Balance 07/01/14 1,402,434.35 2,048,283.44 435,721.64 14,419,214.33 8,447,373.28 4,030,455.70 30,783,482.75
Revenues:
Revenues From Stanford ‐‐‐‐‐‐‐
Transfer from HIL‐Residential ‐‐‐
Interdepartment Service ‐‐‐
Investment Earnings 566,862.00 566,862.00 646,200.00
Allocate to categories (566,862.00) (566,862.00)
Allocated Investment Earnings 3,931.13 39,776.18 8,461.40 280,010.72 164,041.88 70,640.68 566,862.00 ‐
Total Revenues 3,931.13 39,776.18 8,461.40 280,010.72 164,041.88 70,640.68 566,862.00 646,200.00
Expenditures:
Temp Salaries/Benefits (25,806.43) (25,806.43) (29,395.70)
Contract Services (356,910.01) (356,910.01) (392,373.12)
Other expenses (10,081.77) (10,081.77) (15,000.00)
Transfer to Capital Projects (1,200,000.00) (1,200,000.00) (1,200,000.00)
Total Expenditures (1,200,000.00) ‐‐‐‐(392,798.21) (1,592,798.21) (1,636,768.82)
FY 2015 Revenues less Exp (1,196,068.87) 39,776.18 8,461.40 280,010.72 164,041.88 (322,157.53) (1,025,936.21) (990,568.82)
Net total 6/30/2015, as previously reported 206,365.48 2,088,059.62 444,183.04 14,699,225.06 8,611,415.17 3,708,298.17 29,757,546.54
Adjustments made in FY 2016
Allocated Investment Earnings 77,603.48 (5.49) (1.17) (38.62) (77,629.86) 71.65 ‐
Operating Transfers in FY 2014 1,200,000.00 (1,200,000.00) ‐
Operating Transfers in FY 2015 1,200,000.00 (1,200,000.00) ‐
Adjusted Net total 6/30/2015, as restated 2,683,968.96 2,088,054.14 444,181.87 14,699,186.44 6,133,785.31 3,708,369.82 29,757,546.54
Less: Unrealized Gain/Loss, 6/30/15 (16,055.53) (12,490.76) (2,657.10) (87,930.71) (36,692.38) (22,183.51) (178,010.00)
Reserve for Encumbrances, 6/30/2015 ‐‐‐‐‐(31,090.00) (31,090.00)
Interest Receivable, 6/30/15 (11,788.97) (9,171.50) (1,951.01) (64,564.19) (26,941.82) (16,288.51) (130,706.00)
Net total available 6/30/2015, as restated 2,656,124.45 2,066,391.88 439,573.76 14,546,691.54 6,070,151.11 3,638,807.79 29,417,740.54
Future Revenues from Stanford:
Estimated January 2018‐1st hospital 7,733,333.00 4,000,000.00
occupancy permit