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HomeMy WebLinkAboutStaff Report 7285 City of Palo Alto (ID # 7285) City Council Staff Report Report Type: Action Items Meeting Date: 10/24/2016 City of Palo Alto Page 1 Summary Title: Storm Water Management Fee Protest Hearing Title: PUBLIC HEARING: Proposition 218 Storm Water Management Fee Protest Hearing and Approval of a Resolution Calling a Mail Ballot Election for April 11, 2017 to Submit a Storm Water Management Fee to Owners of Parcels of Real Property Subject to the Fee and a Resolution Amending Utility Rule and Regulation 25 From: City Manager Lead Department: Public Works Recommendation Staff recommends that: 1. Council hold a public hearing and accept written and oral testimony on the matter of the proposed Storm Water Management Fee. At the close of the public testimony portion of the public hearing, the City Clerk will count the written protests received on the matter, and will announce to the Council whether written protests have been received from a majority of owners of parcels subject to the fee. 2. If a majority protest does not exist, Council adopt a resolution calling a mail ballot election for Tuesday, April 11, 2017 to allow owners of parcels subject to the Storm Water Management Fee to vote on whether the fee should be imposed. 3. Council adopt the attached resolution modifying Section 8(C) of Utility Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) to exempt certain developed parcels which do not impact City storm drainage facilities, and to clarify how the fee applies to parcels which only partially drain to the City’s storm drain system. City of Palo Alto Page 2 Background The City’s storm drain capital improvement, maintenance, and water quality protection programs are funded through the Storm Drainage Fund, an enterprise fund established by Council in 1989. Revenue is generated by a Storm Drainage Fee charged to all developed properties in Palo Alto on monthly utility bills. The Storm Drainage Fee is a property-related fee subject to the requirements of Proposition 218, and cannot be increased without the approval of property owners subject to the fee increase in a mail ballot election. In April 2005, Palo Alto property owners, voting in a mail ballot election, approved a measure increasing the Storm Drainage Fee, through June 1, 2017, for a typical single- family residential parcel to $10.00 per month, with provision for annual inflationary increases. Council approved a monthly fee of $13.03 per Equivalent Residential Unit (ERU) for FY 2017. If no action is taken to approve updated fees, the fee structure approved in 2005 will sunset in June 2017, and the fee will revert back to its pre-2005 level of $4.25 per ERU per month. Proposition 218 limits the authority of local governments to impose or increase taxes and property-related assessments, fees, or charges; and imposes procedural rules for the levy of new or increased fees. The provisions of Proposition 218 require that a proposed fee increase must be submitted to property owners for approval or rejection, after proper notice and public hearing. An initial public hearing must be held not less than 45 days after a mailed notice. If written protests are received from a majority of property owners at the hearing, the proposed fee increase cannot be levied. If a majority protest does not occur, the local government may refer the matter to property owners for a vote. Approval is required through a mail ballot election in which a majority of property owners returning ballots agree to any new or increased property-related fees. On August 29, 2016, Council approved a resolution proposing a monthly Storm Water Management Fee of $13.65 per ERU and establishing the procedures and timeline for a protest hearing and mail ballot election for implementation of the Storm Water Management Fee (Attachment A). On September 9, notices were mailed to all property owners subject to the fee. The notices contained information on the public hearing, property-specific information on the amount of the proposed Storm Water Management Fee, a description of how the proceeds from the fee would be spent, and instructions for filing a formal written City of Palo Alto Page 3 protest to the fee (Attachment B). Staff has also developed a web site containing detailed information on the proposed Storm Water Management Fee (www.cityofpaloalto.org/stormwaterfee). Discussion To comply with the provisions of Proposition 218, detailed procedures were adopted by Council for the public hearing and mail ballot election. The protest hearing is the next step in the process. Property owners have the opportunity to appear before Council to register their concerns and submit a written protest against the proposed Storm Water Management Fee. The proceedings will be governed by the following Council-approved guidelines: • Written protests must (i) state that it is a protest against the proposed Storm Water Management Fee; (ii) identify the parcel with respect to which it is made; (iii) identify the owner for whom the written protest is submitted; (iv) include the printed name of the natural person signing the protest (if that person is not himself or herself the owner); and (v) include the original wet signature of the owner or of a person legally authorized to execute documents on behalf of the owner. • No protests received after the close of the public hearing on October 24, 2016 will be accepted. • At the hearing, Council will hear all objections and take and receive documentary evidence pertaining to the proposed Storm Water Management Fee. • At the end of the hearing, Council will determine whether a majority protest has been received. If Council determines, at the close of the public testimony portion of the public hearing, that written protests have been received from property owners representing a majority of the parcels subject to the proposed Storm Water Management Fee, the Mayor shall declare the proceedings closed, and the fee shall not be approved. If Council determines that less than a majority of property owners have submitted written protest, the Council may adopt a resolution calling for the mailing of ballots to eligible property owners (Attachment C). Assuming that Council calls for a mail ballot election, the ballots will be mailed to property owners on February 24, 2017. This represents a slight delay from the City of Palo Alto Page 4 initial schedule proposed in the August 29, 2016 staff report, and would ensure that the voting period is conducted well after the distractions of the general election cycle and the holiday season. Ballots will be accompanied by a notice of election (consisting of a letter from the City Clerk and a description of the proposed fee) (Attachment D) and a postage paid return envelope. Ballots must be received by the City Clerk no later than 5:30 p.m. on April 11, 2017. Ballots received after 5:30 p.m. will not be included in the vote tabulation. The City Clerk will tabulate the ballots in public view in Council Chambers on April 12, 2017. During and after the tabulation, the ballots shall be treated as public records, subject to public disclosure and made available for inspection by any interested person. This treatment of the ballots is specified in the revised mail ballot procedures to be enacted through adoption of the recommended Council resolution. Council will certify the mail-in ballot vote on May 1, 2017. Utility Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) sets forth the manner in which the City’s existing storm drainage fee is charged. An update to Section 8(C) of Rule and Regulation 25 is needed to exempt certain developed parcels which do not impact City storm drainage facilities from the fee, and to clarify how the fee applies to parcels which only partially drain to the City’s storm drain system. This change will not increase the existing storm drainage fee and will have a negligible impact on Storm Drainage Fund revenues since only a small number of parcels are covered by this provision. Staff recommends that Council adopt the attached resolution, which amends Utility Rule and Regulation 25 as described above (Attachment E). Timeline The timeline for the protest hearing and storm drain mail ballot election is presented below. 10/24/16 Protest hearing; adoption of revised Utility Rule and Regulation 25 2/24/17 Ballots mailed; balloting process requires at least 45 days 4/11/17 Ballots due back to City Clerk 5/1/17 Council certification of election results; adoption of Utility Rate Schedule D-1 City of Palo Alto Page 5 6/1/17 Effective date of new Storm Water Management Fee Resource Impact To maintain the self-sufficiency of the Storm Drainage Fund, the City must secure property owner approval of a ballot measure authorizing increased storm drain funding before the 2005 ballot measure sunsets in June 2017. If the Storm Water Management Fee reverts back to its pre-2005 level of $4.25 per month per ERU, it will generate approximately $2.2 million per year. This amount of revenue would not support a minimum level of storm drainage service, which would cost approximately $4.3 million per year. In addition, the pre-2005 level of funding would preclude any further storm drain capital improvement projects. If a new ballot measure is not approved, storm drain system operations would need to be significantly curtailed. If the proposed rate schedule were approved, it would generate the following revenue for storm water management programs and capital improvement projects in FY 2018: Base Component ($7.48/month/ERU): $3.8 million Projects And Infrastructure Component ($6.17/month/ERU): $3.1 million Total Storm Water Management Fee Revenue: $6.9 million Policy Implications Identification of funding for storm drain capital improvements is consistent with Policy N-24 of the Comprehensive Plan, which states that the City should “improve storm drainage performance by constructing new system improvements where necessary and replacing undersized or otherwise inadequate lines with larger lines or parallel lines.” Program N-36 further states that the City should “complete improvements to the storm drainage system consistent with the priorities outlined in the City’s 1993 Storm Drainage Master Plan, provided that an appropriate funding mechanism is identified and approved by the City Council.” Environmental Review Holding a public hearing and calling for a mail ballot election for a proposed Storm Water Management Fee does not meet the definition of a project for the City of Palo Alto Page 6 purposes of the California Environmental Quality Act (CEQA) under Public Resources Code Section 21065 and CEQA Guidelines Section 15378(b)(5), because these are administrative governmental activities which will not cause a direct or indirect physical change in the environment. Thus, no environmental analysis is required at this time. The level of future CEQA review will depend on the scope of the storm drain capital improvement projects that may be funded by the updated Storm Water Management Fee. Courtesy Copies Storm Drain Blue Ribbon Committee Attachments:  Attachment A: Adopted Council Resolution #9624 (PDF)  Attachment B: Storm Water Management Fee Public Notice (PDF)  Attachment C: Resolution calling for Mail Ballot Election for Storm Water Management Fee (PDF)  Attachment D: Storm Water Management Fee Mail Election Ballot (PDF)  Attachment E: Resolution modifying Utility Rule & Regulation 25 (PDF) NF Resolution No. 9624 Resolution of the Council of the City of Palo Alto Proposing a Storm Water Management Fee To Replace The Storm Drainage Fee, Calling A Public Hearing For October 24, 2016 With Respect To Such Fee And Adopting Procedures Relating To The Conduct Of A Protest Hearing And Mail Ballot Election R E C I T A L S A. In 1989, the City established a storm drainage fee to fund costs associated with B. In 1994, the City set the rate of the storm drainage fee at $4.25 per month per C. In 1996, California voters adopted Proposition 218 which, among other things, required voter approval of certain property­related fees. D. In 2005, at a mail ballot election, Palo Alto property owners approved an the increase. E.­year sunset. F. The increase is scheduled to sunset on June 1, 2017. G. The current rate of the storm drainage fee, including the portion of the fee that is set to sunset, is $13.03 per month per ERU. H. The City Council desires to propose that the existing storm drainage fee be I. In order to conduct a fair process that complies with the provisions of Proposition 218, the City Council finds it appropriate to clearly describe the Proposed Fee and the procedure by which the City will conduct any protest hearings and mail ballot elections in connection with the Proposed Fee. NOW, THEREFORE, the City Council does hereby resolve as follows: DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF SECTION 1. The City Council hereby declares that its intent in adopting this resolution is to provide the community with a guide to the protest and mail ballot election process for the Proposed Fee. SECTION 2. The Council sets October 24, 2016, at 6:00 PM at the Council Chambers located at 250 Hamilton Avenue, Palo Alto, CA as the time and place for a public hearing on the Proposed Fe and incorporated herein by reference. SECTION 3 Hearing and Mail Ballot Election in Connection with reference. SECTION 4. Staff is directed to give notice of the October 24, 2016 public hearing in the manner set forth in the Procedures. The public hearing will be conducted as a protest hearing pursuant to the Procedures. SECTION 5. It is the intent of the Council that the $4.25 per month per ERU base storm drainage fee levied since 1994 will continue unless the Proposed Fee is approved. If the Proposed Fee is approved by the property owners at a mail ballot election and imposed by the City Council, the existing base storm drainage fee will not be charged in any month during which the Proposed Fee is effective. SECTION 6. The Council finds that this resolution, calling a public hearing and adopting protest hearing and election procedures is categorically exempt from California Environmental Quality Act review under CEQA Guidelines Section 15061(b)(3), because these actions do not adoption of a funding mechanism for storm water management projects is not a project under government funding mechanisms which do not involve commitment to any specific project which may result in a potentially significant environmental impact. Thus, no environmental analysis is required at this time. Future CEQA review will occur based on the selection of storm / / / / / / / / / / DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF drain capital improvement projects that may be funded by the proposed storm water management fees. INTRODUCED AND PASSED: August 29, 2016 AYES: BERMAN, BURT, DUBOIS, FILSETH, HOLMAN, KNISS, SCHARFF, SCHMID, WOLBACH NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Senior Deputy City Attorney City Manager Director of Public Works Director of Administrative Services DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF DESCRIPTION OF THE PROPOSED STORM WATER MANAGEMENT FEE A. Overview The proposed Storm Water Management Fee would have two components: A Base Component A Projects and Infrastructure Component B. Proposed Rates (Effective June 1, 2017) The Proposed Rate for the Storm Water Management Fee effective June 1, 2017 is: $13.65 per ERU (Equivalent Residential Unit) per month. This is comprised of: Base Component of $7.48 per ERU per month; and Projects and Infrastructure Component of $6.17 per ERU per month C. Inflation Adjustment In order to offset the effects of inflation on labor and material costs, the maximum rate for the Storm Water Management Fee (and each component of the Storm Water Management Fee) will be increased annually each July 1 (beginning July 1, 2018), by the lesser of (i) the percentage change in the Consumer Price Index [CPI] for the San Francisco­Oakland­San Jose CSMA, published by the United States Department of Labor, Bureau of Labor Statistics during the prior calendar year or (ii) 6%. The City Council would have the authority to set the rate for the Storm Water Management Fee (and each component of the Storm Water Management Fee) at any rate that is less than or equal to the inflation adjusted maximum rate. D. Duration 1) Base Component The Base Component would be charged monthly, beginning June 1, 2017, until terminated by the City Council. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF 2) Projects and Infrastructure Component The Projects and Infrastructure Component would be charged monthly, beginning June 1, 2017. Unless further extended by the voters, the Projects and Infrastructure Component would no longer be charged beginning June 1, 2032. E. Method of Collection and Calculated The Storm Water Management Fee would be collected and calculated in the manner set forth in City of Palo Alto Utilities Rule and Regulation No. 25, subject to the exemptions set forth in this Section E. As a general rule, ERU's are assigned to each parcel subject to the fee on the following basis: Single­Family Residential Parcels: Lot Size ERU's <6,000 sq. ft. 0.8 ERU 6,000 ­ 11,000 sq. ft. 1.0 ERU >11,000 sq. ft. 1.4 ERU All Other Improved Parcels: Number of ERU = Impervious Area (Sq. Ft.) / 2,500 Assigned ERU's are rounded to the nearest one­tenth of an ERU. Unimproved parcels are not subject to the Storm Water Management Fee, and the fee will not be charged for developed parcels that (i) have their own maintained storm drainage facility or facilities, and which do not utilize City facilities or (ii) make no substantial contribution of storm or surface water to the City's storm drainage facilities. For a more complete description of the manner of collection and calculation of the Storm Water Management Fee, reference is made City of Palo Alto Utilities Rule and Regulation No. 25. F. Use of Funds Proceeds of the Storm Water Management Fee would be available to the City exclusively to pay for: (A) Improving the quality of storm and surface water; (B) The operation, maintenance, improvement and replacement of existing City storm drainage facilities; and (C) The operation, maintenance, and replacement of future such facilities. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF Permissible uses would include, but not be limited to, Green Storm Water Infrastructure programs (including financial incentives to property owners) intended to reduce the quantity of storm water entering the City's public storm water system or to improve the quality of storm water before it enters that system through measures including, but not limited to, rain gardens, rain barrels/cisterns, green roofs, tree wells, bioretention/infiltration basins and planters, and permeable pavement. G. Oversight provision for proposed fee increase The City Council would appoint an oversight committee to monitor and review expenditures for all storm water funding elements, including, but not limited to, Green Storm Water Infrastructure projects, storm water Capital Improvement Program projects, and Incentive Project funding and ensure that the money raised from the increased storm water management fee is spent in accordance with this resolution. The Committee would be empowered to consider and recommend consolidation of Green Storm Water Infrastructure and Incentive Project funding for particular projects. The City Council may choose to retain the members of the existing Council­appointed Storm Drain Oversight Committee to perform this oversight function. The oversight committee would report its findings to the City Council at least annually. H. Pay­as­you­go funding of capital improvements The storm drain capital improvements to be funded through the proposed Storm Water Management Fee would be paid for on a pay­as­you­go basis, without debt financing. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF EXHIBIT "B" PROCEDURES FOR THE CONDUCT OF PROTEST HEARING AND MAIL BALLOT ELECTION IN CONNECTION WITH PROPOSED STORM WATER MANAGEMENT FEE 2016 The following procedures have been adopted by the City Council of the City of Palo Alto for the purpose of conducting all proceedings required by Article XIIID of the California Constitution for consideration of the proposed Storm Water Management Fee. Where no specific procedures are imposed by Article et seq.), these procedures shall apply. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF Part I Introduction In connection with consideration of its proposed Storm Water Management Fee, the City of Palo Alto will conduct two proceedings: 1. A Protest Hearing. 2. A Mail Ballot Election. A Mail Ballot Election will only be held if (i) the City Council determines that, as of the close of the public input portion of the Protest Hearing, a majority protest does not exist and (ii) the City Council adopts a resolution calling a Mail Ballot Election. All references in this document to the City Clerk shall, to the extent the reference requires that the City Clerk perform a function, be deemed to include any employee of the City who is designated by the City Clerk to perform that function. The term "owner", when used in this document and not otherwise defined, includes any person who qualifies as an owner for purposes of Article XIII D, Section 6 of the California Constitution. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF Part 2 Protest Hearing A. Notice 1. Not less than 45 days prior to the date of the Protest Hearing, Notice of the Protest Hearing shall be mailed to the Record Owner of each parcel to which the Storm Water Management Fee is proposed to apply. 2. The Notice shall include all information required by Article XIII D, Section 6(a)(1) of the California Constitution and such other relevant information as staff may determine to include. 3. For purposes of this Subsection A, "Record Ownership" shall be determined by the name appearing on the last equalized secured property tax assessment roll. Notice shall be mailed to the Record Owner at the mailing address indicated on that roll. B. Protests 1. Written Protests will be accepted by the City Clerk via US Mail or hand delivery at the Office of the City Clerk located at 250 Hamilton Avenue, Palo Alto, CA 94301 during regular business hours. Written Protests will also be accepted by the City Clerk at the Protest Hearing. All Written Protests must be received by the City Clerk prior to the close of the public input portion of the Public Hearing in order to be considered pursuant to these Procedures. 2. A Written Protest must (i) state that it is a protest against the proposed Storm Water Number or Street Address); (iii) identify the owner for whom the Written Protest is submitted; (iii) include the printed name of the natural person signing the Protest (if that person is not himself or herself the owner); and (iv) include the original wet signature of the owner or of a person legally authorized to execute documents on behalf of the owner. 3. If a Parcel served by the City is owned by a partnership, joint tenancy, or tenancy in common, any partner, joint tenant, or tenant in common may submit a Written Protest, but only one Protest will be counted per Parcel and any one Protest submitted in accordance with these rules will be sufficient to count as a Protest for that Parcel. 4. Where an owner of a Parcel is not a natural person, a Written Protest may be submitted by the owner and signed by any person authorized to execute documents on behalf of the owner. 5. In the event a person not shown on the last equalized secured property tax assessment roll assumes (or otherwise has) ownership of a Parcel, that person may submit a Written Protest with respect to that Parcel. Such protest must include all information otherwise required of a Written Protest and must also include either (i) proof of such ownership or (ii) a statement, submitted under penalty of perjury by the person submitting the Written Protest, that the person signing the Protest is an owner of the Parcel or is legally authorized to submit the Protest on behalf of the owner of the Parcel. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF 6. Anyone who submits a Written Protest may withdraw it by submitting to the City Clerk a signed written request that the protest be withdrawn. The request shall contain sufficient information to identify the affected Parcel and the name of the person who submitted both the Protest and the request that it be withdrawn. 7. To ensure transparency and accountability in the fee protest tabulation, Protests shall constitute disclosable public records from and after the time they are received. C. Tabulation 1. The City Clerk or her designee shall determine the validity of all Protests. That person (the alid any Protest if he or she determines that any of the following conditions exist: a. The Written Protest does not identify a Parcel subject to the Storm Water Management Fee. b. The Written Protest does not bear an original wet signature of (i) an owner of the identified Parcel or (ii) a person legally authorized to submit the Written Protest on behalf of the owner. c. The Written Protest does not state its opposition to the proposed fee. d. The Written Protest was not received before the close of the public input portion of the Public Hearing. e. A request to withdraw the Written Protest is received prior to the close of the public input portion of the Public Hearing. 3. final action of the City and shall not be subject to any internal appeal. 4. A majority protest exists if Written Protests are timely submitted and not withdrawn with respect to a majority of the parcels subject to the proposed fee. The City Council may not adopt a resolution calling a Mail Ballot Election if there is a majority protest. 5. At the conclusion of the public hearing, the Tabulator shall complete the tabulation of all Written Protests received, including those received during the Public Hearing and shall report the results of the tabulation to the City Council upon completion. If review of the Written Protests received demonstrates that the number received is manifestly less than one­half of the Parcels served by the City with respect to the fee which is the subject of the protest, then the Tabulator may advise the City Council of the absence of a majority protest without determining the validity of all Written Protests. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF Part 3 Mail Ballot Election A. Mailing of Ballot 1. Not less than 45 days prior to the date of the Mail Ballot Election, Election Materials shall be mailed to the Record Owner of each Parcel to which the Storm Water Management Fee is proposed to apply. 2. Election Materials shall include a Notice, a Ballot, and a Ballot Return Envelope. 3. The Notice shall include: (i) The total amount of the Storm Water Management Fee chargeable to all Parcels in the City that are subject to the Storm Water Management Fee; (ii) The amount chargeable to the owner's particular Parcel; (iii) A description of the inflation adjustment formula applicable to the Storm Water Management Fee; (iv) The duration of the Storm Water Management Fee; (v) The reason for the Storm Water Management Fee and the basis upon which the amount of the proposed fee was calculated; (vi) The date and time by which Ballots must be returned to the City Clerk and the address for return of Ballots; (vii) The date, time and location where Ballots will be tabulated; (viii) A summary of the procedures applicable to the completion, return, and tabulation of the Ballots; (ix) A disclosure that the Fee will only be approved if the number of Ballots cast (and not withdrawn) in favor of the Storm Water Management Fee exceed the number of Ballots cast (and not withdrawn) in opposition to the Storm Water Management Fee; and (x) Such other relevant information as staff may determine to include. 4. The Ballot shall include: (i) The address for return of Ballots; (ii) The name of the Record Owner; (iii) An identification of the Parcel; DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF (iv) A place where the person casting the Ballot may indicate support or opposition to the Storm Water Management Fee; (v) A place where the person submitting the Ballot may print his or her name and execute a statement under penalty of perjury that he or she is an owner of the Parcel identified on the Ballot or is a person legally entitled to submit a Ballot on behalf of an owner; and (vi) Such other relevant information as staff may determine to include. 5. The Ballot Return Envelope shall include prepaid postage and be preaddressed to the Office of the City Clerk. The City Clerk may establish a special Post Office Box address for the return of Ballots. If the City Clerk does so, that address shall be used on the Ballot Return Envelope. In order to ensure Envelope 6. Any information required to be included on the Notice may instead be included on the Ballot. 7. For purposes of this Subsection A, "Record Ownership" shall be determined by the name appearing on the last equalized secured property tax assessment roll. Notice, a Ballot, and a Ballot Return Envelope shall be mailed to the Record Owner at the mailing address indicated on that roll. B. Completion of Ballots 1. Who May Complete a Ballot A Ballot may be completed by an owner of the parcel subject to the fee. If the owner of the Parcel is a partnership, joint tenancy, or tenancy in common, a Ballot may be completed by any of the general partners, joint tenants, or tenants in common. Except as set forth below, only one Ballot may be completed for each Parcel. 2. Proportional Ballots If a Parcel has multiple owners, any owner may request a Proportional Ballot. If the ownership interest of the owner is not shown on the last equalized secured property tax assessment roll, such request must include evidence, satisfactory to the City Clerk, of the owner's Proportional rights in the Parcel. The City Clerk will provide the Proportional Ballot to the owner at the address shown on the assessment roll. Any request for a Ballot to be mailed to another location must be made in writing and must include evidence, satisfactory to the City Clerk, of the identity of the person requesting the Ballot. Each Proportional Ballot will be marked to show the date on which the Ballot was provided, to identify it as a Proportional Ballot and to indicate the owner's Proportional rights in the Parcel. The City Clerk will keep a record of each Proportional Ballot provided to an owner. 3. Duplicate Ballots If a Ballot is lost, withdrawn, destroyed or never received, the City Clerk will mail or otherwise provide a Duplicate Ballot to the owner upon receipt of a request in writing delivered to the City Clerk. The Duplicate Ballot will be marked to show the date on which the Ballot was mailed or provided and to DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF identify it as a Duplicate Ballot or a Duplicate Proportional Ballot. The same procedure applies to Duplicate Ballots or Duplicate Proportional Ballots which are lost, withdrawn, destroyed, or never received. If the ownership interest of the owner requesting the Duplicate Ballot is not shown on the last equalized secured property tax assessment roll (as, for example, when a Parcel has been acquired after the assessment roll is equalized), the Duplicate Ballot request must include evidence, satisfactory to the City owner who has requested the Ballot. The City Clerk will provide the Duplicate Ballot to the owner at the address shown on the assessment roll. Any request for a Ballot to be mailed to another location must be made in writing and must include evidence, satisfactory to the City Clerk, of the identity of the person requesting the Ballot. Each Duplicate Ballot will be marked to show the date on which the Ballot was provided, to identify it as a Duplicate Ballot. The City Clerk will keep a record of each Duplicate Ballot provided to an owner. 4. Provisional Ballot If a person requests a Duplicate Ballot, and that person does not provide the City Clerk with evidence to the City Clerk that is sufficient to demonstrate to the City Clerk that the person is the owner of a Parcel that will be subject to the Storm Water Management Fee, the City Clerk will issue that person a Provisional Ballot. Each Provisional Ballot shall be marked to show the date on which the Ballot was provided, to identify the person to whom it was issued, and to identify the Parcel for which the requesting person claims an ownership interest. The City Clerk will keep a record of each Provisional Ballot provided. 5. Marking and Signing the Ballot To complete a Ballot, the owner of the Parcel must (1) mark the appropriate box supporting or opposing the proposed Storm Water Management Fee, and (2) sign, under penalty of perjury, the statement on the Ballot that the person completing the Ballot is an owner of the Parcel or a person legally authorized to execute documents on behalf of the owner. Ballots must be completed in ink and include the original wet signature of the signer. 6. Only Ballots Provided by the City Will Be Accepted The City Clerk will only accept Ballots mailed or otherwise provided to owners by the City. B. Return of Ballots 1. Where to Return Ballots Ballots may be hand­delivered to the Office of the City Clerk located at 250 Hamilton Avenue, Palo Alto, CA 94301 during the normal business hours of that office. Ballots may also be returned to the Office of the City Clerk by mail. The mailing address for return of Ballots shall be the address printed on the DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF Ballot and Ballot Return Envelope, and may be the usual mailing address of the Office of the City Clerk or a special Post Office Box established for this purpose. 2. When to Return Ballots All returned Ballots must be received by the City Clerk prior to the date and time set by the City Council in the resolution calling the election. The date shall be any Tuesday selected by the City Council (aside from the date of a statewide direct primary election or statewide general election). 3. Withdrawal of Ballots Anyone who submits a Ballot may withdraw it by submitting to the City Clerk a signed written request that the Ballot be withdrawn. The request shall contain sufficient information to identify the affected Parcel and the name of the person who submitted both the Ballot and the request that it be withdrawn. When Ballots are tabulated, the City Clerk will segregate withdrawn Ballots from all other returned Ballots. The City Clerk will retain all withdrawn Ballots and will indicate on the face of such withdrawn Ballots that they have been withdrawn. If any Ballot has been withdrawn, the person withdrawing the Ballot may request a Duplicate Ballot. 4. Changes to Ballots In order to change the contents of a Ballot that has been submitted, the person who has signed that Ballot must (1) request that such Ballot be withdrawn, (2) request that a Duplicate Ballot be issued, and (3) return the Duplicate Ballot fully completed. Each of these steps must be completed according to the procedures set forth above. C. Tabulation of Ballots 1. Which Ballots Will Be Counted? Only Ballots which are completed and returned in compliance with these procedures will be counted. Ballots received by the City Clerk after the close of the deadline for return of Ballots will not be counted. Ballots which are not signed by the owner will not be counted. Ballots with no boxes marked, or with more than one box marked, will not be counted. Ballots withdrawn in accordance with these procedures will not be counted. The City will keep a record of each Proportional, Duplicate, or Provisional Ballot mailed or otherwise provided to an owner and will ensure that only one Ballot is tabulated for the Parcel (or for each owner in the case of Proportional Ballots). Provisional Ballots shall not be counted unless, by the deadline for returning Ballots, the City Clerk has received sufficient evidence of ownership as would have been required for the issuance of a Duplicate Ballot. All Provisional Ballots that have been returned to the City Clerk shall be retained along with other Ballots so returned. 2. When and Where Ballots Will Be Tabulated DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF The City Clerk will count the Ballots in the City Council Chambers at a date and time scheduled for such purpose by the City Clerk. Tabulation will be performed in view of such members of the public who choose to observe such tabulation. Ballots will not be removed from their Return Envelopes until tabulation begins. 3. How Ballots Will Be Tabulated Ballots may be counted by hand, by computer or by any other tabulating device. Each Ballot, other than a Proportional Ballot, will count as one vote. Proportional Ballots will be counted as a fraction of a vote, weighted in accordance with the respective ownership interests of each Proportional Ballot submitted. If one or more Proportional Ballots are returned for a Parcel and a non­ Proportional Ballot is returned for the Parcel, the non­Proportional Ballot will either be disregarded (if the same owner has returned a Proportional Ballot) or treated as a Proportional Ballot (if the same owner has not returned a Proportional Ballot). 4. Who Will Tabulate Ballots? Ballots will be tabulated by the City Clerk or some other impartial person designated by the City Council who does not have a vested interest in the outcome of the Election. The City Clerk or other designated person may be assisted by any of the staff and consultants of the City. 5. Results of Tabulation The property owners will be deemed to have approved the Storm Water Management Fee (including any associated inflation adjustment formula) if the number of votes cast in favor of the Storm Water Management Fee exceeds the number of votes cast in opposition to the Storm Water Management Fee. 6. Announcement of Tabulation The results of the tabulation will be announced at a meeting of the City Council and will be certified by resolution of the City Council. D. Resolution of Disputes In the event a question arises regarding whether the signer of a Ballot (or person on whose behalf a Ballot has been submitted) is an owner of the Parcel to which the Ballot applies, the City Clerk will make such determination from the last equalized secured property tax assessment roll and any evidence of ownership submitted to the City Clerk prior to the closing of the election. The City Clerk will be under no duty to obtain or consider any other evidence as to ownership of property and her determination of ownership will be final and conclusive. In the event a question arises regarding whether the signer of a Ballot is legally entitled to submit a Ballot on behalf of an owner, the City may rely on the statement on the Ballot signed under penalty of perjury and any evidence submitted to the City Clerk prior to the closing of the election. The City Clerk will be under no duty to obtain or consider any other evidence as to whether the signer of the Ballot is an authorized representative of the owner and its determination will be final and conclusive. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NF E. Confidentiality The City considers the vote contained on a Ballot (i.e. whether the box in support is checked or the box in opposition is checked) to be confidential, and will not disclose that fact with respect to any specific voter unless ordered to do so by a court of competent jurisdiction. DocuSign Envelope ID: 58A85B2C-9AB2-4B7F-A5E0-F2A7CEEA12F1 NOTICE OF PUBLIC HEARING  CITY OF PALO ALTO   STORM WATER MANAGEMENT FEE      TO: «Situs_Street_Address»   ASSESSOR’S PARCEL NO.  «Assessors_Parcel_Number»     «Assessee»   «In_Care_of_Name»   «Mailing_Address»   «Mailing_City_and_State» «Mailing_Zip_Code»      FROM:  Beth Minor, City Clerk      Dear Property Owner:    On August 29, 2016, the Palo Alto City Council adopted its Resolution No. 9624.  This  Resolution proposes to replace the City’s existing Storm Drainage Fee with a new Storm Water  Management Fee.      The City Council will hold a public hearing on the proposed fee on October 24, 2016, in  the Council Chambers, City Hall, 250 Hamilton Avenue, Palo Alto, California.  At the hearing, the  City Council will consider the proposed fee and hear all persons interested in the matter.    The October 24, 2016 public hearing will be conducted as a protest hearing pursuant to  the City’s “Procedures for the Conduct of Protest Hearing and Mail Ballot Election in Connection  with Proposed Storm Water Management Fee.”  A copy of these procedures, and of Resolution  No. 9624, can be found online at www.cityofpaloalto.org/sdbrc.    The City will accept written protests against the proposed fee from owners of parcels of  real property subject to the fee.   Written protests may be delivered to the Office of the City  Clerk located at 250 Hamilton Avenue, Palo Alto, CA 94301 via US Mail or hand delivery.   Written protests will also be accepted by the City Clerk at the October 24, 2016 hearing.  Any  written protests must be received by the City Clerk prior to the close of the public input portion  of the October 24, 2016 hearing in order to be considered.    A written protest must (i) state that it is a protest against the proposed Storm Water  Management Fee; (ii) identify the parcel with respect to which the protest is made (either by  Assessor’s Parcel Number or Street Address); (iii) include the printed name of the person  signing the protest; and (iv) include the original wet signature of the person submitting the  protest.        If a parcel is owned by more than a single person, any owner may submit a written  protest. If an owner of a parcel is a corporation, a trust, or is otherwise not a natural person, a  written protest may be submitted by the owner and signed by any person authorized to  execute documents on behalf of the owner.  Property ownership has the same meaning as  under Article XIII D of the California Constitution. This notice has been addressed to the parcel  owner shown on the last equalized secured property tax assessment roll.  In the event a person  not shown on the last equalized secured property tax assessment roll assumes (or otherwise  has) ownership of a parcel, that person may submit a written protest with respect to that  parcel.  Such protest should include all information otherwise required of a written protest and  must also include either proof of such ownership or a statement, submitted under penalty of  perjury by the person submitting the written protest, that the person signing the protest is the  owner of the parcel or (if the owner is not a natural person) is legally entitled to file the protest  for the owner of the parcel.    If the City Clerk receives valid protests with respect to a majority of the parcels subject  to the proposed fee, then the City Council will not continue the fee proceedings.  Otherwise,  the City Council may submit the proposed fee to a property owner mail ballot election.    If ultimately approved by the election, the Storm Water Management Fee would be  collected on monthly City utility bills beginning June 1, 2017, replacing the existing Storm  Drainage Fee.  The current and proposed monthly fee for your property is shown below.    Current Fee Proposed Fee* Property Information    «Current_Fee» «Proposed_Fee» «Situs_Street_Address»  «Assessors_Parcel_Number»       * In order to offset the effects of inflation on labor and material costs, the maximum rate for  the Storm Water Management Fee will be increased annually each July 1 (beginning July 1,  2018), by the lesser of (i) the percentage change in the Consumer Price Index [CPI] for the San  Francisco‐Oakland‐San Jose CSMA, published by the United States Department of Labor,  Bureau of Labor Statistics during the prior calendar year or (ii) 6%.     The City Council would have the authority to set the rate for the Storm Water Management  Fee at any rate that is less than or equal to the inflation adjusted maximum rate.      The following pages of this notice include additional information about the proposed  Storm Water Management Fee.        1  DESCRIPTION OF THE PROPOSED STORM WATER MANAGEMENT FEE    A. Overview  The proposed Storm Water Management Fee of $13.65 per ERU (Equivalent Residential Unit) per month  would replace the existing Storm Drainage Fee of $13.03 per ERU per month.   The Storm Water  Management Fee would have two components:  1) A Base Component of $7.48 per ERU per month (adjusted annually for inflation as discussed  later in this document), which would continue until terminated by the City Council.    2) A Projects and Infrastructure Component of $6.17 per ERU per month (adjusted annually for  inflation as discussed later in this document), which would end after 15 years, on June 1, 2032,  unless extended by the voters.    If approved, the Storm Water Management Fee would go into effect June 1, 2017.   Proceeds of the  Storm Water Management Fee would be available to the City exclusively to pay for:   Improving the quality of storm and surface water;   The operation, maintenance, improvement and replacement of existing City storm drainage  facilities; and   The operation, maintenance, and replacement of future such facilities.    Permissible uses would include, but not be limited to, Green Storm Water Infrastructure programs  (including financial incentives to property owners) intended to reduce the quantity of storm water  entering the City's public storm water system or to improve the quality of storm water before it enters  that system through measures including, but not limited to, rain gardens, rain barrels/cisterns, green  roofs, tree wells, bio‐retention/infiltration basins and planters, and permeable pavement.  B. Background  The Palo Alto City Council established the Storm Drainage Fund and an associated Storm Drainage Fee in  1989 as an independent means to fund municipal storm drain capital improvements, maintenance, and  storm water quality protections programs.  The fee was last authorized in a 2005 property owner  election, and most of the current fee will sunset in June 2017.  Revenue generated by the fee since 2005  has funded seven high‐priority storm drain capital improvement projects as well as ongoing operational  costs.  The new Storm Water Management Fee was recommended to the City Council by an appointed  Blue Ribbon Storm Drain Committee of residents.   Adoption of the proposed new fee will enable the  implementation of additional drainage improvements throughout the City, including compliance with  state permit requirements mandating green storm water infrastructure.  Green storm water  infrastructure reduces runoff, improves storm water quality, and restores the natural water cycle by  collecting and retaining, and/or treating runoff rather than discharging it directly to storm drains.    C. Budget    1. Base Component  Each Year, the Base Component is anticipated to generate approximately $3.8 million (to be adjusted for  inflation in future years).  The Base Component has been calculated based on the City’s anticipated  ongoing costs for the engineering, maintenance, storm water quality protection, operation and  administration of the City’s storm water system, including regulatory permit compliance.    Floodplain Management   $    101,000  Engineering      $    255,000  Storm Water Quality Protection    $ 1,135,000  Storm Drain System Maintenance  $ 1,293,000  Emergency Response    $    119,000  Administrative Support    $ 1,112,000  SUBTOTAL (partially funded by other revenue) $ 4,015,000     2  2. Projects and Infrastructure Component  Each Year, the Projects and Infrastructure Component is anticipated to generate approximately $3.1  million (to be adjusted for inflation in future years).  The Projects and Infrastructure Component has  been calculated based on anticipated 15‐year costs for the Storm Drain Capital Improvement Program  (which includes both major capacity upgrade projects and capital improvement repair and  rehabilitation), Incentive Projects, and Green Storm Water Infrastructure Projects.    Storm Drain Capital Improvements  $ 1,104,000     Debt Service for Past Capital Projects*  $    947,000   Storm Drain System Repairs    $    400,000  Capital Program Engineering Support  $    177,000  Green Storm Water Infrastructure Projects $    375,000  Incentive Projects    $    125,000  SUBTOTAL      $ 3,128.000    * Debt service obligations end in Fiscal Year 2024, after which this budget is available for use for new  capital improvements.     The fifteen‐year budget for major capital improvements was based on the following projects depicted  on the attached exhibit:    a. Loma Verde Avenue (Louis Road to Sterling Canal) storm drain capacity upgrade (Midtown)   $2,200,000  b. Corporation Way/East Bayshore Road Pump Station to Adobe Creek (Baylands) $2,420,000  c. West Bayshore Road to Adobe Creek storm drain capacity upgrade (Palo Verde) $1,390,000  d. West Bayshore Road Pump Station to Adobe Creek (Palo Verde) $1,040,000  e. East Charleston Road to Adobe Creek storm drain capacity upgrade (Charleston Terrace)  $1,300,000  f. East Meadow Circle storm drain connection to Adobe Creek Pump Station (E Meadow  Circle)$360,000  g. East Meadow Drive to Adobe Creek Pump Station storm drain capacity upgrade (Ortega)  $400,000  h. Fabian Way storm drain capacity upgrade (Fabian Way) $580,000  i. Hamilton Avenue (Center Drive to Rhodes Drive) storm drain capacity upgrade (Duveneck‐St  Francis) $3,440,000  j. Louis Road (Embarcadero Road to Seale‐Wooster Canal) storm drain capacity upgrade  (Garland/Midtown) $6,910,000  k. Louis Road (Seale‐Wooster Canal to Matadero Creek) overflow storm drain (Midtown)  $1,560,000  l. Colorado Pump Station integration with Matadero Pump Station (Midtown) $430,000  m. Center Drive storm drain capacity upgrade (Crescent Park) $1,620,000    Project costs were estimated based upon the best information currently available for the purpose of  developing a reasonable and appropriate capital improvement program budget.  Final selection and  sequencing of individual projects is subject to further study and analysis, such as analysis under the  California Environmental Quality Act.     D. Annual Inflation Adjustment  In order to offset the effects of inflation on labor and material costs, the maximum rate for the Storm  Water Management Fee (and each component of the Storm Water Management Fee) will be increased  annually each July 1 (beginning July 1, 2018), by the lesser of (i) the percentage change in the Consumer  Price Index [CPI] for the San Francisco‐Oakland‐San Jose CSMA, published by the United States  Department of Labor, Bureau of Labor Statistics during the prior calendar year or (ii) 6%.       3  The City Council would have the authority to set the rate for the Storm Water Management Fee (and  each component of the Storm Water Management Fee) at any rate that is less than or equal to the  inflation adjusted maximum rate.     E. Method of Collection and Calculated  As a general rule, ERU's are assigned to each parcel subject to the fee on the following basis:    Single‐Family Residential Parcels:        Lot Size    ERU's   <6,000 sq. ft.    0.8 ERU   6,000 ‐ 11,000 sq. ft.  1.0 ERU   >11,000 sq. ft.    1.4 ERU    All Other Improved Parcels:   Number of ERU = Impervious Area (Sq. Ft.) /   2,500.    Assigned ERU's are rounded to the nearest one‐tenth of an ERU.    Fees are generally collected on water bills.  The Storm Water Management Fee would be collected and  calculated in the manner set forth in City of Palo Alto Utilities Rule and Regulation No. 25 (available  online at www.cityofpaloalto.org/sdbrc), subject to the following exemptions:      Unimproved parcels are not subject to the Storm Water Management Fee, and the fee will not be  charged for developed parcels that (i) have their own maintained storm drainage facility or facilities, and  which do not utilize City facilities or (ii) make no substantial contribution of storm or surface water to  the City's storm drainage facilities.    F. Oversight provision for proposed fee increase  The City Council would appoint an oversight committee to monitor and review expenditures for all  storm water funding elements, including, but not limited to, Green Storm Water Infrastructure projects,  storm water Capital Improvement Program projects, and Incentive Project funding and ensure that the  money raised from the increased storm water management fee is spent properly.  The Committee  would be empowered to consider and recommend consolidation of Green Storm Water Infrastructure  and Incentive Project funding for particular projects. The City Council may choose to retain the members  of the existing Council‐appointed Storm Drain Oversight Committee to perform this oversight function.   The oversight committee would report its findings to the City Council at least annually.    G. Pay‐as‐you‐go funding of capital improvements  The storm drain capital improvements to be funded through the proposed Storm Water Management  Fee would be paid for on a pay‐as‐you‐go basis, without debt financing.    H. Additional Information  Should you have any questions about the public hearing, please call or write to:  Beth Minor, City Clerk,  P.O. Box 10250, Palo Alto, CA  94303.  Telephone:  (650) 329‐2571.    For questions about the proposed fee, please call Joe Teresi in the Public Works Engineering Services  Division at (650) 329‐2129 or visit the City’s web site at www.cityofpaloalto.org/sdbrc.  HWY 10 1 W. Bays h o r e R o a d Lom a V e r d e A v e n u e Co l o r a d o A v e n u e Middlefield Road Ore g o n E x p r e s s w a y El Camino Real Ro a d Pa g e M i l l Alma Street Emerson Street Ch a n n i n g A v e n u e Emb a r c a d e r o R o a d 2. CORPORATION WAY ($2.4 MILLION) 9. HAMILTON AVE($3.4 MILLION) 5. EAST CHARLESTON ROAD ($ 1.3 MILLION) 12. COLORADO PUMP STATION ($430 THOUSAND) 6. EAST MEADOW CIRCLE ($360 THOUSAND) 8. FABIAN WAY ($ 580 THOUSAND) 1. LOMA VERDE AVE. ($2.2 MILLION) 7. EAST MEADOW DRIVE ($400 THOUSAND) 13. CENTER DRIVE ($1.6 MILLION) 11. LOUIS ROAD (SEALE - WOOSTER CANAL) ($1.5 MILLION) 3. WEST BAYSHORE ROAD ($1.3 MILLION)10. LOUIS ROAD (EMBARCADERO ROAD - SEALE -WOOSTER) ($6.9 MILLION)4. WEST BAYSHORE ROAD PUMP STATION ($1 MILLION) This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. 0'3000' ProposedStorm DrainCapital Improvements For Storm Water Management Fee CITY O F PALO A L TO IN C O R P O RAT E D C ALIFOR N I A P a l o A l t oT h e C i t y o f A P RIL 1 6 1894 The City of Palo Alto assumes no responsibility for any errors. ©1989 to 2016 City of Palo Alto rhada, 2016-08-17 10:22:25Ballot Measure 2016 (\\cc-maps\gis$\gis\admin\Personal\Storm.mdb) Not Yet Approved 160929 jb 6053836 Resolution No. ______ Resolution of the Council of the City of Palo Alto Calling a Mail Ballot Election in Connection with the City’s Proposed Storm Water Management Fee R E C I T A L S A. On August 29, 2016, by its adoption of its Resolution No. 9624 (the “Resolution of Intention”), the City Council (i) proposed a new Storm Water Management Fee (the “Proposed Fee”) to replace the City’s existing Storm Drainage Fee; (ii) approved the City’s “Procedures for the Conduct of Protest Hearing and Mail Ballot Election in Connection with Proposed Storm Water Management Fee” (the “Procedures”) to govern proceedings for the consideration of the Proposed Fee; and (iii) called a public hearing with respect to the Proposed Fee. B. On September 9, 2016, notice of the Protest Hearing was mailed to record owners in the manner set forth in the Procedures. C. On October 24, 2016, at 6:00 PM, in the Council Chambers located at 250 Hamilton Avenue, Palo Alto, CA, the City Council held the Protest Hearing. At the Protest Hearing all persons had an opportunity to be heard with respect to the Proposed Fees. D. The City Clerk has caused the tabulation pursuant to the Procedures of all written protests against the Proposed Fee. E. A majority protest against the Proposed Fee does not exist. F. The City Council desires to conduct a mail ballot election pursuant to the Procedures and to submit the Proposed Fee to property owners at the mail ballot election. NOW, THEREFORE, the City Council does hereby resolve as follows: SECTION 1. The City Council calls a Mail Ballot Election for Tuesday, April 11, 2017 to submit the Proposed Fee to property owners (the “Mail Ballot Election”). The Mail Ballot Election shall be conducted as set forth in the Procedures. All ballots in the Election must be received by the Office of the City Clerk no later than 5:30 PM on the date of the Election in order to be counted. The Proposed Fee is more completely described in Exhibit “A,” attached hereto and incorporated herein by reference. If the property owners approve the Proposed Fee at the Mail Ballot Election, that shall indicate their approval of this Resolution and authorize the City Council to levy the Proposed Fee at any rate that does not exceed the rate set forth in Exhibit “A”. Not Yet Approved 160929 jb 6053836 SECTION 2. Staff is directed to take all actions necessary for the conduct of the Mail Ballot Election. SECTION 3. It is the intent of the Council that the $4.25 per month per ERU base storm drainage fee levied since 1994 will continue unless the Proposed Fee is approved. If the Proposed Fee is approved by the property owners at the mail ballot election and imposed by the City Council, the existing base storm drainage fee will not be charged in any month during which the Proposed Fee is effective. SECTION 4. In accordance with Section 53755.5 of the Government Code, Section E of Part 3 of the Procedures, attached as Exhibit “B” and incorporated herein by reference, is revised to read “During and after the tabulation, the ballots shall be treated as public records, as defined in Section 6252 of the California Government Code, subject to public disclosure and made available for inspection by any interested person. The ballots shall be preserved for a minimum of two years, after which they may be destroyed as provided in accordance with applicable law.” SECTION 5. The Council finds that this resolution calling a mail ballot election does not meet the definition of a project for the purposes of the California Environmental Quality Act, under Public Resources Code Section 21065 and CEQA Guidelines Section 15378(b)(5), because it is an administrative governmental activity which will not cause a direct or indirect physical change in the environment. The Council’s review and adoption of a funding mechanism for storm water management projects is not a project under CEQA Guidelines Section 15378(b)(4), because a “project” does not include the creation of government funding mechanisms which do not involve commitment to any specific project which may result in a potentially significant environmental impact. Thus, no environmental analysis is required at this time. Future CEQA review will occur based on the selection of storm drain capital improvement projects that may be funded by the proposed storm water management fees. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ____________________________ ____________________________ City Clerk Mayor Not Yet Approved 160929 jb 6053836 APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ Senior Deputy City Attorney City Manager ____________________________ Director of Public Works ____________________________ Director of Administrative Services Not Yet Approved 160929 jb 6053836 EXHIBIT “A” DESCRIPTION OF THE PROPOSED STORM WATER MANAGEMENT FEE A. Overview The proposed Storm Water Management Fee would have two components: A Base Component A Projects and Infrastructure Component B. Proposed Rates (Effective June 1, 2017) The Proposed Rate for the Storm Water Management Fee effective June 1, 2017 is: $13.65 per ERU (Equivalent Residential Unit) per month. This is comprised of: Base Component of $7.48 per ERU per month; and Projects and Infrastructure Component of $6.17 per ERU per month C. Inflation Adjustment In order to offset the effects of inflation on labor and material costs, the maximum rate for the Storm Water Management Fee (and each component of the Storm Water Management Fee) will be increased annually each July 1 (beginning July 1, 2018), by the lesser of (i) the percentage change in the Consumer Price Index [CPI] for the San Francisco-Oakland-San Jose CSMA, published by the United States Department of Labor, Bureau of Labor Statistics during the prior calendar year or (ii) 6%. The City Council would have the authority to set the rate for the Storm Water Management Fee (and each component of the Storm Water Management Fee) at any rate that is less than or equal to the inflation adjusted maximum rate. D. Duration 1) Base Component The Base Component would be charged monthly, beginning June 1, 2017, until terminated by the City Council. Not Yet Approved 160929 jb 6053836 2) Projects and Infrastructure Component The Projects and Infrastructure Component would be charged monthly, beginning June 1, 2017. Unless further extended by the voters, the Projects and Infrastructure Component would no longer be charged beginning June 1, 2032. E. Method of Collection and Calculated The Storm Water Management Fee would be collected and calculated in the manner set forth in City of Palo Alto Utilities Rule and Regulation No. 25, subject to the exemptions set forth in this Section E. As a general rule, ERU's are assigned to each parcel subject to the fee on the following basis: Single-Family Residential Parcels: Lot Size ERU's <6,000 sq. ft. 0.8 ERU 6,000 - 11,000 sq. ft. 1.0 ERU >11,000 sq. ft. 1.4 ERU All Other Improved Parcels: Number of ERU = Impervious Area (Sq. Ft.) / 2,500 Assigned ERU's are rounded to the nearest one-tenth of an ERU. Unimproved parcels are not subject to the Storm Water Management Fee, and the fee will not be charged for developed parcels that (i) have their own maintained storm drainage facility or facilities, and which do not utilize City facilities or (ii) make no substantial contribution of storm or surface water to the City's storm drainage facilities. For a more complete description of the manner of collection and calculation of the Storm Water Management Fee, reference is made City of Palo Alto Utilities Rule and Regulation No. 25. F. Use of Funds Proceeds of the Storm Water Management Fee would be available to the City exclusively to pay for: (A) Improving the quality of storm and surface water; (B) The operation, maintenance, improvement and replacement of existing City storm drainage facilities; and (C) The operation, maintenance, and replacement of future such facilities. Not Yet Approved 160929 jb 6053836 Permissible uses would include, but not be limited to, Green Storm Water Infrastructure programs (including financial incentives to property owners) intended to reduce the quantity of storm water entering the City's public storm water system or to improve the quality of storm water before it enters that system through measures including, but not limited to, rain gardens, rain barrels/cisterns, green roofs, tree wells, bioretention/infiltration basins and planters, and permeable pavement. G. Oversight provision for proposed fee increase The City Council would appoint an oversight committee to monitor and review expenditures for all storm water funding elements, including, but not limited to, Green Storm Water Infrastructure projects, storm water Capital Improvement Program projects, and Incentive Project funding and ensure that the money raised from the increased storm water management fee is spent in accordance with this resolution. The Committee would be empowered to consider and recommend consolidation of Green Storm Water Infrastructure and Incentive Project funding for particular projects. The City Council may choose to retain the members of the existing Council-appointed Storm Drain Oversight Committee to perform this oversight function. The oversight committee would report its findings to the City Council at least annually. H. Pay-as-you-go funding of capital improvements The storm drain capital improvements to be funded through the proposed Storm Water Management Fee would be paid for on a pay-as-you-go basis, without debt financing. 6053814 EXHIBIT "B" PROCEDURES FOR THE CONDUCT OF PROTEST HEARING AND MAIL BALLOT ELECTION IN CONNECTION WITH PROPOSED STORM WATER MANAGEMENT FEE 2016 The following procedures have been adopted by the City Council of the City of Palo Alto for the purpose of conducting all proceedings required by Article XIIID of the California Constitution for consideration of the proposed Storm Water Management Fee. Where no specific procedures are imposed by Article XIIID, or the Proposition 218 Omnibus Implementation Act (Gov’t Code Section 53750 et seq.), these procedures shall apply. 6053814 Part I Introduction In connection with consideration of its proposed Storm Water Management Fee, the City of Palo Alto will conduct two proceedings: 1. A Protest Hearing. 2. A Mail Ballot Election. A Mail Ballot Election will only be held if (i) the City Council determines that, as of the close of the public input portion of the Protest Hearing, a majority protest does not exist and (ii) the City Council adopts a resolution calling a Mail Ballot Election. All references in this document to the City Clerk shall, to the extent the reference requires that the City Clerk perform a function, be deemed to include any employee of the City who is designated by the City Clerk to perform that function. The term "owner", when used in this document and not otherwise defined, includes any person who qualifies as an owner for purposes of Article XIII D, Section 6 of the California Constitution. 6053814 Part 2 Protest Hearing A. Notice 1. Not less than 45 days prior to the date of the Protest Hearing, Notice of the Protest Hearing shall be mailed to the Record Owner of each parcel to which the Storm Water Management Fee is proposed to apply. 2. The Notice shall include all information required by Article XIII D, Section 6(a)(1) of the California Constitution and such other relevant information as staff may determine to include. 3. For purposes of this Subsection A, "Record Ownership" shall be determined by the name appearing on the last equalized secured property tax assessment roll. Notice shall be mailed to the Record Owner at the mailing address indicated on that roll. B. Protests 1. Written Protests will be accepted by the City Clerk via US Mail or hand delivery at the Office of the City Clerk located at 250 Hamilton Avenue, Palo Alto, CA 94301 during regular business hours. Written Protests will also be accepted by the City Clerk at the Protest Hearing. All Written Protests must be received by the City Clerk prior to the close of the public input portion of the Public Hearing in order to be considered pursuant to these Procedures. 2. A Written Protest must (i) state that it is a protest against the proposed Storm Water Management Fee; (ii) identify the parcel with respect to which it is made (either by Assessor’s Parcel Number or Street Address); (iii) identify the owner for whom the Written Protest is submitted; (iii) include the printed name of the natural person signing the Protest (if that person is not himself or herself the owner); and (iv) include the original wet signature of the owner or of a person legally authorized to execute documents on behalf of the owner. 3. If a Parcel served by the City is owned by a partnership, joint tenancy, or tenancy in common, any partner, joint tenant, or tenant in common may submit a Written Protest, but only one Protest will be counted per Parcel and any one Protest submitted in accordance with these rules will be sufficient to count as a Protest for that Parcel. 4. Where an owner of a Parcel is not a natural person, a Written Protest may be submitted by the owner and signed by any person authorized to execute documents on behalf of the owner. 5. In the event a person not shown on the last equalized secured property tax assessment roll assumes (or otherwise has) ownership of a Parcel, that person may submit a Written Protest with respect to that Parcel. Such protest must include all information otherwise required of a Written Protest and must also include either (i) proof of such ownership or (ii) a statement, submitted under 6053814 penalty of perjury by the person submitting the Written Protest, that the person signing the Protest is an owner of the Parcel or is legally authorized to submit the Protest on behalf of the owner of the Parcel. 6. Anyone who submits a Written Protest may withdraw it by submitting to the City Clerk a signed written request that the protest be withdrawn. The request shall contain sufficient information to identify the affected Parcel and the name of the person who submitted both the Protest and the request that it be withdrawn. 7. To ensure transparency and accountability in the fee protest tabulation, Protests shall constitute disclosable public records from and after the time they are received. C. Tabulation 1. The City Clerk or her designee shall determine the validity of all Protests. That person (the “Tabulator”) shall not accept as valid any Protest if he or she determines that any of the following conditions exist: a. The Written Protest does not identify a Parcel subject to the Storm Water Management Fee. b. The Written Protest does not bear an original wet signature of (i) an owner of the identified Parcel or (ii) a person legally authorized to submit the Written Protest on behalf of the owner. c. The Written Protest does not state its opposition to the proposed fee. d. The Written Protest was not received before the close of the public input portion of the Public Hearing. e. A request to withdraw the Written Protest is received prior to the close of the public input portion of the Public Hearing. 3. The Tabulator’s decision that a Written Protest is not valid shall constitute a final action of the City and shall not be subject to any internal appeal. 4. A majority protest exists if Written Protests are timely submitted and not withdrawn with respect to a majority of the parcels subject to the proposed fee. The City Council may not adopt a resolution calling a Mail Ballot Election if there is a majority protest. 5. At the conclusion of the public hearing, the Tabulator shall complete the tabulation of all Written Protests received, including those received during the Public Hearing and shall report the results of the tabulation to the City Council upon completion. If review of the Written Protests received demonstrates that the number received is manifestly less than one-half of the Parcels served by the City with respect to the fee which is the subject of the protest, then the Tabulator may advise the City Council of the absence of a majority protest without determining the validity of all Written Protests. 6053814 Part 3 Mail Ballot Election A. Mailing of Ballot 1. Not less than 45 days prior to the date of the Mail Ballot Election, Election Materials shall be mailed to the Record Owner of each Parcel to which the Storm Water Management Fee is proposed to apply. 2. Election Materials shall include a Notice, a Ballot, and a Ballot Return Envelope. 3. The Notice shall include: (i) The total amount of the Storm Water Management Fee chargeable to all Parcels in the City that are subject to the Storm Water Management Fee; (ii) The amount chargeable to the owner's particular Parcel; (iii) A description of the inflation adjustment formula applicable to the Storm Water Management Fee; (iv) The duration of the Storm Water Management Fee; (v) The reason for the Storm Water Management Fee and the basis upon which the amount of the proposed fee was calculated; (vi) The date and time by which Ballots must be returned to the City Clerk and the address for return of Ballots; (vii) The date, time and location where Ballots will be tabulated; (viii) A summary of the procedures applicable to the completion, return, and tabulation of the Ballots; (ix) A disclosure that the Fee will only be approved if the number of Ballots cast (and not withdrawn) in favor of the Storm Water Management Fee exceed the number of Ballots cast (and not withdrawn) in opposition to the Storm Water Management Fee; and (x) Such other relevant information as staff may determine to include. 4. The Ballot shall include: (i) The address for return of Ballots; (ii) The name of the Record Owner; (iii) An identification of the Parcel; 6053814 (iv) A place where the person casting the Ballot may indicate support or opposition to the Storm Water Management Fee; (v) A place where the person submitting the Ballot may print his or her name and execute a statement under penalty of perjury that he or she is an owner of the Parcel identified on the Ballot or is a person legally entitled to submit a Ballot on behalf of an owner; and (vi) Such other relevant information as staff may determine to include. 5. The Ballot Return Envelope shall include prepaid postage and be preaddressed to the Office of the City Clerk. The City Clerk may establish a special Post Office Box address for the return of Ballots. If the City Clerk does so, that address shall be used on the Ballot Return Envelope. In order to ensure proper handling, the Ballot Return Envelope shall include on its face the words “Ballot Return Envelope—Do Not Open Until Close of [date] Election”. 6. Any information required to be included on the Notice may instead be included on the Ballot. 7. For purposes of this Subsection A, "Record Ownership" shall be determined by the name appearing on the last equalized secured property tax assessment roll. Notice, a Ballot, and a Ballot Return Envelope shall be mailed to the Record Owner at the mailing address indicated on that roll. B. Completion of Ballots 1. Who May Complete a Ballot A Ballot may be completed by an owner of the parcel subject to the fee. If the owner of the Parcel is a partnership, joint tenancy, or tenancy in common, a Ballot may be completed by any of the general partners, joint tenants, or tenants in common. Except as set forth below, only one Ballot may be completed for each Parcel. 2. Proportional Ballots If a Parcel has multiple owners, any owner may request a Proportional Ballot. If the ownership interest of the owner is not shown on the last equalized secured property tax assessment roll, such request must include evidence, satisfactory to the City Clerk, of the owner's Proportional rights in the Parcel. The City Clerk will provide the Proportional Ballot to the owner at the address shown on the assessment roll. Any request for a Ballot to be mailed to another location must be made in writing and must include evidence, satisfactory to the City Clerk, of the identity of the person requesting the Ballot. Each Proportional Ballot will be marked to show the date on which the Ballot was provided, to identify it as a Proportional Ballot and to indicate the owner's Proportional rights in the Parcel. The City Clerk will keep a record of each Proportional Ballot provided to an owner. 3. Duplicate Ballots If a Ballot is lost, withdrawn, destroyed or never received, the City Clerk will mail or otherwise provide a Duplicate Ballot to the owner upon receipt of a request in writing delivered to the City Clerk. The 6053814 Duplicate Ballot will be marked to show the date on which the Ballot was mailed or provided and to identify it as a Duplicate Ballot or a Duplicate Proportional Ballot. The same procedure applies to Duplicate Ballots or Duplicate Proportional Ballots which are lost, withdrawn, destroyed, or never received. If the ownership interest of the owner requesting the Duplicate Ballot is not shown on the last equalized secured property tax assessment roll (as, for example, when a Parcel has been acquired after the assessment roll is equalized), the Duplicate Ballot request must include evidence, satisfactory to the City Clerk, of the person’s rights in the Parcel. In this case, the Duplicate Ballot shall indicate the name of the owner who has requested the Ballot. The City Clerk will provide the Duplicate Ballot to the owner at the address shown on the assessment roll. Any request for a Ballot to be mailed to another location must be made in writing and must include evidence, satisfactory to the City Clerk, of the identity of the person requesting the Ballot. Each Duplicate Ballot will be marked to show the date on which the Ballot was provided, to identify it as a Duplicate Ballot. The City Clerk will keep a record of each Duplicate Ballot provided to an owner. 4. Provisional Ballot If a person requests a Duplicate Ballot, and that person does not provide the City Clerk with evidence to the City Clerk that is sufficient to demonstrate to the City Clerk that the person is the owner of a Parcel that will be subject to the Storm Water Management Fee, the City Clerk will issue that person a Provisional Ballot. Each Provisional Ballot shall be marked to show the date on which the Ballot was provided, to identify the person to whom it was issued, and to identify the Parcel for which the requesting person claims an ownership interest. The City Clerk will keep a record of each Provisional Ballot provided. 5. Marking and Signing the Ballot To complete a Ballot, the owner of the Parcel must (1) mark the appropriate box supporting or opposing the proposed Storm Water Management Fee, and (2) sign, under penalty of perjury, the statement on the Ballot that the person completing the Ballot is an owner of the Parcel or a person legally authorized to execute documents on behalf of the owner. Ballots must be completed in ink and include the original wet signature of the signer. 6. Only Ballots Provided by the City Will Be Accepted The City Clerk will only accept Ballots mailed or otherwise provided to owners by the City. B. Return of Ballots 1. Where to Return Ballots Ballots may be hand-delivered to the Office of the City Clerk located at 250 Hamilton Avenue, Palo Alto, CA 94301 during the normal business hours of that office. Ballots may also be returned to the Office of 6053814 the City Clerk by mail. The mailing address for return of Ballots shall be the address printed on the Ballot and Ballot Return Envelope, and may be the usual mailing address of the Office of the City Clerk or a special Post Office Box established for this purpose. 2. When to Return Ballots All returned Ballots must be received by the City Clerk prior to the date and time set by the City Council in the resolution calling the election. The date shall be any Tuesday selected by the City Council (aside from the date of a statewide direct primary election or statewide general election). 3. Withdrawal of Ballots Anyone who submits a Ballot may withdraw it by submitting to the City Clerk a signed written request that the Ballot be withdrawn. The request shall contain sufficient information to identify the affected Parcel and the name of the person who submitted both the Ballot and the request that it be withdrawn. When Ballots are tabulated, the City Clerk will segregate withdrawn Ballots from all other returned Ballots. The City Clerk will retain all withdrawn Ballots and will indicate on the face of such withdrawn Ballots that they have been withdrawn. If any Ballot has been withdrawn, the person withdrawing the Ballot may request a Duplicate Ballot. 4. Changes to Ballots In order to change the contents of a Ballot that has been submitted, the person who has signed that Ballot must (1) request that such Ballot be withdrawn, (2) request that a Duplicate Ballot be issued, and (3) return the Duplicate Ballot fully completed. Each of these steps must be completed according to the procedures set forth above. C. Tabulation of Ballots 1. Which Ballots Will Be Counted? Only Ballots which are completed and returned in compliance with these procedures will be counted. Ballots received by the City Clerk after the close of the deadline for return of Ballots will not be counted. Ballots which are not signed by the owner will not be counted. Ballots with no boxes marked, or with more than one box marked, will not be counted. Ballots withdrawn in accordance with these procedures will not be counted. The City will keep a record of each Proportional, Duplicate, or Provisional Ballot mailed or otherwise provided to an owner and will ensure that only one Ballot is tabulated for the Parcel (or for each owner in the case of Proportional Ballots). Provisional Ballots shall not be counted unless, by the deadline for returning Ballots, the City Clerk has received sufficient evidence of ownership as would have been required for the issuance of a Duplicate 6053814 Ballot. All Provisional Ballots that have been returned to the City Clerk shall be retained along with other Ballots so returned. 2. When and Where Ballots Will Be Tabulated The City Clerk will count the Ballots in the City Council Chambers at a date and time scheduled for such purpose by the City Clerk. Tabulation will be performed in view of such members of the public who choose to observe such tabulation. Ballots will not be removed from their Return Envelopes until tabulation begins. 3. How Ballots Will Be Tabulated Ballots may be counted by hand, by computer or by any other tabulating device. Each Ballot, other than a Proportional Ballot, will count as one vote. Proportional Ballots will be counted as a fraction of a vote, weighted in accordance with the respective ownership interests of each Proportional Ballot submitted. If one or more Proportional Ballots are returned for a Parcel and a non- Proportional Ballot is returned for the Parcel, the non-Proportional Ballot will either be disregarded (if the same owner has returned a Proportional Ballot) or treated as a Proportional Ballot (if the same owner has not returned a Proportional Ballot). 4. Who Will Tabulate Ballots? Ballots will be tabulated by the City Clerk or some other impartial person designated by the City Council who does not have a vested interest in the outcome of the Election. The City Clerk or other designated person may be assisted by any of the staff and consultants of the City. 5. Results of Tabulation The property owners will be deemed to have approved the Storm Water Management Fee (including any associated inflation adjustment formula) if the number of votes cast in favor of the Storm Water Management Fee exceeds the number of votes cast in opposition to the Storm Water Management Fee. 6. Announcement of Tabulation The results of the tabulation will be announced at a meeting of the City Council and will be certified by resolution of the City Council. D. Resolution of Disputes In the event a question arises regarding whether the signer of a Ballot (or person on whose behalf a Ballot has been submitted) is an owner of the Parcel to which the Ballot applies, the City Clerk will make such determination from the last equalized secured property tax assessment roll and any evidence of ownership submitted to the City Clerk prior to the closing of the election. The City Clerk will be under no duty to obtain or consider any other evidence as to ownership of property and her determination of ownership will be final and conclusive. 6053814 In the event a question arises regarding whether the signer of a Ballot is legally entitled to submit a Ballot on behalf of an owner, the City may rely on the statement on the Ballot signed under penalty of perjury and any evidence submitted to the City Clerk prior to the closing of the election. The City Clerk will be under no duty to obtain or consider any other evidence as to whether the signer of the Ballot is an authorized representative of the owner and its determination will be final and conclusive. E. Confidentiality The City considers the vote contained on a Ballot (i.e. whether the box in support is checked or the box in opposition is checked) to be confidential, and will not disclose that fact with respect to any specific voter unless ordered to do so by a court of competent jurisdiction. During and after the tabulation, the ballots shall be treated as public records, as defined in Section 6252 of the California Government Code, subject to public disclosure and made available for inspection by any interested person. The ballots shall be preserved for a minimum of two years, after which they may be destroyed as provided in accordance with applicable law. February 24, 2017 Dear Property Owner: In September, the City mailed information about a proposed Storm Water Management Fee that would replace the City’s existing Storm Drainage Fee. On October 24, 2016, the City Council held a public hearing regarding the proposed fee. Following the hearing the City Council adopted its Resolution No. _____, which directed that the proposed fee be submitted to property owners at a Mail Ballot Election. Enclosed is your ballot for the Mail Ballot Election. The Mail Ballot election is being conducted pursuant to the City’s “Procedures for the Conduct of Protest Hearing and Mail Ballot Election in Connection with Proposed Storm Water Management Fee.” A copy of these procedures, and of Resolution No. ______, can be found online at www.cityofpaloalto.org/stormwaterfee. The procedures describe how you can withdraw a submitted ballot, or obtain a duplicate, proportional, or provisional ballot. Ballots may be returned to the Office of the City Clerk, located at 250 Hamilton Avenue, Palo Alto, CA during normal business hours. Ballots may also be returned via mail addressed to ______________. In order to be counted, ballots must be received by the Office of the City Clerk no later than 5:30 PM on Tuesday, April 11, 2017. Postmarks do not count. The votes cast as “yes” or “no” will determine the fate of this fee increase. Ballots that are not returned or are returned late cannot be counted, so please return your ballot. The Storm Water Management Fee will only be approved if the number of Ballots cast (and not withdrawn) in favor of the fee exceed the number of Ballots cast (and not withdrawn) in opposition to the fee. Each ballot counts as a single vote. The City Clerk will count the Ballots in the City Council Chambers beginning at 9:00 AM on April 12, 2017. Tabulation will be performed in view of such members of the public who choose to observe such tabulation. Ballots will not be removed from their return envelopes until tabulation begins. As required by state law, during and after tabulation, ballots will be treated as public records. Enclosed is a description of the proposed Storm Water Management Fee. Together with this letter, the description constitutes the notice of the election. If you have any questions about the mail ballot election, need to have a copy of any document described in this letter mailed to you, please call Beth Minor at (650) 329-2571. If you have questions regarding the fee increase, please call _______ in the Public Works Department at (650) __________, or visit the City’s web site at www.cityofpaloalto.org/stormwaterfee. Please Vote! OFFICIAL MAIL BALLOT CITY OF PALO ALTO APRIL 11, 2017 MAIL BALLOT ELECTION PROPOSED STORM WATER MANAGEMENT FEE This Ballot is for the property designated as Assessor’s Parcel Number: <APN> located at :<Situs Address> <Owner> <Mail Address> <Mail City>, <Mail State> <Mail Zip> This is your official ballot for the Tuesday, April 11, 2017 City of Palo Alto Mail Ballot Election. You will receive a separate ballot for each parcel you own that is subject to the fees, and one vote may be cast for each such parcel. To complete your ballot, mark an (X) in the line next to the word “YES” or next to the word “NO” below, sign and date the ballot, and return the entire ballot to the City Clerk’s Office via mail at __(PO BOX ADDRESS, if using)__ or in person at 250 Hamilton Avenue, Palo Alto, CA. If you wrongly mark, tear, or deface this ballot, you may obtain a duplicate ballot by requesting one in writing from the Office of the City Clerk. All ballots must be received by the Office of the City Clerk no later than 5:30 PM on Tuesday, April 11, 2017. Assessor’s Parcel Number: <APN> Proposed Storm Drain Management Fee: $ <Amount> per month This is a monthly fee. The amount shown above is the projected monthly charge for the indicated parcel based on the methodology described in the election notice and in Resolution No. _(Oct. 24 Reso)_. As set forth in the notice and resolution, the proposed fee would be subject to an annual adjustment based on published inflation data, and capped at 6% per year. MARK ONLY ONE OPTION _______ YES -- I support the proposed Storm Drain Management Fee (and associated inflation adjustment) upon my parcel. ‘ _______ NO — I oppose the proposed Storm Drain Management Fee (and associated inflation adjustment) upon my parcel. IMPORTANT: BALLOT MUST BE SIGNED AND DATED BELOW IN ORDER TO BE COUNTED I hereby declare, under penalty of perjury, that I am an owner of the property identified on this ballot or I am legally entitled to submit a ballot on behalf of an owner. Signed ___________________________________________________ Date _______________________ Print Name of Person Signing Ballot: ____________________________ This ballot will be accepted and tabulated pursuant to the City’s “Procedures for the Conduct of Protest Hearing and Mail Ballot Election in Connection with Proposed Storm Water Management Fee.” A copy of these procedures can be found online at www.cityofpaloalto.org/stormwaterfee . Not Yet Approved 160502 jb 6053835 1 Resolution No. ____ Resolution of the Council of the City of Palo Alto Amending Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) R E C I T A L S A. Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) sets forth the manner in which the City’s Storm Drainage Fee is charged. B. On August 29, by its adoption of Resolution 9624, the City Council proposed a new Storm Water Management Fee (the “Proposed Fee”) to replace the City’s existing Storm Drainage Fee, which will also be governed by the provisions of Rule and Regulation 25. C. An update to Section 8(C) of Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) is needed in order to exempt certain developed parcels which do not impact City Storm Drainage Facilities from the City’s Storm Drainage Fee, and to clarify how the Storm Drainage Fee applies to parcels which only partially drain into the City’s Storm Drainage Facilities. D. Pursuant to Chapter 12.20.010 of the Palo Alto Municipal Code, the Council of the City of Palo Alto may by resolution adopt rules and regulations governing utility services, fees and charges. The Council of the City of Palo Alto hereby RESOLVES as follows: SECTION 1. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 25, as amended, shall become effective November 1, 2016. SECTION 2. This Resolution is not intended to increase the rate of the City’s existing Storm Drainage Fee. In the unintended event this Resolution would cause the Storm Drainage Fee to increase (as that term is defined in Government Code Section 53750(h)(1)), it is the intent of the City Council that the charge for that parcel continue to be calculated as if this Resolution had not been adopted. The reservation set forth in this Section does not apply to the Proposed Fee or to any fee that is approved in a mail ballot election conducted subsequent to the approval of this Resolution. SECTION 3. The adoption of this resolution amending Utility Rules and Regulations does not meet the definition of a project for the purposes of the California Environmental Not Yet Approved 160502 jb 6053835 2 Quality Act, under Public Resources Code Section 21065 and CEQA Guidelines Section 15378(b)(5), because it is an administrative governmental activity which will not cause a direct or indirect physical change in the environment. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ___________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ Senior Deputy City Attorney City Manager ___________________________ Director of Utilities ___________________________ Director of Administrative Services SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 1 A. GENERAL For the purpose of City of Palo Alto Rate Schedule D-1 and this Rule and Regulation, the following words and terms shall be defined as follows, unless the context in which they are used clearly indicates otherwise. The definitions of words and terms set forth in Titles 12 and 13 of the Palo Alto Municipal Code shall also apply herein to the extent that they are not inconsistent herewith: 1. “Developed Parcel” shall mean any lot or parcel of land altered from its natural state by the construction, creation, or addition of impervious area, except public streets and highways. 2. “Equivalent Residential Unit (ERU)” shall mean the basic unit for the computation of storm drainage fees. The ERU’s for all parcels other than single-family residential properties shall be computed to the nearest 1/10 ERU using the following formula: Number of ERU = Impervious Area (Sq. Ft.) 2,500 Sq. Ft. The ERU's for single-family Residential properties shall be computed as set forth in CPAU Rate Schedule D-1. 3. “Impervious Area” shall mean any part of any developed parcel of land that has been modified by the action of Persons to reduce the land’s natural ability to absorb and hold rainfall. This includes any hard surface area which either prevents or retards the entry of water into the soil mantle as it entered under natural conditions pre-existent to development, and/or a hard surface area which causes water to run off the surface in greater quantities or at an increased rate of flow from the flow present under natural conditions pre-existent to development. By way of example, common impervious areas include, but are not limited to roof tops, walkways, patios, driveways, parking lots or storage areas, concrete or asphalt paving, gravel roads, or any cleared, graded, paved, graveled, or compacted surface or packed SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 2 earthen materials, or areas covered with structures or other surfaces which similarly impede the natural infiltration of surface water into the soil mantle. 4. “Non-Single-Family Residential Property” shall include all developed parcels zoned or used for multi-family, commercial, industrial, retail, governmental, or other non-single family Residential purposes and shall include all developed parcels in the City of Palo Alto not defined as single-family Residential property herein. 5. “Parcel” shall mean the smallest separately segregated lot, unit or plot of land having an identified owner, boundaries, and surface area which is documented for property tax purposes and given a Tax lot number by the Santa Clara County Assessor. 6. “Primary CPAU Account” shall mean that CPAU Account, as determined below, that will be assessed the storm drainage fee for a given developed parcel: a. If there is only one CPAU Account associated with a developed parcel, then that Account is the Primary CPAU Account. b. If there is more than one CPAU Account associated with a developed parcel, then the Primary CPAU Account shall be the Account listed below, in order of preference: 1. The CPAU Account designated as the “house Account” or, if none or more than one, then; 2. The CPAU Account in the name of the owner of the parcel, or if none, then; 3. The CPAU Account(s) in the name of the occupier(s) of the parcel. 4. If more than one Account, then the CPAU Account that includes the most CPAU Services. 7. “Single-Family Residential Property” shall include all developed parcels with either one or two single-family detached housing units or one two-unit attached dwelling structure commonly known as a “duplex.” SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 3 8. “Storm and Surface Water Control Facilities” shall mean all man-made structures or natural water course facility improvements, developments, properties or interest therein, made, constructed or acquired for the conveyance of Storm or Surface Water Runoff for the purpose of improving the quality of, controlling, or protecting life or property from any storm, flood, or surplus waters. 9. “Storm Drainage Facilities” shall mean the storm and surface water drainage systems comprised of storm and surface water control facilities and any other natural features which store, control, treat and/or convey storm and surface water. Storm Drainage Facilities shall include all natural and man-made elements used to convey storm water from the first point of impact with the surface of the earth to the suitable receiving body of water or location internal or external to the boundaries of the City of Palo Alto. Such facilities include all pipes, appurtenant features, culverts, streets, curbs, gutters, pumping stations, channels, streams, ditches, wetlands, detention/retention basins, ponds, and other storm water conveyance and treatment facilities whether public or private. See CPAU Rule and Regulation No. 8 “Access to Premises.” 10. “Storm and Surface Water” shall mean water occurring on the surface of the land, from natural causes such as rainfall, whether falling or flowing onto the land in question. 11. “Undeveloped Parcel” shall mean any parcel which has not been altered from its natural state by the construction, creation, or addition of impervious area. B. STORM DRAINAGE FEES 1. There is hereby imposed on each and every developed parcel of land within the City of Palo Alto, and the owners and occupiers thereof, jointly and severally, a Storm Drainage fee. This fee is deemed reasonable and is necessary to pay for: a. Improving the quality of storm and surface water; b. The operation, maintenance, improvement and replacement of the existing City storm drainage facilities; and c. The operation, maintenance, and replacement of future such facilities. SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 4 It is the intent of the City of Palo Alto, and the City has calculated the storm drainage fee in such a manner, that the amount of the fee imposed upon any parcel shall not exceed the proportional cost of the service attributable to the parcel. It is the further intent of the City that revenues derived from the fee shall not exceed the funds required to provide the property-related Services described in this Rule and Regulation 25, and that revenues derived from the fee shall not be used for any purpose other than those described in this Rule and Regulation 25. 2. All of the proceeds of these fees are deemed to be in payment for use of City storm drainage facilities by the developed parcel on, and with respect to, which the fee is imposed, and the owners and/or occupiers thereof. 3. The storm drainage fee shall be payable monthly and shall be paid to CPAU, as billed by CPAU, for each and every developed parcel in the City by the owner or occupier responsible for the Primary CPAU Account for other CPAU Services for the subject parcel, unless otherwise agreed in writing by CPAU. The method of billing described in this Rule and Regulation 25 has been designed for administrative efficiency. However, because the storm drainage fee is a "property-related fee" as defined by Article XIIID, Section 6 of the California Constitution, a property owner may in writing request that the storm drainage fee for a parcel owned by the property owner be billed directly to the owner, notwithstanding the typical method of billing. Because the storm drainage fee is a "property-related fee," the parcel owner shall be responsible to pay all unpaid or delinquent storm drainage fees. For administrative efficiency, the storm drainage fee for condominium and townhouse- style developments is typically billed to the CPAU Account of the Homeowners' Association. 4. If a developed parcel does not have a CPAU Account on the effective date of this Rule and Regulation, a new Account shall be established for that parcel and billed to the owner as shown on the latest County Assessor's property Tax rolls until such time as a Primary CPAU Account is established for other CPAU Services. 5. When an undeveloped parcel is developed, a new Account shall be established and billed to the owner of that parcel as shown on the latest property Tax rolls of the Santa Clara SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 5 County Assessor until such time as a Primary CPAU Account is established for other CPAU Services. 6. BASIS FOR CALCULATION a. The storm drainage fee shall be based on the relative contribution of Storm and Surface Water from a given developed parcel to City storm drainage facilities. b. The relative contribution of Storm and Surface Water from each developed parcel shall be based on the amount of impervious area on that parcel and shall determine that parcel’s storm drainage fee. c. For administrative efficiency, the impervious area of condominium and townhouse-style developments is typically calculated for the entire development rather than on a per-parcel basis. d. The extent of impervious area will be established to the nearest square foot by any of the following methods: 1. Computation of the impervious area using on-site measurements of the apparent outside boundaries of the impervious area in or on such developed parcels made by CPAU or on its behalf; or 2. Computation of the impervious area using the dimensions of the impervious area in or on the developed parcels which are set forth and contained in the records of the office of the County Assessor. 3. Estimation, calculation and computation of the impervious area using aerial photography or photogrammetry, or using the information and data from on-site measurements of like or similar property or features or as contained in City or County records. 4. Computation of the impervious area using information submitted by building permit Applicants on forms provided by the City, subject to review and correction by the City. SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 6 7. CALCULATION OF MONTHLY FEE Monthly fees for all developed parcels shall be computed in accordance with the following formula: Number of ERU’s x Rate per ERU as set forth in CPAU Rate Schedule D-1. 8. APPLICATION a. Developed Parcels: Storm drainage fees shall apply to all developed parcels within the City, including those classified as non-profit or tax-exempt for ad valorem Tax purposes. The fees shall apply to all government properties, to the full extent permitted by the constitutions of the United States and the State of California, including developed parcels of the City of Palo Alto, City-owned buildings and parks, but excluding public streets and highways. b. Undeveloped Parcels: Storm drainage fees shall not be levied against undeveloped parcels that have not been altered from their natural state as defined herein under “Impervious Areas.” c. Proportional Reduction of FeesParcels That Do Not Use The City’s Storm Drainage Facilities: Developed parcels that (i) have their own maintained storm drainage facility or facilities, and which do not utilize City Storm Drainage Ffacilities or (ii) which make no substantial contribution of Storm or Surface Water to the City’s Storm Drainage Ffacilities shall be liable to pay only that portion of the storm drainage fee attributable to the generic discharge of storm runoff (e.g. coordination with the Santa Clara Valley Water District on regional flood control projects, administration of the City's flood hazard regulations, and implementation of the urban runoff pollution prevention program) and shall not be liable to pay for the portion of the fee attributable to the actual usage of (i.e. drainage into) the City's Storm Drain system (e.g. Storm Drain system capital improvements and maintenance) exempt from the fee. Developed parcels that have a portion of their impervious area within City of Palo Alto shall be cCharged only for that portion of impervious area which is in the City of Palo Alto. SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Sheet No. 7 Developed parcels that drain totally or partially into an area outside the City of Palo Alto shall be charged only for that portion of impervious area that drains into the City of Palo Alto or City Storm Drainage Facilities.liable to pay only that portion of the storm drainage fee attributable to the generic discharge of storm runoff (e.g. coordination with the Santa Clara Valley Water District on regional flood control projects, administration of the City's flood hazard regulations, and implementation of the urban runoff pollution prevention program) and shall not be liable to pay for the portion of the fee attributable to the actual usage of (i.e. drainage into) the City's Storm Drain system (e.g. Storm Drain system capital improvements and maintenance). The City of Palo Alto has calculated the storm drainage fee for each parcel based on information available to the Public Works Department as to the amount of impervious area for the parcel, as well as other relevant information regarding the parcel. However, it is the intent of the City of Palo Alto that no fee shall exceed the proportional cost of Services attributable to the parcel. Therefore, a parcel owner has the right, through Administrative Review, to request a proportional reduction in the storm drainage fee if the owner believes that the parcel contributes less water to the City's Sstorm Ddrainage Ffacilities or uses fewer storm or surface water treatment Services, notwithstanding the amount of the parcel's impervious area. 9. ADMINISTRATIVE REVIEW a. Any Person who owns or pays the storm drainage fee for a developed parcel and who disputes the amount of any storm drainage fee for the parcel, or who requests a deferred payment schedule therefor may request a revision or modification of such fee from the City Engineer. b. The Person seeking Administrative Review shall make such request in writing pursuant to Rule and Regulation 11 Section H. The request for Administrative Review must be signed by the property owner. The City Engineer shall conduct the review. c. The City Engineer shall review the request and all data and documentation deemed by the City Engineer to be relevant to the request, and shall make a written determination as to whether the fee for the parcel exceeds the proportional SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES RULES AND REGULATIONS Issued by the City Council Effective 6-1-201011-1-2016 Original Sheet No. 8 cost of the service attributable to the parcel. If the City Engineer determines that the fee is proportional to the cost of service, no adjustment shall be made. If the City Engineer determines that the fee exceeds the proportional cost of service, the fee shall be adjusted accordingly. (END)