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HomeMy WebLinkAbout2016-01-25 City Council Agenda PacketCITY OF PALO ALTO CITY COUNCIL January 25, 2016 Special Meeting Council Chambers 5:00 PM Agenda posted according to PAMC Section 2.04.070. Supporting materials are available in the Council Chambers on the Thursday preceding the meeting. 1 January 25, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. PUBLIC COMMENT Members of the public may speak to agendized items; up to three minutes per speaker, to be determined by the presiding officer. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located on the table at the entrance to the Council Chambers, and deliver it to the City Clerk prior to discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful. TIME ESTIMATES Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public. To ensure participation in a particular item, we suggest arriving at the beginning of the meeting and remaining until the item is called. HEARINGS REQUIRED BY LAW Applicants and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and up to three minutes for concluding remarks after other members of the public have spoken. Call to Order Special Orders of the Day 5:00-5:15 PM 1. Midpeninsula Regional Open Space District Measure A Update Agenda Changes, Additions and Deletions City Manager Comments 5:15-5:25 PM Oral Communications 5:25-5:40 PM Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes. Approval of Minutes 5:40-5:45 PM 2. Approval of Action Minutes for the January 11, 2016 Council Meeting 2 January 25, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Consent Calendar 5:45-5:50 PM Items will be voted on in one motion unless removed from the calendar by three Council Members. 3. Approval and Authorization for the City Manager to Extend the Term of the Construction Inspection Services Contract With Canus Corporation (C13145442) to July 31, 2016 With no Change to the Total Amount 4. Review and Acceptance of Annual Status Report on Development Impact Fees for Fiscal Year 2015 5. Policy and Services Committee Recommendation to Accept the Auditor's Office Quarterly Report as of September 30, 2015 6. Finance Committee Recommendation to Accept Macias Gini & O'Connell's Audit of the City of Palo Alto's Financial Statements as of June 30, 2015, and Management Letter 7. Approval of a Contract With O'Grady Paving Inc. in the Amount of $1,988,344 for the FY 2016 Alma Street and Middlefield Road Paving Project 8. Approval of Amendment Number Two to Contract Number C14149978 With Dyett & Bhatia Urban and Regional Planners in the Amount of $42,000 to Complete/Provide Downtown Cap Study Policy Recommendations and Analyze Scope of Downtown Basement Conversions to Office Space 9. Approval of Amendment Number Three to the Palo Alto-Stanford Fire Protection Agreement With the Board of Trustees of the Leland Stanford Junior University Extending the Term for One Year for a Total Fee of $6.5 Million, and Amendment of the FY 2016 Budget to Reduce the General Fund Budget Stabilization Reserve by $675,000 to Offset a Reduction in FY 2016 Fire Department Revenues (CONTINUED FROM DECEMBER 7 and 14, 2015) 10. Approve and Authorize the City Manager or His Designee to Execute a 25-year Lease Agreement With Annual Lease Payments of $20,000 Between the City and Komuna Palo Alto, LLC Covering Four City- Owned Parking Structures for: (1) Construction and Operation of Solar Photovoltaic Systems, With the Potential to be a Palo Alto Clean Local Energy Accessible Now (CLEAN) Program Participant; and (2) Installation of City-Owned Electric Vehicle Chargers and Infrastructure 11. Policy and Services Committee Recommendation Regarding 2016 City Council Priority Setting and Annual Retreat 3 January 25, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. 12.SECOND READING: Adoption of an Ordinance Amending Chapter 9.14 (Smoking and Tobacco Regulations) of the Palo Alto Municipal Code to Include E-Cigarettes, Change Signage Language, and Include Additional Enforcement Options (FIRST READING: January 11, 2016 PASSED: 9-0) 13.SECOND READING: Adoption of an Ordinance Amending Title 5 (Health and Sanitation) and Title 18 (Zoning) of the Palo Alto Municipal Code to Require all Businesses to Subscribe to Recycling and Compost Services and Comply With Refuse Sorting Requirements (FIRST READING: January 11, 2016 PASSED: 9-0) 14.Approval of Agreement With Empowerment Institute on Cool Block Small Pilot Program 15.Review and Approval of a Draft Process Letter From the City of Palo Alto to the California High Speed Rail Authority and Caltrain Study Session 5:50-6:20 PM 16.Study Session With Stefan Heck Regarding Innovation, Energy, and Transportation Issues 6:20-8:20 PM 17.Study Session Regarding Ongoing Preparation of a Sustainability/ Climate Action Plan (S/CAP) to Update and Replace the City's 2007 Climate Protection Plan 8:20-9:45 PM 18.Study Session on the Parks, Trails, Natural Open Space and Recreation Master Plan 9:45-10:30 PM 19.FY 2015 Performance Report, the National Citizen Survey™, and Citizen Centric Report Inter-Governmental Legislative Affairs Council Member Questions, Comments and Announcements Members of the public may not speak to the item(s) Adjournment AMERICANS WITH DISABILITY ACT (ADA) Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance. 4 January 25, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Additional Information Standing Committee Meetings Council Rail Committee Meeting January 27, 2016 Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Informational Report Update on Progress Towards Building a Second Electric Transmission Interconnection Between the City, Stanford National Accelerator Laboratory and Stanford University Update on Plan Bay Area 2040: 2016 Scenario Planning and Timeline Annual Review of the City’s Renewable Procurement Plan, Renewable Portfolio Standard Compliance, and Carbon Neutral Electric Supplies Public Letters to Council Set 1 CITY OF PALO ALTO OFFICE OF THE CITY CLERK January 25, 2016 The Honorable City Council Palo Alto, California Approval of Action Minutes for the January 11, 2016 Council Meeting Staff is requesting Council review and approve the attached Action Minutes. ATTACHMENTS:  Attachment A: 01-11-16 DRAFT Action Minutes (DOC) Department Head: Beth Minor, City Clerk Page 2 CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 9 Regular Meeting January 11, 2016 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:02 P.M. Present: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach arrived at 6:04 P.M. Absent: Closed Session 1. EXISTING LITIGATION – 3 MATTERS Authority: Govt. Code 54956.9(d)(1) Wells Fargo Bank v. City of Palo Alto, et al., Santa Clara County Superior Court, Case No. 1-13-CV-238764 Monroe Place v. City of Palo Alto, Santa Clara County Superior Court, Case No. 1-14-CV-259305 Petition Requesting State Water Resources Control Board Review of Region 2’s Re-Issuance of Municipal Regional Permit Regulating Stormwater Run-off (NPDES No. CAS612008). MOTION: Council Member Kniss moved, seconded by Vice Mayor Scharff to go into Closed Session. MOTION PASSED: 8-0 Wolbach absent Council went into Closed Session at 6:04 P.M. Council returned from Closed Session at 7:07 P.M. Mayor Burt advised the Council voted unanimously to authorize a settlement in the matter of Wells Fargo Bank v. City of Palo Alto, et al., Case No. 1-13- CV-23-8764, existing litigation in Santa Clara County Superior Court. The DRAFT ACTION MINUTES Page 2 of 9 City Council Meeting Draft Action Minutes: 1/11/16 matter settled for $190,000 and the return of a condominium located at 4250 El Camino Real, Unit A310 to the City’s affordable housing inventory; The Council voted unanimously to authorize a settlement in the matter of Monroe Place v. City of Palo, Case No. 1-14-CV-259305, existing litigation in Santa Clara County Superior Court. The matter settled for a recovery to the City of $2,801,474 and 7.5 percent of the final sale price of three unsold units to be paid to the Residential Housing In Lieu Fund; and The Council voted unanimously to ratify the filing of the Water Quality Petition filed by the Santa Clara Valley Urban Run-off Pollution Prevention Program on behalf of the City. The Petition requests the California Regional Water Quality Control Board review Region 2’s (San Francisco Bay Region) issuance of Municipal Regional Stormwater (National Pollutant Discharge Elimination System) NPDES Permit CAS612008. Special Orders of the Day 2. City of Palo Alto Certified as a Storm Ready Community. Agenda Changes, Additions and Deletions None. Minutes Approval 3. Approval of Action Minutes for the December 7, 9, and 14, 2015 Council Meetings. MOTION: Vice Mayor Scharff moved, seconded by Council Member Berman to approve the Action Minutes for the December 7, 9, and 14, 2015 Council Meetings. MOTION PASSED: 9-0 Consent Calendar MOTION: Vice Mayor Scharff moved, seconded by Council Member Kniss to approve Agenda Item Numbers 4-19, including in Agenda Item Number 15- SECOND READING: Approval of Planning Codes Update… removing “and DRAFT ACTION MINUTES Page 3 of 9 City Council Meeting Draft Action Minutes: 1/11/16 approval” before “by the Architectural Review Board” in Municipal Code Section 18.16.060 (b)(9)(1). Council Member Schmid registered a no vote on Agenda Item Number 14- Approval of a Contract for the Downtown Paid… 4. Finance Committee Recommendation to Council to Continue the PV Partners Program Until the State Legislative Requirements set Forth in the California Million Solar Roof Bill Have Been Fulfilled. 5. Finance Committee Recommendation That the City Council Approve Design Guidelines for the Net Energy Metering Successor Program. 6. Approval of a Purchase Order With American Truck & Trailer Body (AT&TB) in an Amount not to Exceed $687,638 for the Purchase of Three 2016 Peterbilt 337 Extended Cab Chassis Including AT&TB Maintenance, Construction Service Body and Approve Budget Amendments in the Water Fund, Gas Fund, Wastewater Fund, and Vehicle Equipment and Replacement Fund. 7. Approval of a Contract With Siegfried for a Total Amount not to Exceed $92,004 for Design and Construction Support Services for the Quarry Road Improvements and Transit Center Access Project and Approval of a Transfer From the Stanford University Medical Center Fund to the Capital Improvement Fund and Creation of CIP Project PL-16000 to Provide an Appropriation of $92,004 to the Quarry Road Improvements and Transit Center Access Project in the Capital Improvement Program. 8. Approval of Contract Amendment Number 1 to Contract Number C15154454 With Integrated Design 360 for Project Management and Analysis Services Associated With an Electrification Feasibility Study, and Budget Amendment Ordinance 5370 Entitled, “Budget Amendment Ordinance of the Council of the City of Palo Alto in the Amount of $145,000.” 9. Ordinance 5371 Entitled, “Ordinance of the Council of the City of Palo Alto Re-Titling and Amending Municipal Code Chapter 5.30 (Plastic Foam and Non-Recyclable Food Service Containers and Packaging Items) to Prohibit Sale of Non-Recyclable Plastic Foam at Retail Establishments Such as Grocery Stores, Pharmacies, Mail Service DRAFT ACTION MINUTES Page 4 of 9 City Council Meeting Draft Action Minutes: 1/11/16 Stores and Hardware Stores (FIRST READING: December 7, 2015 PASSED: 7-0 Scharff not participating, Burt absent).” 10. Ordinance 5372 Entitled, “Ordinance of the Council of the City of Palo Alto Amending Section 18.08.040 (Zoning Map and District Boundaries) of the Palo Alto Municipal Code to Change the Classification of Certain Properties on Greer Road, Amarillo Avenue, Metro Circle and Moffett Circle, a Portion of That Property Known as Greer Park, Tract Number 796, From R-1 to R-1-S (FIRST READING: November 30, 2015 PASSED: 9-0).” 11. Adoption of the City of Palo Alto Emergency Operations Plan (EOP) and Update of Membership of the Palo Alto/Stanford Citizen Corps Council. 12. Approval of Contract Change Order Number 2 to Contract Number S14151060 in the Amount of $150,000 With Monterey Mechanical Company for On-Call Emergency Construction Services at the WQCP, Capital Improvement Program Project WQ-80021, for a Total Compensation not to Exceed $400,000. 13. Policy and Services Committee Recommendation to Council for Adoption of an Ordinance Amending Chapter 9.14 (Smoking and Tobacco Regulations) of the Palo Alto Municipal Code to Include E-Cigarettes, Change Signage Language, and Include Additional Enforcement Options. 14. Approval of a Contract for the Downtown Paid Parking Study and Downtown Parking Management Evaluation With Dixon Resources for $100,000. 15. Ordinance 5373 Entitled, “Ordinance of the Council of the City of Palo Alto to Amend Land Use Related Portions of Titles 16 and 18 of the Palo Alto Municipal Code. The Affected Chapters of Title 16 Include Title 16 (Building Regulations), Chapters 16.20 (Signs), 16.24 (Fences), and 16.57 (In-Lieu Parking Fees for New Non-Residential Development in the Commercial Downtown (CD) Zoning District), and Title 18 (Zoning), Chapters 18.01 (Adoption, Purposes and Enforcement), 18.04 (Definitions), 18.08 (Designation and Establishment of Districts), 18.10 (Low Density Residential RE, R-2 and RMD Districts), 18.12 (R-1, Single Family Residence District), 18.13 (Multiple Family Residential RM-15, RM-30, RM-40 Districts), 18.14 (Below Market Rate Housing Program), 18.15 (Residential DRAFT ACTION MINUTES Page 5 of 9 City Council Meeting Draft Action Minutes: 1/11/16 Density Bonus), 18.16 (Neighborhood, Community, and Service Commercial CN, CC and CS Districts), 18.18 (Downtown Commercial CD Districts), 18.20 (Office, Research and Manufacturing MOR, ROLM, RP and GM Districts), 18.23 (Performance Criteria for Multiple Family, Commercial, Manufacturing and Planned Community Districts), 18.31 (CEQA Review - a new Chapter), 18.34 (PTOD Combining District Regulations), 18.40 (General Standards and Exceptions), 18.52 (Parking and Loading Requirements), 18.70 (Non-conforming Uses and Non-complying Facilities) and 18.77 (Processing of Permits and Approvals).” 16. Ordinance 5374 Entitled, “Ordinance of the Council of the City of Palo Alto Amending the Table of Organization for Fiscal Year 2016 to Incorporate Classification Title and Salary Changing the Name of the Classification From “Traffic Operations Lead” to “Traffic Engineering Lead (FIRST READING: December 14, 2015 PASSED: 9-0).” 17. Ordinance 5375 Entitled, “Ordinance of the Council of the City of Palo Alto Amending Municipal Code Section 2.07.010 to Update Post Government Employment Regulations to Include all City Department Heads (FIRST READING: December 14, 2015 PASSED: 9-0).” 18. Adoption of an Ordinance Amending Title 5 (Health and Sanitation) and Title 18 (Zoning) of the Palo Alto Municipal Code to Require all Businesses to Subscribe to Recycling and Compost Services and Comply With Refuse Sorting Requirements. 19. Resolution 9571 Entitled, “Resolution of the Council of the City of Palo Alto Approving Terms of Agreement With the Palo Alto Police Managers' Association and Amending the Merit System Rules and Regulations to add Chapter 19 (PMA Agreement).” MOTION FOR AGENDA ITEM NUMBERS 4-13, 15-19 PASSED: 9-0 MOTION FOR AGENDA ITEM NUMBER 14 PASSED: 8-1 Schmid no Action Items 20. PUBLIC HEARING: On Objections to Weed Abatement and Resolution 9572 Entitled, “Resolution of the Council of the City of Palo Alto Ordering Weed Nuisance Abated.” DRAFT ACTION MINUTES Page 6 of 9 City Council Meeting Draft Action Minutes: 1/11/16 Public Hearing opened and closed without public comment at 8:11 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Kniss to adopt a Resolution ordering the abatement of weed nuisances in the City of Palo Alto. MOTION PASSED: 7-0 Berman, DuBois not participating 21. PUBLIC HEARING: Approval of a Record of Land Use Action for a Variance to Allow for a Reduction in the Required Front Setback (Contextual) From 37 Feet 1-1/4 Inches to 32 Feet for a new Two- Story Single Family Residence Located at 224 Churchill Avenue. Exempt From California Environmental Quality Act (CEQA). Public Hearing opened at 8:21 P.M. Public Hearing closed at 8:31 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Kniss to adopt the findings and recommendation of the Planning and Transportation Commission to approve a variance for the property at 224 Churchill Avenue as documented in the Record of Land Use Action and direct Staff to include this topic in the annual Code clean-up. MOTION PASSED: 8-1 Filseth no Council took a break from 9:03 P.M. to 9:10 P.M. 22. PUBLIC HEARING: Approval of the Final Environmental Impact Report (FEIR) and Record of Land Use Action to Allow Demolition of Four Existing Structures Totaling 265,895 Square Feet and for Construction of Four Two-Story Office Buildings Totaling 265,895 Square Feet of Floor Area With Below and At-Grade Parking and Other Site Improvements. Zoning District: Research Park (RP) Located at 1050 Page Mill Road. Environmental Assessment: A Final Environmental Impact Report has Been Prepared. Council Member DuBois advised he would not be participating in this Agenda Item due to his wife’s employment at Stanford University. He left the meeting at 9:11 P.M. DRAFT ACTION MINUTES Page 7 of 9 City Council Meeting Draft Action Minutes: 1/11/16 Public Hearing opened at 9:40 P.M. Public Hearing closed at 10:24 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Kniss to: A. Certify the Final Environmental Impact Report and adopt a project specific Mitigation Monitoring and Reporting Program; and B. Adopt a Record of Land Use Action approving the Architectural Review application for four new office buildings at 1050 Page Mill Road; and C. Require landscaping that is predominately indigenous plants providing natural habitat; and D. Provide a landscape reserve South of Building Number 3 sufficient to provide for a future bikeway spine, should a spine project be adopted in the future by Stanford University and the City. Agreement to this condition would be required from the Lessee and Stanford University. MOTION SPLIT FOR THE PURPOSE OF VOTING MOTION1: Vice Mayor Scharff moved, seconded by Council Member Kniss to: A. Certify the Final Environmental Impact Report and adopt a project specific Mitigation Monitoring and Reporting Program. MOTION2: Vice Mayor Scharff moved, seconded by Council Member Kniss to: B. Adopt a Record of Land Use Action approving the Architectural Review application for four new office buildings at 1050 Page Mill Road; and C. Landscaping that is predominately indigenous plants providing natural habitat; and D. Provide a landscape reserve South of Building Number 3 sufficient to provide for a future bikeway spine, should a spine project be adopted DRAFT ACTION MINUTES Page 8 of 9 City Council Meeting Draft Action Minutes: 1/11/16 in the future by Stanford University and the City. Agreement to this condition would be required from the Lessee and Stanford University. INCORPORATED INTO MOTION2 WITH THE CONSENT OF THE MAKER AND SECONDER to remove from the Motion Part D, “agreement to this condition would be required from the Lessee and Stanford University.” INCORPORATED INTO MOTION2 WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion Part D, “pedestrian and” after “for a future.” AMENDMENT TO MOTION2: Council Member Holman moved, seconded by Council Member XX to add to the Motion, “direct Staff to review placing as much HVAC equipment inside the building as possible.” AMENDMENT TO MOTION2 FAILED DUE TO THE LACK OF A SECOND INCORPORATED INTO MOTION2 WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “direct applicant to work with Staff to further consider ways to reduce noise impact.” (new Part E) INCORPORATED INTO MOTION2 WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “add the Environmental Impact Report (EIR) mitigations and mitigation monitoring requirements to the Record of Land Use Action.” (new Part F) INCORPORATED INTO MOTION2 WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “the Traffic Demand Management (TDM) program will be designed to reduce single occupancy vehicle trips by 20 percent during the peak hour.” (new Part G) MOTION2 PART G RESTATED: The Traffic Demand Management (TDM) program will reduce motor vehicle trips by 20 percent during A.M. and P.M. peak hours. MOTION1 RESTATED: Vice Mayor Scharff moved, seconded by Council Member Kniss to: A. Certify the Final Environmental Impact Report and adopt a project specific Mitigation Monitoring and Reporting Program. DRAFT ACTION MINUTES Page 9 of 9 City Council Meeting Draft Action Minutes: 1/11/16 MOTION2 RESTATED: Vice Mayor Scharff moved, seconded by Council Member Kniss to: B. Adopt a Record of Land Use Action approving the Architectural Review application for four new office buildings at 1050 Page Mill Road; and C. Landscaping that is predominately indigenous plants providing natural habitat; and D. Provide a landscape reserve sufficient to provide for a future pedestrian and bikeway spine to connect Hanover Street and El Camino Real, should a spine project be adopted in the future by Stanford University and the City. In such event the Applicant shall work with the City and Stanford University to convert the landscape reserve to a pedestrian and bikeway spine; and E. Applicant to work with Staff to further consider ways to reduce noise impact; and F. Add the Environmental Impact Report (EIR) mitigations and mitigation monitoring requirements to the Record of Land Use Action; and G. The Traffic Demand Management (TDM) program will reduce motor vehicle trips by 20 percent during A.M. and P.M. peak hours. MOTION1 PASSED: 5-3 Filseth, Holman, Schmid no, DuBois absent MOTION2 AS AMENDED PASSED: 7-1 Holman no, DuBois absent Inter-Governmental Legislative Affairs None. Council Member Questions, Comments and Announcements Vice Mayor Scharff announced his appointment to the Association of Bay Area Governments (ABAG) Personnel and Finance Committee, and the ABAG Committee in discussions with the Metropolitan Transit Commission (MTC) regarding a potential merger. Adjournment: The meeting was adjourned at 12:24 P.M. City of Palo Alto (ID # 6289) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Extend Term of Canus Corporation's Contract Until July 31, 2016 Title: Approval and Authorization of the City Manager to Extend the Term of the Construction Inspection Services Contract with Canus Corporation (C13145442) to July 31, 2016 with no Change to the Total Amount From: City Manager Lead Department: Utilities Recommendation Staff recommends that Council approve and authorize the City Manager or his designee to extend the term of the construction inspection services contract with Canus Corporation (C13145442) until July 31, 2016, with no change to the contract dollar amount. Background The City’s Utilities and Public Works Departments inspect the construction of their Capital Improvement Projects (“CIP”) to ensure safety, reliability, contractor performance and compliance with contract specifications. Construction Inspection of CIP projects has traditionally been performed by Utilities Operations and Public Works Operations staff. Because of an increase in construction activity and limited number of qualified staff, on July 16, 2012 Council approved a contract with Canus Corporation (“Canus”) in a total not to exceed amount of $7,673,000 (contract amount of $6,975,000 + 10% contingency amount of $698,000) for electric, water, gas, wastewater, storm drain and Public Works construction inspection services (Staff Report 2973). The original contract was set to expire in July 2015. Because of ongoing projects, the City Manager extended the term of the contract to January 2016, the current expiration date, based on the authority provided by Section 2.30.290(b) of the municipal code. A second term extension, even without the expenditure of additional funds, requires Council approval. Discussion The City awarded, via a competitive bid process, a contract to Canus in July 2012 for a period of three years. After executing a six (6) month extension, this contract is now valid until January 31, 2016. At the time of the extension it was thought that there was adequate internal staff to handle upcoming CIP projects and that there was sufficient time to go out to bid for outside City of Palo Alto Page 2 inspection services. But the current construction requirements to meet customer and system improvement schedules indicate internal staff resources are better allocated to construction activities rather than inspection. Canus has provided a qualified person for inspecting various Utilities and Public Works projects over the past three years. This has included projects dealing with electric underground system rebuild; overhead electric system rebuild; water, gas, and wastewater pipeline replacement; and storm drain replacement. Utilities has a current need for Canus to provide inspection services for upcoming pole replacement and water main replacement projects that will continue beyond the Canus contract expiration date in January 2016. Canus has met the needs of the City and has satisfactorily carried out its work, provided accurate billing for work, and have addressed issues identified by staff over the past three years. Staff has checked with Canus and they stated that they would accept the extension until July 31, 2016 and perform inspection work without any escalation in their existing labor rates. Resource Impact The value of the contract is $6,975,000 and to date $1,870,000 has been expended, leaving $5,105,000 remaining on the contract. When the contract was originally awarded it was anticipated that Canus would be used to inspect several CIP projects for Utilities and Public Works. But the actual number of projects that the Canus inspectors worked on was less than expected. Staff intends to utilize Canus for inspection of the construction of pole and pipeline replacement projects, and other associated work, which is estimated to be $600,000 through June 2016, thus no additional funds need to be added to the contract. Funds for this contract are available in the approved CIP budgets for each project. Staff is also preparing to go out to bid for a new inspection services contract. The extension of the Canus contract is to bridge the gap between the January 2016 expiration and anticipated award of a new contract by July 2016. Policy Implications The approval of this contract is consistent with existing city policies, including the Council approved Utilities Strategic Plan to operate the distribution system in a cost effective manner and to invest in utility infrastructure to deliver reliable service. Timeline In the event that Council approves the extension of the Contract, wood pole and pipeline replacement projects can continue as scheduled, avoiding a delay until the new contract is awarded. Environmental Review City of Palo Alto Page 3 The Council’s approval of an extension of this construction inspection services contract is exempt from California Environmental Quality Act (CEQA) review, as it does not meet the definition of a “project” under Public Resources Code 21065. Attachments:  Canus Corporation - Second Amendment (PDF) ATTACHMENT A City of Palo Alto (ID # 6295) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Annual Status Report Development Impact Fees FY15 Title: Review and Acceptance of Annual Status Report on Development Impact Fees for Fiscal Year 2015 From: City Manager Lead Department: Administrative Services Recommendation Staff recommends that Council review and accept the Annual Report on Development Impact Fees for the year ended June 30, 2015 (Attachment A). Background State law (Government Code Section 66006) requires that each local agency that imposes development impact fees prepare an annual report providing specific information about those fees. This requirement is part of the law commonly referred to as AB 1600. It codifies the legal requirement that fees on new development must have the proper nexus to any project on which they are imposed. In addition, AB 1600 imposes certain accounting and reporting requirements with respect to the fees collected. The fees, for accounting purposes, must be segregated from the general funds of the City and from other funds or accounts containing fees collected for other improvements. Interest on each development fee fund or account must be credited to that fund or account and used only for the purposes for which the fees were collected. Government Code Section 66006 contains comprehensive annual reporting requirements for development impact fees. This statute requires that, within 180 days after the close of the fiscal year, the agency that collected the fees must make available to the public the following information regarding each fund or account:  Brief description of the type of fee in the fund.  Amount of the fee.  Beginning and ending balance in the fund. City of Palo Alto Page 2  Amount of fees collected and interest earned.  Identification of each public improvement on which fees were expended and the amount of the expenditure on each improvement, including the total percentage of the cost of the public improvement that was funded with fees.  Identification of an approximate date by which the construction of a public improvement will commence, if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement.  Description of each interfund transfer or loan made from the account or fund, including the public improvement on which the loaned funds will be expended, and in the case of an interfund loan, the date on which the loan will be repaid and the rate of interest that the account or fund will receive on the loan.  Amount of any refunds made due to inability to expend fees within the required time frame. This report must also be reviewed by the City Council at a regularly scheduled public meeting not less than 15 days after the information is made available to the public. In addition, notice of the time and place of the meeting shall be mailed at least 15 days prior to the meeting to any interested party who files a written request with the local agency for such a mailed notice. An early packet consisting of Exhibit A only was made available to the public and included in the packet for the December 7, 2015 meeting of the City Council. The law also provides that, for the fifth fiscal year following the first deposit into the fund and every five years thereafter, the local agency shall make findings with respect to any portion of the fee remaining unexpended, whether committed or uncommitted. The finding must:  identify the purpose to which the fee is to be put;  demonstrate a nexus between the fee and the purpose for which it was originally charged; and  identify all sources and amounts of funding anticipated to complete financing of incomplete improvements along with the approximate dates on which the anticipated funding is expected to be deposited into the fund. If the agency no longer needs the funds for the purposes collected, or if the agency fails to make required findings, or to perform certain administrative tasks prescribed by AB 1600, the agency may be required to refund to property owners a prorated portion of the monies collected for that project and any interest earned on those funds. The City Auditor’s office recently conducted an audit of the City’s Parking in-lieu fund. City of Palo Alto Page 3 Discussion The City of Palo Alto development fees covered by AB 1600, and documented in Attachment A, include the established fees noted below, as well as two new fees for Public Safety Facilities and General Government Facilities that were approved by Council in May 2014. In addition, though not technically a fee covered by AB 1600, the City is reporting its Public Art fee for informational purposes only.  Stanford Research Park/El Camino Real traffic impact fees (PAMC Ch. 16.45): Fee for new nonresidential development in the Stanford Research Park/El Camino Real Service Commercial zone, to fund capacity improvements at eight intersections.  San Antonio/West Bayshore Area traffic impact fees (PAMC Ch. 16.46): Fee for new nonresidential development in the San Antonio/West Bayshore area to fund capacity improvements at four intersections.  Commercial housing in-lieu (PAMC Ch. 16.47): Fee on commercial and industrial development to contribute to programs that increase the City's low income and moderate-income housing stock.  University Avenue Parking in-lieu (PAMC Ch. 16.57): Fee on new non-residential development in the University Avenue Parking Assessment District in lieu of providing required parking spaces.  Parks, Community Centers, and Libraries impact fees (PAMC Ch. 16.58): Fee on new residential and non-residential development to provide community facility funds for parks, community centers, libraries, public safety, and general government.  Residential housing in-lieu fees (PAMC Ch. 16.47): Fee on residential developments in- lieu of providing required below-market rate units to low and moderate income households.  Parkland dedication fees (Quimby Act) (California Government Code Section 66477): Fee or parkland dedication imposed on new residential and non-residential development.  Charleston-Arastradero Corridor pedestrian and bicyclist safety fees (PAMC Ch. 16.59): Fee on new development and re-development within the Charleston-Arastradero Corridor to provide for pedestrian and bicyclist improvements.  Public Safety facilities (PAMC Ch. 16.58): Fee on residential and non-residential development to fund police and fire facilities, including fire apparatus and vehicles.  General Government facilities (PAMC Ch. 16.58): Fee on residential and non-residential development to fund facilities associated with municipal administration. City of Palo Alto Page 4  Citywide Transportation impact fee (PAMC Ch 16.59): Fee on development in all parts of the City to fund transportation projects and programs to reduce congestion.  Public Art fees (PAMC 16.61): Fee on public art for private developments.  Water and sewer capacity fees (California Government Code Section 66000): Fee on developments adding load to water and sewer systems. AB 1600 requires the City to make specified findings in the event any funds are not expended within five fiscal years of collection and every five years thereafter. While there are several funds containing collected fees that have not been expended in five years, the required statutory carryover findings have already been made for those funds and no further findings are required. RESOURCE IMPACT Council approved the required findings with respect to unexpended fees in fiscal years 2012 and 2013. There were no required findings for either fiscal year 2014 or fiscal year 2015. The next finding date will be fiscal year 2017, and the unexpended balances for each fee type are noted at the bottom of each section in Attachment A. Attachments:  Attachment A: Developer Fees (XLS) Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Stanford Research Park/San Antonio/West FUND El Camino Fund Bayshore Fund Purpose and Authority Traffic impact fees imposed on new Traffic impact fees imposed on new for Collection nonresidential development in the nonresidential development in the Stanford Research Park/El Camino San Antonio/West Bayshore Areas Real CS zone to fund improvements to fund capacity improvements at at eight identified intersections.four identified intersections. PAMC Ch. 16.45 PAMC Ch. 16.46 Amount of the Fee $11.64 per square foot $2.40 per square foot Fund Balance July 1, 2014 $3,492,212 $848,819 Activity in 2014-15 Revenues Fees Collected 616,173 0 Interest Earnings 73,552 16,769 Unrealized Gain/Loss Investments (4,692)(361) -------------------------------------------------------------------------------------------------------------------- Total Revenues $685,033 $16,408 Expenditures Inter-agency expenses 0 Transfer to Gas Tax Fund (994,217)0 -------------------------------------------------------------------------------------------------------------------- Total Expenditures (994,217)0 -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $3,183,028 $865,227 Other Commitments/AppropriationsReserve for unrealized gain on investments (19,599)(5,037)-------------------------------------------------------------------------------------------------------------------- Net Funds Available $3,163,429 $860,190 Unexpended balance at next finding date (FY 2017-18)$2,343,008 $823,819 USE OF FEES:USE OF FEES: Expenditures of funds have been made in Fiscal Year 2015 for $994K transfer to Gas Tax Fund. During the FY 2008-09, the City transferred out $994k from Gas Tax Fund to this fund for various street related costs. However, the transfer were not used for street related expenses, as result per SCO recommendation $994K was returned to Gas Tax Fund. No expenditures have been made from this fund in Fiscal Year 2015. Page 1 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Commercial Housing University Avenue Parking FUND In-Lieu Fund In-Lieu Fund Purpose and Authority Fees imposed on large commercial Fees collected from non-residential for Collection and industrial development to development within the University Ave. contribute to programs that increase Parking Assessment District in lieu of the City's low income and moderate-providing the required number of income housing stock.parking spaces. PAMC Ch.16.47 PAMC Ch 16.57 Amount of the Fee $19.31 per square foot $63,848 per space Fund Balance July 1, 2014 $12,538,778 $1,970,372 Activity in 2014-15 Revenues Fees Collected 2,297,126 2,890,950 Interest Earnings 171,150 90,052 Unrealized Gain/Loss Investments 10,053 11,685 -------------------------------------------------------------------------------------------------------------------- Total Revenues 2,478,329 2,992,687 Expenditures Transfer to Residential Housing In- Lieu Fund (375,000)0 -------------------------------------------------------------------------------------------------------------------- Total Expenditures (375,000)0 -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $14,642,107 $4,963,059 Other Commitments/Appropriations Reserve for Notes Receivable include:$1,290,000 for 2811 Alma, and $3,645,010 for 801 Alma.(4,935,010) Reserve for Buena Vista (7,700,000) Reserve for unrealized gain on investments (49,863)(20,457) -------------------------------------------------------------------------------------------------------------------- Net Funds Available $1,957,234 $4,942,602 Unexpended balance at next finding date (FY 2017-18)4,667,286 $652,080 USE OF FEES:USE OF FEES: Expenditures of funds have been made in Fiscal Year 2015 for $375K. This is transfer to Residential Housing In-Lieu Fund for rehabilitation and preservation of affordable housing units at 110-130 El Dorado. This will be repaid on June 30, 2016 including interest. No expenditure of funds have been made from this fund in Fiscal Year 2015. Page 2 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Residential & Non-Residential Housing Residential & Non-Residential Housing Community Facilities Community Facilities FUND Parks Community Centers Purpose and Authority Fees imposed on new residential and Fees imposed on new residential and for Collection non-residential development approved non-residential development approved after Jan 28, 2002 for Parks. after Jan 28, 2002 for Community Centers. PAMC Ch. 16.58 PAMC Ch. 16.58 Amount of the Fee Residential: Single family $11,180/residence (or $16,695/residence larger than 3,000 sq ft); Multi-family $7,318/unit (or $3,700/unit smaller than or equal to 900 sq ft) Residential: Single family $2,898/residence (or $4,439/residence larger than 3,000 sq ft); Multi-family $1,907/unit (or $963/unit smaller than or equal to 900 sq ft) Nonresidential: Commercial/industrial $4,748 per 1,000 sq ft; Hotel/Motel $2,147 per 1,000 sq ft Nonresidential: Commercial/industrial $268 per 1,000 sq ft; Hotel/Motel $121 per 1,000 sq ft Fund Balance July 1, 2014 $2,929,569 $5,009,861 Activity in 2014-15 Revenues Fees Collected 830,387 117,161 Interest Earnings 64,721 99,910 Unrealized Gain/Loss 5,398 (4,344) -------------------------------------------------------------------------------------------------------------------- Total Revenues $900,506 $212,727 -------------------------------------------------------------------------------------------------------------------- Total Expenditures 0 0 -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $3,830,075 $5,222,588 Other Commitments/Appropriations Reserve for unrealized gain on investments (19,905)(30,068)-------------------------------------------------------------------------------------------------------------------- Net Funds Available $3,810,170 $5,192,520 Unexpended balance at next finding date (FY 2016-17)446,005 $843,809 USE OF FEES:USE OF FEES: No expenditure of funds have been made from this Fund in Fiscal Year 2015. No expenditure of funds have been made from this Fund in Fiscal Year 2015. Page 3 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Residential & Non-Residential Housing Residential Housing Community Facilities In-Lieu Fund FUND Libraries Purpose and Authority Fees imposed on new residential and Fees collected from residential for Collection non-residential development approved developments of three or more units in after Jan 28, 2002 for Libraries. lieu of providing the required below- market rate unit(s) to low and moderate PAMC Ch. 16.58 income households. PA Comprehensive Plan and PAMC Chapter 18 Amount of the Fee Residential: Single family $1,012/residence (or $1,507/residence larger than 3,000 sq ft); Multi-family $604/unit (or $332/unit smaller than or equal to 900 sq ft)Varies Nonresidential: Commercial/industrial $255 per 1,000 sq ft; Hotel/Motel $107 per 1,000 sq ft Fund Balance July 1, 2014 $730,991 $13,909,337 Activity in 2014-15 Revenues Fees Collected 58,007 19,800 Sterling Litigation Settlement 3,851,759 Webster Wood In-Lieu Payment 5,175 Interest Earnings 14,909 203,752 Unrealized Gain/Loss Investments (211)12,663 Transfer from Commercial Housing In- Lieu Fund 375,000 -------------------------------------------------------------------------------------------------------------------- Total Revenues $72,705 $4,468,149 Expenditures Legal (278,326) Housing Program Expense (347,070) Principal Retired (131,126) -------------------------------------------------------------------------------------------------------------------- Total Expenditures 0 (756,522) -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $803,697 $17,620,964 Other Commitments/Appropriations Reserve for Reappropriations (1,975,000) Reserve for Encumbrances (363,645) Reserve for Buena Vista (6,800,000) Reserve for unrealized gain on investments (4,512)(46,400) Reserve for Notes Receivable include $375,000 for 3053 Emerson, $3,804,850 for Tree House Apts, $203,093 for Oak Manor, $756,819 for Sheridan Apts., and $2,674,986 for 801 Alma (7,814,748) -------------------------------------------------------------------------------------------------------------------- Net Funds Available $799,185 $621,171 Page 4 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Unexpended balance at next finding date (FY 2016-17-Residential & Non Residential Housing Communities Facilities Libraries, FY2017-18- Residential Housing In-Lieu)$541,529 2,734,967 USE OF FEES:USE OF FEES: No expenditure of funds have been made from this Fund in Fiscal Year 2015. Expenditures in Fiscal Year 2015 include $147K to Palo Alto Housing Corp for BMR fees, $131K for Oak Manor Apts. loan forgiveness, $279K for legal fees, and $200K financial contribution to Housing Trust Silicon Valley. Page 5 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Parkland Dedication Charleston-Arastradero Corridor Pedestrian and Bicyclist Safety FUND Purpose and Authority Fees on parkland dedication imposed Fees collected from new development and for Collection on new residential and non-residential re-development within the Charleston- development Arastradero Corridor to provide for pedest- rian and bicyclist safety improvements. Govt Code Sec.66477 (Quimby Act) PAMC Ch. 16.60 Amount of the Fee Varies Residential: $1,225 per unit; Commercial: $0.36 per sq ft Fund Balance July 1, 2014 $2,427,163 $249,804 Activity in 2014-15 Revenues Fees Collected 78,214 1,168 Interest Earnings 48,088 4,942 Unrealized Gain/Loss (310)(1,224) -------------------------------------------------------------------------------------------------------------------- Total Revenues $125,992 $4,886 -------------------------------------------------------------------------------------------------------------------- Total Expenditures 0 0 -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $2,553,155 $254,690 Other Commitments/ReappropriationsReserve for unrealized gain on investments (14,534)(1,475) -------------------------------------------------------------------------------------------------------------------- Net Funds Available $2,538,621 $253,215 Unexpended balance at next finding date (FY 2016-17-Parkland Dedication, FY2017-18-Charleston)$757,744 $138,989 USE OF FEES:USE OF FEES: No expenditure of funds have been made from this Fund in Fiscal Year 2015. No expenditure of funds have been made from this Fund in Fiscal Year 2015. Page 6 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 New Public Safety Facilities General Government Facilities FUND Purpose and Authority Fees imposed on residential and non- residential development to fund police and fire facilities (including fire apparatus and vehicles) Fees imposed on residential and non- residential development to fund facilities associated with municipal administration for Collection PAMC Ch. 16.58 PAMC Ch. 16.58 Amount of the Fee Residential: Single family $996 per unit; Multi-family $797 per unit Residential: Single family $1,225 per unit; Multi-family $1004 per unit Nonresidential: Commercial $557 per 1,000 sq ft. or fraction thereof; Industrial $186 per 1,000 sq. ft. or fraction thereof; Hotel/Motel $743 per 1,000 sq ft or fraction thereof Nonresidential: Commercial $702 per 1,000 sq ft. or fraction thereof; Industrial $234 per 1,000 sq. ft. or fraction thereof; Hotel/Motel $937 per 1,000 sq ft or fraction thereof Fund Balance July 1, 2014 $0 $0 Activity in 2014-15 Revenues Fees Collected 1,594 2,008 Interest Earnings 2 3 -------------------------------------------------------------------------------------------------------------------- Total Revenues $1,596 $2,011 -------------------------------------------------------------------------------------------------------------------- Total Expenditures 0 0 -------------------------------------------------------------------------------------------------------------------- Ending Balance June 30, 2015 $1,596 $2,011 Other Commitments/Reappropriations -------------------------------------------------------------------------------------------------------------------- Net Funds Available $1,596 $2,011 Unexpended balance at next finding date FY 2019-20 $1,596 $2,011 USE OF FEES:USE OF FEES: No expenditure of funds have been made from this Fund in Fiscal Year 2015. No expenditure of funds have been made from this Fund in Fiscal Year 2015. Page 7 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 Citywide Transportation FUND Purpose and Authority for Collection Transportation impact fees imposed on new development in all parts of the City to fund congestion reduction projects. PAMC Ch. 16.59 Amount of the Fee $3,354 per net new PM peak hour trip Fund Balance July 1, 2014 $3,882,010 Activity in 2014-15 Revenues Fees Collected 405,120 Interest Earnings 62,759 Unrealized Gain/Loss Investments (4,311)-------------------------------------------------------- Total Revenues $463,568 Expenditures Operating Transfer to CIP (1,885,183) -------------------------------------------------------- Total Expenditures (1,885,183)-------------------------------------------------------- Ending Balance June 30, 2015 $2,460,395 Other Commitments/Reappropriations Reserve for unrealized gain on investments (18,630)-------------------------------------------------------- Net Funds Available $2,441,765 Unexpended balance at next finding date (FY 2017-18)$1,216,124 USE OF FEES: Expenditures have been made in Fiscal Year 2015 for $372K to PL-15001 (Embarcadero Corridor), $308K to PL- 14000 (El Camino / Churchhill), $841K to PL-05030 (Traffic Signal and ITS upgrades, and $364K to PL-11003 (Palo Alto Traffic Signal) Page 8 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 (INFORMATION ONLY) Public Art Fund FUND Purpose and Authority for Collection Fees imposed on new commercial develoments (including mixed use projects), including new construction, remodels, additions and reconstruction that (i) have a floor area of 10,000 square feet or more, and (ii) have a construction value of $200,000, or more, exclusive of costs for architecture, design, engineering, and required studies; and all new residential projects of five or more units to fund public art for private developments. PAMC Ch. 16.61 Amount of the Fee 1% of first $100 million construction valuation and .9% of construction valuation for valuation in excess of $100 million Fund Balance July 1, 2014 $56,176 Activity in 2014-15 Revenues Fees Collected 110,485 Interest Earnings 5,707 Unrealized Gain/Loss Investments 1,208 Operating Transfer from General Fund 96,123 -------------------------------------------------------- Total Revenues $213,523 Expenditures Salaries and benefits (114,815) Supplies and materials (168) -------------------------------------------------------- Total Expenditures (114,983) -------------------------------------------------------- Ending Balance June 30, 2015 $154,716 Reserve for unrealized gain on investments (1,546) -------------------------------------------------------- Net Funds Available $153,170 This fund is not subject to AB1600 requirements and is listed only for information purposesPage 9 of 10 1/5/2016 Attachment A City of Palo Alto Annual Report on Development Impact Fees for Period Ending June 30, 2015 (INFORMATION ONLY) FUND Water and Wastewater Collection Purpose and Authority Capacity fees charged to developers that for Collection are adding load to the water and sewer systems effective July 1, 2005. California Government Code Sect 66000 Amount of the Fee Water Domestic: 5/8 in., 3/4 in. $5,000, 1 in. $9,400, 1 1/2 in. $18,850, 2 in. by est. $125/FU, 3 in. by est. $125/FU , 4 in. by est. $125/FU , 6 in. by est. $125/FU Water Fire Service: 2 in. $750, 4 in. $9,000, 6 in. $22,530, 8 in. $43,080, 10in. $69,510 Sewer: 4 in. $10,500 first 50 FU, $210/FU additional, 6 in. by est. $210/FU, 8 in. by est. $210/FU FU is fixture unit Activity in 2014-15 Capacity Fees Collected Water $1,132,095 Wastewater Collection 647,640 Total $1,779,735 USE OF FEES: The fees are used exclusively for water and sewer system improvements Page 10 of 10 1/5/2016 CITY OF PALO ALTO OFFICE OF THE CITY AUDITOR January 25, 2016 The Honorable City Council Palo Alto, California Policy and Services Committee Recommendation to Accept the Auditor's Office Quarterly Report as of September 30, 2015 The Office of the City Auditor recommends acceptance of the Auditor’s Office Quarterly Report as of September 30, 2015. At its meeting on November 10, 2015, the Policy and Services Committee approved and unanimously recommended the City Council accept the report. The Policy and Services Committee minutes are included in this packet. Respectfully submitted, Harriet Richardson City Auditor ATTACHMENTS:  Attachment A: Auditor's Office Quarterly Report as of September 30, 2015 (PDF)  Attachment B: Policy and Services Committee Meeting Minutes Excerpt (November 10, 2015) (PDF) Department Head: Harriet Richardson, City Auditor Page 2 CITY OF PALO ALTO OFFICE OF THE CITY AUDITOR November 10, 2015 The Honorable City Council Attention: Policy & Services Committee Palo Alto, California Auditor's Office Quarterly Report as of September 30, 2015 RECOMMENDATION The City Auditor’s Office recommends the Policy and Services Committee review and recommend to the City Council acceptance of the Auditor’s Office Quarterly Report as of September 30, 2015. SUMMARY OF RESULTS In accordance with the Municipal Code, the City Auditor prepares an annual work plan and issues quarterly reports to the City Council describing the status and progress towards completion of the work plan. This report provides the City Council with an update on the first quarter for FY 2016. Respectfully submitted, Harriet Richardson City Auditor ATTACHMENTS:  Attachment A: Auditor's Office Quarterly Report as of September 30, 2015 (PDF) Department Head: Harriet Richardson, City Auditor Attachment A Page 2 Attachment A        O “P Q Office Promoting ho account Quart e of th onest, efficien table and tra   erly R he City nt, effective,  nsparent city Report y Aud economical,  y government t as of itor  and fully  t."  f Septtembeer 30, 2015 Attachment A 2  Fiscal Year (FY) 2016 First Quarter Update (July – September 2015)  Overview  The audit function is essential to the City of Palo Alto’s public accountability. The mission of the Office of the City Auditor,  as mandated by the City Charter and Municipal Code, is to promote honest, efficient, effective, economical, and fully  accountable and transparent city government. We conduct performance audits and reviews to provide the City Council  and City management with information and evaluations regarding how effectively and efficiently resources are used, the  adequacy of internal control systems, and compliance with policies, procedures, and regulatory requirements. Taking  appropriate action on our audit recommendations helps the City reduce risks and protect its good reputation.  Highlights of Activities During the Quarter   City Auditor Harriet Richardson participated in a peer review of the Lawrence City Auditor’s Office in Kansas to help  fulfill our reciprocity requirement for participating in the ALGA peer review program.  Audits  Below is a summary of our audit work for the first quarter of FY 2016 (as of September 30, 2015):  Title Objective(s) Start  Date  End  Date  Status Results/Comments  Franchise Fee  Audit  Determine if 1) the City  accurately accounted for and  oversaw the Media Center’s  use of public, education, and  government (PEG) fees, 2) the  City established and defined  roles and responsibilities to  administer its cable  communications program and  state franchises awarded to  Comcast and AT&T, and  3) Comcast and AT&T collected  and promptly remitted the  appropriate amount of  franchise and PEG fees.  02/14 02/16 In Process We have completed planning and  field work and have drafted the  report for the second and third  objectives; a consultant  conducted field work for the third  objective and provided us with a  draft of the results, which we  have reviewed and are  incorporating into the draft audit  report. The City Attorney will  review the draft report before we  present it to the departments for  review and comments. We expect  to present the report to the Policy  and Services Committee in  February.  Parking Funds  Audit  Determine if the City’s parking  funds are properly calculated,  collected, accounted for, and  used in compliance with  applicable laws, regulations,  policies, and governing  documents. The audit focuses  on the Parking in‐Lieu Fund and  the University and California  Avenues and Residential  Parking Permit Funds.  05/14 12/15 In Process We have completed planning and  field work and have drafted the  report, which the City Attorney’s  Office and relevant departments  are currently reviewing. We  expect to present the results to  the Policy and Services  Committee in December.  Attachment A 3  Title Objective(s) Start  Date  End  Date  Status Results/Comments  Fee Schedules  Audit  Evaluate City processes for  establishing fees to determine  if the fees cover the cost of  services provided when  expected. The specific fees to  be reviewed will be narrowed  down during the planning  phase of the audit.  06/15 02/16 In Process The audit is in the planning phase.  Estimated date of draft report is  December 2015, and estimated  date of final report is February  2016.  Disability Rates  and Workers’  Compensation  Audit  Assess the effectiveness of  activities to manage and  minimize disability retirements  and workers’ compensation  claims. Review of processes to  ensure employee safety,  tracking and reporting  activities, contract  administration, and efficiency  of claim processing.  06/15 02/16 In Process The audit is in the planning phase.  Estimated date of draft report is  December 2015, and estimated  date of final report is February  2016.  Utilities  Customer  Service: Rate  and Billing  Accuracy Audit  Evaluate whether the Utilities  Department properly  implements rates and  accurately bills customers.  06/15 02/16 In Process The audit is in the planning phase.  Estimated date of draft report is  December 2015, and estimated  date of final report is February  2016.  Citywide  Analytic  Development  and Continuous  Monitoring:  Procure‐to‐Pay  Develop and implement a  continuous monitoring system  to increase audit efficiency and  coverage through the use of  read‐only access to City data.  The project will involve  developing data analytics to  identify high‐risk areas and  improvement opportunities in  the City’s core processes. The  focus of this project is accounts  payable.  06/15 01/16 In Process The project is in the planning  phase. Estimated date of draft  report is November 2015, and  estimated date of final report is  January 2016.  Citywide  Analytic  Development  and Continuous  Monitoring:  Overtime  Develop and implement a  continuous monitoring system  to increase audit efficiency and  coverage through the use of  read‐only access to City data.  The project will involve  developing data analytics to  identify high‐risk areas and  improvement opportunities in  the City’s core processes. The  focus of this project is use of  overtime.  06/15 01/16 In Process The project is in the planning  phase. Estimated date of draft  report is November 2015, and  estimated date of final report is  January 2016.  Attachment A 4  Title Objective(s) Start  Date  End  Date  Status Results/Comments  National Citizen  Survey™  Obtain resident opinions about  the community and services  provided by the City of Palo  Alto and benchmark our results  against other jurisdictions that  participate in the survey.  07/15 01/16 In process The National Research Center  (NRC) mailed postcards and the  first wave of surveys in late  September to residents who have  been selected to participate in  the survey. The NRC will mail the  second wave of surveys on  October 14. The data collection  end date is November 11.    Other Monitoring and Administrative Assignments  Below is a summary of other assignments as of September 30, 2015:  Title Objective(s) Status Results/Comments  Sales and Use Tax  Allocation  Reviews  1) Identify and collect  underreported or  misallocated sales and use  tax from businesses that do  business in Palo Alto.  2) Monitor sales taxes  received from the Stanford  University Medical Center  Project and notify Stanford  of any differences between  their reported taxes and  state sales tax information,  in accordance with the  development agreement.  3) Provide Quarterly Status  Updates and Sales Tax  Digest Summaries for  Council review.  Ongoing 1)  Total sales and use tax recoveries for the first quarter  were $1,508 from the vendor’s inquiries. Due to  processing delays at the State Board of Equalization,  there are 49 potential misallocations waiting to be  researched and processed: 16 from our office and 33  from the vendor.  2) We receive calendar‐year sales tax information for the  Stanford project about six months after the end of the  calendar year. We will report the sales tax information  for this project in our June 2016 quarterly report.  3) Quarterly reports are published on the OCA website at  www.cityofpaloalto.org/gov/depts/aud/reports/default.asp. City Auditor  Advisory Roles  Provide guidance and  advice to key governance  committees within the City.  Ongoing The City Auditor continues to serve as an advisor to  various boards and committees: Utilities Risk Oversight  Committee, the Library Bond Oversight Committee, the  Information Technology Governance Review Board, and  the Information Security Steering Committee.    Fraud, Waste, and Abuse Hotline Administration  The hotline review committee, composed of the City Auditor, the City Attorney, and the City Manager, or their  designees, meets as needed to review hotline‐related activities. We received 7 hotline complaints during the first  quarter of FY 2016, which are currently under investigation. Four of the complaints are in regard to the same issue. The  chart below summarizes the status of complaints received in each fiscal year.  Attachment A 5    Source: City of Palo Alto hotline case management system as of September 30, 2015  77 3 2 0 1 2 3 4 5 6 7 8 FY 2013 FY 2014 FY 2015 FY 2016 Status of Complaints Received by Fiscal Year Closed Complaints Open Complaints Attachment A POLICY AND SERVICES COMMITTEE DRAFT MINUTES Page 1 of 10 Regular Meeting November 10, 2015 Chairperson Chair Burt called the meeting to order at 7:19 P.M. in the Community Meeting Room, 250 Hamilton Avenue, Palo Alto, California. Present: Berman, Burt (Chair), DuBois, Wolbach Absent: Chair Burt: We're going to have a small change in our Agenda Item 1, which is the Auditor's Quarterly Report will move down to following Item Number 3. That will help a bunch of people who are here for other items. The Auditor has to be here for Item 4 anyway, so she volunteered to readjust. 1. Auditor's Office Quarterly Report as of September 30, 2015 Chair Burt: We're going to move onto the Auditor's Quarterly Report. Welcome, Harriet. Harriet Richardson, City Auditor: Good evening, Mr. Chair and Members of the Committee. Harriet Richardson, City Auditor, presenting the Office of the City Auditor's Quarterly Report for the first quarter of Fiscal Year 2016 which ended on September 30th. We have two audits that are nearing completion, the franchise fee audit and the parking funds audit. The parking funds audit is out for City Manager's official written response. We're expecting—it's scheduled on the December 8th Policy and Services Committee agenda, and we're expecting to meet that date. The franchise fee audit, we are still finalizing findings, and we'll give that to the City Attorney for review prior to reviewing it with the departments. We've been working very closely with the City Attorney on this audit due to the nature of the findings. We're tentatively scheduled to present the report to Policy and Services in February, but we may need to delay to March because of the number of parties involved including some outside of the City who will need to review and respond to the report. We have five other audits in progress. The report shows that two of these are expected to be presented in January Attachment B DRAFT MINUTES Page 2 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 and three of them in February. As of now, there's not a Policy and Services Committee meeting scheduled for January. I'm now anticipating that we will present these in February and March, and they may stretch out into April depending on the number of items on the agendas. Three of those audits, the first one, the fee schedule audit, we're evaluating processes used within the City to establish fees that are expected to cover the cost of services to ensure that they do cover the cost of services when they're expected to do so or that Council has full information to make policy decisions on how much they want to subsidize. We're also doing the disability rates and workers' compensation audit which is focusing on assessing whether the City's safety practices are effective to minimize on-the-job injuries and illnesses and whether the City is effective at minimizing workers' compensation payments after an injury or illness has occurred. We also have the utilities rate and billing accuracy audit which will evaluate whether the Utilities Department properly implements established rates and accurately bills customers. Because of the large number of rates—there's a variety of rates for each utility depending on the customer, residential, commercial, different types of rates—we'll be using sampling techniques in this audit rather than evaluating every single rate. We also have two continuous monitoring projects in progress. With these projects, we'll be using our data analysis software to identify whether the City has made duplicate payments or is paying overtime when it should not be. In both instances, the scripts we develop will be available to do similar analysis on an ongoing basis. Regular intervals may be quarterly, twice a year, something like that. If those projects are successful at finding opportunities for improvement, then we'll likely expand these techniques to future areas in the City that can provide a quick return on our invested time in a shorter time period than a full audit. That's the benefit of continuous monitoring audits. Looking to page 4 of our report, we've begun the work on the National Citizens Survey. The National Research Center mailed surveys to 3,000 residents in late September, and a second copy to those same residents in mid-October. The data collection period ends this week, and we'll have the draft results in early to mid- December. We'll expect to have the report completed in early January. We also do sales and use tax allocation reviews. We do some, and we also contract with Muni Services who does some of them on our behalf. Total recoveries for the first quarter were $1,508. This amount was lower than usual on an ongoing basis, but it is typical for the amount recovered to vary significantly from quarter to quarter. I went back and looked at a couple of examples. In one quarter in Fiscal Year '14, we collected 5,900 in one quarter, but then in another quarter that same year we collected 93,000. There's a really wide range, so I'm not alarmed at this point since it's only the first quarter. If it stays low, I would start questioning the need to continue doing this type of work within our office, the cost-benefit of doing it. We continue to do our City advisory roles, Utilities Risk Oversight Attachment B DRAFT MINUTES Page 3 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 Committee, Library Bond Oversight Committee, Information Technology Governance Review Board and the Information Security Steering Committee. The Library Bond Oversight Committee is wrapping up their work. There's a meeting scheduled in December that we'll be attending. I believe that that might be the last one. There may possibly be one more, but we'll be wrapping up our obligation on that one shortly. The last item we have is the hotline, the number of complaints that we receive each year. We didn't receive—we only received two at the beginning of Fiscal Year '15 and then none later in the last three quarters of Fiscal Year '15. To date, we've already received seven in Fiscal Year '16. Four of those are the same issue. All seven of those are still under investigation, so we don't have an update on closing those out yet. As I said, four are the same. The other three are completely different issues. This concludes my report. I can address any questions that you may have. Chair Burt: Tom. Council Member DuBois: I've got three quick questions. On the hotline, are you kind of directly managing that at this point? Has that changed? Ms. Richardson: We do not—there's actually a committee that involves the City Manager's Office, the City Attorney and my office. When a complaint comes in, we triage the complaints and decide who's going to investigate it. Once it's gone out for investigation, I typically don't have a role in the process. Council Member DuBois: We had talked about, I think, about you tracking resolution though. Has that changed or not? Ms. Richardson: We receive comments back from the City Manager's Office. I generally don't get a lot of detail in those comments. When I'm told an investigation is complete and I can close it out, I typically close it out and rely on that information. Council Member DuBois: On the Utilities one, I'm wondering if there are any—if it's going to be similar to the waste audit in terms of looking at billing, classification. Is there any leverage or are those entirely different systems? Ms. Richardson: They're different systems. Utilities is billed through the SAP system. The rates are in the SAP system. We're looking at—there's generally one person who’s responsible for putting the rates into the system—making sure those rates got entered accurately and that when they come back out onto the bills, that they are accurately going onto the bills Attachment B DRAFT MINUTES Page 4 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 and the calculation. There's various levels of calculation that have to be done, and we'll be looking at that. Council Member DuBois: Remind me, because I know we talked about it before. At one point, we talked about possibly an audit on TDR sender sites. Ms. Richardson: Correct. Our audit plan for this year doesn't have that on it, but I have spoken with Planning and I did talk to you again after that. We do plan to put it on our audit plan for next year. Council Member DuBois: Thank you. Chair Burt: Others? Can you review again on when you have the hotline questions, your process for closing cases? Ms. Richardson: I typically just rely on what I'm—the information I'm given is that we've investigated it and you can close it. I don't get a lot of detail. I get very little detail, so I don't have the ability, for example, to say it's reasonable to close it or not. I rely on what I'm given generally from the City Manager's Office. Suzanne Mason, Assistant City Manager: Let me comment. Harriet and I work closely with Molly on this, since I've been here which has been primarily this year's complaints. Most of those complaints—we've had multiple on similar issues. They're mostly personnel items, and personnel items are of a confidential matter. I think sometimes it's difficult to provide results on exactly what has transpired or transpired when it has to do with a confidential matter on a personnel item. That's difficult to provide a lot of detail. Chair Burt: Do either of you know how similar situations of predominantly personnel hotline issues are handled in other cities that have hotlines? Ms. Mason: That's one issue that we've been discussing. Harriet, Molly and I are discussing how we handle those. I'm not sure, and that's one of the questions I have. When the original procedure was developed, whether it anticipated the level of items we're getting versus more serious conduct- type items of fraud, really serious. Not that personnel items aren't serious, that people perceive there to be a problem. An argument between coworkers, things of that nature. Some of this is a little bit challenging, so we're exploring that. We just had a dialog about that. Ms. Richardson: I also think that—I will say I think that we don't always agree on what's a personnel issue and what's not. I think sometimes it's not Attachment B DRAFT MINUTES Page 5 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 completely black and white that it's strictly a personnel issue. Those are the ones that I think are more difficult. I might view it as there's an aspect of it that could be, for example, an abuse of a position or where someone maybe has been reported as—I believe one of the very original complaints was something about someone not recording time on their timecard when they were leaving. It was treated like a personnel issue, but from an auditor's perspective we look at that as theft of time. That's something that other jurisdictions view as theft of time. That's why I say a lot of times it's not strictly black and white. Chair Burt: Let's take that hypothetically, just that kind of circumstance. Is that still how the City Manager's Office would view that kind of complaint, as a personnel issue? Ms. Mason: Yeah. I think if someone's falsifying a timecard, I think that is serious and potential theft. Yes, we view that very seriously. I mean, I view everything reported to the City Manager's Office seriously. The outcome of what happened with an individual or how a situation was handled, that's the matter I'm asking the City Attorney and Harriet for us to look at, if we're recording something back in the system. Those are some of the concerns I have. People are named in complaints. I just want to make sure we're handling it appropriately based on that. Chair Burt: There's a ... Ms. Mason: I definitely—that is—falsification of a time record, I mean we are having—every complaint is a (crosstalk). Chair Burt: There could be serious issues that are still viewed as strictly personnel even though they're also viewed as serious. Seriousness is one filter. Another one would be what is a boundary of a personnel issue versus something else. Ms. Mason: Right. I may have ventured off topic. Where Harriet was saying we're not providing a lot of detail, that's what I'm trying to address with the City Attorney, how much detail is appropriate. Council Member DuBois: I think there's two dimensions on that too. There's the level that the City Auditor is involved to determine the categorization versus what's reported back to us. I don't think we're necessarily interested in personnel matters being reported back out. I think we are interested in the City Auditor maybe having more control over the hotline. Ms. Richardson: When I ... Attachment B DRAFT MINUTES Page 6 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 Ms. Mason: The hotline's under the City Auditor. Ms. Richardson: The hotline is under us to receive the calls, but we don't really have any authority beyond that is what it comes down to. When I talk to auditors in other jurisdictions that have a hotline, they maintain a lead role even when they put the complaint out to a department for investigation. They get a enough detail where they can actually overturn the outcome. If someone says it's unsubstantiated, the auditor might look at the detail of the write-up, but they have enough information to be able to do that. They say, "We disagree. This is clearly an issue." I talked to an auditor recently in California where that was the case, where the city manager in that city said it's not an issue. The issue came back through the hotline a second time, and the auditor maintained full control over it and said, "Yes, it is an issue," after he did his investigation. Chair Burt: Those cities, how does the auditor contend with issues that are personnel issues and have that confidentiality requirement? Ms. Richardson: Generally, the auditor still sees that information. In our case, there's a very limited number of people who can see the outcomes. We have a system, and the person who complains can see what their complaint is. We write a very general response to the complainant back, but they don't see all of the detail about what has been done to investigate it. Even if I got that information, I mean as an Auditor, I have an obligation to have integrity and maintain confidentiality. I don't see it quite the same way as it being a personnel issue that I shouldn't be able to see the information to make a determination if that was the right outcome. I don't think I need to be actively involved in saying, "You implemented the wrong disciplinary action." I think that's strictly management's decision. If there's enough information to say yes, there is or there isn't a problem, I do see it as ... Chair Burt: More of a systemic problem you mean or ... Ms. Richardson: It might be systemic, but it might be pertaining to a specific individual also. Chair Burt: Cory. Council Member Wolbach: Actually, I find that kind of concerning. Actually a couple of things. One, I hope that we're using thought and discretion if somebody forgets to punch a timecard, that we don't jump to the conclusion that they're intentionally trying to steal from the City. Sometimes Attachment B DRAFT MINUTES Page 7 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 something slips their mind, forget to turn off the light switch, forget to lock the door, forget to punch your timecard, not necessarily trying to drain the electricity bill, leave the City unsecured or steal. I just hope we're using good discretion about that. I would like to see us move towards the City Auditor having a little bit more control. The reason for that is I want to make sure that City Staff top to bottom feel comfortable calling the hotline as a way to go outside of their usual chain of command. If it just goes back to the chain of command, then they would just report it up the line. If it just goes up the line anyway, then there's no reason to have a hotline which is designed to provide an outside mechanism. Having heard those concerns from City Staff, just that if that if they were hypothetically in a situation where they wanted to report something, but they don't feel that the current hotline structure provides that anonymity and protection, it says to me that we should have a little bit more independence for the hotline from the usual chain of command. We can explore that more in the future perhaps. Ed Shikada, Assistant City Manager: I would want to clarify—excuse me— that this is outside the typical chain of command, because it is shared with the City Attorney, the City Auditor as well as the City Manager. Quite frankly, the checks and balances inherent in that three-party review takes it out of the potential of any one of the Council Appointed Officers having the sole direct responsibility for any personnel issue that exists. I would disagree with Harriet. On my experience, it has not been of greater control by the Auditor. Having that shared responsibility among Council appointees is one of the more pressing (inaudible) as well, including with the police auditor in which the police auditor may have the opportunity to review but not to have any more control over the disposition of the investigation any (inaudible). Council Member Wolbach: I was just going to say I don't want to belabor the point. I wonder if maybe this is something that we'd want to take up in greater depth at some point in the future. Ms. Mason: One thing I just want to share, we independently investigate the complaints. I make sure Harriet's onboard and Molly with the approach we're going to take. I just want to make sure we jointly approach that and it is an independent investigation. We don't turn it over to the department and the chain of command. We're actively involved in that. Chair Burt: I heard earlier that there are some issues that are being discussed with the City Attorney on certainly these areas of personnel matters were the ones that you're having additional ... Attachment B DRAFT MINUTES Page 8 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 Ms. Mason: The appropriate level of detail to provide in a personnel matter is ... Chair Burt: That aspect, I guess we have to hear back from the group of you after Molly has looked into that more. Is that correct? For us to understand. Ms. Mason: We're talking about it together. We've really been approaching this as a joint responsibility. Chair Burt: From the Council's standpoint, who set up the hotline and had it reporting through to the City Auditor, I think a legitimate question that we have is how well is that functioning and to what degree is the hotline independent. We're hearing from the City Auditor concerns that the Auditor's Office or the Auditor herself, if we want to in the case of the hotline even in some of these ones that might include personnel aspects, we might even want to restrict to the City Auditor rather than the City Auditor's Staff involvement in those issues. To what extent should the City Auditor be more informed about the basis for outcomes and engaged in that? It sounds that at the current time those things are being treated as personnel matters outside of any review by the Auditor. Ms. Mason: I think it would help to have the City Attorney in the dialog. Maybe at the next update Molly can be part of the discussion. I think part of it is if there was a complaint of embezzlement, I think that the Auditor would be the lead investigating that. When it's a personnel matter—again, we're having this independently looked at—the question is where does the personnel function fall. That's when some of our dialog about is the City Manager responsible for appropriate personnel action. That's the dialog we've been having with Molly. I just wanted to share that. Ms. Richardson: One of the things that when the hotline was established, it was intended originally—when the audit was done, it was intended to be a fraud, waste, abuse, ethics hotline. I think where it has evolved is a fraud hotline. I think we need guidance as to what Council really wants the hotline to be. If you want it to be fraud, waste, abuse and ethics or do you really only want it to be fraud. I think that might be some of the discussion that we really need to focus on to know what direction we should be going with them. Council Member Wolbach: Do you need that tonight or ... Ms. Richardson: I guess that would depend on whether you want to give me some direction tonight to do something. Attachment B DRAFT MINUTES Page 9 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 Council Member DuBois: The seven, I guess, this year, did you think that was tied to the recent ethics training? Did that trigger more calls to the hotline? Ms. Richardson: These were before the training started. Chair Burt: How is the hotline being framed in the training? Ms. Richardson: It's very limited. Everyone reads the ethics policy, and it does address in there that if someone wants to report anonymously, they can report through the ethics hotline. It was mentioned briefly aside from just reading it, but most of the training has focused on—the ethics policy is much longer than that one little sentence. It's focused on other parts of that and then a lot of case studies of ethical challenges, kind of working through what would you do in those situations. Ms. Mason: Harriet, I just want to say something. You and I sat through the Executive Leadership Team training, and we were doing kind of feedback, dissecting as we were going through it so that we could give feedback to improve the training. I kicked off the last two sessions, and I opened it welcoming people, explaining why we felt it was important. I pointed out in my comments, "You will notice as part of the training that the ethics hotline is highlighted. There is a phone number. There is a diagram in the training that shows all the ways you can report. You can go to your supervisor. You can go to Human Resources, City Manager, ethics hotline. It's right on that diagram." I just want you to know I've been opening every training. We're just getting started. I am going to be trying to stay through every training, or Ed, one of the two of us, so that we are there to make sure it's clear and clarified. I just want you to know—I know you and I were in a different training, but I was very clear in the beginning. I pointed out the hotline and where the phone number is. I just want you to know that. Chair Burt: Thanks. Cory. Council Member Wolbach: I guess—thank you by the way for that. I really appreciate the efforts to increase awareness about it. Speaking for myself, I certainly think that the full scope of the intention of the hotline as originally created should be maintained and should not be narrowed. To clarify on the point of chain of command—I have a great deal of respect and strong confidence in all of our ELT including the City Manager and our two wonderful Assistant City Managers. The chain of command, as I see it, does include those positions. The City Auditor being outside of that chain of command, even to the very top, I think is important, at least when the calls Attachment B DRAFT MINUTES Page 10 of 10 Policy and Services Committee Special Meeting Draft Minutes 11/10/15 first come in, in case there's potentially some point in the future or say some different City Manager and there's a need for the City Auditor to respond to a hotline call independently of the City Manager or City Manager's chain of command. I want to make sure that's still an option that can be utilized if necessary, heaven forbid. Chair Burt: We'll need to have this come back to the Committee after you've had further huddling and maybe update on what is the current hotline training versus what maybe was the former. Ms. Mason: It wasn't former. It was just that the first training was with the whole Executive Leadership Team. We wanted to make sure we started at the top, but it was also an opportunity to dialog about maybe this would be better or that. It was kind of a joint training and feedback. I just wanted to show Harriet since we've ruled it out beyond the Executive Leadership Team, I am making sure that's introduced at the beginning. Chair Burt: There's no action. Ms. Richardson: Yes, there is. Chair Burt: There is. I'm sorry. We're still on the quarterly report. We're not going to make that mistake two times in a row on that. We need a motion to recommend to the Council acceptance of the Auditor's Quarterly Report as of September 30th. Council Member Wolbach: So moved. Chair Burt: Second. MOTION: Council Member Wolbach moved, seconded by Chair Burt to recommend the City Council accept of the Auditor’s Office Quarterly Report as of September 30, 2015. Chair Burt: Any discussion? All in favor. That passes unanimously. MOTION PASSED: 4-0 Attachment B CITY OF PALO ALTO OFFICE OF THE CITY AUDITOR January 25, 2016 The Honorable City Council Palo Alto, California Finance Committee Recommendation to Accept Macias Gini & O'Connell's Audit of the City of Palo Alto's Financial Statements as of June 30, 2015 and Management Letter The Office of the City Auditor recommends acceptance of Macias Gini & O’Connell’s Audit of the City of Palo Alto’s Financial Statements as of June 30, 2015 and Management Letter. At its meeting on November 17, 2015, the Finance Committee approved and unanimously recommended the City Council accept this report. The Finance Committee minutes are included in this packet. Respectfully submitted, Harriet Richardson City Auditor ATTACHMENTS:  Attachment A: Macias Gini & O’Connell’s Audit of the City of Palo Alto’s Financial Statements as of June 30, 2015 and Management Letter (PDF)  Attachment B: Finance Committee Meeting Minutes Excerpt (November 17, 2015) (PDF) Department Head: Harriet Richardson, City Auditor Page 2 CITY OF PALO ALTO OFFICE OF THE CITY AUDITOR November 17, 2015 The Honorable City Council Attention: Finance Committee Palo Alto, California Macias Gini & O'Connell's Audit of the City of Palo Alto's Financial Statements as of June 30, 2015 and Management Letter RECOMMENDATION We recommend the Finance Committee review and forward to the City Council for approval the City of Palo Alto’s audited financial statements for the fiscal year ended June 30, 2015, and the accompanying reports provided by Macias Gini & O’Connell LLP. DISCUSSION The City Charter requires that the City Council, through the City Auditor, engage an independent certified public accounting firm to conduct the annual financial audit. The selected firm reports the results of the audit, in writing, to the City Council. Macias Gini & O’Connell LLP, a certified public accounting firm based in Sacramento, California, conducted the audits of the City’s financial statements for the fiscal year ended June 30, 2015. The Administrative Services Department provides the Comprehensive Annual Financial Report (CAFR) and Single Audit Report, including the following Independent Auditor’s Reports, to the Finance Committee:  Independent Auditor’s Reports on the Financial Statements (CAFR)  Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards (Single Audit Report)  Independent Auditor’s Report on Compliance for Each Major Program and on Internal Control over Compliance Required by OMB Circular A‐133 (Single Audit Report) We are providing copies of the following financial statements and reports, as prepared by MGO:  Report to the City Council (the “Management Letter”) – Attachment A  Pedestrian/Bicycle Facilities Grants, Metropolitan Transportation Commission, Transportation Development Act Funds, Article III, Independent Auditor’s Reports, Financial Statements and Supplementary Information for the year ended June 30, 2015 – Attachment B  Regional Water Quality Control Plant, Independent Auditor’s Report and Financial Statements for the year ended June 30, 2015 – Attachment C Attachment A Page 2  Palo Alto Public Improvement Corporation (a Component Unit of the City of Palo Alto), Annual Financial Report for the year ended June 30, 2015 – Attachment D  General Obligation Bonds, Capital Projects Fund (a Fund of the City of Palo Alto), Independent Auditor’s Reports, Financial Statements, and Independent Accountant’s Report for the year ended June 30, 2015 – Attachment E  Independent Accountant’s Report on Applying Agreed-Upon Procedures Related to the Article XIII-B Appropriations Limit for the year ended June 30, 2015 – Attachment F  Cable TV Franchise – Independent Auditor’s Report and Statements of Franchise Revenues and Expenditures for the years ended December 31, 2014 and 2013 – Attachment G I would like to express appreciation to Macias Gini & O’Connell, and Laura Kuryk and her staff in the Administrative Services Department for their hard work and cooperation during the audit. Respectfully submitted, Harriet Richardson City Auditor ATTACHMENTS:  Attachment A: Report to the City Council (PDF)  Attachment B: Transportation Development Act (PDF)  Attachment C: Regional Water Quality Control Plant (PDF)  Attachment D: Public Improvement Corporation (PDF)  Attachment E: General Obligation Bonds Capital Projects Fund (PDF)  Attachment F: GANN Appropriation Limit (PDF)  Attachment G: Cable TV Franchise (PDF) Department Head: Harriet Richardson, City Auditor Attachment A Page 3 Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 Table of Contents Page(s) Transmittal Letter ........................................................................................................................................... i Required Communications ....................................................................................................................... 1 - 4 Current Year Recommendations ................................................................................................................... 5 Status of Prior Year Recommendations ................................................................................................... 6 - 7 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 i Honorable Mayor and the Members of the City Council of the City of Palo Alto Palo Alto, California In planning and performing our audit of the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Palo Alto, California (City), as of and for the year ended June 30, 2015, in accordance with auditing standards generally accepted in the United States of America, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of City’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control was for the limited purpose described in the first paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses. Given these limitations, during our audit, we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Following this letter, we have included a report on required communications to those charged with governance, as required by auditing standards generally accepted in the United States of America. This communication is intended solely for the information and use of the Mayor and City Council, the Finance Committee, management and others within the City, and is not intended to be and should not be used by anyone other than these specified parties. Walnut Creek, California November 3, 2015 Attachment A This page is intentionally left blank. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 1 REQUIRED COMMUNICATIONS We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Palo Alto (City) as of and for the year ended June 30, 2015. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated March 30, 2015. Professional standards also require that we communicate to you the following information related to our audit. Significant Audit Findings Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1. As described in Note 1(n) to the City’s basic financial statements, the City implemented three new Governmental Accounting Standards Board (GASB) pronouncements:  GASB Statement No. 68 – Accounting and Financial Reporting for Pension – an Amendment of GASB Statement No. 27 This statement addresses changes in the accounting and financial reporting requirements for pensions. Significant changes include an actuarial calculation of the total and net pension liability. It also includes comprehensive footnote disclosures regarding the pension liability, the sensitivity of the net pension liability to the discount rate, and pension expense and related deferred outflows/inflows of resources disclosures. The City restated its beginning balance of governmental activities and business-type activities by $229.4 million and $88.9 million to include the actuarially determined net pension liabilities. Certain items such as the differences between expected and actual investment rate of return are reported as deferred inflows of resources on the financial statements.  GASB Statement No. 69, Government Combinations and Disposals of Government Operations This statement does not have significant impact on the City’s financial statements.  GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date – an amendment of GASB Statement No. 68 This statement resolves transition issues in GASB Statement No. 68. The contributions made subsequent to the measurement date are reported as deferred outflows of resources of governmental activities and business-type activities in the amount of $19.2 million and $8.1 million respectively. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 2 REQUIRED COMMUNICATIONS (Continued) Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were:  Fair value of investments. The City’s investments are generally carried at fair value, which is defined as the amount that the City could reasonably expect to receive for an investment in a current sale between a willing buyer and a willing seller and is generally measured by quoted market prices.  Estimated allowance for losses on notes and loans receivable. The allowance for losses on notes and loans receivable was based on management’s estimate regarding the likelihood of collectability.  Useful life estimates for capital assets. The estimated useful lives of capital assets were based on management’s estimate of the economic life of its capital assets.  Accrued landfill closure/post-closure costs. The City has estimated, based on a study conducted by consultants, the closure/post-closure costs of the Palo Alto landfill based on what it would cost to perform all currently mandated closure and post-closure care. Actual closure and post-closure care costs may be higher due to inflation variances, changes in technology, or changes in State or federal regulations.  Valuation of the net other postemployment benefits (OPEB) asset. The net OPEB asset is the amount of cumulative City contributions that exceeded the actuarially determined annual required contributions, which is based upon certain approved actuarial assumptions.  Annual required contributions to pension and other postemployment benefit plans. The City is required to contribute to its pension and OPEB plans at an actuarially determined rate and to measure these benefit costs based upon certain approved actuarial assumptions.  Claims loss reserve. The City is exposed to a variety of risks of loss due to general liability, workers’ compensation and other claims and records an estimate of these losses based on actuarial studies performed by third party actuaries. These studies are prepared based on the City’s prior claims history, which is used as a basis for extrapolating losses for known and incurred but not reported claims. Actual loss experience may vary from these estimates. We evaluated the key factors and assumptions used to develop the accounting estimates described above in determining that they are reasonable in relation to the City’s basic financial statements taken as a whole. Certain financial statements disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were the disclosure of the City’s Pension Plans in Note 11, the Retiree Health Benefits in Note 12 and the Commitments and Contingencies in Note 16. The financial statement disclosures are neutral, consistent, and clear. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 3 REQUIRED COMMUNICATIONS (Continued) Difficulties Encountered in Performing the Audit We encountered no difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole. Disagreements with Management For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated November 3, 2015. Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Other Matters We applied certain limited procedures to Management’s Discussion and Analysis, the schedule of changes in the net pension liability and related ratios and the schedule of employer pension contributions, which is required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 4 REQUIRED COMMUNICATIONS (Continued) We were engaged to report on the combining and individual nonmajor fund financial statements and schedules and the schedule of expenditures of federal awards, as required by the Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We were not engaged to report on the introductory and statistical sections, which accompany the financial statements but are not RSI. We did not audit or perform other procedures on this other information and we do not express an opinion or provide any assurance on them. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 5 CURRENT YEAR RECOMMENDATIONS None noted. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 6 STATUS OF PRIOR YEAR RECOMMEDATIONS 2011-01 - A Comprehensive Disaster Recovery Plan Has Not Been Fully Developed and Tested (Significant Deficiency) General computer controls should ensure that plans have been developed and documented to provide contingency for unforeseeable events, including the recovery of operational and financial data in the event of a disaster. The City, however, has not completed the development of a comprehensive disaster recovery plan. City’s IT management stated the prolonged plan development process was due to a lack of sufficient resources. The lack of a comprehensive plan that has been fully tested places the City at an increased risk of loss of financial data in the event of a disaster that affects the City’s server room. We recommend the City’s Chief Information Officer (CIO), working with the City Manager, should plan to budget for the resources necessary to complete the development of a comprehensive disaster recovery plan. Once the plan is completed, it should be fully tested to ensure the City’s financial data can be restored in a reasonable amount of time. Current Year Status: In Progress. The City has engaged Seagate Technology to develop a data center backup/ recovery plan (implementing Moss Adams’ analysis.) Target implementation date is by December 2015. 2011-03 - A Comprehensive IT Risk Assessment Has Not Been Performed (Significant Deficiency) General computer controls over the access to programs and data should require that a mechanism or procedures be in place to identify and react to risks arising from internal and external sources. A comprehensive means to identify IT risks is through the periodic performance of IT risk assessments. The City, however, has not performed a formal comprehensive and independent IT risk assessment to help identify the risks to the delivery of IT services and the accuracy and integrity of the City’s financial and personnel data. We recommend the City’s CIO (acting) should plan and budget for an independent IT risk assessment to be performed on the department’s functions. The risk assessment should focus on identifying all of the possible risks to the City’s IT department, the delivery of IT services and the accuracy and integrity of the City’s financial and personnel data. The risk assessment should quantify the likelihood of an event, the impact of the event and the mitigating controls that would address the possible risk. The risk assessment should also include network penetration testing to ascertain the vulnerabilities of the City’s computer network from hacking attempts. Attachment A CITY OF PALO ALTO Report to the City Council For the Year Ended June 30, 2015 7 STATUS OF PRIOR YEAR RECOMMEDATIONS (CONTINUED) 2011-03 - A Comprehensive IT Risk Assessment Has Not Been Performed (continued) (Significant Deficiency) Current Year Status: In Progress. The City plans to complete the assessment by late 2015. 2011-04 - City IT Department Does Not Have Oversight Over Non-Core Financial Applications (Significant Deficiency) The City has several applications that are used by the various departments. These include; Class, used by Parks and Recreation; Chameleon, used by Animal Services; Horizon, used by the Libraries; and Acella, used for Permitting. These applications are owned by the individual departments and not controlled nor managed by the City’s IT Department. Since management of the applications is decentralized, the individual applications may not adhere to best practices for application access (password configuration) or management of authorization profiles. This places the City’s network and financial data at increased risk of unauthorized access. We recommend the City’s Internal Auditor, working with the CIO (acting), should review the password configuration requirements being used in the City’s non-core financial applications. If it is found that the password requirements do not meet industry best practices shown in the table below, the password configuration settings within the applications should be updated, if possible. Account Setting Best Practices Password Length (Min.) 7-9 characters Expiration Period 30-60 days Account Lockout Threshold 3-5 invalid logon attempts will lock the account. Strong Passwords Required Yes Current Year Status: On hold. Implementation has been hampered by the fact that city-wide password standards are lower than the strong passwords in the Network and SAP Password Policy. Revised Recommendation: The City Manager should work with the Chief Information Officer to either (1) amend the city- wide password standards to include the strong password requirements included in the Network and SAP Password Policy, or (2) amend the Network and SAP Password Policy to cover the network and all financial-related applications. Attachment A    8 This page is intentionally left blank. Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III Independent Auditor’s Reports, Financial Statements and Supplementary Information For the Year Ended June 30, 2015 Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III For the Year Ended June 30, 2015 Table of Contents Page Independent Auditor’s Report ................................................................................................................... 1 Financial Statements Balance Sheet ................................................................................................................................... 3 Statement of Revenues, Expenditures, and Changes in Fund Balance ........................................... 4 Notes to the Financial Statements .................................................................................................... 5 Supplementary Information Schedule of Construction Projects with Capital Outlay Expenditures............................................. 7 Internal Control and Compliance Section Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards and the Transportation Development Act............................................... 9 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Auditor’s Report Honorable Mayor and the Members of the City Council of the City of Palo Alto Palo Alto, California Report on the Financial Statements We have audited the accompanying financial statements of the Pedestrian/Bicycle Facilities Grants (Grants) made to the City of Palo Alto, California (City), by the Metropolitan Transportation Commission, Transportation Development Act Funds, Article III, as of and for the year ended June 30, 2015, and the related notes to the financial statements, as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibilities Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Attachment A 2 Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Grants as of June 30, 2015, and the changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As described in Note 1 to the financial statements, the financial statements present only the Grant and do not purport to, and do not, present fairly the financial position of the City as of June 30, 2015, and changes in its financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter. Other Matters Other Information Our audit was conducted for the purpose of forming an opinion on the financial statements. The accompanying schedule of construction projects with capital outlay expenditures (Schedule) is presented for purposes of additional analysis and is not a required part of the financial statements. The Schedule is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Schedule is fairly stated, in all material respects, in relation to the financial statements as a whole. Other Reporting Required by Government Auditing Standards and the Transportation Development Act In accordance with Government Auditing Standards and the Transportation Development Act, we have also issued our report dated November 3, 2015, on our consideration of the City’s internal control over the Grants’ financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and the Transportation Development Act in considering the City’s internal control over the Grants’ financial reporting and compliance. Walnut Creek, California November 3, 2015 Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III Balance Sheet June 30, 2015 Assets Due from the Metropolitan Transportation Commission -$ Liabilities Due to the City of Palo Alto -$ Fund balance Unassigned - Total liabilities and fund balance -$ See accompanying notes to the financial statements. 3 Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III Statement of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended June 30, 2015 Revenues Grant 97,712$ Expenditures Capital outlay 82,712 Change in fund balance 15,000 Fund Balance - beginning of year (15,000) Fund Balance - end of year -$ See accompanying notes to the financial statements. 4 Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III Notes to the Financial Statements For the Year Ended June 30, 2015 5 NOTE 1 – DESCRIPTION OF REPORTING ENTITY The accompanying financial statements are prepared from the accounts and financial transactions of the City of Palo Alto, California (City) for the projects funded under the Transportation Development Act of 1971 (TDA) Article III of the State of California, which include the construction of pedestrian and bicycle paths. The financial statements do not purport to present the financial position or changes in financial position of the City. The projects represent a portion of the accounts of the City and, as such, are included in the City’s basic financial statements. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation The Pedestrian/Bicycle Facilities Grants (Grants) have been accounted for in the Capital Project Fund, which is a major governmental fund type and is included in the City’s basic financial statements. The capital project fund accounts for resources used for acquisition and construction of capital facilities by the City, with the exception of those assets financed by proprietary funds. (b) Basis of Accounting The accompanying financial statements have been prepared on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are recorded when the related governmental fund liabilities are incurred. Grant revenues, which are received as reimbursement for specific purposes or projects, are recognized when they become measurable and available. The City considers revenues susceptible to accrual to be available if the revenues are collected within ninety days after year-end, except for property taxes, which are available if collected within sixty days after year-end. (c) Fund Balance The City reports fund balance for governmental funds in specific classifications (nonspendable, restricted, committed, assigned and unassigned) based on the extent to which the City is bound to the constraints on the specific purposes for which funds can be spent. (d) Due to the City of Palo Alto Cash has been advanced to the Grants’ projects for expenditures paid by the City’s major capital projects fund for the benefit of the TDA Article III projects. The projects are obligated to immediately repay these advances upon receipt of reimbursement from the Metropolitan Transportation Commission. Attachment A CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III Notes to the Financial Statements For the Year Ended June 30, 2015 6 NOTE 3 – COMPLIANCE REQUIREMENTS The TDA is defined at Chapter 4 of the California Public Utilities Code commencing with Section 99200. Funds received pursuant to Section 99235 of the TDA (Article 3) may only be used for facilities provided for exclusive use by the project. NOTE 4 – SECTION 99301 – INTEREST EARNED ON ALLOCATED FUNDS The City incurred and paid expenditures prior to the receipt of the Grant reimbursements; as a result, no interest was earned on Grant funds. Attachment A Title of Project Project Number Awards Carried Over from Prior Year Current Year Allocation/ (Recission) Total Awards Cumulative Capital Outlay Expenditures as of June 30, 2014 Current Year Capital Outlay Expenditures Cumulative Capital Outlay Expenditures as of June 30, 2015 Status of Project TDA 12-13 Fabian Way Enhanced Bike Lane Improvements 13001027 43,359 (28,359) 15,000 15,000 - 15,000 Completed TDA 13-14 Charleston "Connection Corridor" Pathway Improvement Project 14001039 82,712 - 82,712 - 82,712 82,712 Completed 126,071$ (28,359)$ 97,712$ 15,000$ 82,712$ 97,712$ The following schedule identifies the projects with capital outlay expenditures during fiscal year 2015: Schedule of Construction Projects with Capital Outlay Expenditures For the Year Ended June 30, 2015 CITY OF PALO ALTO, CALIFORNIA Pedestrian/Bicycle Facilities Grants Metropolitan Transportation Commission Transportation Development Act Funds, Article III 7 Attachment A 8 This page is left intentionally blank. Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 9 Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Governmental Auditing Standards and the Transportation Development Act Honorable Mayor and the Members of the City Council of the City of Palo Alto Palo Alto, California We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, the financial statements of the Pedestrian/Bicycle Facilities Grants (Grants) made to the City of Palo Alto, California (City), by the Metropolitan Transportation Commission, Transportation Development Act Funds, Article III, as of and for the year ended June 30, 2015, and the related notes to the financial statements, and have issued our report thereon dated November 3, 2015. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the City’s internal control over the Grants’ financial reporting (internal control) to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exists that have not been identified. Attachment A 10 Compliance and Other Matters As part of obtaining reasonable assurance about whether the Grants’ financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, including the applicable statutes, rules and regulations of the Transportation Development Act, including Section 6666 of Title 21, of the California Code of Regulations, and the allocation instructions and resolutions of the Metropolitan Transportation Commission, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards or the Transportation Development Act. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control over compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Walnut Creek, California November 3, 2015 Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Independent Auditor’s Report and Financial Statements For the Year Ended June 30, 2015 Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT For the Year Ended June 30, 2015 Table of Contents Page Independent Auditor’s Report ................................................................................................................... 1 Financial Statements: Statement of Net Expenditures ............................................................................................................... 3 Statement of Quarterly Billings .............................................................................................................. 4 Notes to the Financial Statements ........................................................................................................... 5 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Auditor’s Report The Honorable Mayor and Members of the City Council of the City of Palo Alto Palo Alto, California We have audited the accompanying financial statements of the City of Palo Alto Regional Water Quality Control Plant (Plant), an enterprise operation of the City of Palo Alto, California (City), for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise the Plant’s financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the financial reporting provisions of the Basic Agreement between the City, the City of Mountain View and the City of Los Altos for the Acquisition, Construction and Maintenance of a Joint Sewer System, dated October 10, 1968, and subsequent letters of agreement dated December 5, 1977, January 14, 1980, April 9, 1985, July 3, 1990, July 31, 1992 and March 16, 1998, as described in Note 2 to the financial statements. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Attachment A 2 Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the revenues, expenditures and quarterly billings of the Plant for the year ended June 30, 2015, in accordance with the financial reporting provisions of the Basic Agreement between the City, the City of Mountain View and the City of Los Altos for the Acquisition, Construction and Maintenance of a Joint Sewer System, dated October 10, 1968, and subsequent letters of agreement dated December 5, 1977, January 14, 1980, April 9, 1985, July 3, 1990, July 31, 1992 and March 16, 1998, described in Note 2 to the financial statements. Basis of Accounting As discussed in Note 2 to the financial statements, the financial statements are prepared in accordance with the financial reporting provisions of the Basic Agreements between the City, City of Mountain View and the City of Los Altos, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter. Restriction on Use This report is intended solely for the information and use of the City Council and management of the Cities of Palo Alto, Mountain View and Los Altos, and is not intended to be and should not be used by anyone other than these specified parties. Walnut Creek, California November 3, 2015 Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Statement of Net Expenditures City of City of City of Total Mountain View Los Altos Palo Alto Direct Expenditures: Source control program 1,039,809$ 408,021$ 107,100$ 524,688$ Public outreach 111,152 43,616 11,449 56,087 Permitting and enforcement 1,098,823 294,109 17,347 787,367 Operations and maintenance 12,912,261 5,066,771 1,329,963 6,515,527 System improvement CIP (Note 3) 3,942,615 1,547,082 406,089 1,989,444 Total Direct Expenditures 19,104,660 7,359,599 1,871,948 9,873,113 Indirect Administrative Expenditures (Note 4): Source control program 658,757 258,496 67,852 332,409 Public outreach 787 309 81 397 Permitting and enforcement 394,183 271,486 16,013 106,684 Operations and maintenance 2,569,685 1,008,345 264,678 1,296,662 Total Indirect Administrative Expenditures 3,623,412 1,538,636 348,624 1,736,152 Debt Service Expenditures (Note 5): Refunding 1990 Series A Bonds 282,192 143,918 22,011 116,263 1999 Wastewater Treatment New Project 546,729 207,156 51,775 287,798 2009 State Water Resource Loan 555,726 210,565 52,627 292,534 Total Debt Service Expenditures 1,384,647 561,639 126,413 696,595 Total Expenditures 24,112,719 9,459,874 2,346,985 12,305,860 Deduct Joint Systems Revenues (Note 6) (387,110) (151,902) (39,872) (195,336) Net Expenditures 23,725,609$ 9,307,972$ 2,307,113$ 12,110,524$ For the Year Ended June 30, 2015 See accompanying notes to the financial statements. 3 Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Statement of Quarterly Billings City of City of Mountain View Los Altos Billings by Quarter, Beginning: July 1, 2014 1,950,793$ 496,344$ October 1, 2014 2,229,717 563,314 January 1, 2015 1,950,793 496,344 April 1, 2015 2,233,293 555,701 Total quarterly billings 8,364,597 2,111,703 Net expenditures 9,307,972 2,307,113 Excess of net expenditures over total billings (943,375)$ (195,410)$ For the Year Ended June 30, 2015 See accompanying notes to the financial statements. 4 Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Notes to the Financial Statements For the Year Ended June 30, 2015 5 NOTE 1 – THE REPORTING ENTITY The Cities of Palo Alto, Mountain View and Los Altos (the Members) participate jointly in the cost of maintaining and operating the Regional Water Quality Control Plant and related system (the Plant). The Members share the original costs of acquisition and construction of the Plant in the same proportions as the allocation of capacity rights to them. The City of Palo Alto (the City) is the owner and administrator of the Plant. The Cities of Mountain View and Los Altos are entitled to use a portion of the capacity of the Plant for a period of 50 years as set forth in the Basic Agreement between the City, the City of Mountain View and the City of Los Altos for Acquisition, Construction and Maintenance of a Joint Sewer System dated October 10, 1968 and subsequent letters of agreement dated December 5, 1977, January 14, 1980, April 9, 1985, July 3, 1990, July 31, 1992 and March 16, 1998. The original agreement, as amended, may terminate any time after 50 years provided that written notice of withdrawal is tendered ten years preceding the date of withdrawal. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Plant is an enterprise that is operated by the City and its operations are accounted for as an enterprise fund in the City’s basic financial statements. The accompanying financial statements are intended to present the Plant’s net expenditures and quarterly billings by the Plant to the Cities of Mountain View and Los Altos pursuant to the agreement of the Members as described above and are not intended to be a complete presentation of the Plant’s financial position or results of operations. Additionally, the capital cost and the outstanding debt of the Plant are not presented in these statements but are presented in the basic financial statements of the City. Plant expenditures, and joint system revenues, debt service and industrial waste compliance expenditures are shared by the Members based on agreed upon allocation percentages. The expenditures and, including indirect administrative expenditures (see Note 4), are allocated to each of the Members based primarily on their respective percentages of the annual sewage flow and treatment needed for suspended solids, chemical oxygen demand and ammonia. Revenues from services, fines and penalties are allocated to each of the Members in the same proportions as those of expenditures. Debt service payments are allocated based on percentages established at the time of bond issuance. Industrial waste compliance (Public Outreach and permitting and enforcement) charges are allocated to Members primarily based on upon the number of industries and efforts required to maintain compliance with sewage use ordinances and other regulations from Environmental Protection Agency. The percentages used for the year ended June 30, 2015, to allocate expenditures and revenues were: City of City of City of Mountain View Los Altos Palo Alto Public outreach, source control program, operations and maintenance, system improvement 39.24% 10.30% 50.46% CIP and joint system revenues Debt services expenditures: Refunding 1990 Series A Bonds 51.00% 7.80% 41.20% 1999 Wastewater Treatment New Project 37.89% 9.47% 52.64% 2009 State Water Resources Loan 37.89% 9.47% 52.64% Permitting and enforcement 37.88% 2.23% 59.89% Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Notes to the Financial Statements (continued) For the Year Ended June 30, 2015 6 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The City is allocated 50.46% of total usage of the treatment plant. The City does not fully utilize its percentage allocation. Therefore, the City has entered into separate contracts to allocate portions of its excess to other entities. Fiscal year 2015 allocations are as follows: East Palo Alto Sanitary District 6.22% Stanford University 6.85% Town of Los Altos Hills 1.41% Remaining City percentages 35.98% Total 50.46% The agreement the City has with the above entities has no effect on the partnership agreement between the Members. Billings are made in advance and are based on the adopted budget for the plant and estimated sewage flow. Excess billings (over) under net expenditures are offset against the subsequent year payments during the second quarter of the subsequent fiscal year. NOTE 3 – SYSTEM IMPROVEMENT CIP (MINOR CAPITAL) The basic agreement between the Members, dated October 10, 1968, provides that the administrator of the Plant is responsible for capital additions. These capital additions should be for the replacement of obsolete or worn-out units, or minor capital additions to improve the efficiency of the Plant’s operations. Per an addendum to the agreement dated March 16, 1998, the Members agreed that capital additions should not exceed $1.9 million in 1998-99 (base year). For future years, the base year amount will be adjusted annually based on increases to the Consumer Price Index-Urban Wage Earners and Clerical Workers for the San Francisco-Oakland-San Jose area. For fiscal year 2014-15, the adjusted capital additions limit is $2,800,893. Actual System Improvement CIP expenditures amounted to $3,942,615 for fiscal year 2015. As of June 30, 2015, the remaining capital additions limit accumulated but unspent is $5,353,283, of which commitments of $3,663,155 have been carried forward to fiscal year 2016. NOTE 4 – INDIRECT ADMINISTRATIVE EXPENDITURES Indirect expenditures include those costs allocated from the City’s General Fund administrative services, which supports all operating departments of the City. Other indirect expenses are administrative charges from the City’s Internal Services Funds. These allocations are applied on a uniform basis throughout the City. The allocations are in accordance with the subsequent letter of agreement dated April 9, 1985. NOTE 5 – DEBT SERVICE EXPENDITURES Debt service expenditures include principal repayments, interest expense and amortization of bond discount reduced by any interest income earned from investments with the fiscal agent, related to the 1999 Series A Bonds (split for the portions used for the “New Project” and refunding of the 1990 Series A Bonds) and the 2009 State Water Resources loan. Attachment A CITY OF PALO ALTO REGIONAL WATER QUALITY CONTROL PLANT Notes to the Financial Statements (continued) For the Year Ended June 30, 2015 7 NOTE 5 – DEBT SERVICE EXPENDITURES (Continued) In prior years, the City, City of Mountain View, City of Los Altos, Town of Los Altos Hills, East Palo Alto Sanitary District and Stanford University agreed to issue bonds (1999 Series A Bonds) to finance the rehabilitation of the Wastewater Treatment System’s two sludge incinerators and to refund the existing 1990 Series A Bonds. In October 2009, the City approved the 2009 State Water Resources Loan to finance the Ultraviolet Disinfection Project. The outstanding principal amount of debts as of June 30, 2015 are allocated as follows: 1999 Wastewater Refunding of 2009 Treatment 1990 Series A State Water New Project Bonds Resources Loan Total City of Palo Alto 1,429,091$ 491,559$ 2,747,088$ 4,667,738$ City of Mountain View 1,418,981 1,002,781 2,727,651 5,149,413 City of Los Altos 354,652 153,367 681,733 1,189,752 East Palo Alto Sanitary District 286,118 233,982 549,994 1,070,094 Stanford University 196,987 80,616 378,661 656,264 Town of Los Altos Hills 59,171 3,932 113,742 176,845 Total 3,745,000$ 1,966,237$ 7,198,869$ 12,910,106$ As required by the Indenture, the City established a debt service reserve fund for the Bonds (the “Reserve Account”), with a minimum funding level requirement in the Reserve Account (the “Reserve Requirement”). At the time it issued the Bonds, the City satisfied the Reserve Requirement with a deposit into the Reserve Account of a surety bond (the “Surety Bond”) in the amount of $1,647,300 issued by Ambac Indemnity Corporation (renamed to Ambac Assurance Corporation in 1997). On May 1, 2013, Ambac Financial emerged from bankruptcy protection, which had been filed under Chapter 11 of the Bankruptcy Code in November 2010. Ambac Assurance remains subject to rehabilitation proceedings undertaken by the Wisconsin Office of the Commissioner of Insurance. No assurance can be made regarding the claims paying ability of Ambac Assurance on the surety bonds described above. NOTE 6 – JOINT SYSTEM REVENUES The Plant’s joint system revenues for the year ended June 30, 2015 total $387,110, which consisted of the following: Septic hauling services 224,925$ Other miscellaneous srevenues 102,619 Salt water marsh services 7,500 Utility service to other utility funds 52,066 387,110$ NOTE 7 – RELATED PARTY TRANSACTIONS During fiscal year 2015, the Plant paid the City $2,408,907 for utility costs. Such costs are included in the Statement of Net Expenditures as source control program, permitting and enforcement, and operations and maintenance expenditures. Vehicle replacement charges of $51,157 were paid to the City’s Equipment Replacement Fund, which is included in the Statement of Net Expenditures as operations and maintenance expenditures. Attachment A    8   This page is intentionally left blank. Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Annual Financial Report For the Year Ended June 30, 2015 Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) For the Year Ended June 30, 2015 Table of Contents Page Independent Auditor’s Report ................................................................................................................... 1 Management’s Discussion and Analysis (Unaudited) .............................................................................. 3 Basic Financial Statements Government-wide Financial Statements: Statement of Net Position ................................................................................................................... 5 Statement of Activities ....................................................................................................................... 6 Debt Service Fund Financial Statements: Balance Sheet ..................................................................................................................................... 7 Statement of Revenues, Expenditures and Changes in Fund Balance ................................................ 8 Notes to the Basic Financial Statements .................................................................................................. 9 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Auditor’s Report The Honorable Mayor and Members of the City Council of the City of Palo Alto, California We have audited the accompanying financial statements of the governmental activities and the major fund of Palo Alto Public Improvement Corporation (Corporation), a component unit of the City of Palo Alto, California (City), as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise the Corporation’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and the major fund of the Corporation as of June 30, 2015, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Attachment A 2 Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 3 through 4 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Walnut Creek, California November 3, 2015 Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Management’s Discussion & Analysis (Unaudited) For the Year Ended June 30, 2015 3 The Palo Alto Public Improvement Corporation (Corporation), a component unit of the City of Palo Alto (City), follows the provisions of Governmental Accounting Standards Board (GASB) Statement No. 34 (GASB 34), Basic Financial Statements - and Management’s Discussion and Analysis - for State and Local Governments. The Corporation is controlled by the City and was organized to assist the City in financing public improvements. The Corporation issues debt and turns the proceeds of the debt over to the City under lease agreements that provide a revenue source for the repayment of this debt. The Corporation has one debt issue outstanding and has turned the proceeds over to the City, which pledged certain lease payments as collateral for this debt as discussed in Note 4 to the financial statements. FISCAL YEAR 2015 FINANCIAL HIGHLIGHTS GASB 34 requires the issuance of government-wide financial statements as well as fund financial statements. The government-wide financial statements report the balance of the Corporation’s long-term debt while the individual fund statements do not. In fiscal year 2002, the Corporation issued its 2002B Downtown Parking Improvements Certificates of Participation (COPs) in the amount of $3.6 million. In fiscal year 2005, a partial redemption was completed by placing excess construction and debt service reserve funds into an escrow account to defease $900 thousand of the 2002B Downtown Parking Improvements COPs. As of June 30, 2015, the 2002B Downtown Parking Improvements COPs comprise the Corporation’s outstanding debt. At the government-wide level, interest and fiscal agent charges were $90 thousand for fiscal year 2015, a decrease of $9 thousand from the prior year. The interest for leases on the assets securing this COP issue was $93 thousand, a decrease of $8 thousand from the prior year. The interest on leases from the City exceeded interest expense by $3 thousand, thereby resulting in an increase in net position of $3 thousand over the prior year. The Corporation ended fiscal year 2015 with total assets of $1.5 million, a decrease of $0.1 million from the prior year. Total assets consist of $251 thousand in cash and investments and $1.3 million of leases receivable from the City of Palo Alto. Total liabilities were $1.3 million, a decrease of $0.1 million from the prior year, and included $178 thousand of current liabilities as well as $1.1 million of long-term debt due in more than one year. At the fund level, the Corporation’s revenues nearly equaled the expenditures. As of June 30, 2015, the Corporation had one fund, the Debt Service Fund, which reported a $251 thousand restricted fund balance. Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Management’s Discussion & Analysis (Unaudited) For the Year Ended June 30, 2015 4 OVERVIEW OF THE CORPORATION’S BASIC FINANCIAL STATEMENTS The Basic Financial Statements are in two parts: 1) Management’s discussion and analysis (this part), 2) The basic financial statements, which include the government-wide and the fund financial statements, along with the notes to these financial statements. The basic financial statements comprise the government-wide financial statements and the fund financial statements. These two sets of financial statements provide two different views of the Corporation’s financial activities and financial positions, both short-term and long-term. The government-wide financial statements provide a long-term view of the Corporation’s activities as a whole, and comprise the statement of net position and the statement of activities. The statement of net position provides information about the financial position of the Corporation as a whole, including all its long-term liabilities on the full accrual basis, similar to that used by corporations. The statement of activities provides information about all the Corporation’s revenues and expenses on the full accrual basis, with the emphasis on measuring net revenues or expenses of the Corporation’s program. The statement of activities explains in detail the change in net position for the year. The fund financial statements report the Corporation’s operations in more detail than the corporate-wide statements and focus primarily on the short-term activities of the debt service fund. Fund financial statements measure only current revenues and expenditures; current assets, liabilities and fund balances; and they exclude capital assets and long-term debt. Together, these statements along with the notes to the financial statements are called the basic financial statements. DEBT ADMINISTRATION The Corporation issues debt in the form of COPs for future lease receipts from the City of Palo Alto. Legally, these COP issues are the Corporation’s debt only; the City is liable only for the payment of the amounts set forth in the lease securing each COP issue. As of June 30, 2015, the Corporation has one outstanding debt related to the 2002B Downtown Parking Improvement projects with an outstanding balance of $1.3 million. ECONOMIC OUTLOOK AND MAJOR INITIATIVES The economy of the City and its major initiatives for the coming year are discussed in detail in the City’s Comprehensive Annual Financial Report. CONTACTING THE CORPORATION’S FINANCIAL MANAGEMENT These Basic Financial Statements are intended to provide citizens, taxpayers, investors, and creditors with a general overview of the Corporation’s finances. Questions about these financial statements should be directed to the Finance Department of the City of Palo Alto, 250 Hamilton Avenue, Palo Alto, CA 94301. Attachment A Assets Cash and investments held for operations 12,853$ Cash and investments held by trustee 237,962 Investment in leases to the City of Palo Alto 1,285,000 Total assets 1,535,815 Liabilities Interest payable 27,842 Long-term debt: Due in one year 150,000 Due in more than one year 1,135,000 Total liabilities 1,312,842 Net Position Restricted for debt service 222,973$ PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Statement of Net Position June 30, 2015 See accompanying notes to financial statements. 5 Attachment A Expenses Interest and fiscal agent charges 89,809$ Program revenues Interest on leases from the City of Palo Alto 92,950 Net program revenues 3,141 General Revenues Investment earnings 15 Change in net position 3,156 Net position, beginning of the year 219,817 Net position, end of the year 222,973$ PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Statement of Activities For the Year Ended June 30, 2015 See accompanying notes to financial statements. 6 Attachment A Assets Cash and investments held for operations 12,853$ Cash and investments held by trustee 237,962 Investment in leases to City of Palo Alto 1,285,000 Total assets 1,535,815$ Deferred Inflows of Resources Unavailable lease receipt from the City of Palo Alto 1,285,000$ Fund balance Restricted for debt service 250,815 Total liabilities and fund balance 1,535,815$ Reconciliation of fund balance to net position Fund balance restricted for debt service 250,815$ Accrual adjustment to remove deferred inflows of resources from the balance sheet 1,285,000 Some liabilities, including bonds payable, are not due and payable in the the current period and therefore are not reported in the funds: Interest payable (27,842) Long-term debt due within one year (150,000) Long-term debt due in more than one year (1,135,000) Net position of governmental activities 222,973$ PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Balance Sheet June 30, 2015 Debt Service Fund See accompanying notes to financial statements. 7 Attachment A Revenues: Lease receipts from the City of Palo Alto: Principal 145,000$ Interest 92,950 Investment earnings 15 Total revenues 237,965 Expenditures: Debt service: Principal repayment 145,000 Interest and fiscal agent charges 92,950 Total expenditures 237,950 Net change in fund balance 15 Fund balance, beginning of the year 250,800 Fund balance, end of the year 250,815$ Reconciliation of net change in fund balance to change in net position Net change in fund balance - debt serivce fund 15$ Amounts reported for governmental activities in the statement of activities are different because: Repayment of bond principal is an expenditure in the governmental funds, but in the statement of net position the repayment reduces long-term liabilities. 145,000 Some amounts reported in the statement of revenues, expenditures and changes in fund balances reflect the collection of an asset which are not includable as revenues on the statement of activities. Change in deferred inflows of resources (145,000) Change in interest payable 3,141 Change in net position of governmental activities 3,156$ PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Statement of Revenues, Expenditures and Changes in Fund Balance For the Year Ended June 30, 2015 Debt Service Fund See accompanying notes to financial statements. 8 Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Notes to the Basic Financial Statements For the Year Ended June 30, 2015 9 NOTE 1 – DESCRIPTION OF REPORTING ENTITY The Palo Alto Public Improvement Corporation (the Corporation) was incorporated in September 1983 under the General Nonprofit Corporation Law of the State of California to acquire, construct and lease capital improvement projects. The Corporation is exempt from federal income taxes under Section 501(c)(4) of the Internal Revenue Code. The Corporation provides financing of public capital improvements for the City through the issuance of Certificates of Participation (COPs), a form of debt which allows investors to participate in a stream of future lease payments. Proceeds from the COPs are used to construct projects which are leased to the City for lease payments which are sufficient in timing and amount to meet the debt service requirements of the COPs. The Corporation is an integral part of the City of Palo Alto (City). It primarily services the City and its governing body is composed of the City Council. Therefore, the financial data of the Corporation has also been included as a blended component unit within the City’s comprehensive annual financial report for the year ended June 30, 2015. NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation Government-wide Statements: The statement of net position and the statement of activities include the financial activities of the Corporation. Eliminations have been made to minimize the double counting of internal activities. The statement of activities presents a comparison between direct expenses and program revenues for each function of the Corporation’s activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs, and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including interest earnings, are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the Corporation’s funds. The emphasis of fund financial statements is on major individual funds, of which the Corporation only reports one debt service fund. (b) Major Fund Major funds are defined as funds that have either assets, liabilities, revenues or expenditures equal to ten percent of their fund-type total and five percent of the grand total. The Corporation has one fund which is reported as a major governmental fund in the accompanying financial statements: Debt Service Fund – This fund accounts for debt service payments on the Corporation’s long-term debt. (c) Investment in Leases Improvements financed by the Corporation are leased to the City for their entire estimated useful life and will become the City property at the conclusion of the lease during the year ended June 30, 2022. The Corporation therefore records the present value of the lease and considers the leased improvement to have been sold for this amount when leased. Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Notes to the Basic Financial Statements For the Year Ended June 30, 2015 10 NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued) (d) Net Position The government-wide financial statements utilize a net position presentation. Net position is further categorized as net investment in capital assets, restricted and/or unrestricted. As of June 30, 2015, the entire net position was considered restricted. Restricted Net Position – This category presents external restrictions imposed by creditors, grantors, contributors or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. (e) Deferred Inflows of Resources A deferred inflow of resources is defined as an acquisition of net position or fund balances applicable to a future reporting period and will not be recognized as an inflow of resources (revenue) until that time. On the governmental fund balance sheet, the lease receipts from the City corresponding to the debt are recorded as deferred inflows of resources since the balances are not current financial resources. The City considers revenues susceptible to accrual to be available if the revenues are collected within ninety days after year-end, except for property taxes, which are available if collected within sixty days after year-end. (f) Fund Balances At June 30, 2015, the Corporation’s governmental funds’ fund balances include the following classification: Restricted Fund Balance – includes amounts that can be spent only for the specific purposes stipulated by external resource providers, constitutionally or through enabling legislation. Restrictions may effectively be changed or lifted only with the consent of resource providers. (g) Estimates The preparation of basic financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Notes to the Basic Financial Statements For the Year Ended June 30, 2015 11 NOTE 3 – CASH AND INVESTMENTS HELD BY TRUSTEE Under the provisions of the Corporation’s COP issues, a Trustee holds and invests the Corporation’s cash held for purposes of bond reserves. (a) Interest Rate Risk Interest rate risk is the risk that a change in market interest rates will adversely affect the fair value of an investment. Normally, the longer it takes an investment to reach maturity, the greater will be that investment’s sensitivity to changes in market rates. Information about the sensitivity of the fair values of the Corporation’s investments to market interest rate fluctuations is provided by the following table that shows the distribution of the Corporation’s investments by maturity: Investment Type Amount Maturity Date Money Market Mutual Fund 237,962$ 35 days (b) Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The actual ratings as of June 30, 2015 for the Money Market Mutual Funds is AAAm, as provided by Standard & Poor’s investment rating system. (c) Investment Policy The Corporation must maintain required amounts of cash and investments with trustees under the terms of certain debt issues. These funds are unexpended bond proceeds or are pledged as reserves to be used if the Corporation fails to meet its obligation under these debt issues. The California Government Code requires these funds to be invested in accordance with bond indentures or State statutes. All these funds have been invested as permitted under the Code. The Investment Policy is described in detail in the City of Palo Alto Comprehensive Annual Financial Report. The table below identifies the investment types that are authorized by the City’s Investment Policy. The table also identifies certain provisions of the City’s Investment Policy that address interest rate risk, credit risk and concentration of credit risk. The table addresses investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City rather than by the general provisions of the City’s investment policy. Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Notes to the Basic Financial Statements For the Year Ended June 30, 2015 12 NOTE 3 – CASH AND INVESTMENTS HELD BY TRUSTEE (continued) Maximum Maturity Minimum Credit Quality Maximum Percentage of Portfolio Maximum Investment in One Issuer U.S. Government Securities 10 years (*) N/A No Limit No Limit U.S. Government Agency Securities 10 years (*) N/A No Limit (A) No Limit Certificates of Deposit 10 years (*) N/A 20% 10% of the par value of portfolio Bankers Acceptances 180 days N/A 30% $5 million Commercial Paper 270 days P-1/A-1+ 15% $3 million (B) Local Agency Investment Fund N/A N/A No Limit $50 million per account Short-Term Repurchase Agreements 1 year N/A No Limit No Limit City of Palo Alto Bonds N/A N/A No Limit No Limit Money Market Deposit Accounts N/A N/A No Limit No Limit Mutual Funds N/A N/A 20%10% Negotiable Certificates of Deposit 10 years (*) N/A 10% $5 million Medium-Term Corporate Notes 5 years AA 10% $5 million 10 years (*) AA/AA2 10% No Limit (A) (B) The lesser of $3 million or 10% of outstanding commercial paper of any one institution. (*) The maximum maturity is based on the Investment Policy that is approved by the City Council and is less restrictive than the California Governmental Code. Authorized Investment Type Bonds of State of California Municipal Agencies Callable and multi-step securities are limited to no more than 25% of the par value of the portfolio, provided that: 1) the potential call dates are known at the time of purchase, 2) the interest rates at which they "step-up" are known at the time of purchase, 3) the entire face value of the security is redeemed at   Attachment A PALO ALTO PUBLIC IMPROVEMENT CORPORATION (A Component Unit of the City of Palo Alto) Notes to the Basic Financial Statements For the Year Ended June 30, 2015 13 NOTE 4 – CERTIFICATES OF PARTICIPATION The Corporation’s changes in long-term debt are presented below: Balance Balance Amount due June 30, 2014 Retirements June 30, 2015 in one year Governmental Activity Debt: Certificates of Participation 2002B Downtown Parking 2-4%; due 03/01/2022 1,430,000$ 145,000$ 1,285,000$ 150,000$ On January 16, 2002, the Corporation issued the 2002B Downtown Parking Improvements Certificates of Participation (2002B COPs) in the amount of $3.6 million to finance the construction of certain improvements to the non-parking area contained in the City’s Bryant/Florence Garage complex. Principal payments are due annually on March 1 and interest payments are due semi-annually on March 1 and September 1 and are payable from lease revenues received from the City from available funds. The 2002B COPs are payable and secured by lease revenues received by the Corporation from any City of Palo Alto General Fund revenue source. Future annual debt service on the 2002B COPs is expected to be provided by the lease receipts discussed above, and is shown below: For the Year Interest Total Ending June 30, Principal Payment Payment 2016 150,000$ 83,525$ 233,525$ 2017 160,000 73,775 233,775 2018 170,000 63,375 233,375 2019 185,000 52,325 237,325 2020 195,000 40,300 235,300 2021 - 2022 425,000 41,925 466,925 1,285,000$ 355,225$ 1,640,225$ Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund of the City of Palo Alto) Independent Auditor’s Reports, Financial Statements, and Independent Accountant’s Report For the Year Ended June 30, 2015 Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund of the City of Palo Alto) For the Year Ended June 30, 2015 Table of Contents Page Independent Auditor’s Report ................................................................................................................... 1 Financial Statements: Balance Sheet ......................................................................................................................................... 3 Statement of Revenues, Expenditures and Changes in Fund Balance .................................................... 4 Notes to the Financial Statements ........................................................................................................... 5 Other Reports: Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards ....................................... 9 Independent Accountant’s Report on Compliance with Measure N .................................................... 11 Status of Current Year and Prior Year Findings ................................................................................... 13 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Auditor’s Report The Honorable Mayor and Members of the City Council of the City of Palo Alto Palo Alto, California Report on the Financial Statements We have audited the accompanying financial statements of the City of Palo Alto General Obligation Bonds Capital Projects Fund (Fund), a fund of the City of Palo Alto, California (City), as of and for the year ended June 30, 2015, and the related notes to the financial statements, as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Fund as of June 30, 2015, and the changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Attachment A 2 Emphasis of a Matter As discussed in Note 2(a) to the financial statements, the financial statements present only the Fund and do not purport to, and do not, present fairly the financial position of the City as of June 30, 2015, and the changes in its financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 3, 2015 on our consideration of the City’s internal control over the Fund’s financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over the Fund’s financial reporting and compliance. Walnut Creek, California November 3, 2015 Attachment A Assets Restricted cash and investments (Note 3)5,348,615$ Liabilities and Fund Balance Liabilities: Accounts payable and accrued liabilities 183,048$ Fund Balance: Restricted for capital projects 5,165,567 Total liabilities and fund balance 5,348,615$ CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND Balance Sheet June 30, 2015 (A Fund of the City of Palo Alto) See accompanying notes to financial statements. 3 Attachment A Revenues Investment income 12,820$ Expenditures Capital outlay: Mitchell Park Library and Community Center 5,318,875 Rinconada Library construction and improvements 3,693,628 Temporary Facility 8,170 Temporary Library at Art Center Auditorium 11,138 Total capital outlay 9,031,811 Debt service - interest and fiscal charges 3,183 Total expenditures 9,034,994 Net change in fund balance (9,022,174) Fund balance, beginning of the year 14,187,741 Fund balance, end of year 5,165,567$ Changes in Fund Balance For the Year Ended June 30, 2015 CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND Statement of Revenues, Expenditures and (A Fund of the City of Palo Alto) See accompanying notes to financial statements. 4 Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund of the City of Palo Alto) Notes to the Financial Statements For the Year Ended June 30, 2015 5 NOTE 1 – BACKGROUND On November 4, 2008, more than two thirds of registered voters of the City of Palo Alto (City) approved Measure N and authorized the issuance and sale of general obligation bonds not to exceed $76,000,000 to be used to construct a new energy-efficient Mitchell Park Library and Community Center, expand and renovate the Main Library, and renovate the Downtown Library. Funds will also be used to provide additional space to expand library collections, add new children’s and group program areas, replace outdated lighting, provide modern ventilation and air conditioning systems and ensure seismic safety and enhance disabled access. On June 9, 2010, the City issued General Obligation Bonds, Election of 2008, Series 2010 (2010 Library Bonds) to finance the costs of constructing a new energy efficient, environmentally friendly Mitchell Park Library and Community Center, renovating and expanding Main Library, and renovating the Downtown Library, including enhancements at all three facilities for seismic safety and disabled access, expanded space for library collections, meeting and study areas, and new air conditioning, ventilation and lighting systems (Project). Proceeds from the 2010 Library Bonds included par of $55,305,000 and a premium on issue of $3,766,208 for a total of $59,071,208. During the fiscal year ended June 30, 2013, the City issued General Obligation Bonds, Election of 2008, Series 2013A (2013A Library Bonds) for the remaining authorized amount of $20,695,000. The premium on issue was $1,011,615 for the total proceeds of $21,706,615. Specific projects approved by the City Council to be funded by the 2010 and 2013A Library Bonds proceeds are as follows: Amended Budget Expenditures Not Charged to Bond Proceeds Cumulative Bond Eligible Expenditures Encumbrances Outstanding Project Balance Remaining Downtown Library Improvements 4,208,225$ 356,987$ 4,163,174$ 40,889$ 4,162$ Mitchell Park Library 48,044,383 2,287,057 44,938,333 217,709 2,888,341 Library and Community Center Temporary Facility 640,472 162,939 512,767 615 127,090 Temporary Main Library 624,034 90,456 524,831 15,044 84,159 Main Library New Construction and Improvements 22,324,593 3,141,890 21,166,899 1,071,773 85,921 Total 75,841,707$ 6,039,329$ 71,306,004$ 1,346,030$ 3,189,673$ Project As of June 30, 2015 NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (a) Reporting Entity The accompanying financial statements present only the financial position and the changes in financial position of the General Obligation Bonds Capital Projects Fund (Fund) and do not purport to, and do not, present fairly the City’s financial position as of June 30, 2015, and the changes in its financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund of the City of Palo Alto) Notes to the Financial Statements For the Year Ended June 30, 2015 6 NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued) (b) Basis of Presentation A capital projects fund (governmental fund) is used to account for the City’s General Obligation Bond Projects activities. Capital projects funds are used to account for financial resources (e.g., bond proceeds and investment income) that are restricted, committed, or assigned to expenditures for capital outlays, including the acquisition of land or acquisition and construction of major governmental facilities. This fund is a set of self-balancing accounts which comprise its assets, liabilities, fund balance, revenues and expenditures. (c) Basis of Accounting Basis of accounting refers to when revenues and expenditures are recognized. The projects are accounted for in a governmental fund type, and the modified accrual basis of accounting is used. Under the modified accrual basis, revenues are recognized when they become measurable and available as net current assets. Expenditures are recognized when they are incurred. The City considers revenues susceptible to accrual to be available if the revenues are collected within ninety days after year-end, except for property taxes, which are available if collected within sixty days after year-end. (d) Fund Balance Fund balance is reported in specific classifications (nonspendable, restricted, committed, assigned and unassigned), which create a hierarchy primarily based on the extent to which the Fund is bound to the constraints of the specific purposes for which funds can be spent. The Fund only has restricted fund balance at June 30, 2015. Restricted fund balance includes amounts when constraints placed on use of resources are either: (1) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or (2) imposed by law through constitutional provisions or enabling legislation. The City will spend the most restricted dollars in accordance with restrictions imposed before less restricted resources in the following order: (a) committed; (b) assigned and (c) unassigned. (e) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make certain estimates and assumptions that affect the reported amounts and disclosures. Accordingly, actual results may differ from those estimates. Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund of the City of Palo Alto) Notes to the Financial Statements For the Year Ended June 30, 2015 7 NOTE 3 – RESTRICTED CASH AND INVESTMENTS The Fund’s investments are carried at fair value, as required by generally accepted accounting principles. The Fund adjusts the carrying value of its investments to reflect their fair value at each fiscal year end, and it includes the effects of these adjustments in revenues for that fiscal year. (a) Project Fund Investment Policy Pursuant to terms of the 2010 and 2013A Library Bonds trust agreement, bond proceeds to be used for project costs were remitted to and are maintained by the City as agent for the bondholders. The City’s Investment Policy allows it to invest in a variety of types of investments subject to maturity maximums, concentration limitations, and minimum credit quality requirements. Allowed investment types are limited to investments permitted by subdivisions (a) to (n), inclusive, of Section 53601 of the California Government Code, which includes U.S. federal securities and the California Asset Management Program (CAMP) Pool. CAMP Pool is an investment pool offered by the California Asset Management Trust (Trust). The Trust is a joint powers authority and public agency created by the Declaration of Trust and established under the provisions of the California Joint Exercise of Powers Act (California Government Code Sections 6500 et seq., or the “Act”) for the purpose of exercising the common power of its participants to invest certain proceeds of debt issues and surplus funds. CAMP Pool’s investments are limited to investments permitted by subdivisions (a) to (n), inclusive, of Section 53601 of the California Government Code. The Fund reports its investment in Federal Home Loan Bank at the fair value. The Fund reports its investments in CAMP Pool at the fair value amounts provided by CAMP, which is the same as the value of the pool share. (b) Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Normally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. Information about the sensitivity of the fair values of the Fund’s investments to market interest rate fluctuations is provided by the following table that shows the distribution of the Fund’s investments by maturity: Weighted Average Investment Type Amount Maturities Credit Rating California Asset Management Program Pool 5,337,832$ 32 Days Not rated Money Market Mutual Funds 10,783 35 Days AAAm (c) Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. As of June 30, 2015, the money market mutual funds were rated by Standard & Poor’s as AAAm. Attachment A 8 This page is left intentionally blank. Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 9 Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards The Honorable Mayor and Members of the City Council of the City of Palo Alto Palo Alto, California We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the City of Palo Alto General Obligation Bonds Capital Projects Fund (Fund), a fund of the City of Palo Alto, California (City), as of and for the year ended June 30, 2015, and the related notes to the financial statements, and have issued our report thereon dated November 3, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the City’s internal control over the Fund’s financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Attachment A 10 Compliance and Other Matters As part of obtaining reasonable assurance about whether the Fund’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Walnut Creek, California November 3, 2015 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 11 Independent Accountant’s Report on Compliance with Measure N The Honorable Mayor and Members of the City Council of the City of Palo Alto Palo Alto, California We have examined the City of Palo Alto’s (City) compliance with certain provisions of Measure N for the year ended June 30, 2015 as follows: a) Proceeds from the sale of general obligation bonds (Bonds) were used only for the purposes specified in Measure N; b) Proceeds from the Bonds were deposited into a Library/Community Center Project Construction Fund held by the City; and c) The Administrative Services Director of the City filed an annual report with the City Council no later than November 1, containing pertinent information regarding the amount of funds collected and expended, as well as the status of the Library/Community Center project listed in the Measure. Management is responsible for the City’s compliance with those requirements. Our responsibility is to express an opinion on the City’s compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the City’s compliance with specified requirements. In our opinion, the City complied, in all material respects, with the aforementioned requirements for the year ended June 30, 2015. This report is intended solely for the information and use of the City Council, the Oversight Committee, the City Auditor and the City’s management and is not intended to be and should not be used by anyone other than these specified parties. Walnut Creek, California November 3, 2015 Attachment A 12 This page is left intentionally blank. Attachment A CITY OF PALO ALTO GENERAL OBLIGATION BONDS CAPITAL PROJECTS FUND (A Fund to the City of Palo Alto) Status of Current Year and Prior Year Findings For the Year Ended June 30, 2015 13 Current Year Findings: No matters were noted. Status of Prior Year Findings: No matters were noted. Attachment A CITY OF PALO ALTO, CALIFORNIA Independent Accountant’s Report on Applying Agreed–Upon Procedures Related to the Article XIII-B Appropriations Limit For the Year Ended June 30, 2015 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Accountant’s Report on Applying Agreed-Upon Procedures Related to the Article XIII-B Appropriations Limit Honorable Mayor and the Members of the City Council, of City of Palo Alto, California We have performed the procedures enumerated below to the accompanying Appropriations Limit Worksheet of the City of Palo Alto, California (City), for the year ended June 30, 2015. These procedures, which were agreed to by the City and the League of California Cities (as presented in the publication entitled Agreed-Upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIIIB of California Constitution), were performed solely to assist the City in meeting the requirements of Section 1.5 of Article XIIIB of the California Constitution. The City’s management is responsible for the Appropriations Limit Worksheet. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures performed and our findings were as follows: 1. We obtained the completed worksheets setting forth the calculations necessary to establish the City’s appropriations limit and compared the limit and annual adjustment factors included in those worksheets to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote of the City Council. Finding: No exceptions were noted as a result of our procedures. 2. For the accompanying Appropriations Limit Worksheet, we added last year’s limit to total adjustments, and compared the resulting amount to this year’s limit. Finding: No exceptions were noted as a result of our procedures. 3. We compared the current year information presented in the accompanying Appropriations Limit Worksheet to the worksheets described in No. 1 above. Finding: No exceptions were noted as a result of our procedures. 4. We compared the prior year appropriations limit presented in the accompanying Appropriations Limit Worksheet to the prior year appropriations limit adopted by the City Council. Finding: No exceptions were noted as a result of our procedures. Attachment A 2 We were not engaged to, and did not conduct an examination, the objective of which would be the expression of an opinion on the Appropriations Limit Worksheet. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the appropriations limit for the base year, as defined by Article XIIIB of the California Constitution. This report is intended solely for the information and use of the City Council and City management and is not intended to be and should not be used by anyone other than these specified parties. However, this report is a matter of public record and its distribution is not limited. Walnut Creek, California November 3, 2015 Attachment A CITY OF PALO ALTO, CALIFORNIA Appropriations Limit Worksheet For the Year Ended June 30, 2015 3 2013-2014 appropriations limit, as adopted 133,476,711$ Adjustment factors: Population 1.0150 Inflation 0.9977 Total adjustment factors (rounded)1.0127 Total adjustments 1,690,549 2014-2015 appropriation limit, as adopted 135,167,260$ Attachment A    4   This page is intentionally left blank. Attachment A CABLE TV FRANCHISE Independent Auditor’s Report and Statements of Franchise Revenues and Expenditures For the Years Ended December 31, 2014 and 2013 Attachment A CABLE TV FRANCHISE For the Years Ended December 31, 2014 and 2013 Table of Contents Page(s) Independent Auditor’s Report .................................................................................................................... 1-2 Financial Statements: Statements of Franchise Revenues and Expenditures ............................................................................. 3 Notes to the Financial Statements ........................................................................................................ 4-5 Attachment A www.mgocpa.com Certified Public Accountants Sacramento Walnut Creek Oakland Los Angeles Century City Newport Beach San Diego Macias Gini & O’Connell LLP2121 N. California Blvd., Suite 750Walnut Creek, CA 94596 1 Independent Auditor’s Report Honorable Mayor and Members of the City Council of the City of Palo Alto Palo Alto, California We have audited the accompanying Statements of Franchise Revenues and Expenditures of the Cable TV Franchise (Franchise) for the years ended December 31, 2014 and 2013, and the related notes to the financial statements, which collectively comprise the Franchise’s financial statements as listed in the table of contents Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the financial reporting provisions of the Amended and Restated Joint Exercise of Powers Agreement signed on June 9, 2009, between the City of Palo Alto, the City of East Palo Alto, the City of Menlo Park, the County of San Mateo, the County of Santa Clara and the Town of Atherton for the provision of cable television and video services as described in Note 1 of the financial statements. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the revenues and expenditures of the Franchise for the years ended December 31, 2014 and 2013, in accordance with the financial reporting provisions of the Amended and Restated Joint Exercise of Powers Agreement signed on June 9, 2009, between the City of Palo Alto, the City of East Palo Alto, the City of Menlo Park, the County of San Mateo, the County of Santa Clara, and the Town of Atherton for the provision of cable television and video services, described in Note 1 to the financial statements. Attachment A 2 Basis of Accounting As discussed in Note 1 to the financial statements, the financial statements are prepared in accordance with the financial reporting provisions of the Amended and Restated Joint Exercise of Powers Agreement signed on June 9, 2009, between the City of Palo Alto, the City of East Palo Alto, the City of Menlo Park, the County of San Mateo, the County of Santa Clara, and the Town of Atherton, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to that matter. Restriction on Use This report is intended solely for the information and use of the governing bodies and management of the City of Palo Alto, the City of East Palo Alto, the City of Menlo Park, the County of San Mateo, the County of Santa Clara and the Town of Atherton, and is not intended to be and should not be used by anyone other than these specified parties. Walnut Creek, California November 3, 2015 Attachment A 2014 2013 Revenues: Franchise fees $ 1,829,378 $ 1,738,703 Expenditures: Franchise administration 46,838 37,672 Consulting fees 4,752 4,335 Total expenditures 51,590 42,007 Net receipts $ 1,777,788 $ 1,696,696 Amount Percent Amount Percent Allocation of Net Receipts: City of Palo Alto $ 864,439 48.6% $ 832,656 49.1% City of Menlo Park 474,995 26.7% 450,460 26.5% City of East Palo Alto 182,051 10.2% 165,557 9.8% Town of Atherton 127,302 7.2% 120,600 7.1% County of Santa Clara 99,360 5.6% 94,067 5.5% County of San Mateo 29,641 1.7% 33,356 2.0% Total $ 1,777,788 100.0% $ 1,696,696 100.0% CABLE TV FRANCHISE Statements of Franchise Revenues and Expenditures For the Years Ended December 31, 2014 and 2013 2014 2013 See accompanying notes to the financial statements. 3 Attachment A CABLE TV FRANCHISE Notes to the Financial Statements For the Years Ended December 31, 2014 and 2013 4 NOTE 1 – JOINT OPERATING AGREEMENT AND BASIS OF ACCOUNTING In July 1983, a Joint Exercise of Powers Agreement was entered into by and between the Cities of Palo Alto, Menlo Park, East Palo Alto, the Counties of San Mateo and Santa Clara, and the Town of Atherton (Members) for the purpose of obtaining a state-of-the-art cable service for residents, businesses, and institutions, within each of their jurisdictions in the most efficient and economical manner possible. On August 9, 2000, the City of Palo Alto (City), acting on behalf of the Members, signed a Franchise Agreement with TCI Cablevision of California, Inc., a wholly owned subsidiary of AT&T Broadband (AT&T), third party contractor, which was granted a non-exclusive franchise to construct, operate, maintain and repair a cable television system within the Members jurisdictions. In 2002, the Franchise Agreement was transferred from AT&T to Comcast Corporation (Comcast). TCI Cablevision of California, Inc. also signed an asset purchase agreement with Cable Communications Cooperative of Palo Alto, Inc. (CCCOPA), the former cable television system operator/owner, and acquired the system. In October 1988, the Members entered into a Joint Operating Agreement in which the City was granted the power and the authority to administer and coordinate the activities of the franchise and exercise the rights and responsibilities of the City pursuant to the Franchise Agreement. The activities are administered by the City and are accounted for within the City’s Agency Fund. The program is accounted for using the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recorded when susceptible to accrual (both measurable and available) and expenditures are recognized when the liability is incurred. On January 1, 2007, the Digital Infrastructure and Video Competition Act (DIVCA) went into effect. Under DIVCA, cable and video service franchises are now granted exclusively by the California Public Utilities Commission (Commission) rather than by local franchising entities. On March 30, 2007, the Commission granted AT&T a statewide franchise. Comcast was allowed to seek a state franchise after January 1, 2008, when another state franchise holder (in this case AT&T) entered the local market. On January 2, 2008, the Commission granted Comcast a state franchise. On June 9, 2009, the Members approved an amended and restated Joint Exercise of Powers Agreement, in substitution of the existing Joint Exercise of Powers Agreement and the Joint Operating Agreement, to reflect changes in the law due to DIVCA and to continue to allow the City to administer the cable and video franchise enforcement and monitoring process for state franchise holders. The accompanying financial statements are intended to present the Franchise’s revenues and expenditures pursuant to the Joint Exercise of Powers Agreement and are not intended to be a complete presentation of the Franchise’s financial position or results of operations. As compensation for services under the state franchise agreements, AT&T and Comcast pay annual franchise fees in an amount equal to 5% of annual gross revenues, taking into account a reasonable adjustment for bad debts. From these fees the City is first reimbursed for out-of-pocket franchise administration costs. The remaining fees are distributed to each Member according to the percentage of revenues derived from the residents and businesses in each of the entities compared to revenues in total. Attachment A CABLE TV FRANCHISE Notes to the Financial Statements For the Years Ended December 31, 2014 and 2013 5 NOTE 2 – PRIOR FRANCHISE SETTLEMENTS A prior Franchise Agreement with CCCOPA was set to expire on March 24, 2001. On June 21, 1999, the City hired a cable communications consultant and retained the services of a law firm to assist in the franchise renewal process. On July 31, 2000, CCCOPA reimbursed the City $185,000 toward the actual costs incurred as part of the franchise renewal efforts. On July 24, 2000, the City reached a settlement with CCCOPA in the amount of $220,000 to resolve outstanding claims resulting from CCCOPA’s alleged failure to fully perform under the prior Franchise Agreement. On November 22, 2004, the City reached a settlement agreement with Comcast regarding cable plant construction claims in the amount of $175,000. This money was to be used towards the institutional network connection costs. In 2006, the City conducted a franchise compliance audit performed by the City Auditor’s Office. A settlement was reached in the amount of $155,391. In addition, CCCOPA paid the City a $250,000 grant to acquire, install, and/or maintain equipment to be used in connection with an institutional network defined in the Franchise Agreement. The settlements and grant have been deposited and are being held by the City and earning interest. The City has since spent a part of the balance on various projects including installing and maintaining the institutional network equipment. As of December 31, 2014 and 2013, the remaining balance on deposit with the City, including $4,142 and $5,186, respectively, in interest receivable, was $1,200,217 and $791,240, respectively. NOTE 3 – SUBSEQUENT EVENT Subsequent to the fiscal year ended December 31, 2014, the Franchise distributed the franchise fee for the quarter ended December 31, 2014 of $442,059 to its members in February 2015. Attachment A FINANCE COMMITTEE TRANSCRIPT Page 1 of 13 Special Meeting Tuesday, November 17, 2015 Chairperson Schmid called the meeting to order at 6:15 P.M. in the Community Meeting Room, 250 Hamilton Avenue, Palo Alto, California. Present: Filseth, Kniss, arrived at 6:18 P.M. Scharff, Schmid (Chair) Absent: Chair Schmid: I wanted to just ask a question upfront to make a clear distinction between Items 1 and Item 2. The audit starts immediately by referring to material in the CAFR. It's very easy to get started here and end there. How should we deal with the two separate reports so they are clear? Lalo Perez, Administrative Services Director and Chief Financial Officer: Good question. Lalo Perez, Chief Financial Officer, Vice Mayor. The idea for the first item is that there's the independence of the City Auditor that reports to you. She has gone out and (inaudible) the process and hired the services of a financial audit firm to do the audit. The first one is an opportunity for you to hear from the City Auditor and the financial auditor, MGO, David Bullock who's here tonight, about what they reviewed and report on their findings of the financial audit. Yes, there may be questions that you may have that kind of cross over to Item Number 2. What we would do for Item Number 2, as Staff, we would then present to you the nuts and bolts of the numbers. That's where I think it would be appropriate to get into the detail questions about some of the specifics and the trending and the numbers. I think on the technical terms or findings or review, what areas were reviewed, David Bullock can answer to that specific. There's specific audits that they perform, that they would call them single audits, that they would discuss with you, also any recommendations that were outstanding from prior years, the status of those. That's the differences of the two. I think for Item Number 2, we would say, "Let's focus on that on the revenue and expenditures big picture, what happened and trends that we see and recommendations. Because we do have excess funds, what is our thinking and our recommendations to you. We can do that under Item Number 2. Chair Schmid: We will deal with the basic accounts on the first one. Attachment B DRAFT MINUTES Page 2 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Mr. Perez: Yes. Chair Schmid: The second one, the host of numbers, the details, we will deal with in Item Number 2. Mr. Perez: Yes. Chair Schmid: Let's move to Item Number 1, which is the audit of the ... Assistant City Clerk: There's a speaker card for Oral Communications right there. Chair Schmid: I'm sorry. Agenda Items 1. Macias Gini & O'Connell's Audit of the City of Palo Alto's Financial Statements as of June 30, 2015 and Management Letter. Chair Schmid: That brings us then to Item Number 1, the audit of the City's financial statements. Harriet Richardson, City Auditor: Good evening, Mr. Chair, Members of the Committee. Harriet Richardson, City Auditor. As Lalo mentioned, my office coordinates the City's annual financial statement audit that's required by the City Charter and the Palo Alto Municipal Code. Tonight, the City's independent certified public accounting firm, Macias Gini and O'Connell, will present the results of their audit for the fiscal year that ended on June 30th, 2015. MGO issued an unmodified opinion for all of the City's basic financial statements which means that the financial statements are presented fairly in all material respects. The auditors didn't make any new recommendations this year; however, they reported on the status of three open recommendations from Fiscal Year 2011 which all pertain to the City's Information Technology Department. You have an at-places memo which gives a revised report. It replaces the report called "Report to the City Council." If you look at pages 6 and 7, those are the pages that were updated to show that all of the recommendations have been implemented as of June 30th, 2015. Just for clarification, I wanted to clarify the difference between the audits that MGO does for the City versus the audits my office does. Their firm focuses on financial reporting. My office focuses on audits that affect the efficiency and effectiveness of operations. They may or may not have a material impact on the City's financial statements. I'd like to thank David Bullock and Irene Chan from MGO as well as Lalo Perez, David Ramberg and Laura Kuryk and her Staff in the City's Administrative Services Department for their hard work in completing the audit as well as Yuki Attachment B DRAFT MINUTES Page 3 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Matsuura from my office who oversees the contract with MGO and coordinates with MGO staff throughout the audit. Now, I'd like to introduce David Bullock, the partner from Macias Gini and O'Connell, who will present the financial audit results and the report to the City Council. David Bullock, MGO Partner: Good evening. Thank you. Chair, Members of the Committee, thank you for inviting us to present your 2015 audited financial statements. Harriet had mentioned the at-places report that we had revised. Just to let you know, we came out and we assessed some of our prior year findings, as we normally do, and apparently some of that information had not been updated since we came out here during our planning stage. What we did is we worked with Staff to identify what changes had been done since we were out here. To the good, we determined and agreed that the three findings that we had brought up in past years have all been implemented as of the date of the report, as of today. We went ahead and issued this revised statement, so we don't have to come back next year and bring back these same items again. I'd be more than happy to discuss specifically what changed. From our perspective, some of it was interpretation and some of it was just updated information that we didn't have at the time we came out here and assessed the status of those findings. Chair Schmid: You're comfortable with what you found? Mr. Bullock: We are, we are. On page 4 of your packet, it has a nice little summary of this first item on the agenda. I thought I would just kind of walk through those really briefly before I went through the specific reports. I'm looking at the attachment section. Attachment A is the report to City Council. That's what was revised. The only thing that had changed in that report was the status of our prior year findings. Nothing else in that report had changed. Council Member Kniss: Just locate me now. We've got two things in front of us. You're on ... Mr. Bullock: Right now, I'm going through your original agenda packet. Chair Schmid: It's this item now. Mr. Bullock: Not the at-places item. Council Member Kniss: This one here. You said a page? Mr. Bullock: Page 4 on the ... Attachment B DRAFT MINUTES Page 4 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Lalo Perez, Administrative Services Director and Chief Financial Officer: Packet page 4 or page 2 of the report. Council Member Kniss: Somehow I start with packet page 3. Does the rest of yours start with 3? Am I crazy? Suzanne Mason, Assistant City Manager: No, you're right. Turn one more page over. There's the list of attachments, right there. Council Member Kniss: On page 4 of page 2, right? Mr. Bullock: Hopefully I'm going by the way you're accustomed to going through these documents. I just thought this was a snapshot of what the scope of the first item was. The report to the City Council is what we use to summarize the results of the audit, to let you know what the important items were during the audit, so that it's within one location. Then we include in there findings that we might have related to the audit. Some might consider it a management letter; we call it Report to City Council. The second item has to do with the Transportation Development Act. That's the monies you get from MTC to fix or improve bikeways or pedestrian ways. The Regional Water Quality Control Plant is reassuring the cost of the plant. We go through and audit the allocation of the costs of the plant. The Public Improvement Corporation was your 2002 Certificates of Participation for your Downtown parking garage. Attachment E was the General Obligation bonds; that's your Measure N, the library bonds and the spending of those funds. Attachment F is the Appropriations Limit. That's the spending limit based on the appropriations established in the base year plus the inflationary and population changes. Finally, the cable TV and the franchise audit that we do, the collection and disbursement of those franchise fees. That's the scope of the first item. I'm happy to report that we didn't have any findings in any of those specific compliance areas. All of the reports have unmodified opinions for those. On the Report to the City Council, I'd like to refer you to the at-places item, which is what was revised. Just so that we all have the final copy of what we're issuing in front of us. The first page is just a transmittal letter. The document really starts on page 1 where we talk about required communications. Any time there's changes in consistency from year to year, we want to make sure you're aware of it. We're going to get more into the pension standards that have changed, GASB 68. I'm going to discuss that when we discuss the CAFR, because that's a better place to discuss that, when we're talking about the impact to your financial statements. We're just letting you know that that was a significant change to yours, and for all governments. There were a few other standards implemented; they didn't have the level of impact. The next couple of pages really talk about estimates that are in your financial Attachment B DRAFT MINUTES Page 5 of 13 Finance Committee Special Meeting Transcript 11/17/2015 statements. It just lets you be aware of some of the softer numbers that could change over time. Any time there's an estimate, things could change. Some of them are based on actuarial studies. Some of them are based on the fair value of your investments or what the predictability is of collections on receivables. That just gives you a summary of what estimates there were on page 2. Three really discusses any issues that we had during the audit, any disagreements with management or any material audit adjustments, things of that nature. We're happy to report there were none. It's quite nice to see a November 3rd date; I just wanted to point that out, as the date of our audit. That's two weeks earlier than we've ever completed in the past. This year the audit went very well. Staff was very cooperative. I think it just was a very efficient audit this year, so we're really happy to report that in working with management. The final couple of pages. Page 5 just lets you know that there were no current year management letter comments. Really what we're required to report as part of our responsibility is any internal control deficiencies that meet the level of significant deficiency or material weakness or material noncompliance. That's kind of the reason you'd have management letter comments. We could also put best practices in there and things of that nature. Sometimes we might put new standards that are coming up or the new OPEB standards. Like the pension plan, OPEB standards are going to have a significant impact to your financial statements. That's a few years down the road in 2018, where that's required to be implemented. There's some time to discuss that. Kind of like the pension plan has been known now for three or four years, and this is where the rubber hits the road. This is where you actually record the pension impact. The OPEB, very similar, will have a significant impact, because you'll be recognizing that in that OPEB liability in your financial statements, much like you do with the pension plan. Finally, the last two pages are just follow-up to past recommendations. This is really where the changes were updated. The only thing I changed in here was the current year status. We had a comment on the disaster recovery plan. The City is still working on other follow-up aspects to it. Once you got the plan done, you're moving on and evolving your IT. In terms of what the recommendation was, that piece has been implemented. It was just a matter of interpretation of where you're at. We don't want these findings to continue to be in your report. We always try to give you a status of your disaster recovery plan. The piece that we've recommended has been completed, so we're going to go ahead and remove that from our report. The other two items had to do with the risk assessment which was completed; the City got a report in May of 2015, so that's done. Finally, the password strength has been updated and put into place just a couple of weeks ago in October. That's done. Chair Schmid: I can ask Lalo his password. It'll be at least seven digits. Attachment B DRAFT MINUTES Page 6 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Mr. Bullock: It better be. Mr. Perez: With characters and capital letters in the mix. Council Member Scharff: But you have it written down right next to it, right? Mr. Perez: It's on my forehead, isn't it? Mr. Bullock: It's a little sticky note that's right next to the monitor. Mr. Perez: Just kidding around. Mr. Bullock: That concludes my report on these audits, unless you have a specific question you wanted to go through in any of these specific reports that we've issued or questions on the (inaudible). I'd be more than happy to answer. Chair Schmid: Thank you very much. I would ask Council Members if there is anything in the separate audits that we have, Attachments A through G, that you want to follow up on or any of the general statement. This would be a good time for that. Council Member Scharff: This is more of a question. On the cable TV franchise, this is a joint power agreement. Who's on the board and how come no—this is the only joint power agreement in which governance seems different. I mean, all the other joint power agreements, Council Members from the three cities would basically be on this. We never really talk about this. What does this do? What's the City's liability on this? What's really happening with the cable—this seems so 1980s. Mr. Perez: It is. That's the answer, that it was established quite some time ago. It was part of the—some of you may know the history better. I'm looking at Council Member Kniss. Council Member Kniss: First thing is before Greg was born, isn't it? Council Member Scharff: I think it was. Mr. Perez: We used to have the cable co-op that ran. That was going to go out, so there was a leadership effort by Palo Alto to ensure that the broadcasting of public meetings took place, so a joint power agreement was set up, an agency, to do that. I think the answer to your question—I don't know for a fact. My assumption over the years is that because it dealt with the nuts and bolts of the operations, that that's probably why there was not an appointment of elected officials to be part of that process. There is a reporting mechanism that we're supposed to do, and that's part of this Attachment B DRAFT MINUTES Page 7 of 13 Finance Committee Special Meeting Transcript 11/17/2015 process. The agencies have representatives from each group, so there's—let me see if I can get them right. There's the Ravenswood School District, East Palo Alto, Menlo Park and the School District was part of it at one point. Mr. Bullock: And Atherton. Mr. Perez: And Atherton. Thank you, David. Ms. Richardson: And unincorporated areas of Santa Clara and San Mateo Counties. Mr. Perez: Thank you for the reminder. And unincorporated areas of Santa Clara and San Mateo Counties. What we do is as the revenues come in, the groups meet to address the needs of each of the agencies in terms of systems, hardware and the operations of the issues. Over the years—now I'm going back from my memory. We tended to have the expertise, because we were bigger and we had a bigger Staff that was more technically aware of the issues. The smaller agencies don't tend to have the funding nor the staff expertise, so we kind of were appointed the leaders in that regard as well, from a technical perspective. We had at times different members of the community that were extremely skilled, that volunteered at times and helped us as well. It's kind of evolved. The question is with technology and where it's going, where are now. It's probably something that we need to review and discuss. Ultimately, from my perspective, I think the goal is for us to ensure that we have the means to broadcast public meetings. That's what the intent of this group is at this point. Council Member Scharff: Right. I mean, it's not hard with YouTube and all of that. It almost seems that anyone could put a camera on here and put it on YouTube and have it broadcast. I'm not sure the structure as—what really struck me here was the huge amount of money, if I understand that. We have 1.2 million and 791 just sitting there. It just struck me that we— this is the way I see it and tell me if I'm wrong. We have some sort of an '80s structure in which the cable co-op was really—the cable co-op has gone away. We sold out of that, and now we have a JPA in which Council's not really even aware of, frankly. I mean, I'm not sure if we polled Council Members that they would even know there was such a JPA. Maybe Council Member Kniss ... Council Member Filseth: I know now. Council Member Scharff: Right. The question is does this make sense. Ms. Richardson: Can I say something? I'd like to just make everyone on this Committee aware, because I know Policy and Services is aware of the Attachment B DRAFT MINUTES Page 8 of 13 Finance Committee Special Meeting Transcript 11/17/2015 audits we have in place. We're actually doing a performance audit right now on the cable franchise fund. Through that audit we'll be raising the question about the future of it. It will come up as something to address through that mechanism. Council Member Scharff: Basically what's left of this is the Media Center. Is that correct? Council Member Kniss: Yes. That's kind of true. Council Member Scharff: That's really what's left of this. Ms. Richardson: This fund was established to support iNet also. Mr. Perez: Correct. Council Member Scharff: What's iNet? Mr. Perez: It was basically a way for the agencies to have—for example, for Ravenswood, it's their communications. They turned it into telephone. Under my watch when we took over, when we had IT—IT is not part of my watch anymore—I remember getting phone calls where construction companies dug and broke the connection. Ravenswood was blank, no connection. Part of the funding is to address issues of connectivity on the other end as well with each of the agencies that belong to the group. Council Member Scharff: I thought we used our fiber ring for connectivity. Mr. Perez: Remember our fiber ring goes only to our border. Council Member Kniss: It's only Palo Alto. Mr. Perez: Right. David, since you worked on it, you can add. David Ramberg, Administrative Services Assistant Director: David Ramberg, Assistant Director of Administrative Services. A little more background. The cable franchise agreement was established when cities had more jurisdiction over franchise agreements. Jurisdiction over franchise agreements has been moved to the State level. We no longer negotiate directly with the cable providers for television services here in our jurisdiction. We used to do that. The agreement with the neighboring jurisdictions was that we would be collectively stronger as a group, and Palo Alto would serve as the lead agency of that group. The City Council is formally the Board of the JPA. You probably don't realize that, but that ... Council Member Scharff: Nope. Attachment B DRAFT MINUTES Page 9 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Mr. Ramberg: Back when we had oversight of the cable franchise agreement, there were issues that came before the City Council on a semi- regular basis. We had customer service issues. We had liquidated damages that we had to assess against the provider then, which was AT&T. Other such issues would come before the City Council on a semi-regular basis. We haven't had those kind of oversight responsibilities in recent years, because that's moved up to the State level. The cable franchise does remain. The service area is still defined by the communities that were mentioned a moment ago. Comcast is still the cable service provider. We still do receive public education and government which are referred to as PEG fees. Those PEG fees support the communities' cable center which is the Media Center. Also we contract with the Media Center for the broadcast of these public meetings. Those types of decisions are still discussed at the cable franchise working group which is representatives of the various cities at the staff level. As matters become significant, they come before the City Council for discussion. We just haven't had any major issues in recent years. Harriet's right. There's a current review going on, and there will be more discussion coming forward, probably in 2016. Council Member Scharff: Maybe I missed it; it's possible. I remember when we actually had a redevelopment agency in Palo Alto which we never used. They used to come once a year to us. Now you're the board of directors, right? We spend a Council meeting; we'd have that meeting; we'd take no action, but we had a requirement to meet once a year, so we met for ten minutes and did that. I don't recall this. I don't recall it in five years. Is there no requirement to ever meet? Council Member Kniss: I didn't know there was an RDA. Mr. Perez: It's dormant. Council Member Scharff: We dealt with all the blighted areas in Palo Alto. Council Member Kniss: You know who else knows (crosstalk) about this is Bob Moss and Lisa van Dusen who were both involved in it at the time. It was an incredibly contentious kind of issue for anyone who was here then. They will still discuss it with a great deal of passion. They will have a long history on it. It was very complicated, because that was kind of the beginning of cable TV. Who should have it? Should it be in-house or should we have somebody outside do it? It was a very long discussion. I don't recall that it essentially was very successful in the end. Maybe I'm wrong, Lalo. Maybe it was wildly successful, and I've forgotten. Mr. Perez: I think it's accomplished its goals. Attachment B DRAFT MINUTES Page 10 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Council Member Kniss: Nicely put. Chair Schmid: Question about the numbers here. You say they get franchise fees from AT&T and Comcast. Is that right? It's allocated; the City of Palo Alto gets $860,000 or pays? Mr. Perez: Receives. Chair Schmid: Where does that go? Mr. Perez: It stays within the fund, and it goes towards the cost of the operations of the cable television program. Chair Schmid: We receive these but immediately pay it ... Mr. Perez: It's not part of the General Fund. It's part of this fund (inaudible) to fund the operations. Chair Schmid: Their expenditures are only $50,000. At least that's what they report. Mr. Ramberg: Once we deduct the cost of operating the cable fund, the rest of the revenues on the—there's two sources of revenues. There's the public education and government, PEG, fees; that goes to support the running of the community media center. There's the franchise fee revenue which comes into the City of Palo Alto in a lump sum. The City of Palo Alto then distributes the cable franchise fees based on subscribership to the JPA agencies. Menlo Park gets a chunk of the cable franchise fee revenue, Atherton, East Palo Alto and so forth. Palo Alto deducts the administration costs because we still administer as the lead agency all of those operations. The remainder of the franchise fee revenue after that deduction goes into the City of Palo Alto General Fund. Chair Schmid: I could look in here and find $864,000 receipts somewhere? Mr. Ramberg: There might not be that exact number, but you will find a number very close to that in the CAFR. It would be a number buried in some other—probably a revenue line item. We could pull it out for you. Chair Schmid: Good deal. We get on TV, and we get paid. Any other questions about any of these other details, attachments? Council Member Kniss: Still on cable TV or do you want to go back to (crosstalk)? Chair Schmid: I'm looking at all the attachments related to ... Attachment B DRAFT MINUTES Page 11 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Council Member Kniss: I just want to look at page 37, if I might, and talk a little about the Regional Water Quality Control Plant. We indicate that we're allocated about half the usage, but we don't utilize that; therefore, we go into a separate contract. I'm on page 37 of the packet. Lalo, talk a little about that. How is this parceled out and why are we not using 50 percent? Does that have to do with the current drought? Is that just a pretty standard long-term amount? Mr. Perez: I'm probably over my head, to be honest with you, on this one. I don't have any Staff from Public Works. My understanding was that we had the percentages split based on the measurement of the Plant. I'm trying to find where you're referencing to. I'm looking at Note 2. Is that what you're looking at? Council Member Kniss: I'm on page 37, so I don't know ..."1C," "1C" it's called. "1C" and it's ... Chair Schmid: My understanding is, if you look at the previous page, the original agreement was between three cities. Palo Alto accounted for over 50 percent of it. We then subcontracted to EPA, Stanford, Los Altos Hills to take shares, so that our total usage is the 36 percent, which is equivalent to the population usages. Council Member Kniss: It's not by amount; it's by population? Chair Schmid: It's by usage rates. There's three original contractors. We subcontracted our 50 percent share to others. Council Member Kniss: I'm not sure I totally understand the plan. Apparently it's working. Chair Schmid: Yes, we are. Council Member Kniss: Sometimes it's (crosstalk). Mr. Perez: You're probably going to get a lot more information from Jaime and Phil as they're talking about the overhaul of the Treatment Plant and how the split of the costs would be borne and spread. I think that's probably when you're going to get a better education than what I can provide you. Council Member Kniss: We're going to see them later this week. I'll ask them at that point. I think anything to do with water right now is of great interest. Mr. Bullock: This has more to do with the sewage. It's more of a Treatment Plant ... Attachment B DRAFT MINUTES Page 12 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Chair Schmid: It ends up with some recycled water. Mr. Bullock: Reclamation. Chair Schmid: Yeah, which is becoming ... Mr. Perez: That has a bit of a ... Council Member Kniss: Becoming more of (crosstalk). Mr. Perez: ... nuance because Mountain View paid for infrastructure to set up a piping system to send water down to them. That's where I feel that I'm a little bit over my head. Council Member Kniss: That's something that's probably worth knowing more about. I don't know how long ago they actually did that. I do know that—don't they get roughly 60 percent of our recycled water? It's not germane for this, but I think it's interesting to know where the—since it ends up as recycled water from this Control Plant. It'd be interesting to know just what percentage goes elsewhere and under a contract as I understand. Mr. Perez: What we can do, if there's no items coming up in a relatively near period, when we put the cover letter to, assuming you approve it and go to Council, we'll ask the department to give us some of that data, and we'll add it. Chair Schmid: Any further questions or comments on the attachments? Council Member Kniss: I may have had—I think this one got answered, on page 15, which was the disaster recovery plan and so forth. You're saying all that's in order, risk assessment and ... Chair Schmid: Yes, that's the update we got. Council Member Kniss: The one that you just mentioned and the fascinating thing about passwords? Chair Schmid: Yes. Council Member Kniss: Does everyone remember all their passwords all the time? It drives me crazy. Chair Schmid: If I had to change them every three months, that would set me back. Council Member Scharff: I just use my birthday. Attachment B DRAFT MINUTES Page 13 of 13 Finance Committee Special Meeting Transcript 11/17/2015 Council Member Kniss: Don't we all? Chair Schmid: Thank you. Council Member Filseth: That big unprotected file on your computer. Council Member Kniss: Do you capitalize it? Council Member Scharff: No. Chair Schmid: If there are no further questions on this, Harriet, did you have ... Ms. Richardson: No questions. I just want to remind you that we will need a motion on this to accept (crosstalk). Council Member Kniss: I would recommend we accept it. That's a motion. And forward to the City Council (crosstalk). Chair Schmid: I will second. MOTION: Council Member Kniss moved, seconded by Chair Schmid that to recommend the City Council approve the audited financial statements for the Fiscal Year ending June 30, 2015, and the accompanying reports provided by Macias Gini & O’Connell LLP. Chair Schmid: Any comments, questions? We have on the table a motion to accept the audit and to forward it to the Council. All in favor. That passes unanimously. MOTION PASSED: 4-0 Council Member Scharff: I did have one quick question. Chair Schmid: Yes. Council Member Scharff: We won some award, right, we win every year? Mr. Bullock: That's part of the CAFR. Council Member Scharff: That's part of the CAFR. That's what that goes for. I'll wait until the CAFR then to ask about it. Chair Schmid: Thank you very much. That closes Item 1. Attachment B City of Palo Alto (ID # 6328) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Contract for FY 16 Alma Street and Middlefield Road Paving Project Title: Approval of a Contract With O'Grady Paving Inc. in the Amount of $1,988,344 for the FY 2016 Alma Street and Middlefield Road Paving Project From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council: 1. Approve and authorize the City Manager or his designee to execute the attached contract with O’Grady Paving Inc. (Attachment A) in an amount not to exceed $1,988,344 for Palo Alto FY 2016 Alma Street and Middlefield Road Paving (Capital Improvement Program projects PE-86070, PL-05030 and PL-04010); and 2. Authorize the City Manager or his designee to negotiate and execute one or more change orders to the contract with O’Grady Paving Inc. for related, additional but unforeseen work that may develop during the project, the total value of which shall not exceed $198,834. Background Public Works Engineering Services Division manages construction contracts for concrete repair, preventive maintenance, resurfacing and reconstruction of various City streets on an annual basis. The candidate streets are surveyed biannually by Public Works Engineering staff and then rated by a computerized pavement maintenance management system (PMMS) and by the Metropolitan Transportation Commission’s (MTC) pavement analysis program. All streets have been coordinated with the City’s Utilities Department and Transportation Division of Planning and Community Environment Department to minimize the cutting of newly resurfaced streets. Extensive public outreach will be conducted before and during the construction phase to keep the community City of Palo Alto Page 2 informed throughout the process, including flyers sent to adjacent residences and businesses and notices posted on Nextdoor and the City’s website. Discussion Project Description Staff recommends approval of this street resurfacing contract and implementation this fiscal year as part of an enhanced program to improve the condition of Palo Alto’s streets. This project is the result of an increase in funding by City Council specifically for the completion of the paving of Alma Street and Middlefield Road by the end of FY 2017. The $1,988,344 expenditure for this contract will be used to repave 4.7 lane miles of high-use arterial streets with rubberized asphalt concrete. This will continue moving the City’s Pavement Condition Index (PCI) toward the goal of a citywide average PCI of 85, with no street below 60, by the end of 2019. The portions of Alma Street and Middlefield Road being resurfaced in this contract are shown in Attachment C. Additional maps of the FY 2016 Street Maintenance Program and current 5-year plan for street repaving are available on the Street Maintenance Program homepage located at www.cityofpaloalto.org/streets. Middlefield Road from Lytton Avenue to Hamilton Avenue will be reconstructed with continuous exposed curb and gutters to match the adjacent section north of Lytton Avenue to the Menlo Park city limit. The majority of the 5,000 lineal feet of curbs and gutters being replaced with this project are on this section of Middlefield Road. All driveway aprons will be replaced as part of the gutter installation and widened as needed. All street corners will be upgraded with new truncated dome panels or receive new concrete curb ramps to comply with current ADA standards. The asphalt roadway will be milled to reduce the steep cross slope that currently exists. This crown reduction will result in a flatter roadway, which will increase driver safety along this busy corridor. Middlefield Road between Hamilton and Forest Avenues and from Embarcadero Road to Oregon Expressway will receive curb, gutter and sidewalk repairs as needed prior to asphalt milling and repaving. The Alma Street work in this project will continue northward from Rinconada Avenue, where the resurfacing ended in November 2015. The Utilities sewer main replacement project was complete in December and the road ready for repaving from Riconada Avenue to Melville Avenue. Six thousand square feet of damaged concrete road base will be replaced along with specific sections of damaged curbs, gutters and sidewalks. All street corners will be upgraded with new City of Palo Alto Page 3 truncated dome panels or receive new concrete curb ramps to comply with current ADA standards. Bicycle and Pedestrian Improvements As part of continuing efforts to create complete streets and implement the Palo Alto Bicycle + Pedestrian Transportation Plan, the City of Palo Alto seeks to improve accommodations for active transportation users when resurfacing city streets, systematically improving roadways by leveraging regularly programmed maintenance activities. This project provides an opportunity for incremental improvements along Middlefield Road between Channing Street and Oregon Expressway, while the upcoming FY 2016 overlay project will allow improvements on North California Avenue between Alma Street and Middlefield Road. Transportation Division staff met with neighborhood residents in December, discussed the projects in detail at the January 5, 2016 meeting of PABAC held at City Hall, hosted a two-hour public open house January 6, 2016, at Lucie Stern Community Center and met with the Jordan Middle School PTA on January 7, 2016. Prior to the public open house, the Transportation Division conducted daytime and nighttime on-street parking occupancy surveys for both streets and developed illustrations and photo simulations. At the public meeting, several potential cross-sections for Middlefield Road and North California Avenue were presented to the public for consideration. Options considered for Middlefield Road included the modification of on-street parking to add Class II bicycle lanes or shared-lanes with sharrow markings. A two-way Class IV separated bikeway was also considered in front of Jordan Middle School to connect the two segments of North California Avenue. Based on the feedback received from the community outreach process, parking will remain on Middlefield Road between Embarcadero Road and Garland Drive and other recommended minor striping changes will be implemented as part of this contract. Bicycle lanes are not recommended. A striped Class IV separated bikeway will also be installed on Middlefield Road in front of Jordan Middle School to connect the two segments of North California Avenue. Transportation Division staff will continue to outreach to neighborhood and school stakeholders as the project progresses. Bid Process City of Palo Alto Page 4 On November 3, 2015, a notice inviting formal bids (IFB) for the Palo Alto FY 2016 Alma Street and Middlefield Road Paving project was posted at City Hall and sent to eight builder’s exchanges and fifteen contractors. The bidding period was 21 calendar days. Bids were received from two contractors on November 24, 2015 as listed on the attached Bid Summary (Attachment B). Staff believes the low number of bidders was due to the project’s construction window being in the busy summer construction season. The project was scheduled during the summer months because warmer conditions are needed to place rubberized asphalt concrete. Summary of Bid Process Bid Name/Number Palo Alto FY 2016 Alma Street and Middlefield Road Paving Project Proposed Length of Project 160 calendar days Number of Bid Packages Sent to Builder’s Exchanges 8 Number of Bid Packages Sent to Contractors 15 Total Days to Respond to Bid 21 Pre-Bid Meeting? No Number of Bids Received: 2 Bid Price Range $1,988,344 to $2,557,648 Bids ranged from $1,988,344 to $2,557,648 and from 15% to 48% above the engineer’s estimate of $1,733,722. Staff has reviewed all bids submitted and recommends that the base bid totaling $1,988,344, submitted by O’Grady Paving Inc. be accepted and that O’Grady Paving Inc. be declared the lowest responsible bidder. The change order amount of $198,834, ten percent of the total contract amount, is requested for related, additional, but unforeseen work which may develop during the project. Staff reviewed other similar projects performed by the lowest responsible bidder, O’Grady Paving Inc., including projects performed for the City. There were no significant complaints with their previous work. Staff also checked with the Contractor's State License Board and found the contractor to have an active license on file. Through conversations with bidding contractors, staff learned that the higher than expected bid prices can be attributed to the reduced work hours for arterial roadways (9:00 am – 4:00 pm), contract requirements for milling and paving City of Palo Alto Page 5 roads on Saturdays (additional labor costs) and the relatively short 160 calendar days allowed to complete the contract (ensuring favorable paving weather). Although increased costs for these considerations were factored into the engineer’s estimate for the project, bids came in even higher as described above. Staff will work to reduce these restrictions where possible in future projects on Middlefield Road and Alma Street to finish the rehabilitation within the allocated budget. In this case, staff believes the increased expenditure is acceptable, as it allows the City’s progress toward its citywide pavement condition goal to remain on schedule and will repair these especially busy sections of roadway with minimal inconvenience to the residents of Palo Alto. Resource Impact Funding for the FY 2016 Alma Street and Middlefield Road Paving Project is available in Capital Improvement Program Project PE-86070 Street Resurfacing Program, CIP Project PL-05030 Traffic Signals and Intelligent Transportation System Upgrades, and CIP Project PL-04010 Bicycle & Pedestrian Transportation Plan Implementation Project. The funding allocation is as follows: Funding Source Contract Contingency Total Encumbrance 1 PE-86070 $ 1,788,344 $ 178,834 $ 1,967,178 2 PL-05030 $ 150,000 $ 15,000 $ 165,000 2 PL-04010 $ 50,000 $ 5,000 $ 55,000 Totals $ 1,988,344 $ 198,834 $ 2,187,178 Policy Implications This project is in conformance with the City of Palo Alto’s Comprehensive Plan and does not represent any changes to existing City policies. Environmental Review Street resurfacing projects are categorically exempt from the California Environmental Quality Act (CEQA) under Section 15301c of the CEQA Guidelines as repair, maintenance and/or minor alteration of the existing facilities and no further environmental review is necessary. Attachments:  Attachment A - Contract No. C16161717 (DOCX) City of Palo Alto Page 6  Attachment B - Bid Summary (PDF)  Attachment C - Map of Project Streets (PDF) Invitation for Bid (IFB) Package 1 Rev. April 20, 2015 CONSTRUCTION CONTRACT ATTACHMENT A CONSTRUCTION CONTRACT Contract No. 16161717 City of Palo Alto FY16 Alma Street and Middlefield Road Paving Project Invitation for Bid (IFB) Package 2 Rev. April 20, 2015 CONSTRUCTION CONTRACT CONSTRUCTION CONTRACT TABLE OF CONTENTS SECTION 1 INCORPORATION OF RECITALS AND DEFINITIONS…………………………………….…………..6 1.1 Recitals…………………………………………………………………………………………………………………….6 1.2 Definitions……………………………………………………………………………………………………………….6 SECTION 2 THE PROJECT………………………………………………………………………………………………………...6 SECTION 3 THE CONTRACT DOCUMENTS………………………………………………………………………………..7 3.1 List of Documents…………………………………………………………………………………………….........7 3.2 Order of Precedence……………………………………………………………………………………………......7 SECTION 4 CONTRACTOR’S DUTY…………………………………………………………………………………………..8 4.1 Contractor's Duties…………………………………………………………………………………………………..8 SECTION 5 PROJECT TEAM……………………………………………………………………………………………………..8 5.1 Contractor's Co-operation………………………………………………………………………………………..8 SECTION 6 TIME OF COMPLETION…………………………………………………………………………………….......8 6.1 Time Is of Essence…………………………………………………………………………………………………….8 6.2 Commencement of Work…………………………………………………………………………………………8 6.3 Contract Time…………………………………………………………………………………………………………..8 6.4 Liquidated Damages…………………………………………………………………………………………………8 6.4.1 Other Remedies……………………………………………………………………………………………………..9 6.5 Adjustments to Contract Time………………………………………………………………………………….9 SECTION 7 COMPENSATION TO CONTRACTOR……………………………………………………………………….9 7.1 Contract Sum……………………………………………………………………………………………………………9 7.2 Full Compensation……………………………………………………………………………………………………9 SECTION 8 STANDARD OF CARE……………………………………………………………………………………………..9 8.1 Standard of Care…………………………………………………………………………………..…………………9 SECTION 9 INDEMNIFICATION…………………………………………………………………………………………..…10 9.1 Hold Harmless……………………………………………………………………………………………………….10 9.2 Survival…………………………………………………………………………………………………………………10 SECTION 10 NON-DISCRIMINATION……..………………………………………………………………………………10 10.1 Municipal Code Requirement…………….………………………………..……………………………….10 SECTION 11 INSURANCE AND BONDS.…………………………………………………………………………………10 Invitation for Bid (IFB) Package 3 Rev. April 20, 2015 CONSTRUCTION CONTRACT 11.1 Evidence of Coverage…………………………………………………………………………………………..10 SECTION 12 PROHIBITION AGAINST RANSFERS………………………………………………………………….…11 12.1 Assignment………………………………………………………………………………………………………….11 12.2 Assignment by Law.………………………………………………………………………………………………11 SECTION 13 NOTICES …………………………………………………………………………………………………………….11 13.1 Method of Notice …………………………………………………………………………………………………11 13.2 Notice Recipents ………………………………………………………………………………………………….11 13.3 Change of Address……………………………………………………………………………………………….12 SECTION 14 DEFAULT…………………………………………………………………………………………………………...12 14.1 Notice of Default………………………………………………………………………………………………….12 14.2 Opportunity to Cure Default…………………………………………………………………………………12 SECTION 15 CITY'S RIGHTS AND REMEDIES…………………………………………………………………………..13 15.1 Remedies Upon Default……………………………………………………………………………………….13 15.1.1 Delete Certain Services…………………………………………………………………………………….13 15.1.2 Perform and Withhold……………………………………………………………………………………..13 15.1.3 Suspend The Construction Contract…………………………………………………………………13 15.1.4 Terminate the Construction Contract for Default………………………………………………13 15.1.5 Invoke the Performance Bond………………………………………………………………………….13 15.1.6 Additional Provisions……………………………………………………………………………………….13 15.2 Delays by Sureties……………………………………………………………………………………………….13 15.3 Damages to City…………………………………………………………………………………………………..14 15.3.1 For Contractor's Default…………………………………………………………………………………..14 15.3.2 Compensation for Losses…………………………………………………………………………………14 15.4 Suspension by City……………………………………………………………………………………………….14 15.4.1 Suspension for Convenience……………………………………………………………………………..14 15.4.2 Suspension for Cause………………………………………………………………………………………..14 15.5 Termination Without Cause…………………………………………………………………………………14 15.5.1 Compensation………………………………………………………………………………………………….15 15.5.2 Subcontractors………………………………………………………………………………………………..15 15.6 Contractor’s Duties Upon Termination………………………………………………………………...15 SECTION 16 CONTRACTOR'S RIGHTS AND REMEDIES……………………………………………………………16 16.1 Contractor’s Remedies……………………………………..………………………………..………………….16 Invitation for Bid (IFB) Package 4 Rev. April 20, 2015 CONSTRUCTION CONTRACT 16.1.1 For Work Stoppage……………………………………………………………………………………………16 16.1.2 For City's Non-Payment…………………………………………………………………………………….16 16.2 Damages to Contractor………………………………………………………………………………………..16 SECTION 17 ACCOUNTING RECORDS………………………………………………………………………………….…16 17.1 Financial Management and City Access………………………………………………………………..16 17.2 Compliance with City Requests…………………………………………………………………………….17 SECTION 18 INDEPENDENT PARTIES……………………………………………………………………………………..17 18.1 Status of Parties……………………………………………………………………………………………………17 SECTION 19 NUISANCE……………………………………………………………………………………………………….…17 19.1 Nuisance Prohibited……………………………………………………………………………………………..17 SECTION 20 PERMITS AND LICENSES…………………………………………………………………………………….17 20.1 Payment of Fees…………………………………………………………………………………………………..17 SECTION 21 WAIVER…………………………………………………………………………………………………………….17 21.1 Waiver………………………………………………………………………………………………………………….17 SECTION 22 GOVERNING LAW AND VENUE; COMPLIANCE WITH LAWS……………………………….18 22.1 Governing Law…………………………………………………………………………………………………….18 22.2 Compliance with Laws…………………………………………………………………………………………18 SECTION 23 COMPLETE AGREEMENT……………………………………………………………………………………18 23.1 Integration………………………………………………………………………………………………………….18 SECTION 24 SURVIVAL OF CONTRACT…………………………………………………………………………………..18 24.1 Survival of Provisions……………………………………………………………………………………………18 SECTION 25 PREVAILING WAGES………………………………………………………………………………………….18 SECTION 26 NON-APPROPRIATION……………………………………………………………………………………….19 26.1 Appropriation………………………………………………………………………………………………………19 SECTION 27 AUTHORITY……………………………………………………………………………………………………….19 27.1 Representation of Parties…………………………………………………………………………………….19 SECTION 28 COUNTERPARTS………………………………………………………………………………………………..19 28.1 Multiple Counterparts………………………………………………………………………………………….19 SECTION 29 SEVERABILITY……………………………………………………………………………………………………19 29.1 Severability………………………………………………………………………………………………………….19 SECTION 30 STATUTORY AND REGULATORY REFERENCES …………………………………………………..19 30.1 Amendments of Laws…………………………………………………………………………………………..19 Invitation for Bid (IFB) Package 5 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 31 WORKERS’ COMPENSATION CERTIFICATION………………………………………………….….19 31.1 Workers Compensation…………………………………………………………………………………….19 SECTION 32 DIR REGISTRATION AND OTHER SB 854 REQUIREMENTS………………………………..…20 32.1 General Notice to Contractor…………………………………………………………………………….20 32.2 Labor Code section 1771.1(a)…………………………………………………………………………….20 32.3 DIR Registration Required…………………………………………………………………………………20 32.4 Posting of Job Site Notices…………………………………………………………………………………20 32.5 Payroll Records…………………………………………………………………………………………………20 Invitation for Bid (IFB) Package 6 Rev. April 20, 2015 CONSTRUCTION CONTRACT CONSTRUCTION CONTRACT THIS CONSTRUCTION CONTRACT entered into on January 25, 2016 (“Execution Date”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("City"), and O'GRADY PAVING INC. ("Contractor"), is made with reference to the following: R E C I T A L S: A. City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the statutes of the State of California and the Charter of City. B. Contractor is a General Contractor duly organized and in good standing in the State of California, Contractor’s License Number 201696. Contractor represents that it is duly licensed by the State of California and has the background, knowledge, experience and expertise to perform the obligations set forth in this Construction Contract. C. On November 3, 2015, City issued an Invitation for Bids (IFB) to contractors for the FY 16 Alma Street And Middlefield Road Paving Project (“Project”). In response to the IFB, Contractor submitted a Bid. D. City and Contractor desire to enter into this Construction Contract for the Project, and other services as identified in the Contract Documents for the Project upon the following terms and conditions. NOW THEREFORE, in consideration of the mutual promises and undertakings hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is mutually agreed by and between the undersigned parties as follows: SECTION 1 INCORPORATION OF RECITALS AND DEFINITIONS. 1.1 Recitals. All of the recitals are incorporated herein by reference. 1.2 Definitions. Capitalized terms shall have the meanings set forth in this Construction Contract and/or in the General Conditions. If there is a conflict between the definitions in this Construction Contract and in the General Conditions, the definitions in this Construction Contract shall prevail. SECTION 2 THE PROJECT. The Project is the FY 16 ALMA STREET AND MIDDLEFIELD ROAD PAVING Project, located at VARIOUS STREETS, Palo Alto, CA. ("Project"). Invitation for Bid (IFB) Package 7 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 3 THE CONTRACT DOCUMENTS. 3.1 List of Documents. The Contract Documents (sometimes collectively referred to as “Agreement” or “Bid Documents”) consist of the following documents which are on file with the Purchasing Division and are hereby incorporated by reference. 1) Change Orders 2) Field Orders 3) Contract 4) Bidding Addenda 5) Special Provisions 6) General Conditions 7) Project Plans and Drawings 8) Technical Specifications 9) Instructions to Bidders 10) Invitation for Bids 11) Contractor's Bid/Non-Collusion Affidavit 12) Reports listed in the Contract Documents 13) Public Works Department’s Standard Drawings and Specifications (most current version at time of Bid) 14) Utilities Department’s Water, Gas, Wastewater, Electric Utilities Standards (most current version at time of Bid) 15) City of Palo Alto Traffic Control Requirements 16) City of Palo Alto Truck Route Map and Regulations 17) Notice Inviting Pre-Qualification Statements, Pre-Qualification Statement, and Pre- Qualification Checklist (if applicable) 18) Performance and Payment Bonds 3.2 Order of Precedence. For the purposes of construing, interpreting and resolving inconsistencies between and among the provisions of this Contract, the Contract Documents shall have the order of precedence as set forth in the preceding section. If a claimed inconsistency cannot be resolved through the order of precedence, the City shall have the sole power to decide which document or provision shall govern as may be in the best interests of the City. Invitation for Bid (IFB) Package 8 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 4 CONTRACTOR’S DUTY. 4.1 Contractor’s Duties Contractor agrees to perform all of the Work required for the Project, as specified in the Contract Documents, all of which are fully incorporated herein. Contractor shall provide, furnish, and supply all things necessary and incidental for the timely performance and completion of the Work, including, but not limited to, provision of all necessary labor, materials, equipment, transportation, and utilities, unless otherwise specified in the Contract Documents. Contractor also agrees to use its best efforts to complete the Work in a professional and expeditious manner and to meet or exceed the performance standards required by the Contract Documents. SECTION 5 PROJECT TEAM. 5.1 Contractor’s Co-operation. In addition to Contractor, City has retained, or may retain, consultants and contractors to provide professional and technical consultation for the design and construction of the Project. The Contract requires that Contractor operate efficiently, effectively and cooperatively with City as well as all other members of the Project Team and other contractors retained by City to construct other portions of the Project. SECTION 6 TIME OF COMPLETION. 6.1 Time Is of Essence. Time is of the essence with respect to all time limits set forth in the Contract Documents. 6.2 Commencement of Work. Contractor shall commence the Work on the date specified in City’s Notice to Proceed. 6.3 Contract Time. Work hereunder shall begin on the date specified on the City’s Notice to Proceed and shall be completed not later than . within One Hundred Sixty calendar days (160) after the commencement date specified in City’s Notice to Proceed. By executing this Construction Contract, Contractor expressly waives any claim for delayed early completion. 6.4 Liquidated Damages. Pursuant to Government Code Section 53069.85, if Contractor fails to achieve Substantial Completion of the entire Work within the Contract Time, including any approved extensions thereto, City may assess liquidated damages on a daily basis for each day of Unexcused Delay in achieving Substantial Completion, based on the amount of five hundred dollars ($500) per day, or as otherwise specified in the Special Provisions. Liquidated damages may also be separately assessed for failure to meet milestones specified elsewhere in the Contract Documents, regardless of impact on the time for achieving Substantial Completion. The assessment of liquidated damages is not a penalty but considered to be a reasonable estimate of the amount of damages City will suffer by delay in completion of the Work. The City is entitled to setoff the amount of liquidated damages assessed against any payments otherwise due to Contractor, Invitation for Bid (IFB) Package 9 Rev. April 20, 2015 CONSTRUCTION CONTRACT including, but not limited to, setoff against release of retention. If the total amount of liquidated damages assessed exceeds the amount of unreleased retention, City is entitled to recover the balance from Contractor or its sureties. Occupancy or use of the Project in whole or in part prior to Substantial Completion, shall not operate as a waiver of City’s right to assess liquidated damages. 6.4.1 Other Remedies. City is entitled to any and all available legal and equitable remedies City may have where City’s Losses are caused by any reason other than Contractor’s failure to achieve Substantial Completion of the entire Work within the Contract Time. 6.5 Adjustments to Contract Time. The Contract Time may only be adjusted for time extensions approved by City and memorialized in a Change Order approved in accordance with the requirements of the Contract Documents. SECTION 7 COMPENSATION TO CONTRACTOR. 7.1 Contract Sum. Contractor shall be compensated for satisfactory completion of the Work in compliance with the Contract Documents the Contract Sum of One Million Nine Hundred And Eighty Eight Thousand Three Hundred And Forty Four Dollars ($1,988,344). [This amount includes the Base Bid and Additive Alternates .] 7.2 Full Compensation. The Contract Sum shall be full compensation to Contractor for all Work provided by Contractor and, except as otherwise expressly permitted by the terms of the Contract Documents, shall cover all Losses arising out of the nature of the Work or from the acts of the elements or any unforeseen difficulties or obstructions which may arise or be encountered in performance of the Work until its Acceptance by City, all risks connected with the Work, and any and all expenses incurred due to suspension or discontinuance of the Work, except as expressly provided herein. The Contract Sum may only be adjusted for Change Orders approved in accordance with the requirements of the Contract Documents. SECTION 8 STANDARD OF CARE. 8.1 Standard of Care. Contractor agrees that the Work shall be performed by qualified, experienced and well-supervised personnel. All services performed in connection with this Construction Contract shall be performed in a manner consistent with the standard of care under California law applicable to those who specialize in providing such services for projects of the type, scope and complexity of the Project. Invitation for Bid (IFB) Package 10 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 9 INDEMNIFICATION. 9.1 Hold Harmless. To the fullest extent allowed by law, Contractor will defend, indemnify, and hold harmless City, its City Council, boards and commissions, officers, agents, employees, representatives and volunteers (hereinafter individually referred to as an “Indemnitee” and collectively referred to as "Indemnitees"), through legal counsel acceptable to City, from and against any and liability, loss, damage, claims, expenses (including, without limitation, attorney fees, expert witness fees, paralegal fees, and fees and costs of litigation or arbitration) (collectively, “Liability”) of every nature arising out of or in connection with the acts or omissions of Contractor, its employees, Subcontractors, representatives, or agents, in performing the Work or its failure to comply with any of its obligations under the Contract, except such Liability caused by the active negligence, sole negligence, or willful misconduct of an Indemnitee. Contractor shall pay City for any costs City incurs to enforce this provision. Except as provided in Section 9.2 below, nothing in the Contract Documents shall be construed to give rise to any implied right of indemnity in favor of Contractor against City or any other Indemnitee. Pursuant to Public Contract Code Section 9201, City shall timely notify Contractor upon receipt of any third-party claim relating to the Contract. 9.2 Survival. The provisions of Section 9 shall survive the termination of this Construction Contract. SECTION 10 NON-DISCRIMINATION. 10.1 Municipal Code Requirement. As set forth in Palo Alto Municipal Code section 2.30.510, Contractor certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. Contractor acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and will comply with all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 11 INSURANCE AND BONDS. 11.1 Evidence of coverage. Within ten (10) business days following issuance of the Notice of Award, Contractor shall provide City with evidence that it has obtained insurance and shall submit Performance and Payment Bonds satisfying all requirements in Article 11 of the General Conditions. Invitation for Bid (IFB) Package 11 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 12 PROHIBITION AGAINST TRANSFERS. 12.1 Assignment. City is entering into this Construction Contract in reliance upon the stated experience and qualifications of the Contractor and its Subcontractors set forth in Contractor’s Bid. Accordingly, Contractor shall not assign, hypothecate or transfer this Construction Contract or any interest therein directly or indirectly, by operation of law or otherwise without the prior written consent of City. Any assignment, hypothecation or transfer without said consent shall be null and void, and shall be deemed a substantial breach of contract and grounds for default in addition to any other legal or equitable remedy available to the City. 12.2 Assignment by Law. The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Contractor or of any general partner or joint venturer or syndicate member of Contractor, if the Contractor is a partnership or joint venture or syndicate or co-tenancy shall result in changing the control of Contractor, shall be construed as an assignment of this Construction Contract. Control means more than fifty percent (50%) of the voting power of the corporation or other entity. SECTION 13 NOTICES. 13.1 Method of Notice. All notices, demands, requests or approvals to be given under this Construction Contract shall be given in writing and shall be deemed served on the earlier of the following: (i) On the date delivered if delivered personally; (ii) On the third business day after the deposit thereof in the United States mail, postage prepaid, and addressed as hereinafter provided; (iii) On the date sent if sent by facsimile transmission; (iv) On the date sent if delivered by electronic mail; or (v) On the date it is accepted or rejected if sent by certified mail. 13.2 Notice to Recipients. All notices, demands or requests (including, without limitation, Change Order Requests and Claims) from Contractor to City shall include the Project name and the number of this Construction Contract and shall be addressed to City at: To City: City of Palo Alto City Clerk 250 Hamilton Avenue P.O. Box 10250 Palo Alto, CA 94303 Copy to: City of Palo Alto Public Works Administration 250 Hamilton Avenue Palo Alto, CA 94301 Attn: Holly Boyd AND [Include Construction Manager, If Applicable.] Invitation for Bid (IFB) Package 12 Rev. April 20, 2015 CONSTRUCTION CONTRACT City of Palo Alto Utilities Engineering 250 Hamilton Avenue Palo Alto, CA 94301 Attn: In addition, copies of all Claims by Contractor under this Construction Contract shall be provided to the following: Palo Alto City Attorney’s Office 250 Hamilton Avenue P.O. Box 10250 Palo Alto, California 94303 All Claims shall be delivered personally or sent by certified mail. All notices, demands, requests or approvals from City to Contractor shall be addressed to: 13.3 Change of Address. In advance of any change of address, Contractor shall notify City of the change of address in writing. Each party may, by written notice only, add, delete or replace any individuals to whom and addresses to which notice shall be provided. SECTION 14 DEFAULT. 14.1 Notice of Default. In the event that City determines, in its sole discretion, that Contractor has failed or refused to perform any of the obligations set forth in the Contract Documents, or is in breach of any provision of the Contract Documents, City may give written notice of default to Contractor in the manner specified for the giving of notices in the Construction Contract, with a copy to Contractor’s performance bond surety. 14.2 Opportunity to Cure Default. Except for emergencies, Contractor shall cure any default in performance of its obligations under the Contract Documents within two (2) Days (or such shorter time as City may reasonably require) after receipt of written notice. However, if the breach cannot be reasonably cured within such time, Contractor will commence to cure the breach within two (2) Days (or such shorter time as City may reasonably require) and will diligently and continuously prosecute such cure to completion within a reasonable time, which shall in no event be later than ten (10) Days after receipt of such written notice. Invitation for Bid (IFB) Package 13 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 15 CITY'S RIGHTS AND REMEDIES. 15.1 Remedies Upon Default. If Contractor fails to cure any default of this Construction Contract within the time period set forth above in Section 14, then City may pursue any remedies available under law or equity, including, without limitation, the following: 15.1.1 Delete Certain Services. City may, without terminating the Construction Contract, delete certain portions of the Work, reserving to itself all rights to Losses related thereto. 15.1.2 Perform and Withhold. City may, without terminating the Construction Contract, engage others to perform the Work or portion of the Work that has not been adequately performed by Contractor and withhold the cost thereof to City from future payments to Contractor, reserving to itself all rights to Losses related thereto. 15.1.3 Suspend The Construction Contract. City may, without terminating the Construction Contract and reserving to itself all rights to Losses related thereto, suspend all or any portion of this Construction Contract for as long a period of time as City determines, in its sole discretion, appropriate, in which event City shall have no obligation to adjust the Contract Sum or Contract Time, and shall have no liability to Contractor for damages if City directs Contractor to resume Work. 15.1.4 Terminate the Construction Contract for Default. City shall have the right to terminate this Construction Contract, in whole or in part, upon the failure of Contractor to promptly cure any default as required by Section 14. City’s election to terminate the Construction Contract for default shall be communicated by giving Contractor a written notice of termination in the manner specified for the giving of notices in the Construction Contract. Any notice of termination given to Contractor by City shall be effective immediately, unless otherwise provided therein. 15.1.5 Invoke the Performance Bond. City may, with or without terminating the Construction Contract and reserving to itself all rights to Losses related thereto, exercise its rights under the Performance Bond. 15.1.6 Additional Provisions. All of City’s rights and remedies under this Construction Contract are cumulative, and shall be in addition to those rights and remedies available in law or in equity. Designation in the Contract Documents of certain breaches as material shall not waive the City’s authority to designate other breaches as material nor limit City’s right to terminate the Construction Contract, or prevent the City from terminating the Agreement for breaches that are not material. City’s determination of whether there has been noncompliance with the Construction Contract so as to warrant exercise by City of its rights and remedies for default under the Construction Contract, shall be binding on all parties. No termination or action taken by City after such termination shall prejudice any other rights or remedies of City provided by law or equity or by the Contract Documents upon such termination; and City may proceed against Contractor to recover all liquidated damages and Losses suffered by City. 15.2 Delays by Sureties. Time being of the essence in the performance of the Work, if Contractor’s surety fails to arrange for completion of the Work in accordance with the Performance Bond, within seven (7) calendar days from the date of the notice of termination, Contractor’s surety shall be deemed to have waived its right to complete the Work under the Contract, and City may immediately make arrangements for the completion of the Work through use of its own forces, by hiring a replacement contractor, or by any other means that City determines advisable under the circumstances. Contractor and its surety shall be jointly and severally Invitation for Bid (IFB) Package 14 Rev. April 20, 2015 CONSTRUCTION CONTRACT liable for any additional cost incurred by City to complete the Work following termination. In addition, City shall have the right to use any materials, supplies, and equipment belonging to Contractor and located at the Worksite for the purposes of completing the remaining Work. 15.3 Damages to City. 15.3.1 For Contractor's Default. City will be entitled to recovery of all Losses under law or equity in the event of Contractor’s default under the Contract Documents. 15.3.2 Compensation for Losses. In the event that City's Losses arise from Contractor’s default under the Contract Documents, City shall be entitled to deduct the cost of such Losses from monies otherwise payable to Contractor. If the Losses incurred by City exceed the amount payable, Contractor shall be liable to City for the difference and shall promptly remit same to City. 15.4 Suspension by City 15.4.1 Suspension for Convenience. City may, at any time and from time to time, without cause, order Contractor, in writing, to suspend, delay, or interrupt the Work in whole or in part for such period of time, up to an aggregate of fifty percent (50%) of the Contract Time. The order shall be specifically identified as a Suspension Order by City. Upon receipt of a Suspension Order, Contractor shall, at City’s expense, comply with the order and take all reasonable steps to minimize costs allocable to the Work covered by the Suspension Order. During the Suspension or extension of the Suspension, if any, City shall either cancel the Suspension Order or, by Change Order, delete the Work covered by the Suspension Order. If a Suspension Order is canceled or expires, Contractor shall resume and continue with the Work. A Change Order will be issued to cover any adjustments of the Contract Sum or the Contract Time necessarily caused by such suspension. A Suspension Order shall not be the exclusive method for City to stop the Work. 15.4.2 Suspension for Cause. In addition to all other remedies available to City, if Contractor fails to perform or correct work in accordance with the Contract Documents, City may immediately order the Work, or any portion thereof, suspended until the cause for the suspension has been eliminated to City’s satisfaction. Contractor shall not be entitled to an increase in Contract Time or Contract Price for a suspension occasioned by Contractor’s failure to comply with the Contract Documents. City’s right to suspend the Work shall not give rise to a duty to suspend the Work, and City’s failure to suspend the Work shall not constitute a defense to Contractor’s failure to comply with the requirements of the Contract Documents. 15.5 Termination Without Cause. City may, at its sole discretion and without cause, terminate this Construction Contract in part or in whole upon written notice to Contractor. Upon receipt of such notice, Contractor shall, at City’s expense, comply with the notice and take all reasonable steps to minimize costs to close out and demobilize. The compensation allowed under this Paragraph 15.5 shall be the Contractor’s sole and exclusive compensation for such termination and Contractor waives any claim for other compensation or Losses, including, but not limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential, direct, indirect or incidental damages of any kind resulting from termination without cause. Termination pursuant to this provision does not relieve Contractor or its sureties from any of their obligations for Losses arising from or related to the Work performed by Contractor. Invitation for Bid (IFB) Package 15 Rev. April 20, 2015 CONSTRUCTION CONTRACT 15.5.1 Compensation. Following such termination and within forty-five (45) Days after receipt of a billing from Contractor seeking payment of sums authorized by this Paragraph 15.5.1, City shall pay the following to Contractor as Contractor’s sole compensation for performance of the Work : .1 For Work Performed. The amount of the Contract Sum allocable to the portion of the Work properly performed by Contractor as of the date of termination, less sums previously paid to Contractor. .2 For Close-out Costs. Reasonable costs of Contractor and its Subcontractors: (i) Demobilizing and (ii) Administering the close-out of its participation in the Project (including, without limitation, all billing and accounting functions, not including attorney or expert fees) for a period of no longer than thirty (30) Days after receipt of the notice of termination. .3 For Fabricated Items. Previously unpaid cost of any items delivered to the Project Site which were fabricated for subsequent incorporation in the Work. .4 Profit Allowance. An allowance for profit calculated as four percent (4%) of the sum of the above items, provided Contractor can prove a likelihood that it would have made a profit if the Construction Contract had not been terminated. 15.5.2 Subcontractors. Contractor shall include provisions in all of its subcontracts, purchase orders and other contracts permitting termination for convenience by Contractor on terms that are consistent with this Construction Contract and that afford no greater rights of recovery against Contractor than are afforded to Contractor against City under this Section. 15.6 Contractor’s Duties Upon Termination. Upon receipt of a notice of termination for default or for convenience, Contractor shall, unless the notice directs otherwise, do the following: (i) Immediately discontinue the Work to the extent specified in the notice; (ii) Place no further orders or subcontracts for materials, equipment, services or facilities, except as may be necessary for completion of such portion of the Work that is not discontinued; (iii) Provide to City a description in writing, no later than fifteen (15) days after receipt of the notice of termination, of all subcontracts, purchase orders and contracts that are outstanding, including, without limitation, the terms of the original price, any changes, payments, balance owing, the status of the portion of the Work covered and a copy of the subcontract, purchase order or contract and any written changes, amendments or modifications thereto, together with such other information as City may determine necessary in order to decide whether to accept assignment of or request Contractor to terminate the subcontract, purchase order or contract; (iv) Promptly assign to City those subcontracts, purchase orders or contracts, or portions thereof, that City elects to accept by assignment and cancel, on the most favorable terms reasonably possible, all subcontracts, purchase orders or contracts, or portions thereof, that City does not elect to accept by assignment; and (v) Thereafter do only such Work as may be necessary to preserve and protect Work already in progress and to protect materials, plants, and equipment on the Project Site or in transit thereto. Upon termination, whether for cause or for convenience, the provisions of the Contract Documents remain in effect as to any Claim, indemnity obligation, warranties, guarantees, Invitation for Bid (IFB) Package 16 Rev. April 20, 2015 CONSTRUCTION CONTRACT submittals of as-built drawings, instructions, or manuals, or other such rights and obligations arising prior to the termination date. SECTION 16 CONTRACTOR'S RIGHTS AND REMEDIES. 16.1 Contractor’s Remedies. Contractor may terminate this Construction Contract only upon the occurrence of one of the following: 16.1.1 For Work Stoppage. The Work is stopped for sixty (60) consecutive Days, through no act or fault of Contractor, any Subcontractor, or any employee or agent of Contractor or any Subcontractor, due to issuance of an order of a court or other public authority other than City having jurisdiction or due to an act of government, such as a declaration of a national emergency making material unavailable. This provision shall not apply to any work stoppage resulting from the City’s issuance of a suspension notice issued either for cause or for convenience. 16.1.2 For City's Non-Payment. If City does not make pay Contractor undisputed sums within ninety (90) Days after receipt of notice from Contractor, Contractor may terminate the Construction Contract (30) days following a second notice to City of Contractor’s intention to terminate the Construction Contract. 16.2 Damages to Contractor. In the event of termination for cause by Contractor, City shall pay Contractor the sums provided for in Paragraph 15.5.1 above. Contractor agrees to accept such sums as its sole and exclusive compensation and agrees to waive any claim for other compensation or Losses, including, but not limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential, direct, indirect and incidental damages, of any kind. SECTION 17 ACCOUNTING RECORDS. 17.1 Financial Management and City Access. Contractor shall keep full and detailed accounts and exercise such controls as may be necessary for proper financial management under this Construction Contract in accordance with generally accepted accounting principles and practices. City and City's accountants during normal business hours, may inspect, audit and copy Contractor's records, books, estimates, take-offs, cost reports, ledgers, schedules, correspondence, instructions, drawings, receipts, subcontracts, purchase orders, vouchers, memoranda and other data relating to this Project. Contractor shall retain these documents for a period of three (3) years after the later of (i) Final Payment or (ii) final resolution of all Contract Disputes and other disputes, or (iii) for such longer period as may be required by law. Invitation for Bid (IFB) Package 17 Rev. April 20, 2015 CONSTRUCTION CONTRACT 17.2 Compliance with City Requests. Contractor's compliance with any request by City pursuant to this Section 17 shall be a condition precedent to filing or maintenance of any legal action or proceeding by Contractor against City and to Contractor's right to receive further payments under the Contract Documents. City many enforce Contractor’s obligation to provide access to City of its business and other records referred to in Section 17.1 for inspection or copying by issuance of a writ or a provisional or permanent mandatory injunction by a court of competent jurisdiction based on affidavits submitted to such court, without the necessity of oral testimony. SECTION 18 INDEPENDENT PARTIES. 18.1 Status of parties. Each party is acting in its independent capacity and not as agents, employees, partners, or joint ventures’ of the other party. City, its officers or employees shall have no control over the conduct of Contractor or its respective agents, employees, subconsultants, or subcontractors, except as herein set forth. SECTION 19 NUISANCE. 19.1 Nuisance Prohibited. Contractor shall not maintain, commit, nor permit the maintenance or commission of any nuisance in connection in the performance of services under this Construction Contract. SECTION 20 PERMITS AND LICENSES. 20.1 Payment of Fees. Except as otherwise provided in the Special Provisions and Technical Specifications, The Contractor shall provide, procure and pay for all licenses, permits, and fees, required by the City or other government jurisdictions or agencies necessary to carry out and complete the Work. Payment of all costs and expenses for such licenses, permits, and fees shall be included in one or more Bid items. No other compensation shall be paid to the Contractor for these items or for delays caused by non-City inspectors or conditions set forth in the licenses or permits issued by other agencies. SECTION 21 WAIVER. 21.1 Waiver. A waiver by either party of any breach of any term, covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained herein, whether of the same or a different character. Invitation for Bid (IFB) Package 18 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 22 GOVERNING LAW AND VENUE; COMPLIANCE WITH LAWS. 22.1 Governing Law. This Construction Contract shall be construed in accordance with and governed by the laws of the State of California, and venue shall be in a court of competent jurisdiction in the County of Santa Clara, and no other place. 22.2 Compliance with Laws. Contractor shall comply with all applicable federal and California laws and city laws, including, without limitation, ordinances and resolutions, in the performance of work under this Construction Contract. SECTION 23 COMPLETE AGREEMENT. 23.1 Integration. This Agreement represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This Agreement may be amended only by a written instrument, which is signed by the parties. SECTION 24 SURVIVAL OF CONTRACT. 24.1 Survival of Provisions. The provisions of the Construction Contract which by their nature survive termination of the Construction Contract or Final Completion, including, without limitation, all warranties, indemnities, payment obligations, and City’s right to audit Contractor’s books and records, shall remain in full force and effect after Final Completion or any termination of the Construction Contract. SECTION 25 PREVAILING WAGES. This Project is not subject to prevailing wages. Contractor is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7, if the public works contract does not include a project of $25,000 or less, when the project is for construction work, or the contract does not include a project of $15,000 or less, when the project is for alteration, demolition, repair, or maintenance (collectively, ‘improvement’) work. Or Contractor is required to pay general prevailing wages as defined in Subchapter 3, Title 8 of the California Code of Regulations and Section 16000 et seq. and Section 1773.1 of the California Labor Code. Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of worker needed to execute the contract for this Project from the Director of the Department of Industrial Relations (“DIR”). Copies of these rates may be obtained at the Purchasing Division’s office of the City of Palo Alto. Contractor shall provide a copy of prevailing wage rates to any staff or subcontractor hired, and shall pay the adopted prevailing wage rates as a minimum. Contractor shall comply with the provisions of all sections, including, but not limited to, Sections 1775, 1776, 1777.5, 1782, 1810, and 1813, of the Labor Code pertaining to prevailing wages. Invitation for Bid (IFB) Package 19 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 26 NON-APPROPRIATION. 26.1 Appropriations. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that the City does not appropriate funds for the following fiscal year for this event, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Construction Contract are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 27 AUTHORITY. 27.1 Representation of Parties. The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. SECTION 28 COUNTERPARTS 28.1 Multiple Counterparts. This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement. SECTION 29 SEVERABILITY. 29.1 Severability. In case a provision of this Construction Contract is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not be affected. SECTION 30 STATUTORY AND REGULATORY REFERENCES. 30.1 Amendments to Laws. With respect to any amendments to any statutes or regulations referenced in these Contract Documents, the reference is deemed to be the version in effect on the date that the Contract was awarded by City, unless otherwise required by law. SECTION 31 WORKERS’ COMPENSATION CERTIFICATION. 31.1 Workers Compensation. Pursuant to Labor Code Section 1861, by signing this Contract, Contractor certifies as follows: “I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the Work on this Contract.” Invitation for Bid (IFB) Package 20 Rev. April 20, 2015 CONSTRUCTION CONTRACT SECTION 32 DIR REGISTRATION AND OTHER SB 854 REQUIREMENTS. 32.1 General Notice to Contractor. City requires Contractor and its listed subcontractors to comply with the requirements of SB 854. 32.2 Labor Code section 1771.1(a) City provides notice to Contractor of the requirements of California Labor Code section 1771.1(a), which reads: “A contractor or subcontractor shall not be qualified to bid on, be listed in a bid proposal, subject to the requirements of Section 4104 of the Public Contract Code, or engage in the performance of any contract for public work, as defined in this chapter, unless currently registered and qualified to perform public work pursuant to Section 1725.5. It is not a violation of this section for an unregistered contractor to submit a bid that is authorized by Section 7029.1 of the Business and Professions Code or Section 10164 or 20103.5 of the Public Contract Code, provided the contactor is registered to perform public work pursuant to Section 1725.5 at the time the contract is awarded.” 32.3 DIR Registration Required. City will not accept a bid proposal from or enter into this Construction Contract with Contractor without proof that Contractor and its listed subcontractors are registered with the California Department of Industrial Relations (“DIR”) to perform public work, subject to limited exceptions. 32.4 Posting of Job Site Notices. City gives notice to Contractor and its listed subcontractors that Contractor is required to post all job site notices prescribed by law or regulation and Contractor is subject to SB 854-compliance monitoring and enforcement by DIR. 32.5 Payroll Records. City requires Contractor and its listed subcontractors to comply with the requirements of Labor Code section 1776, including: (i) Keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by, respectively, Contractor and its listed subcontractors, in connection with the Project. (ii) The payroll records shall be verified as true and correct and shall be certified and made available for inspection at all reasonable hours at the principal office of Contractor and its listed subcontractors, respectively. (iii) At the request of City, acting by its project manager, Contractor and its listed subcontractors shall make the certified payroll records available for inspection or furnished upon request to the project manager within ten (10) days of receipt of City’s request. City requests Contractor and its listed subcontractors to submit the certified payroll records at the end of each week during the Project. Invitation for Bid (IFB) Package 21 Rev. April 20, 2015 CONSTRUCTION CONTRACT (iv) If the certified payroll records are not produced to the project manager within the 10-day period, then Contractor and its listed subcontractors shall be subject to a penalty of one hundred dollars ($100.00) per calendar day, or portion thereof, for each worker, and City shall withhold the sum total of penalties from the progress payment(s) then due and payable to Contractor. This provision supplements the provisions of Section 15 hereof. (v) Inform the project manager of the location of contractor’s and its listed subcontractors’ payroll records (street address, city and county) at the commencement of the Project, and also provide notice to the project manager within five (5) business days of any change of location of those payroll records. IN WITNESS WHEREOF, the parties have caused this Construction Contract to be executed the date and year first above written. CITY OF PALO ALTO ____________________________ Purchasing Manager City Manager APPROVED AS TO FORM: ____________________________ Senior Asst. City Attorney APPROVED: ____________________________ Public Works Director CONTRACTOR By:___________________________ Name:________________________ Title:__________________________ Date: _________________________ FY 16 Alma Street and Middlefield Road Paving  Project Bid Summary Attachment B UNIT COST TOTAL COST UNIT COST TOTAL COST UNIT COST TOTAL COST 1 Rubberized Asphalt Overlay: 3,514 TON $150.00 527,100.00$ $132.00 463,848.00$ $200.00 702,800.00$ 2 PCC Base Repair:7,500 SF $16.00 120,000.00$ $16.00 120,000.00$ $25.00 187,500.00$ 3 AC Milling: 375,000 SF $0.46 172,500.00$ $0.40 150,000.00$ $0.60 225,000.00$ 4 Reset Utility Box:10 EA $500.00 5,000.00$ $600.00 6,000.00$ $700.00 7,000.00$ 5 Reset Manhole:10 EA $750.00 7,500.00$ $900.00 9,000.00$ $1,200.00 12,000.00$ 6 traffic loops (6x6)12 EA $400.00 4,800.00$ $400.00 4,800.00$ $1,000.00 12,000.00$ 7 Reset Catch Basin:5 EA $1,050.00 5,250.00$ $1,600.00 8,000.00$ $1,500.00 7,500.00$ 8 Type A Curb and Gutter, 1’ Buried Pan:1800 LF $50.00 90,000.00$ $75.00 135,000.00$ $60.00 108,000.00$ 9 Type A vertical curb with 1' exposed gutter pan 2,900 LF $51.00 147,900.00$ $75.00 217,500.00$ $60.00 174,000.00$ 10 Type A Curb and Gutter, 2’ Pan:550 LF $58.00 31,900.00$ $84.00 46,200.00$ $85.00 46,750.00$ 11 Concrete Driveway:11,800 SF $10.00 118,000.00$ $16.00 188,800.00$ $25.00 295,000.00$ 12 Concrete Sidewalk:3,700 SF $9.00 33,300.00$ $14.00 51,800.00$ $15.00 55,500.00$ 13 Demo Concrete/Asphalt:1,500 SF $5.00 7,500.00$ $8.50 12,750.00$ $7.00 10,500.00$ 14 Type A Curb Ramp:6 EA $1,900.00 11,400.00$ $4,200.00 25,200.00$ $4,400.00 26,400.00$ 15 ADA Dome Upgrade:6 EA $525.00 3,150.00$ $450.00 2,700.00$ $550.00 3,300.00$ 16 Recycling of Inert Solid Materials:3,514 TON $3.00 10,542.00$ $3.00 10,542.00$ $1.00 3,514.00$ 17 Blue Pavement Markers:23 EA $26.00 598.00$ $20.00 460.00$ $14.00 322.00$ 18 Curb Paint:2000 LF $4.00 8,000.00$ $2.00 4,000.00$ $1.75 3,500.00$ 19 Thermo Striping, Caltrans Detail 27B 800 LF $1.00 800.00$ $1.00 800.00$ $1.15 920.00$ 20 Thermo Striping, Caltrans Detail 22:8000 LF $2.00 16,000.00$ $2.30 18,400.00$ $1.75 14,000.00$ 21 Thermo Striping, Caltrans Detail 1:400 LF $2.00 800.00$ $1.00 400.00$ $0.60 240.00$ 22 Thermo Striping, Caltrans Detail 8:8,800 LF $1.65 14,520.00$ $1.00 8,800.00$ $0.60 5,280.00$ 23 Thermo Striping, Caltrans Detail 38C:400 LF $1.20 480.00$ $1.40 560.00$ $2.00 800.00$ 24 Thermo Striping, 12" Yellow:900 LF $4.00 3,600.00$ $3.00 2,700.00$ $4.00 3,600.00$ 25 Thermo Striping, 12" White:1500 LF $4.00 6,000.00$ $3.00 4,500.00$ $4.00 6,000.00$ 26 Thermoplastic Paving Legends:39 EA $60.00 2,340.00$ $80.00 3,120.00$ $52.00 2,028.00$ 27 Brickwork/Specialty Finishes 400 SF $20.00 8,000.00$ $30.00 12,000.00$ $35.00 14,000.00$ 28 Green Sharrows 12 EA $350.00 4,200.00$ $500.00 6,000.00$ $990.00 11,880.00$ 29 Traffic Control:1 LS $ 100,000.00 100,000.00$ $ 81,000.00 81,000.00$ $ 225,000.00 225,000.00$ 30 Notices:1 LS $ 10,000.00 10,000.00$ $ 37,000.00 37,000.00$ $ 15,000.00 15,000.00$ 31 Utility Tie Out Drawings:1 LS $2,000.00 2,000.00$ $2,000.00 2,000.00$ $2,500.00 2,500.00$ 32 Tree Trimming:50 HRS $200.00 10,000.00$ $250.00 12,500.00$ $250.00 12,500.00$ 33 Type G Curb Ramp:14 EA $1,500.00 21,000.00$ $4,300.00 60,200.00$ $4,200.00 58,800.00$ 34 Planter Area Conform:1 LS $3,000.00 3,000.00$ $ 13,000.00 13,000.00$ $500.00 500.00$ 35 Install bolt on risers for manholes 10 EA $350.00 3,500.00$ $250.00 2,500.00$ $200.00 2,000.00$ 36 Install bolt on risers for utility boxes 10 EA $250.00 2,500.00$ $150.00 1,500.00$ $100.00 1,000.00$ 37 inert recycling containing petromat 3514 TON $3.00 10,542.00$ $1.00 3,514.00$ $1.00 3,514.00$ 38 Misc. Transportation Improvements:1 LS $ 50,000.00 50,000.00$ $ 50,000.00 50,000.00$ $ 50,000.00 50,000.00$ 39 traffic Signal Video Equipment 1 LS $ 125,000.00 125,000.00$ $ 150,000.00 150,000.00$ $ 160,000.00 160,000.00$ 40 HMA AC Conforms 17500 SF $2.00 35,000.00$ $3.50 61,250.00$ $5.00 87,500.00$ 1,733,722.00$ 1,988,344.00$ 2,557,648.00$ DESCRIPTION APPROX. QTY UNIT ENGINEER'S ESTIMATE over INTERSTATE PAVING 15%48% over O'GRADY PAVING INC Base Bid Total (Items 001 through 040) BID ITEM Attachment B 2500 600 1900 1800 400 600 2000 2100 2000 2100 2000 2200 2300 1700 400 1500 1600 16001500 0 1800 1800 200 1800 300 1700 1900 2500 400 2400 2700 200 2400 2300 300 2200 2200 100 2300 200 2000 100 1800 20001900 2100 2000 200 300 1900 2600 100 2400 2700 100 2500 2100 2100 200 2300 300 200 1900 400 500 2 400 2400 2400 300 500 24002300 500 23002200 600 22002200 800 2400 1900 25002400 900 900 700 0 600 800 800 600 500 400 300 400 700 300 600 200 100 600 200 100 500 500 500 400 300 400 400 500400 1200 1300 200 1600 1700 1600 500 1800 2100 1400 100 1700 400 1700 1800 1500 1500 1400 600 2000 600 700 700 700 400 1000 1300 500 1500 400 100 1100 1100 200 14001300 400 1400 100 200 1200 1200 900 800 600 1000 300 900800 1000 900 800 700600 700 400 500 700 500 400 600 800 700700 500 900 400 1200 600 1100 400 1100 500 1000 700 600 900800 800 600 1000 800 1000 1000 1100 1000 900 1000 1200 13001200 700 1100 800 900 1200 1100 1000 1100 1700 700 1900 600 1600 500 1600 2100 1700 600 1800 800 1300 1200 800 1200 1200 1400 1100 1100 1100 1300 800 1500 900 700 1400 1000 1300 1100 1200 800 900 800 1400 2000 2100 1800 2000 2200 2200 2000 1900 600 2500 700 600 2200 1500 2300 1000 1300 2500 600 1900 1800 400 600 2000 2100 2000 2100 2000 2200 2300 1700 400 1500 1600 16001500 0 1800 1800 200 1800 300 1700 1900 2500 400 2400 2700 200 2400 2300 300 2200 2200 100 2300 200 2000 100 1800 20001900 2100 2000 200 300 1900 2600 100 2400 2700 100 2500 2100 2100 200 2300 300 200 1900 400 500 2 400 2400 2400 300 500 24002300 500 23002200 600 22002200 800 2400 1900 25002400 900 900 700 0 600 800 800 600 500 400 300 400 700 300 600 200 100 600 200 100 500 500 500 400 300 400 400 500400 1200 1300 200 1600 1700 1600 500 1800 2100 1400 100 1700 400 1700 1800 1500 1500 1400 600 2000 600 700 700 700 400 1000 1300 500 1500 400 100 1100 1100 200 14001300 400 1400 100 200 1200 1200 900 800 600 1000 300 900800 1000 900 800 700600 700 400 500 700 500 400 600 800 700700 500 900 400 1200 600 1100 400 1100 500 1000 700 600 900800 800 600 1000 800 1000 1000 1100 1000 900 1000 1200 13001200 700 1100 800 900 1200 1100 1000 1100 1700 700 1900 600 1600 500 1600 2100 1700 600 1800 800 1300 1200 800 1200 1200 1400 1100 1100 1100 1300 800 1500 900 700 1400 1000 1300 1100 1200 800 900 800 1400 2000 2100 1800 2000 2200 2200 2000 1900 600 2500 700 600 2200 1500 2300 1000 1300 Coastland Drive Coastland Driv Oxford Avenue Cambridge Avenue College Avenue Williams Street Yale Street Staunton Court Oxford AvenueEl Camino Real Churchill Avenue Park Boulevard Park Avenue Escobita Avenue Churchill Avenue Sequoia Avenue Mariposa Avenue Castilleja Avenue Miramonte Avenue Madrono Avenue Portola Avenue Manzanita Avenue Coleridge Avenue Leland Avenue StanfordAvenue Birch Street Ash Street Lowell Avenue Alma StreetTennyson Avenue Grant Avenue Sheridan Avenue Jacaranda Lane El Camino Real Sherman Avenue Ash Street Mimosa Lane d College Avenue Cambridge Avenue New Mayfield LaneBirch Street California Avenue Park Boulevard Nogal Lane Rinconada Avenue Santa Rita Avenue Park Boulevard Seale Avenue Washington Avenue Santa Rita AvenueWaverleyStree Bryant Street High Street Emerson Street Colorado A venue Street Alma Street HighStreet t Emerson Wa v e r l e y O a k s Washington Avenue Bryant Street South Court Waverley Street Emerson Street Nevada Avenue North California Avenue Santa Rita Avenue Ramona Street High Street North California Avenue Oregon Expressway Marion Avenue Ramona Street South Court Cowper Street Anton Court Nevada Avenue Tasso StreetTasso Street Oregon Avenue Marion Pl Middlefield Road Ross Road Warren Way El Cajon Way Garland Drive Louis Road Marshall Drive D Agnes Way Quarry Road Homer Avenue Lane 8 West Medical Foundation Way Lane 7 West Lane 7 East Embarcadero Road Encina Avenue El Camino Real Urban Lane Wells Avenue Forest Avenue High Street Emerson Street Channing Avenue Alma StreetAlma Street El Camino Real Mitchell Lane Lytton Avenue High Street Lane 6 E Lane 11 W Lane 21 Gilman Street Hamilton Avenue University Avenue Lane 30 Florence Street Tasso Street Cowper Street Everett Court Lytton Avenue Churchill Avenue Lowell Avenue Seale Avenue Tennyson Avenue Melville Avenue Cowper Street Tasso Street Webster Street Byron Street North California Avenue Coleridge AvenueWaverley Street Bryant Street Emerson Street Kellogg Avenue Alma StreetKingsley Avenue Portal Place Ross Road Oregon Avenue Garland Drive Lane A West Lane B West Lane B East Lane D West Lane 59 East Whitman Court Kellogg Avenue Embarcadero Road Kingsley Avenue Lincoln Avenue Addison Avenue Lincoln Avenue Forest Avenue Downing Lane Homer Avenue Lane D East Lane 39 Lane 56 Hamilton Avenue Webster Street Waverley Street Kipling Street Bryant Street Ramona Street Addison Avenue Scott Street Byron Street Palo Hale Street Seneca Street Lytton Avenue Guinda StreettoAvenue Fulton Street Middlefield Road Forest Avenue Webster Street Kellogg Avenue Middlefield Road Byron Street Webster Street Cowper Street Tasso Street Cowper Street Addison Avenue Lincoln Avenue B oyce Avenu e Forest Avenue Hamilton Avenue Homer Avenue Guinda Street Middlefield Road Channing Avenue AltoAvenueChaucer Street Chaucer Street University Avenue C h anning A ven ue Addiso n Avenu e Lin coln Avenue R e gent Pl Guinda Street Lincoln Avenue Fulton Street Melville A ven ue Byron Street Kingsley Avenue Melville Avenue H amilton A venue Ha milton C ourt Forest Avenue Forest Ct M arlo S om erset Pl Pitm a n Avenue Fife Ave nue Forest A ven ueDa Lin coln Ave n Coleridge Avenue Lowell Avenue Fulton Street Cowper Street Tennyson Avenue Seale Avenue Northampton Drive West Greenwich Pl Middlefield Road Newell Road Guinda Street East Greenwich Pl Southampton Drive Webster Street Kirby Pl K ent PlaceTevis Pl M artin A venu e Harriet Stre et Wilson Stree t C edar Street H arker A venu eGreenwood Ave nue H utchinson A ven ue C ha nning A venu e H opkins A venue Embarcadero Road Sharon Ct Erstw i ld Court Walter Hays Drive Walnut DriveN e w ell R oad P arkinso n Ave nue Pine Street Mark Twain Street Louis Road Barbara Drive Embarcadero Road Walter Hays Drive Lois LaneJordan Pl L ois L Bret Harte Street Stanley W ay Addison Avenue Channing Avenue Waverley Street Tennyson Avenue Seale Avenue Middlefield Road Byron Street Webster Street Marion Avenue Sedro Lane Peral Lane Paulsen Ln C om m u nity La ne Lane 15 E Green Ct Oregon Expressway S h eridan A v enu e Emerson Street Lane 20 WLane 20 E University Avenue CalTrain ROW CalTrain ROW Waverley Street Kipling Street Bryant Street Ramona Street Palo Road Lane 12 W Lane 5 E asuen Stre et rra Street Olmstead Road Bellview Dr Homer Avenue Co m muity L ane Gree n wood Ave nue H arker A venue P arkinso n Avenue This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend abc ALMA STREET: RINCONADA AVENUE TO MELVILLE AVENUE abc MIDDLEFIELD ROAD: LYTTON AVENUE TO FOREST AVENUE abc MIDDLEFIELD ROAD: OREGON EXPRESSWAY TO EMBARCADERO ROAD 0'1197' AT T A C H M E N T C CITY O F PALO A L TO I N C O R P O R ATE D C ALIFOR N IA P a l o A l t oT h e C i t y o f A P RIL 16 1894 The City of Palo Alto assumes no responsibility for any errors. ©1989 to 2015 City of Palo Alto mnicols, 2015-12-14 11:25:52 (\\cc-maps\gis$\gis\admin\Personal\Pavement.mdb) Attachment C City of Palo Alto (ID # 6393) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Contract Amendment for Dyett & Bhatia Title: Approval of Amendment Number 2 to Contract No. C14149978 with Dyett & Bhatia Urban and Regional Planners in the Amount of $42,000 to Complete/Provide Downtown Cap Study Policy Recommendations and Analyze Scope of Downtown Basement Conversions to Office Space From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council authorize the City Manager or designee to approve Amendment Number 2 to contract C14149978 with Dyett & Bhatia Urban & Regional Planners to add $42,000 for a total contract amount not to exceed $305,000 for further data and analysis related to the Downtown basement conversions and preparation of a policy recommendation report based on the findings of Phase I Downtown Cap Study and the previously initiated Retail and Residential analyses. Executive Summary In October 2013, the City Council awarded a contract for the Downtown Development Cap Study (Phase I) to Dyett & Bhatia Urban & Regional Planners for the sum of $200,000. As part of that study, Dyett & Bhatia performed detailed data collection and analysis of non-residential developments in the Downtown area. Phase I has been completed and the City Council received the resulting reports in June 2014 and January 2015. Additional Retail and Residential analysis work was requested by the City Council in December 2014 while reviewing the City’s Comprehensive Plan. City Council directed staff to explore opportunities to preserve retail throughout the city and gather data and stakeholder input. In February of 2015, the Dyett & Bhatia contract was amended to add $63,000 to include this additional task. Staff and consultant are now working on this previously initiated Downtown Retail and Residential capacity analysis. Through fall and spring of 2014 and 2015, at various City Council meetings on the Comprehensive Plan update, City Council members expressed their desire to conduct a study of basement conversions occurring in the Downtown area. City of Palo Alto Page 2 Background The City Council awarded the contract for the Downtown Development Cap Study Phase I to Dyett & Bhatia Urban and Regional Planners in October 2013, and the study was completed over the course of 2014. The study included background research and analysis of existing land use and development trends, parking and traffic conditions and the theoretical and realistic capacity of Downtown Palo Alto for non-residential development. The C i t y Council specifically deferred a discussion of policy implications (Phase II of the study) until a later date and the Comprehensive Plan Update became the forum for discussions related to the relative merits of growth management programs like the “cap” instituted in Comprehensive Plan Program L-8. The City Council’s discussions during the Comprehensive Plan update study sessions of late 2014 and early 2015 resulted in a list of additional items to be studied concurrently with the Comprehensive Plan. The City Council directed staff to explore opportunities to study retail preservation throughout the City, necessitating data collection and stakeholder discussions in the City’s retail districts (CMR 5286). The City Council also adopted an updated Housing Element which commits the City to assess the potential for removing housing sites in the San Antonio/South El Camino Real areas, requiring an analysis of the potential for residential development in Downtown. Since residential uses were not included in the original Downtown Development Cap Phase I study, the City Council requested similar type of analysis work to understand the potential of the Downtown area to accommodate more residential development, both over long term to support a vibrant mixed use urban core, as well as short term need to meet the housing units need of the adopted Housing Element. In February of 2015, the City Council amended Dyett & Bhatia’s contract (CMR # 5464) and added $63,000 to include the above mentioned additional work of data collection and analysis of Downtown’s Retail and Residential conditions. This work is ongoing. Discussion At a study session on Sept 8, 2014 on Comprehensive Plan update, the City Council requested staff to assess and understand trends related to basement conversions in downtown; (please refer to meeting minutes http://www.cityofpaloalto.org/civicax/filebank/documents/44712 pages 5 through 7). Staff included this City Council requested information update in the work scope for Comprehensive Plan update in the December 8, 2014 Council Update (CMR # 5286, Attachment A). Basement conversion discussion came up consequently in few other City Council meetings. On February 9th, 2015, City Council’s agenda item on Office R&D annual growth limit included discussion on basement conversions by different City Council members; (please refer to pages 17-18 of meeting minutes (http://www.cityofpaloalto.org/civicax/filebank/documents/46612). The Retail Preservation Ordinance discussion item of April 6th, 2015 also included another discussion by City Council members on basement conversions; (please refer to meeting minutes pages 23-24, http://www.cityofpaloalto.org/civicax/filebank/documents/47145). City of Palo Alto Page 3 Based on the City Council’s repeated discussions on basement conversions, staff suggests amending existing Dyett & Bhatia Urban and Regional Planners’ work scope. The scope includes identifying and characterizing existing basements in the downtown area based on available data and research, and establishing an approximate magnitude for potential basement conversions in the future. A memorandum with findings on basement conversion will be prepared by the consultants as a part of this contract. Additional tasks under this contract include preparation of a policy recommendation report based on the key findings from Phase I study as well as Retail and Residential analyses. Policy recommendations will be made on office/non-residential growth management, retail preservation and retention, housing and mixed use in Downtown and parking and traffic impact reduction. Staff requests an additional $42,000 to add to the existing Dyett & Bhatia contract for the two above mentioned items. Staff believes that this work can be accomplished by Dyett & Bhatia because of their familiarity and understanding of economic conditions and land use issues of Downtown Palo Alto. Timeline Immediately upon execution of the contract amendment, staff will meet with the consultants to initiate the scope of work as described in contract. Staff expects the retail and residential market assessment and capacity analysis along with the basement conversion trend and analysis to be completed within four to five months after commencement. Resource Impact Sufficient funding is available in the Planning and Community Environment Department FY 2016 operating budget for the basement conversion analysis study. No additional funding is needed. Policy Implications Undertaking the proposed assessment of retail trends and residential capacity along with basement conversions study would continue to address Comprehensive Plan Program L-8 (re- evaluate the Downtown cap) and L-9 (monitor the effectiveness of ground floor retail requirements), and would inform implementation of Housing Element Program H2.2.5 (identify more transit-rich sites including the downtown and consider exchanging for sites along San Antonio and South El Camino Real). Environmental Review The recommended action in this report is exempt from the provisions of the California Environmental Quality Act (CEQA). Specifically, this action would authorize the city to conduct a land use study that will help inform future decisions. No action, change or impact to the environment will occur as a direct result of this decision. Accordingly, the project is exempt City of Palo Alto Page 4 pursuant to CEQA Guidelines Section 15262 (Feasibility and Planning Studies) and Section 15061(b)(3) (the “Common Sense exception”). Attachments:  Attachment A: Dyett & Bhatia Contract #C1419978 Amendment 2 (PDF) 1 of 10 Revision April 28, 2014 AMENDMENT NO. 2 TO CONTRACT NO. C14149978 BETWEEN THE CITY OF PALO ALTO AND DYETT & BHATIA, URBAN AND REGIONAL PLANNERS This Amendment No. 2 to Contract No. C14149978 (“Contract”) is entered into January 25, 2016, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and DYETT & BHATIA, URBAN AND REGIONAL PLANNERS, a California corporation, located at 755 Samsome Street, Suite 400, San Francisco, California, Telephone (415) 956-4300 ("CONSULTANT"). R E C I T A L S A. The Contract was entered into between the parties for the provision of evaluation of existing and projected parking, traffic and land use conditions in the downtown Palo Alto. B. CITY intends to increase compensation of $263,000.00 by $42,000.00 to $305,000.00 for additional studies as specified and incorporated into EXHIBIT “A” SCOPE OF SERVICES. C. The parties wish to amend the Contract. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree: SECTION 1. Section 4 is hereby amended to read as follows: “SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A”, including both payment for professional services and reimbursable expenses, shall not exceed Two Hundred Ninety Five Thousand Dollars ($295,000.00). In the event Additional Services are authorized, the total compensation for Services, Additional Services and reimbursable expenses shall not exceed Three Hundred Five Thousand Dollars ($305,000.00). The applicable rates and schedule of payment are set out in Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described in Exhibit “A”.” DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 Attachment A 2 of 10 Revision April 28, 2014 SECTION 2. The following exhibit(s) to the Contract is/are hereby amended to read as set forth in the attachment(s) to this Amendment, which are incorporated in full by this reference: a. Exhibit “A” entitled “SCOPE OF SERVICES”. b. Exhibit “B” entitled “SCHEDULE OF PERFORMANCE”. c. Exhibit “C” entitled “COMPENSATION”. d. Exhibit “C1” entitled “HOURLY RATE SCHEDULE”. SECTION 3. Except as herein modified, all other provisions of the Contract, including any exhibits and subsequent amendments thereto, shall remain in full force and effect. IN WITNESS WHEREOF, the parties have by their duly authorized representatives executed this Amendment on the date first above written. CITY OF PALO ALTO APPROVED AS TO FORM: DYETT & BHATIA, URBAN AND REGIONAL PLANNERS Attachments: EXHIBIT "A": SCOPE OF SERVICES EXHIBIT "B": RATE SCHEDULE EXHIBIT “C” COMPENSATION EXHIBIT “C1” HOURLY RATE SCHEDULE DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 President 3 of 10 Revision April 28, 2014 EXHIBIT “A” SCOPE OF SERVICES Per Amendment No. 2, EXHIBIT “A” is hereby modified to incorporate the following additional scope of services. Project Understanding and Approach Background on Phase I CONSULTANT and Economic Planning Systems (EPS) (as subconsultant) completed Phase 1 of the Downtown Development Cap Study for the City of Palo Alto in 2014, which consisted of background research and analysis of land use and development trends, parking, and economic conditions in Downtown Palo Alto following implementation of the non-residential development cap policy established in 1986. The final deliverable included an assessment of current and potential future non-residential development in Downtown Palo Alto, based on an analysis of remaining development capacity under current zoning, physical and regulatory constraints to development, and the market potential for and financial feasibility of new development. Residential and Retail Uses CITY is concerned about the trend in conversions of retail space to non-retail uses, particularly office uses, in the Downtown area off University Avenue. In particular, small-scale “mom and pop” stores appear to be most affected. Retail, as a non-residential use, was included in the overall analysis of supply and demand for non-residential space in Downtown in Phase I of the study; this effort would parse out buildout potential for retail as a subset of commercial uses overall. The CITY has adopted an Emergency Interim Retail Preservation Ordinance; the work completed under this project may assist the CITY in determining its permanent approach to supporting retail in Downtown. Phase II The CITY spent much of the summer of 2015 considering an annual cap on office development. An ordinance has not yet been adopted, as both the CITY Council and the Planning & Transportation Commission have continued to debate aspects of the proposed square footage limit, including implementation, enforcement, the area(s) of the CITY to which it would apply, and its relationship to current development proposals, adopted plans, and other ongoing planning efforts. However, after the CITY Council receives recommendations from the Planning & Transportation Commission, it is anticipated that the cap will be adopted on a trial basis. Accordingly, the CITY is considering the potential effects of the proposal as part of the Comprehensive Plan 2030 effort. Further, in June, the CITY Council extended the ground floor retail “Urgency Ordinance” (originally adopted during May) to prevent the conversion of any ground floor retail or “retail-like” use to any other use on a citywide basis. The ground floor retail protections will now extend for about two years, allowing the CITY time to reconsider policy options. The original Request for Proposals for the Downtown Development Cap project envisioned a second DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 4 of 10 Revision April 28, 2014 phase of work in which the findings from Phase I were used to draft policy recommendations. Given that the topics addressed in Phase I are still relevant and unresolved, this revised scope of work includes preparation of policy recommendations consistent with Phase II of the Downtown Development Cap Study. These recommendations may be used by staff, decision-makers, and members of the Comprehensive Plan Citizens Advisory Committee to help chart a long-term direction for Palo Alto regarding land use and growth management in its Downtown. Scope of Work Task 1: Basement Conversions Study (CONSULTANT, EPS) A. Records Search. In cooperation with CITY staff, query planning and building permit databases for basement improvement projects. Through interviews with staff, instances of code enforcement citations for basement improvements or basement use infractions will also be reviewed. The purpose is to identify legal and illegal basement retail-to-office conversions. This sub-task assumes one half-day working session with CITY staff in the Development Services Department and the Building Department/code enforcement as necessary (one meeting). B. Visual search. Visually inspect areas of Downtown for evidence of basements, and, if possible, basement offices, to identify and characterize these spaces. This sub-task assumes one day of on- site fieldwork in Downtown Palo Alto. C. Characterize basement workspaces. Identify building, site, tenant, and other characteristics of subterranean office spaces, particularly those that were converted from storage or other non- office use. D. Identify potential for additional conversions. Compare constituent characteristics of basement offices to overall downtown building stock data to establish approximate magnitude of potential for future conversions. E. Draft Report. We will provide a draft memorandum of findings on potential for basement conversions. The documentation of basement conversion data and analysis is anticipated to be both quantitative and qualitative in nature, with the depth of quantitative data to be determined based on the outcome and success of the various lines of inquiry explored. The draft will be provided for CITY review and comment (up to two rounds of review). F. Final Report. Based on consolidated comments, the team will prepare the final basement conversions study. Task 2: Phase II Policy Recommendations A. Check-in meeting with Staff and General Plan Policy Review (CONSULTANT, EPS). Prior to starting to draft the policy recommendations, the consultant team will meet with staff to review progress to date, major issues, and preliminary policy areas to explore. Staff and the consultant team will also discuss the status of the concurrent Comprehensive Plan Update and review relevant policies pertaining to land use, circulation, and business/economics affecting the Downtown area. The objective is to learn what policy approaches have been tried and been successful (or not) in the past, and to assess current proposed policy direction as it relates to this effort. B. Administrative Draft Policy Recommendations (CONSULTANT, with EPS input). Prepare an administrative draft policy recommendations report, which will include the following:  Project background  Summary of key findings from Phase I and additional residential/retail analyses DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 5 of 10 Revision April 28, 2014  Statement of Policy Objectives  Policy recommendations on the following topics (preliminary list): o Office/non-residential growth management o Retail preservation, building space use, and small local business development and retention o Development standards o Housing and mixed use Downtown o Parking and traffic impact reduction; transportation demand management C. Revised Draft Policy Recommendations (CONSULTANT). Based on staff review and input, revise the policy recommendations. D. Present Recommendations (CONSULTANT, EPS). Present the final recommendations at one meeting of the Planning & Transportation Commission or other decision-making body. DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 6 of 10 Revision April 28, 2014 EXHIBIT “B” SCHEDULE OF PERFORMANCE Per Amendment No. 2, EXHIBIT “B” is hereby modified to incorporate the following Schedule of Performance. CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement Task Start/End Time Total Weeks from NTP Task 1: Basement Conversions Start week 1, end week 10 10 weeks Task 2: Policy Recommendations Start week 10 end week 16 16 weeks DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 7 of 10 Revision April 28, 2014 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the hourly rate schedule attached as exhibit C-1 up to the not to exceed budget amount for each task set forth below. The compensation to be paid to CONSULTANT under this Agreement for all services described in Exhibit “A” (“Basic Services”) and reimbursable expenses shall not exceed $305,000.00. CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. The CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, does not exceed $305,000.00. BUDGET SCHEDULE NOT TO EXCEED AMOUNT Task 1 (Start Up, Review & Community Engagement Plan) $8,978.00 Task 2 (Existing Condition & Trends Evaluations) $41,672.00 Task 3 (Growth Projections) $80,895.00 Task 4 (Surveys on Parking Habits & Employment Density) $33,130.00 Task 5 (Stakeholders Task Meetings) $8,430.00 Task 6 (Focus Groups Meetings) $7,740.00 Task 7 (Planning & transportation Commission, DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 8 of 10 Revision April 28, 2014 City Council Meetings) $7,570.00 Task 8 (Community Workshop Open House $9,690.00 Meetings) Task 9 (Amendment No. 1, Additional Studies) $52,530.00 Task 10 (Amendment No. 2, Additional Studies) $42,000.00 Sub-total Basic Services $292,635.00 Total Basic Services and Reimbursable expenses $2,365.00 Additional Services $10,000.00 Maximum Total Compensation $305,000.00 REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost. All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $2,365.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 9 of 10 Revision April 28, 2014 CONSULTANT’s proposed maximum compensation, including reimbursable expense, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 10 of 10 Revision April 28, 2014 Per Amendment No. 2, EXHIBIT “C1” is hereby modified to incorporate the following Hourly Rate Schedule. Task 1: Basement Conversions Task 2: Policy Recommendations Rate Hours Fee Hours Fee Total Hours Total Fee D&B Principal $185 26 $4,810 16 $2,960 42 $7,770 Senior Associate $145 20 $2,900 20 $2,900 40 $5,800 Planner/Urban Designer I $95 34 $3,230 8 $760 42 $3,990 GIS $125 12 $1,500 $0 12 $1,500 Admin $75 0 $0 4 $300 4 $300 Direct Costs 0 $100 Subtotal 92 $12,440 48 $6,920 140 $19,460 EPS Managing Principal $250 16 $4,000 4 $1,000 20 $5,000 Executive VP $220 38 $8,360 16 $3,520 54 $11,880 Research Analyst $120 40 $4,800 4 $480 44 $5,280 Production Staff $85 2 $170 $0 2 $170 Direct Costs $110 0 $210 Subtotal 96 $17,440 24 $5,000 120 $22,540 Grand Total 188 $29,880 72 $11,920 260 $42,000 Direct Costs includes mileage, meals and other travel expenses; printing; data purchase. Direct costs are billed at no markup. Mileage is billed at the IRS-permitted maximum. D&B reserves the right to reallocate budget between tasks and/or personnel provided the overall budget does not change. DocuSign Envelope ID: 541734D6-5EC0-49A3-A4B8-343C868F59C6 Certificate Of Completion Envelope Id: 541734D65EC049A3A4B8343C868F59C6 Status: Completed Subject: Please DocuSign this document: C14149978 CONTRACT AMENDMENT NO 2.pdf Source Envelope: Document Pages: 10 Signatures: 1 Envelope Originator: Certificate Pages: 4 Initials: 0 Christopher Anastole AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 chris.anastole@cityofpaloalto.org IP Address: 199.33.32.254 Record Tracking Status: Original 1/5/2016 9:32:09 AM Holder: Christopher Anastole chris.anastole@cityofpaloalto.org Location: DocuSign Signer Events Signature Timestamp Rajeev Bhatia rajeev@dyettandbhatia.com President Security Level: Email, Account Authentication (None)Using IP Address: 50.193.44.189 Sent: 1/5/2016 9:38:37 AM Viewed: 1/5/2016 10:06:57 AM Signed: 1/5/2016 10:52:51 AM Electronic Record and Signature Disclosure: Not Offered ID: In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Robin Ellner robin.ellner@cityofpaloalto.org Admin Associate III City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 1/5/2016 10:52:52 AM Electronic Record and Signature Disclosure: Accepted: 2/11/2015 9:51:24 AM ID: efb775a7-f39e-4c9f-817a-5ec939666ecf Notary Events Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 1/5/2016 10:52:52 AM Certified Delivered Security Checked 1/5/2016 10:52:52 AM Signing Complete Security Checked 1/5/2016 10:52:52 AM Completed Security Checked 1/5/2016 10:52:52 AM Electronic Record and Signature Disclosure CONSUMER DISCLOSURE From time to time, City of Palo Alto (we, us or Company) may be required by law to provide to you certain written notices or disclosures. 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City of Palo Alto (ID # 6502) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Stanford Fire Agreement 3rd Amendment Title: Approval of Amendment Number Three to the Palo Alto-Stanford Fire Protection Agreement With the Board of Trustees of the Leland Stanford Junior University Extending the Term for One Year for a Total Fee of $6.5 Million, and Amendment of the FY 2016 Budget to Reduce the General Fund Budget Stabilization Reserve by $675,000 to Offset a Reduction in FY 2016 Fire Department Revenues (CONTINUED FROM DECEMBER 7 14, 2015) From: City Manager Lead Department: City Manager Recommendation Staff recommends the City Council: 1) Approve the Third Amendment to the Palo Alto-Stanford Fire Protection Agreement with the Board of Trustees of the Leland Stanford Junior University (“Stanford”) in the amount of $6.5 million for the extended term of one year through October 8, 2016 (Attachment A); and 2) Amend the FY 2016 Budget by: a. Reducing the Fire Department revenue estimate for providing fire services to Stanford by $675,000; and b. Decreasing the Budget Stabilization Reserve by $675,000. Background The City of Palo Alto has provided fire protection services to Stanford University since 1976, when the City’s fire department and Stanford’s private fire protection company were consolidated. Under the fire services agreement between the City and Stanford, either party may terminate the Agreement by providing written notice to the other party. The Agreement was amended in 1981 and restated in 2006 related to services City of Palo Alto Page 2 provided to the Stanford Linear Accelerator (SLAC). In 2012, fire protection services to SLAC were transitioned from the City of Palo Alto to the Menlo Park Fire Protection District. On October 8, 2013, Stanford notified the City that it was exercising its option to terminate the Agreement effective at least one year, and no more than two years, from the date of notice. Stanford subsequently solicited proposals from other fire protection service providers, but to date has not selected an alternative provider. Discussion Representatives from the City and Stanford have met periodically to discuss alternative service and cost allocation models for current and future service requirements, but were unable to reach agreement on terms prior to termination of the Agreement. The recommended Third Amendment (attached) will provide for continuation of fire services for one year at a fixed fee of $6.5 million, while allowing the time needed to facilitate negotiation of financial terms for a new long term agreement. Resource Impact City and Stanford negotiators have agreed that the City will continue to provide fire protection services during the one-year extension for the fee of $6.5 million. In agreeing to this fee, the parties have acknowledged that a new long term agreement could result in a different prospective annual cost allocation to Stanford, and that the parties may discuss adjustment of payments made by Stanford under the Third Amendment. The current fiscal year 2016 budget anticipates a higher revenue from Stanford equal to $7.4 million. Since the contract extension is effective Oct. 9, 2015, the revenue loss for Fiscal Year 2016 is approximately $675,000. In order to reflect the lower revenues during the one-year Amendment, the Fire Department is developing an alternative staffing strategy intended to maintain response performance while reducing expenses. Implementation of alternative staffing will involve meeting and conferring with the International Association of Fire Fighters, Local 1319. Staff anticipates bringing forward for City Council consideration staffing reductions to offset the revenue loss as part of the Fiscal Year 2016 Midyear Budget Review report. In the meantime, the Fire Department will continue to keep six positions vacant. To address the revenue loss for Fiscal Year 2016, staff recommends amendment of the 2016 General Fund Budget to reduce revenues by $675,000 with a corresponding reduction to the Budget Stabilization Reserve. Policy Implications City of Palo Alto Page 3 The recommended Amendment will provide for continuation of fire services to Stanford while allowing time for the City and Stanford to reach mutually agreeable terms for the continued provision of fire protection services into the future. The current Agreement has demonstrated the efficiency and mutual benefit to both agencies gained by integrated services on campus and throughout the City; therefore, approval of the Amendment is in the City’s best interest to complete negotiations and establish a new agreement. Attachments:  Attachment A: Third Amendment to the Palo Alto-Stanford Fire Protection Agreement with the Board of Trustees of the Leland Stanford Junior University (PDF) THIRD AMENDMENT TO PALO ALTO-STANFORD FERE PROTECTION AGREEMENT This Third Amendment to the Palo Alto-Stanford Fire Protection Agreement is entered into this ,2016,between the BOARD OF TRUSTEES OF THE LELAND STANFORD JUNIOR UNIVERSITY ("Stanford"),a body having corporate powers under the laws of the State of California,and the CITY OF PALO ALTO ("Palo Alto"),a municipal corporation duly organizedandexistingunder andby virtueof the laws of the Stateof California. RECITALS A.Stanford and Palo Alto agreed for Palo Alto to provide fire protection services for the Stanford Campus for a term of fifty years and entered into the "Palo Alto- Stanford Fire Protection Agreement"dated October 1,1976,as amended on September 1,1980 and June 26,2006 ("Agreement"). B. In 2012, the parties agreed that Palo Alto would no longer provide fire service to the Stanford Linear Accelerator Center ("SLAC"). C.In 2013,Stanford notified Palo Alto that it intended to terminate the Agreement.Under the terms of the Agreement and the notice of termination,the effective termination date was October 8,2015. D. Stanford and Palo Alto now agree that Palo Alto will continue to provide fire services to Stanford continuously through and including October 8, 2016, for a fixed fee described here. The parties have retained a mediator and intend to continue negotiating towards a new agreement for fire services that will begin on October 9, 2016 and continue thereafter,if the parties reach an agreement. E.The parties acknowledge that "Section 2:Services"and Exhibit B of the Agreement contain terms that may be inconsistent with the parties'interpretation and performance of the contract, including but not limited to: Palo Alto does not operate and Stanford does not maintain a fire station at SLAC;staffing,equipment configurations,response times and response resources have been updated consistent with service levels provided within the City of Palo Alto;and fire prevention services are no longer provided.The parties are negotiating for a new agreement to be effective beginning October 9,2016,and intend to update these and other terms as part ofthat process.Between October 9,2015 and October 8,2016,it is the parties'intention to maintain the status quo of services at Stanford that are substantially equivalent to those provided within the City ofPalo Alto. NOW,THEREFORE,in consideration of the covenants,terms,conditions,and provisions of this Amendment,the parties agree to amend the Agreement as follows.Except as amended,the Agreement shall remain in full force and effect: SECTION 1.Article 1is amended by adding Section 1.2.1 to read as follows: "Article 1:Operative Date and Termination 1.2.1 October 9,2015 through October 8,2016. Notwithstanding any notices of termination issued under the Agreement,the parties agree that the Agreement shall remain in force and effect through and including October 8,2016.Unless extended by mutual agreement of the parties,the Agreement shall terminate at theclose ofbusinesson October 8,2016." SECTION 2.Article 3is amended by adding Section 3.12 toread as follows: "Article 3:Funding 3.12 Fees for Fire Services from October 9,2015 through October 8,2016. (a)Notwithstanding the terms ofany other Section ofthis Article,includingbutnotlimitedtoSections3.2,3.3,3.4,3.5,3.6,and 3.8,the parties agree that Stanford will pay Palo Alto afixed fee of $6.5 million for the services described in this Agreement for the period October 9,2015 through October 8,2016.This fee includes all costs and revenues for the identified period,including but not limited to personnel,vehicles,capital costs,IT and revenue credits. (b)For the one year beginning October 9,2015 and ended October 8,2016 Stanford shall pay Palo Alto the fee for fire service in equal quarterly installments,eachmstallmenttobepaidbythe10thdayfoUowingthequarterlypaymentdateorbythe10thday following Stanford's receipt of an invoice for the quarterly payment,whichever is later The payment dates for each quarter shall be as follows,unless revised in writing by Palo Alto and Stanford: First payment February 1,2016 Second payment March 31,2016 Thirdpayment June 30,2016 Fourth payment September 30,2016 Payments shall be delivered to: Administrative Services Director 250 Hamilton Avenue Palo Alto,California 94301 (c)If Stanford shall fail to pay any sum to Palo Alto when due,then such latepaymentshallaccrueinterestonadailybasisattherateequaltothecurrentannualizedyieldearnedbytheCity's investment Portfolio for the prior fiscal quarter,until fully paid (d) disagreement ahou Stanford campus.Tl compromise in ordei the parties reach agl the parties'intention the extent permitted Section 3.12(a)." At the lime of this Third Amendment,the parties have a good faith the appropriate amount of the fees for fire protection services for the le parties have agreed to the fixed fee in Section 3.12(a)for one year as a rto secure continuation of services pending further negotiation over fees.If eement on fees for continuation of fire services after October 9,2016,it is to revisit the fee in Section 3.12(a)in light ofthat agreement.Otherwise,to under the Agreement or by applicable law,a party may challenge the fee in SECTION 3.Except as herein modified,all other provisions of the Agreement, including any exhibits and subsequent amendments thereto,shall remain in full force and effect.' IN WITNESS WHEREOF,the parties have by their duly authorized representatives executedthis Amendment on thedate first above written. CITY OF PALO ALTO Fire Chief APPROVED AS TO FORM: City Attorney THE BOARD OF TRUSTEES OF THE LELAND STANFORD JR.UNIVERSITY By: Vice Presidenyapd/General Counsel &T M.,/&T*Ms£i City of Palo Alto (ID # 6535) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Lease Agreement with Komuna Energy Title: Approve and Authorize the City Manager or His Designee to Execute a 25-year Lease Agreement with Annual Lease Payments of $20,000 between the City and Komuna Palo Alto LLC Covering Four City-Owned Parking Structures for: (1) Construction and Operation of Solar Photovoltaic Systems, with the Potential to be a Palo Alto Clean Local Energy Accessible Now (CLEAN) Program Participant; and (2) Installation of City-Owned Electric Vehicle Chargers and Infrastructure. From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council:  Approve and Authorize the City Manager or his designee to execute a 25- year Lease Agreement (Attachment A) between the City of Palo Alto and Komuna Palo Alto LLC (Komuna) with an annual lease payment of $20,000 covering portions of four city-owned parking structures located at 445 Bryant Street, 520 Webster Street, 475 Cambridge Avenue and 275 Cambridge Avenue in order for Komuna to: (1) Construct and operate solar photovoltaic (PV) systems, with the potential to be a Palo Alto CLEAN Program applicant; and (2) install City-owned Electric Vehicle (EV) Chargers and infrastructure; and  Delegate authority to the City Manager or his designee to execute on behalf of the City, any documents that are ministerial in nature or are otherwise necessary to administer the Lease Agreement that are consistent with the Palo Alto Municipal Code and City Council approved policies. City of Palo Alto Page 2 Background On March 25, 2014, the Public Works Department issued a Request for Proposals (RFP) for the installation and operation of solar PV facilities at one or more of the five city-owned parking structures. These solar PV facilities will provide local solar electric power generation that will be purchased by the City and contribute to its renewable portfolio needs. In addition, the RFP was structured to solicit proposals from vendors that would be eligible for participation in the Council- approved Palo Alto CLEAN Program. The Palo Alto CLEAN program offers payment for the electricity generated from Palo Alto solar PV installations where the electricity is not used on site, but is sold to City of Palo Alto Utilities (CPAU) under the Palo Alto CLEAN Program Power Purchase Agreement (CLEAN PPA). The CLEAN PPA establishes a fixed price per unit of electricity delivered to the Palo Alto electric grid over a 20- or 25-year term. The current CLEAN Program rate is 16.5¢/kWh over the term of the CLEAN PPA. In May 2015, Council considered recommendations from the Finance Committee (Staff Report 5849) to reduce the CLEAN Program price for solar resources (from 16.5¢/kWh to 10.3¢/kWh or 10.4 ¢/kWh, depending on contract term length). Council was informed that such a reduction could have implications for this project. On May 27, 2015, Council voted, amongst other things, to continue the CLEAN program for solar at the cost of 16.5 ¢/kWh for 3 MW as previously approved by the Council; and to direct lease income on City owned garages from the CLEAN program to Utilities to offset costs of the program to electric ratepayers (Staff report 5849; Action Minutes). One important consideration in Council’s decision to maintain the contract rate of $0.165/kWh for solar resources, rather than reducing it to the avoided cost level as the Finance Committee advocated, was the expectation that the Public Works Department would soon be executing the Lease Agreement now being presented to Council for Komuna to develop a group of solar facilities (totaling about 1.3 MW of capacity) atop several downtown parking garages that would participate in the CLEAN program. Staff from Community Services, Planning and Community Environment, Public Works, Utilities and Administrative Services Real Estate Division worked to review City of Palo Alto Page 3 city-owned sites for their suitability for PV installation based on solar access, property access, future redevelopment plans and historical status. Staff concluded the parking garages have good potential for one of the first Palo Alto CLEAN projects on city-owned sites. The solar installations would provide shade to the top floor of each garage. The non-profit organization, Clean Coalition, was engaged to draft an RFP to solicit proposals for installing PV systems on the city- owned garages. The five City-owned parking structures listed below were originally included in the RFP to be considered for the PV installation:  Lot R – 528 High Street  Lot S/L – 445 Bryant Street  Cowper/Webster – 520 Webster Street  Cambridge – 475 Cambridge Avenue  Ted Thompson – 275 Cambridge Avenue The RFP requested proposals to install PV systems at up to five of the city-owned parking structures and an option to propose the installation of EV chargers at each location as well. On June 3, 2014, three proposals were received from Pristine Sun, THINKnrg (now Komuna) and AltaM Energy. Proposals were reviewed by staff from Public Works, ASD and Utilities Departments as well as consultants from Clean Coalition. The proposals were evaluated by quantitative and qualitative factors including PV system design and aesthetics, PV system output and the financial terms of the lease agreement. All three companies were interviewed and Pristine Sun was unanimously selected based on their substantial lease payment, strong project team and history with PV projects. The other two proposals included a significantly reduced lease payment. Negotiations began with Prisitine Sun in early 2015. However, City and Pristine Sun were unable to structure an agreement. The City ceased negotiations with Pristine Sun and ultimately rejected the vendor’s proposal in June 2015 (Staff Report 5876). Discussion In July 2015, staff began negotiations with Komuna (formally THINKnrg). Komuna was rated second in the RFP responses, mainly due to the reduced rent payment City of Palo Alto Page 4 compared to the first proposer. The City was able to negotiate a higher rent payment than previously proposed with a 25-year, rather than 20-year, PPA term and solar installations on only four of the five parking garage rooftops. No PV systems will be installed at Lot R parking garage located at 528 High Street due to the high cost to develop that particular parking structure. Once the Lease is approved, Komuna will have site control, which is required in order to submit an application for the CLEAN Program. At that point, Komuna will apply to the CLEAN Program to process a PPA. The estimated design size of the generating facility is 1.3 MW, or 43 percent of the CLEAN program capacity. The final system size is contingent upon approval of Building Permit/Plan Check review. Summary of Key Lease Terms Lease Term 25 years, no option to extend Solar Project Size 1.3 MW, approximately 43% of the CLEAN Program’s capacity Location 4 (rather than the original 5) City Garages located in downtown Palo Alto and near California Avenue Rental Payments $20,000 annually for all four garages, $5,000 per garage. No payment escalator Buyout Option Available at years 10, 15, 20 and 25 for fair market value Security  $25,000 in more conventional security deposit that can be used for failure to pay rent, clean property; and  Completion assurance (e.g. bond, letter of credit) at estimated cost of construction, that City is authorized to draw on to guarantee performance of all covenants and conditions. Parking Impacts and Mitigation  Komuna starts paying rent at when the construction commences, continuing through operational period. If construction is delayed, in addition, liquidated damages apply on a lump sum basis, per garage and range from $632-$1,820 per garage, per day.  Komuna compensates City for permanent loss of parking – which cannot exceed two spaces lost per garage – at the City’s in lieu fee in effect at the time. EV Chargers  City to own, operate; prevailing wage requirement included City of Palo Alto Page 5  Developer to construct six total EV chargers (3 dual head chargers) in three garages; install wiring for additional twenty chargers (ten dual head chargers) in all four garages Next Steps If Lease Agreement approved, Komuna will have site control and be eligible to apply for CLEAN Program Lease Payments and Electric Vehicle Chargers The Lease Agreement includes a total annual payment of $20,000 for the four parking garages, or $5,000 per garage. Based on the City Council’s direction, the lease income will be directed to the Utilities Electric Fund to offset the cost of the CLEAN program. (Staff report 5849; Action Minutes) This will reduce the amount by which the CLEAN program rate exceeds the current avoided cost of solar electricity. The current CLEAN program rate is 16.5 ¢/kWh. Successful applicants to the CLEAN Program secure this higher rate for the term of their project, even if Council later reduces the rate. The avoided cost of solar electricity, which is falling, is discussed in more detail in Staff Report 5849. Although the lease terms include lower rent than was discussed during negotiations with the first proposer, the Lease requires installation of 18 new Level 2 EV chargers (3 dual head chargers in three garages) and electrical infrastructure to support an additional 80 future new Level 2 chargers (ten dual head in all four garages). These chargers will be owned, operated and maintained by the City. The EV chargers and infrastructure, as well as the generating facilities, provide value and notable benefits to the City, beyond rental revenue alone. It is difficult to lease or use the area above the top floor in a parking garage. Here, lease of the parking garages enables the City to use that area for which it would otherwise not have a use, while simultaneously improving upon them in several ways. The solar array provides shade amenities to the top level of the parking garages, which benefit the parking district. In addition, there is community value associated with having more EV chargers and installation of infrastructure for even more in the future available in the City. Though use of EV chargers is currently free, the Policy and Services Committee is expected to soon consider options for changing the City of Palo Alto Page 6 City’s current policy of free use of EV chargers. Changes to EV charging policy may result in additional revenues to the City related to the Lease. In addition, the Lease is consistent with the City’s policy goals of developing local solar generation facilities. Buyout and System Ownership Komuna would install and maintain the generating facilities for a term beginning with the Lease execution and ending twenty-five years after commencement of commercial operation of all the generating facilities. At the end of the twenty- five year term, Komuna is required to remove the generating facilities and restore the parking structure to the original condition. Komuna is required to post a $25K security deposit which covers failure to pay rent, to repair damages caused by Komuna’s acts or omissions, or expenses to clean the property upon end of the term. In addition, Komuna must post security based on the estimated cost of construction or $3.05 per watt. The City can draw on this completion assurance to guarantee Komuna’s full performance of all Lease obligations. The City has the option to buy-out one or more of the generating facilities at the 10, 15, 20 or 25 year anniversary date. If the City exercises the buy-out option, the City will pay Komuna the fair market value of the generating facility or facilities as determined by a third party appraiser. Public Purpose Taking, Property Transfer and Default The City has the right to take any or all of the properties for any public purpose at any time during the term of the Lease. If the City takes a property for any public purpose, the City can choose between finding an alternative City-owned site which has substantially similar insolation and access to the grid as the existing property or paying a termination payment (Termination Payment). If the City finds a new site, the City will pay for the reasonable costs of removal and reinstallation, and will reimburse Komuna for any production revenues lost in excess of ten days. If the City does not locate an alternate site, the amount of the Termination Payment owed is set forth as a specific lump sum amount in Schedule 23.2 of Attachment A. The Termination Payment is different for each generating facility and decreases each year over the term. Schedule 23.2 of Attachment A describes the Termination Payment in detail, which is generally near $1MM for an individual facility in year 1 and decreases to between $45K to $81K in year 25. City of Palo Alto Page 7 The City also has the ability to transfer any or all of the properties at any time during the term. If the City is no longer the lessor on the property, the City would pay Komuna the Termination Payment, unless the new lessor has reasonably acceptable credit or the City provides reasonably acceptable credit support. The Lease also provides that if the City defaults under the Lease, then the City will pay a Termination Payment to Komuna. For a default to occur, the City would need to undergo a bankruptcy-type event or to materially breach a material term of the Lease after a 30-day cure period. An administrative or operational error or omission is not an event of default. If the Lease terminates and the City pays Komuna a Termination Payment, Komuna’s CLEAN PPA for that parking facility will also terminate. Construction Phasing/Loss of Parking The Lease Agreement estimates that it will take six weeks to construct the generating facility. Construction of the generating facilities may require Komuna to temporarily restrict access to all, or portions of the parking garages’ top floors during that time; however, the Lease Agreement anticipates that the parties will work together to mutually agree upon a construction schedule for the generating facilities. As part of that process the City will look to phase construction if necessary and mitigate potential parking impacts for instance, by constructing the facilities consecutively so that only one downtown and California Avenue garage may be under construction concurrently. Note that Komuna starts paying rent when generating facility construction commences, and continues to do so through the operational period. The lease does not charge Komuna a separate fee for the parking structure closure during the six-week construction period above and beyond those rent payments. In addition to working with Komuna to establish a mutually agreeable construction schedule, the Lease imposes penalties in the form of liquidated damages on Komuna if construction (and any related parking closures) extends beyond the initial six week construction estimate. If construction is delayed, Komuna must pay a penalty. After the six-week period, liquidated damages will be assessed at a fixed daily rate per garage calculated based on the number of impacted parking spaces multiplied by the maximum daily parking rate for each City of Palo Alto Page 8 garage. This liquidated damages amount ranges from $632.00 per day for the 475 Cambridge Garage to $1820.00 per day for the Bryant Garage, and is described in a table in the Lease. While Komuna anticipates no permanent loss of parking from the generating facility’s support infrastructure, the Lease Agreement allows for a maximum of two parking spaces to be permanently lost for each garage. In this instance, Komuna would pay parking elimination fees in the amount of parking in-lieu fee, which is currently $65,475 per space. In addition, Komuna will pay for parking not on the top floor at the then-posted daily parking rate. Design/Planning Review According to terms and conditions of the Lease Agreement, Komuna is responsible for obtaining all approvals and permits as part of the planning entitlement and building permit process. In discussions with Planning staff it is anticipated that the solar installations will require architectural review. The one percent for art requirement was discussed during RFP development and staff determined the requirement did not apply to this project as it is electrical equipment on top of a building. Resource Impact The PV facilities will be installed and maintained at Komuna’s expense. If the City owed a Termination Payment as the result of a public purpose taking or a sale or transfer of property to another entity, it is anticipated that payment of the Termination Payment would be a negotiated part of the underlying transaction. However, if that was not accomplished or in the case of a City default, a Termination Payment could be a General Fund expense. Komuna also intends to apply to the Palo Alto CLEAN program and expects to meet all requirements of that program and secure the existing CLEAN Program Rate of $0.165 kWh fixed over the 25-year term. No additional city funding will be used for this project. The annual $20,000 lease payment will be directed to the Utilities Electric Fund per Council direction. Additionally, Council consideration of the current policy on fees for EV charging may result in additional revenues. Policy Implications City of Palo Alto Page 9 Entering into a new lease agreement is consistent with policies and programs in the Comprehensive Plan promoting smart energy development and City and private sector collaboration for effective development of alternative clean and sustainable energy programs. Environmental Review Approval of the Lease Agreement does not require review under the California Environmental Quality Act: (1) for the solar PV facilities, because section 21080.35 of the California Public Resources Code specifies that CEQA does not apply to the installation of a solar energy system on the roof of an existing building or at an existing parking lot; and (2) for the installation of EV Chargers, which is categorically exempt pursuant to CEQA Guidelines section 15303 (construction and location of limited numbers of new, small facilities and structures) and CEQA Guidelines section 15301 (existing facilities). Attachments:  Attachment A - Komuna Lease Agreement (PDF)  Komuna Lease Agreement & Exhibits FINAL 1.14.2016 (PDF) 999019-eml LEASE AGREEMENT BETWEEN THE CITY OF PALO ALTO AND KOMUNA PALO ALTO LLC This lease agreement ("Lease") is made and entered into this _____ day of __________, 2016 (the “Effective Date”), by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("City" or “Lessor”) and Komuna Palo Alto LLC, a Delaware limited liability company ("Lessee"). City and Lessee may be referred to individually as a “Party” or collectively as the “Parties.” RECITALS WHEREAS, City is the owner of four (4), multi-level parking facilities in Palo Alto, California, two (2) of which are near downtown Palo Alto and two (2) of which are near California Avenue; and WHEREAS, City desires to lease a portion of each of the four (4) parking facilities to Lessee for the purpose of installing, constructing, operating and maintaining a solar powered electric generating project to be owned, maintained and operated by Lessee for the Term of this Lease; and WHEREAS, City also desires and Lessee also has agreed to install three (3) electric vehicle chargers capable of charging six vehicles in each of three (3) of the four (4) parking facilities, and to install wire, conduit, switchgear and any electrical capacity upgrades necessary to support an additional ten (10) electric vehicle chargers capable of charging upon full installation twenty (20) vehicles in each of the four (4) parking facilities, which upon installation will be owned, maintained and operated by City; and WHEREAS, Lessee desires to lease portions of the parking facilities from City in order to install, construct, maintain and operate such solar powered electric generating project, and to gain the necessary access to install such electric vehicle chargers, conduit and switchgear; and WHEREAS, the leasehold rights granted to Lessee by the City in this Lease combine Ground Floor Area and Air Rights Parcels; and WHEREAS, the City desires to purchase from Lessee and Lessee desires to sell to the City the entire energy output of the Generating Facility pursuant to the terms and conditions of a Power Purchase Agreement for Eligible Renewable Energy Resource under the Palo Alto Clean Local Energy Accessible Now Program (the “CLEAN PPA”); and WHEREAS, following a competitive selection process consistent with the requirements of section 2.30 of the Palo Alto Municipal Code, the City Council authorized the City to enter into this Lease with Lessee on ____________, 2016. NOW, THEREFORE, in consideration of these Recitals and the following covenants, terms, and conditions, Lessee and City mutually agree as follows: LEASE PROVISIONS DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 2 Rev.: 1/29/15 1. INTERPRETATION; EXHIBITS. 1.1. Interpretation. 1.1.1. The captions of the various sections, paragraphs and subparagraphs of this Lease are for convenience only and shall not be considered or referred to in resolving questions of interpretation. 1.1.2. In construing or interpreting this Lease, the word "or" shall not be construed as exclusive and the word "including" shall not be limiting. 1.2. Recitals. The Recitals set forth above are true and correct and are hereby incorporated into this Lease as if fully set forth herein. 1.3. Exhibits. The following Exhibits are attached to and made part of this Lease as if fully set forth herein. Exhibit “A” – DEFINITIONS Exhibit “B” – DESCRIPTION OF SITE Exhibit “C” – DESCRIPTION OF PREMISES Exhibit “D” – IMPROVEMENTS Exhibit “E” – WORK SCHEDULE Exhibit “F” – MEMORANDUM OF LEASE Exhibit “G” – INSURANCE REQUIREMENTS Exhibit “H” - FORM OF CLEAN PPA Exhibit “I” - FORM OF CLEAN PPA INTERCONNECTION AGREEMENT Exhibit “J” - FORM OF LENDER CONSENT AND AGREEMENT 2. DEFINITIONS. Capitalized terms used in the Lease and not otherwise defined herein have the meanings set forth in Exhibit “A” (Definitions), which is attached to and made part of this Lease as if fully set forth herein. 3. LEASE. City hereby leases to Lessee, in accordance with the terms and conditions hereafter set forth, a bundle of rights consisting of Air Rights Parcels and Ground Floor Areas (both of which are described more specifically in Exhibit “C” (Description of Premises)) of the Property necessary to allow for the installation, maintenance, operation of the Generating Facility and installation of the EV Chargers and Infrastructure (which upon installation shall be owned, maintained and operated by City). Unless specifically provided in this Lease, Lessee accepts the Property “as-is” on the Effective Date of this Lease. 4. TERM, TERMINATION. 4.1. Term. 4.1.1. Definition. This Lease shall commence on the Effective Date and shall DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 3 Rev.: 1/29/15 remain in effect until, for each of the four (4) Properties: 4.1.1.1. The Operations Period has expired (the “Term”); or 4.1.1.2. The Lease has been terminated by either the City or Lessee in accordance with the terms of this Lease. 4.1.2. Fifty-Year Limit. Notwithstanding the provisions of this section, under no circumstances shall the Term of this Lease extend beyond fifty (50) years, consistent with section 7 of the City Charter. 4.2. Termination. The City, in its sole discretion, shall have the right to terminate this Lease as follows: 4.2.1. Public Purpose. If the City determines that it requires any individual, any combination or all parking garage facilities or portions thereof included in the Site at any time or multiple times during the Term for any public purpose as determined by City in its sole discretion, upon sixty (60) days prior written notice to Lessee, the City may in its sole discretion: 4.2.1.1. Find an alternative City owned replacement site or sites, that has or have substantially similar insolation and reasonably acceptable access to the utility grid (with appropriate upgrades or otherwise), that Lessee may use for the Generating Facility or Generating Facilities, as applicable; provided, however, that the City shall pay for the reasonable costs of removal, lost revenue from production (for any down time exceeding ten (10) days) and costs of reinstallation of the Generating Facility (including interconnection and utility related fees) or Generating Facilities from the existing Site to the new site (after which such new parking garage facility or facilities shall thereafter be referred to as the “Site”); provided further that Lessee shall use commercially reasonable efforts to remove and reinstall the Generating Facility or Generating Facilities without delay and endeavor to minimize lost production time; or 4.2.1.2. Terminate the Lease with respect to any individual or all parking garage facilities included in the Site and pay Lessee within sixty (60) days the termination value set forth on Schedule 23.2 attached hereto; provided that Lessor and Lessee each agree that termination of this Lease with respect to any individual or all parking garage facilities included in the Site shall cause a termination of the CLEAN PPA with respect to such individual or all parking garage facilities included in the Site. 4.2.2. Hazardous Materials. In the event that: 4.2.2.1. Any anticipated use of the Property by Lessee involves the generation or storage, use, treatment, disposal, or release of DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 4 Rev.: 1/29/15 Hazardous Materials; 4.2.2.2. Lessee has been required by any lender or governmental authority to take remedial action in connection with Hazardous Materials contaminating the Property, or the Site, if the contamination resulted from Lessee’s actions, omissions or use of the Property; or 4.2.2.3. Lessee is subject to an investigation or enforcement order issued by any governmental authority in connection with the release, use, disposal, or storage of a Hazardous Materials on the Property or Site. 4.2.3. Event of Default. City may terminate this Lease following an Event of Default in accordance with section 23 of this Lease. 4.3. Buyout Option for Generating Facilities. At certain points during the Term or at expiration of the Term, the City may elect a Buyout Option for any one, any combination, or all of the four (4) Generating Facilities: 4.3.1. Buyout Option Price for all Generating Facilities. On the tenth (10th), fifteenth (15th), twentieth (20th), and twenty-fifth (25th) anniversary of the earliest individual Generating Facility to achieve its Commercial Operation Date, the City has the option to purchase all four (4) Generating Facilities on the Properties at a price determined to be the fair market value of all four (4) Generating Facilities as of such anniversary date, as applicable, calculated according to Section 4.3.3.3. 4.3.2. Buyout Option for Individual Generating Facilities. The City may exercise its Buyout Option provided in Section 4.3.1 with respect to any individual Generating Facility, in its discretion. The Buyout Option price for each individual Generating Facility will be calculated by determining the fair market value of all four (4) Generating Facilities as of such anniversary date, as applicable, calculated according to Section 4.3.3.3. and multiplying such value by a fraction that is (A) the Generating Facility’s capacity as of the commencement of operations of that Generating Facility over (B) the total capacity of all such Generating Facilities on the date each commenced operations. 4.3.3. Exercise of Buyout Option; Notice; Fair Market Value. 4.3.3.1. For all four (4) Generating Facilities. If the City desires to exercise its Buyout Option for all four (4) Generating Facilities at once, City will, no later than six (6) months prior to the applicable anniversary date of the Generating Facility with the earliest Commercial Operation Date, notify Lessee of City’s election to exercise its Buyout Option for all four (4) Generating Facilities. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 5 Rev.: 1/29/15 4.3.3.2. For an individual Generating Facility. If the City desires to exercise this Buyout Option for an individual Generating Facility, City will, no later than six (6) months prior to the applicable anniversary date of the Commercial Operation Date for that Generating Facility, notify Lessee of City’s election to exercise its Buyout Option. 4.3.3.3. “Fair Market Value”. The “fair market value” of the Generating Facilities shall be determined by an independent, third party appraiser mutually agreed upon by Lessor and Lessee having substantial experience in the valuation of solar facilities similar to the Generating Facility or Generating Facilities, as applicable. If Lessor and Lessee are unable to agree, then each of Lessor and Lessee shall designate an appraiser who shall designate a third appraiser having substantial experience in the valuation of solar facilities similar to the Generating Facility or Generating Facilities, as applicable, to perform the fair market value appraisal. The reasonable costs of such fair market value appraisal shall be borne by Lessor. 4.4. Removal of Generating Facility. 4.4.1. Except where a Buyout Option is exercised with respect to the relevant Generating Facility, for any individual, or for all four (4) Properties as applicable, Lessee shall at its sole expense, remove the Generating Facility and all its associated equipment and materials completely and vacate the Property and restore the Property to its original conditions, within ninety (90) days of: 4.4.1.1. Upon expiration of the Term; or 4.4.1.2. Upon termination. 4.4.2. The Parties expect reasonable wear and tear; provided, however, that Lessee shall repair to the reasonable satisfaction of City any damage to the Property caused by the Generating Facility or its removal. 4.4.3. Before departure, Lessee shall return any of City’s keys or personal property to City in good, clean and sanitary condition, reasonable wear and tear excepted. 4.4.4. Lessee shall allow City to inspect the Property to verify the condition of the Property and its contents. At City’s request, Lessee agrees to participate in a walk-through inspection of the Property to verify the Property’s condition. 4.4.5. City shall provide Lessee with reasonable access to perform the necessary removal activities. 4.4.6. Upon City request, the usual and customary lighting, plumbing, utility and heating fixtures shall remain upon the Property upon termination or DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 6 Rev.: 1/29/15 expiration of this Lease. RENT. 4.5. Rent. Lessee agrees to pay Rent to the City during the Term of this Lease on the schedule and in the amounts set forth in this Lease. 4.5.1. Schedule. 4.5.1.1. Annual, Payable in Advance. Lessee agrees to pay City Rent in the amounts set forth in section 5.1.2.3. Rent shall be paid on an annual basis, in advance for the upcoming year on July (1st) of each year. 4.5.1.2. Proration. Rent due for any partial year hereunder shall be prorated. 4.5.2. Amount. 4.5.2.1. Definitions. 4.5.2.1.1. “Initial Period” means, for each individual Property, the period commencing on the Effective Date and continuing until the commencement date of the Construction Period. 4.5.2.1.2. “Construction Period” means, for each individual Property, the Scheduled Construction Period, plus the Delayed Construction Period, if any. 4.5.2.1.3. “Scheduled Construction Period” means the period commencing on the Construction Start Date for the Generating Facility identified in Exhibit “E” (Work Schedule) for the Property continuing through the date by which Lessee is set to achieve the Commercial Operation Date for the Generating Facility, according to Exhibit “E” (Work Schedule). 4.5.2.1.4. “Delayed Construction Period” means, for each individual Property, the period commencing the day following the date Lessee was due to achieve its Commercial Operation Date for the Generating Facility according to Exhibit “E” (Work Schedule) to this Lease continuing through the date Lessee takes to actually achieve its Commercial Operation Date for the Generating Facility. 4.5.2.1.5. “Operations Period” means, for each individual Property, the period commencing with the actual DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 7 Rev.: 1/29/15 Commercial Operation Date for the Generating Facility, continuing until the twenty-fifth (25th) anniversary of such Commercial Operation Date. 4.5.2.2. Initial Period Rent. The Rent during the Initial Period for all Properties is zero dollars ($0.00). 4.5.2.3. Construction Period Rent; Operations Period Rent. 4.5.2.3.1. Amount. The Rent during the Construction Period and the Operations Period is as set forth below: PROPERTY RENT Construction Period Operations Period (per year) PRO RATA SHARE OF TOTAL RENT AMOUNT 475 Cambridge Garage $5,000 25% 275 Cambridge Garage $5,000 25% Webster Garage $5,000 25% Bryant Garage $5.000 25% TOTAL RENT AMOUNT $20,000 100% 4.5.2.3.2. Calculation. The Rent during the Construction Period and the Operations Period for each individual Property is calculated based on that Property’s pro rata share of the Total Rent Amount. 4.5.2.4. Delayed Construction Period Penalties. In addition to Lessee’s obligation to pay Rent during Delayed Construction Period(s), if any, Lessee is also subject to Delay Liquidated Damages during the Delayed Construction Period, pursuant to section 6.2 of this Lease. 4.6. Rent Payment Procedures. 4.6.1. Rent shall be due and payable by Lessee promptly upon receipt of an invoice from City therefore and rent shall be delivered to City’s Revenue Collections Division, 250 Hamilton Avenue, PO Box 10250, Palo Alto, CA 94303. This designated place of payment may be changed at any time by City upon ten (10) days advanced written notice to Lessee. 4.6.2. Lessee agrees that acceptance of any late or incorrect Rent or other payment submitted by Lessee shall not constitute an acquiescence or waiver by City and shall not prevent City from enforcing section 5.4 (Late Charge) or any other remedy provided in this Lease. Rent payments shall be effective upon DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 8 Rev.: 1/29/15 receipt by City. 4.6.3. Acceptance of Rent shall not constitute approval of any unauthorized sublease or use, nor constitute a waiver of any non-monetary breach by Lessee. 4.6.4. City may apply any payment received from Lessee at any time against any obligation due and owing by Lessee under this Lease, regardless of any statement appearing on or referred to in any remittance from Lessee or any prior application of such payments. 4.7. Partial Payment. The receipt by City of a partial payment of any amount due to City endorsed as payment in full will be deemed to be a partial payment only. City may accept and deposit said check without prejudice to its right to recover the balance. Any endorsements or statements on the check or any letter accompanying the check shall not be deemed an accord and/or satisfaction. Lessee's obligation (without prior notice or demands) to pay Rent and all other amounts due hereunder shall be absolute and unconditional, and not subject to any abatement, set off, defense, recoupment or reduction. 4.8. Late Charge. 4.8.1. Lessee acknowledges late payment of Rent will cause City to incur costs not contemplated by this Lease, the exact amount of such costs being extremely difficult and impracticable to fix. Such costs include, without limitation, processing, accounting and late charges that may be imposed on City. 4.8.2. Therefore, if City does not receive any installment of Rent due from Lessee within ten (10) days after the date such Rent is due, Lessee shall pay to City an additional sum of five percent (5%) of the overdue Rent as a late charge. 4.8.3. The Parties agree this late charge represents a fair and reasonable estimate of the costs City will incur by reason of late payment of Rent by Lessee. 4.8.4. Acceptance of any late charge shall not constitute a waiver of any Lessee Event of Default with respect to the overdue amount, nor prevent City from exercising any of the other rights and remedies available to City. 5. PARKING FEES 5.1. Parking Elimination Fees. The Parties agree that if the installation, maintenance and/or operation of the Generating Facilities cause any permanent loss of use or reduction of up to two (2), but no more than two (2), parking spaces at each individual Site at any time during the Term, Lessee shall compensate Lessor for such loss of parking spaces in an amount equal to (a) the fee set forth under the heading, “Parking in lieu for the Downtown Assessment District,” on the municipal fee schedule entitled, “City of Palo Alto Development Impact Impacts,” in effect at the time such loss initially occurs (the “In-Lieu Parking Fee”), multiplied by (b) the number of permanently eliminated parking spaces (the “Parking Elimination Fees”). The In-Lieu Parking Fee is updated annually by DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 9 Rev.: 1/29/15 City. As of June 14, 2015, the In-Lieu Parking Fee is sixty five thousand, four hundred and seventy-five dollars ($65,475.00) per parking space. Lessee shall pay City any Parking Elimination Fees promptly after receipt of an invoice therefor. Notwithstanding any provision to the contrary, the installation, maintenance and/or operation of the Generating Facilities shall not cause a permanent loss of more than two (2) parking spaces per individual Site. 5.2. Delay Liquidated Damages. 5.2.1. In the event that Lessee enters the Delayed Construction Period, Lessee shall pay City the Delay Liquidated Damages as set forth in section 6.2.2. Lessee shall pay City such Delay Liquidated Damages every fourteen (14) days after receipt of an invoice therefor while in the Delayed Construction Period. 5.2.2. During the Delayed Construction Period, Lessee will be assessed Delay Liquidated Damages on a daily basis according to the table set forth immediately below. Such Delay Liquidated Damages shall be cumulative and apply to and across all Properties during a Delayed Construction Period. Property Daily Delay Liquidated Damages Per Property 475 Cambridge Garage $632.00 275 Cambridge Garage $768.00 Webster Garage $1400.00 Bryant Garage $1820.00 5.2.3. The Parties agree that the Delay Liquidated Damages set forth in section 6.2.2 are reasonable and represent a fair and genuine estimate of the damages that City will suffer if Lessee enters the Delayed Construction Period. The Parties acknowledge that it would be impracticable or extremely difficult to fix actual damages in such circumstances, and therefore they have deemed the Delay Liquidated Damages set forth above to be the amount of damage sustained by City upon the occurrence of such circumstances. 6. SECURITY DEPOSIT. 6.1. Amount. Lessee agrees to provide City with a Security Deposit of twenty-five thousand dollars ($25,000.00). DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 10 Rev.: 1/29/15 6.2. Use of Security Deposit. Within ten (10) days of the Effective Date of this Lease, Lessee shall deliver to City its Security Deposit. City may use these funds as are reasonably necessary to remedy any Lessee’s failure to pay Rent, to repair damages caused by Lessee’s acts or omissions, or expenses incurred to clean the Property upon termination of tenancy. 6.3. Reinstatement of Security Deposit. If any portion of the Security Deposit is used towards Rent or damages at City's sole discretion, Lessee agrees to reinstate the total Security Deposit upon receipt of ten (10) days written notice from City. 6.4. Return of Security Deposit. City agrees to provide the balance of Security Deposit, if any, to Lessee’s last known address within thirty (30) days of the completion of surrender and removal at all four (4) Properties. 7. USE OF PROPERTY. 7.1. Required Uses. Throughout the term of this Lease, Lessee shall provide the following uses, services and activities (“Required Uses”) at the Property: installation, operation and maintenance of the Generating Facility in Exhibit “D” (Improvements) of this Lease, and installation of EV Chargers and Infrastructure, also described in Exhibit “D” (Improvements) for City ownership. 7.2. Permitted Uses. Lessee may not use the Property for any purpose other than the Required Uses without City's prior written consent, which consent may be withheld in the City’s sole and absolute discretion. 7.3. Prohibited Uses. Lessee shall not use Property for any purpose not expressly permitted hereunder. 7.3.1. Lessee shall not create, cause, maintain or permit any nuisance or waste in, on, or about the Property, or permit or allow the Property to be used for any unlawful or immoral purpose. Lessee shall not do or permit to be done anything in any manner which unreasonably disturbs the users of the City Property or the occupants of neighboring property. Specifically, and without limiting the above, Lessee agrees not to cause any unreasonable odor, noise, vibration, power emission, or other item to emanate from the Property. 7.3.2. No materials or articles of any nature shall be stored outside upon any portion of the Properties. Lessee will not use Property in a manner that increases the risk of fire, cost of fire insurance or improvements thereon. 7.3.3. No unreasonable sign or placard shall be painted, inscribed or placed in or on said Property; and no tree or shrub thereon shall be destroyed or removed or other waste committed of said Property. 7.3.4. No bicycles, motorcycles, automobiles or other mechanical means of transportation shall be placed or stored anywhere on the Property except for the garage or driveway. No repair, overhaul or modification of any motor DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 11 Rev.: 1/29/15 vehicle shall take place on the Property or the street in front of said Property. 7.3.5. Lessee, at its own expense, shall keep the Property in as good condition as it was at the beginning of the terms hereof, except damage occasioned by ordinary wear and tear, and except damage to the publically accessible areas, roof, sidewalks and underground plumbing, which is not the fault of Lessee. 7.4. Condition and Use of Property. City makes no warranty or representation of any kind concerning the condition of the Property, or the fitness of the Property for the use intended by Lessee, and hereby disclaims any personal knowledge with respect thereto, it being expressly understood by the Parties that Lessee has personally inspected the Property, knows its condition, finds it fit for Lessee’s intended use, accepts it as is, and has ascertained that it can be used exclusively for the Required Uses, and any Permitted Uses authorized by City. 8. HAZARDOUS MATERIALS. 8.1. Use of Hazardous Materials Prohibited. Lessee shall not cause or permit any Hazardous Material (as defined in Exhibit “A” (Definitions)) to be brought upon, kept or used in or about the Property by Lessee, its agents, employees, contractors or invitees. 8.2. City’s Right to Perform Tests. At any time during the Term, City shall have the right to enter upon the Property in order to conduct tests of water, soil and other relevant media or substances to assess the environmental condition of the Property. 9. UTILITIES AND OPERATING EXPENSES. 9.1. Lessee shall fully and promptly pay for all expenses associated with Lessee’s use of the operation Property, including but not limited to the furnishing of gas, water, sewer, electricity, telephone service, garbage pickup and disposal, landscaping installation and maintenance, and other public utilities associated with the Required Uses or Permitted Uses by Lessee. 9.2. Subject to Lessee’s obligation to pay for such utilities service set forth in section 10.1 of this Lease, City shall furnish to the Properties reasonable quantities of gas, electricity, water, sewer and refuse collections services as required for Lessee’s and City’s continued use. However, if City is required to construct new, improved or additional installations in connection with utilities, including, without limitation, wiring, plumbing, conduits, transformers, and mains, resulting from the Required Use or Permitted Use by Lessee, Lessee shall pay to City the total cost of such new, improved or additional installations in the amounts and in accordance with any schedule set forth in the City’s Utilities Rules and Regulations, as the same may be amended from time to time. 10. TAXES. 10.1. Payment of Real Property Taxes. Lessee shall pay Lessee’s share of all Real Property Taxes that become due and payable to City on or before the later of ten (10) days prior to the delinquency thereof or three (3) days after the date on which Lessee receives a copy of the tax bill and notice of City’s determination hereunder. Lessee’s liability to pay Real DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 12 Rev.: 1/29/15 Property Taxes shall be prorated on the basis of a three hundred sixty-five (365) day year to account for any fraction or portion of a tax year included in the Lease term at the commencement or expiration or termination of the Lease. 10.2. Revenue and Taxation Code. Lessee specifically acknowledges it is familiar with section 107.6 of the California Revenue and Taxation Code. Lessee realizes that a possessory interest subject to property taxes may be created, agrees to pay any such tax, and hereby waives any rights Lessee may have under said California Revenue and Taxation Code section 107.6. 10.3. Personal Property Taxes. Lessee shall pay before delinquent, or if requested by City, reimburse City for, any and all taxes, fees, and assessments associated with the Property, the personal property contained on the Property and other taxes, fees, and assessments regarding any activities which take place at the Property. Lessee recognizes and understands in accepting this Lease that its interest therein may be subject to a possible possessory interest tax that City or County may impose on such interest and that such tax payment shall not reduce any rent due City hereunder and any such tax shall be the liability of and be paid by Lessee. 11. CONTRACTORS, CONSULTANTS; WORK HOURS 11.1. Contractors, Consultants. 11.1.1. Any contractor or consultant engaged by Lessee to install, construct, operate or maintain the Generating Facility or Generating Facilities, or to install the EV Chargers and Infrastructure must be properly licensed. 11.1.2. Lessee agrees to advise the City of any contractors or consultants involved in the installation or construction of the Improvements in advance of the commencement of the Construction Period for the Generating Facility or the installation and construction of EV Chargers and Infrastructure. 11.1.3. Lessee is responsible for the conduct of its contractors and consultants, and any subcontractors thereto, and City shall have no contractual relationship with any such contractors or consultants. 11.1.4. All Lessee’s contractors and consultants must carry public liability and property damage insurance, standard fire and extended coverage insurance, with vandalism and malicious mischief endorsements, during the period of construction consistent with requirements set forth in Section 27 (Insurance). Such insurance shall contain waiver of subrogation clauses in favor of City and Lessee in accordance with the Provisions of Exhibit “G” (Insurance Requirements). 11.2. Work Hours. 11.2.1. Except for emergency situations or unplanned outages, Lessee shall cause all installation, construction, maintenance or operations work to be performed as authorized by Lessee’s permit. All such work shall be in a manner that DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 13 Rev.: 1/29/15 minimizes interference with City and City’s employees, visitors, tenants, licensees and their customers to the extent commercially practicable. Lessee shall notify the Lease Administrator at least seventy two (72) hours in advance of such work, including where such activities could result in the loss of or limitation of access to the Site. Lessee shall schedule such activities in coordination with the City to minimize said loss or limitation of access to the Site. 11.2.2. Except as expressly set forth in Exhibit “E” (Work Schedule), the Property, and the Site shall remain open for business to during the Construction Period and the Operations Period. 11.2.3. As set forth in section 5 (Rent) and section 6 (Parking Fees) of this Lease, Lessee shall compensate the City for any loss of access, or exclusive use by Lessee, of common areas and associated parking spaces at the Site. If Lessee or any of its agents, suppliers or subcontractors parks any vehicles in parking spaces not on the top floor of any Site, Lessee shall compensate City for such temporary parking usage at the daily posted parking rate then in-effect for such Site during the Term. 12. OWNERSHIP OF IMPROVEMENTS. 12.1. Generating Facilities. Title to the Generating Facility placed on the Property by Lessee shall be held by Lessee during the Term, subject to City’s exercise of its Buyout Option. 12.1.1. In the event City exercises its Buyout Option, Lessee shall take whatever actions are necessary to transfer fee title ownership of the Generating Facility placed by Lessee on the Property to City, free and clear from any lien, or monetary or other encumbrances. 12.1.2. Should this Lease be terminated for any reason prior to the expiration of the Term, other than as a result of the City exercising its Buyout Option as provided for in section 4.3, all the Generating Facility placed by Lessee on the Property shall remain under the ownership of Lessee and shall be removed by Lessee in accordance with section 4.4 of this Lease. 12.1.3. City acknowledges and agrees that: 12.1.3.1. Notwithstanding that the Generating Facilities are a fixture on the Property, the City has no ownership interest in the Generating Facilities, other than as set forth in this Lease (Buyout Option) and Lessee is the exclusive owner and operator of the Generating Facilities; 12.1.3.2. The Generating Facilities, may not be sold, leased, assigned, mortgaged, pledged or otherwise alienated or encumbered (collectively, a “Transfer”) with the fee interest or leasehold rights to the Property by City; and DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 14 Rev.: 1/29/15 12.1.3.3. Nothing shall prevent or limit City’s right to Transfer the Property or the Site; provided, however that: 12.1.3.3.1. City agrees to give Lessee at least fifteen (15) days written notice prior to any Transfer of all or a portion of the Property or the Site identifying the transferee, the portion of the Property or the Site to be transferred and the proposed date of transfer; and 12.1.3.3.2. City agrees that this Lease and any right-of-way granted hereunder shall run with the Property and the Site and survive any Transfer of the Property or the Site; provided that if and solely if a Transfer of the Property by the City causes a change to the Lessor, this Lease shall terminate and the termination value on Schedule 23.2 for the applicable year for each Generating Facility shall be payable by Lessor and Lessor and Lessee hereby agree that the CLEAN PPA as to each Site or all Sites, as applicable, shall terminate, unless Lessee otherwise agrees that the new Lessor has acceptable credit quality, which agreement shall not be unreasonably withheld or Lessor provides reasonably acceptable credit support. 12.2. EV Chargers. 12.2.1. Lessor hereby grants Lessee the right to install and the right to locate the EV Chargers and Infrastructure, and Lessee hereby agrees to install the EV Chargers and Infrastructure. To the extent practicable, Lessee agrees to work with City to install the EV Chargers and Infrastructure near existing chargers or in alternate locations that have the potential to maximize construction, operational or other efficiencies for City as directed by City. 12.2.2. Upon completion of installation of EV Chargers and Infrastructure by Lessee: 12.2.2.1. Lessee has no ownership interest in the EV Chargers and Infrastructure, and City is the exclusive owner of the EV Chargers and Infrastructure. 12.2.2.2. Lessee shall take commercially reasonable actions as are necessary to transfer fee title ownership of the EV Chargers and Infrastructure placed by Lessee on the EV Chargers and Infrastructure to City, free and clear from any lien, or monetary or other encumbrances, along with the transfer of any applicable warranties, guarantees, interests or other contracts, held by Lessee to City. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 15 Rev.: 1/29/15 12.2.2.3. The EV Chargers and Infrastructure shall be powered by electricity provided by City at the City’s sole expense. 13. INSTALLATION AND CONSTRUCTION IMPROVEMENTS (GENERATING FACILITIES AND EV CHARGERS AND INFRASTRUCTURE) BY LESSEE. 13.1. Installation and Construction of Improvements. 13.1.1. City Consent. City hereby consents to the installation on the Property of the Improvements by Lessee, including the Generating Facilities and EV Chargers and Infrastructure, as shown in Exhibit “D” (Improvements). Lessee shall use commercially reasonable efforts to cause the installation and construction of such Improvements in accordance with the specifications set forth in Exhibit “D” (Improvements) and Exhibit “E” (Work Schedule) attached to this Lease. 13.1.2. Performance. Lessee shall be responsible for the installation of the Improvements, including all costs associated with the installation of the Improvements. Within thirty (30) days of the Effective Date, Lessee shall commence pre-installation activities relating to the Improvements, which shall include, without limitation and as applicable to the specific Improvement involved, using commercially reasonable efforts to: 13.1.2.1. Obtain financing for construction of the Improvements, if necessary; 13.1.2.2. Execute all contracts, and agreements required for the installation and operation of the Improvements, including, for the Generating Facility, the CLEAN PPA; 13.1.2.3. Execute all agreements required for Utility interconnection of the Generating Facility, including the CLEAN PPA Interconnection Agreement; and 13.1.2.4. Obtain, at no additional cost and expense to City, all Permits necessary for the installation and operation of the Improvements. Lessee is responsible for and City agrees to cooperate in Lessee’s seeking any and all Permits Lessee finds necessary or desirable for the installation of the Improvements. Lessee will carry out the activities set forth in this section in accordance with all applicable laws, rules, codes and ordinances and in such a manner as will not unreasonably interfere with City’s operation or maintenance of the Site as a parking facility. 13.1.3. Construction Standards. 13.1.3.1. Lessee shall in a good, efficient and workmanlike manner, cause to be designed, constructed, and installed within the Property, at DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 16 Rev.: 1/29/15 no cost to City, appropriate equipment, materials and services to adequately accommodate the Improvements and the Required Uses and Permitted Uses (if any) under this Lease. 13.1.3.2. Lessee shall prepare the plans and specifications for approval by the City’s Building Division and Planning & Community Development Divisions as required by the Palo Alto Municipal Code. 13.1.3.3. Lessee shall obtain approval of all such plans and specifications and shall cause the construction of all Improvements to be completed within twelve (12) months of the effective date set forth in the CLEAN PPA. 13.1.3.4. All design and construction performed by or on behalf of Lessee shall materially and substantially conform to the approved plans, specifications, construction and architectural standards approved by City and contained in Exhibit “D” (Improvements). 13.1.3.5. All work shall be performed in a manner that complies with all applicable governmental permits, laws, ordinances and regulations, and shall meet all other requirements contained in this Lease. 13.1.3.6. Lessee shall, and shall cause its contractors to, keep the Site reasonably clear of debris, waste, material and rubbish and to comply with reasonable safety procedures established by City for the conduct of business on the Site. 13.1.3.7. Lessee shall keep the Property free and clear of all claims and liens resulting from construction done by or for Lessee. 13.1.4. Cost of Improvements. Lessee shall pay all costs for construction done or caused to be done by Lessee on the Property as permitted or required by this Lease. Promptly after completion of construction, Lessee shall provide to the Lease Administrator a statement of the reasonable and actual costs of construction for the Improvements described in Exhibit “D”, which statement shall be certified as to accuracy and signed by Lessee under penalty of perjury. 13.1.5. Assurance of Completion. 13.1.5.1. For the Construction of the Improvements. The estimated construction cost of the Improvements set forth in Exhibit “D” to be constructed by Lessee is $3.05 per Watt. Within thirty (30) days of the Effective Date of this Lease, Lessee shall furnish to the Lease Administrator evidence that assures City that sufficient monies are available to Lessee to complete the construction of the Improvements. The amount of such assurance shall be at DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 17 Rev.: 1/29/15 least the estimated construction cost. Evidence of such assurance shall take one of the forms set out below and City is authorized to draw on such assurances to guarantee Lessee’s full and faithful performance of all of the terms, covenants, and conditions of this Lease: 13.1.5.1.1. Completion Bond; 13.1.5.1.2. Performance bond, labor and material bonds, supplied by Lessee’s contractor or contractors, provided the bonds are issued jointly to Lessee and City; 13.1.5.1.3. Irrevocable letter of credit from a financial institution; or 13.1.5.1.4. Any combination of the above. 13.1.5.2. Additional Construction or Alteration. Prior to commencement of any construction or alteration expected to cost more than ten thousand dollars ($10,000.00), Lessee shall furnish the Lease Administrator evidence that assures City that sufficient monies will be available to Lessee to complete the proposed work. Such assurance may be in the form identified in section 14.1.5.1.1 to section 14.1.5.1.4 of this Lease. 13.1.5.3. All bonds and letters of credit must be issued by a company qualified to do business in the State of California and be acceptable to the Lease Administrator. All bonds and letters of credit shall be in a form acceptable to the Lease Administrator, and shall insure faithful and full observance and performance by Lessee of all of the terms, conditions, covenants, and agreements relating to the construction of Improvements or other alterations in accordance with this Lease. 13.1.6. Certificate of Inspection. Upon completion of construction of any building, the Generating Facilities and the EV Chargers and Infrastructure, Lessee shall submit to the Lease Administrator a Certificate of Inspection, verifying that the construction was completed in conformance with Title 20 of the California Code of Regulations for residential construction, or in conformance with Title 24 of the California Code of Regulations for non-residential construction. 13.1.7. As Built Plans. Lessee shall provide the Lease Administrator with a complete set of reproducible “as built plans” reflecting actual construction within or upon the Property upon completion of any: (i) new construction; (ii) structural alterations; or (iii) non-structural alterations costing more than twenty-five thousand dollars ($25,000.00), which shall include, by way of clarification but not of limitation, the Generating Facilities and the EV DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 18 Rev.: 1/29/15 Chargers and Infrastructure. 14. MAINTENANCE AND OPERATION OF GENERATING FACILITIES BY LESSEE 14.1. Maintenance. 14.1.1. City Responsibilities. 14.1.1.1. Site. City shall be responsible for the maintenance and repair of the overall Site, other than the Generating Facility, including main support systems not exclusively serving the Lessee’s facilities, such as electrical system repair, painting, structural repairs, and all maintenance of landscaped areas. 14.1.1.2. EV Chargers and Infrastructure. City shall be responsible for maintenance of all EV Chargers and Infrastructure, which are to be solely owned by City following Lessee’s installation. 14.1.1.3. Common Areas. City shall maintain or cause to be maintained, including repair and replacement as necessary, all Common Areas serving the Property. 14.1.2. Lessee Responsibilities. Lessee shall maintain, at Lessee’s expense, all Generating Facilities, including all related equipment, furnishings and trade fixtures upon the Property in a safe, clean, wholesome, and sanitary condition required for the maintenance and operation of a first-class business of the type to be conducted pursuant to this Lease. Lessee agrees to promptly (and in no case later than within thirty (30) days written notice from City) paint, clean, and abate graffiti, to the complete satisfaction of City, and in compliance with all applicable laws, throughout the term of this Lease. 14.1.3. Waiver of Civil Code. Lessee expressly waives the benefit of any statute now or hereinafter in effect, including the provisions of sections 1941 and 1942 of the Civil Code of California, which would otherwise afford Lessee the right to make repairs at City’s expense or to terminate this Lease because of City’s failure to keep Property in good order, condition and repair. Lessee further agrees that if and when any repairs, alterations, additions or betterments shall be made by Lessee as required by this paragraph, Lessee shall promptly pay for all labor done or materials furnished and shall keep the Property free and clear of any lien or encumbrance of any kind whatsoever. If Lessee fails to make any repairs or perform any maintenance work for which Lessee is responsible within a reasonable time (as determined by the City in the City’s sole discretion) after demand by the City, City shall have the right, but not the obligation, to make the repairs at Lessee’s expense; within ten (10) days of receipt of a bill, Lessee shall reimburse City for the cost of such repairs, including a fifteen percent (15%) administrative overhead fee. The making of such repairs or performance of maintenance by City shall in no event be construed as a waiver of the duty of Lessee to make repairs or perform maintenance as provided in this section. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 19 Rev.: 1/29/15 14.2. Operation. 14.2.1. Generating Facility. 14.2.1.1. Lessee shall be solely responsible for operation and maintenance of the Generating Facility (subject, however, to the obligations and responsibilities of City herein). Lessee’s obligation shall include, without limitation, the obligation to promptly make or pay (as determined by City) for any repairs to the Property or to the Site to the extent directly caused by Lessee, its employees, agents, contractors or subcontractors. 14.2.1.2. Lessee shall bear all risk of loss with respect to the Generating Facility, except: 14.2.1.2.1. As set forth elsewhere in this Lease; or 14.2.1.2.2. For actions or negligence by the City or it agents and employees. 14.2.1.3. Lessee shall operate the Generating Facilities so as to keep such Generating Facilities in good operating condition and repair, in compliance with all applicable laws, and in accordance with generally accepted practices of the electric industry, in general, and the solar generation industry in particular. 14.2.2. EV Chargers and Infrastructure. City shall be responsible for operation of all EV Chargers and Infrastructure, which are to be solely owned by City following Lessee’s installation. 15. RELOCATION 15.1. City may request to move the Generating Facility on either a temporary or permanent basis to another location on the Site or to another site owned by City. 15.2. For any such relocation that is required due to Site work or another purpose unrelated to the Generating Facility, the City is responsible for all associated reasonable costs of removal and reinstallation and must proceed diligently. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 20 Rev.: 1/29/15 16. ALTERATIONS BY LESSEE Lessee shall not make any alterations or modifications to the Property without obtaining the prior written consent of the Lease Administrator. Lessee may, at any time and at its sole expense, install and place business fixtures and equipment within the Property provided such fixtures and installation have been reviewed and approved by the Lease Administrator. 17. REPRESENTATIONS AND WARRANTIES; COVENANTS 17.1. Representations and Warranties. On the Effective Date, each Party represents and warrants to the other Party that: 17.1.1. It is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation; 17.1.2. The execution, delivery and performance of this Lease is within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it; 17.1.3. This Lease and each other document executed and delivered in accordance with this Lease constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; 17.1.4. It is not bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming bankrupt; 17.1.5. There is not pending or, to its knowledge, threatened against it or any of its affiliates, if any, any legal proceedings that could materially adversely affect its ability to perform its obligations under this Lease; and 17.1.6. It is acting for its own account, has made its own independent decision to enter into this Lease and as to whether this Lease is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of, and understands and accepts, the terms, conditions and risks of this Lease. 17.2. Covenants. Each Party covenants that, during the Term: 17.2.1. It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation; 17.2.2. It shall maintain (or obtain from time to time as required, including through renewal, as applicable) all regulatory authorizations necessary for it to legally perform its obligations under this Lease; and 17.2.3. It shall perform its obligations under this Lease in a manner that does not DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 21 Rev.: 1/29/15 violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it. 18. HOLD HARMLESS, INDEMNIFICATION. 18.1. General Indemnification. Lessee agrees to protect, defend (with counsel acceptable to City), hold harmless and indemnify City, its City Council, commissions, officers, agents, volunteers, and employees from and against any claim, injury, liability, loss, cost, penalties, forfeiture, and/or expense and/or damage, however same may be caused, including all costs and reasonable attorney's fees in providing a defense to any claim arising therefrom for which City shall become legally liable arising from Lessee’s or its contractors, consultants, agents or assigns negligent, reckless, or wrongful acts, errors, or omissions with respect to or in any way connected with this Lease together with reasonable attorneys' fees and all costs and expenses reasonably incurred by City in negotiating, settling, defending or otherwise protecting against such claims. This indemnity shall be in addition to the Hazardous Materials Indemnity and Indemnity for claims arising out of construction contained in this Lease and shall survive shall survive the expiration of or early termination of the Lease Term. 18.2. Indemnity for Claims Arising Out of Construction. Lessee agrees to protect, defend (with counsel acceptable to City), hold harmless and indemnify City, its City Council, commissions, officers, agents, volunteers, and employees from and against any claim, injury, liability, loss, cost, penalties, forfeiture, and/or expense or damage arising out of work performed on the Property by Lessee or its contractors, consultants, agents or assigns, together with reasonable attorneys' fees and all costs and expenses reasonably incurred by City in negotiating, settling, defending or otherwise protecting against such claims. 18.3. Hazardous Materials Indemnity. Lessee shall protect, defend (with counsel acceptable to City), hold harmless, and indemnify the City, its City Council, commissions, officers, agents, volunteers, and employees harmless from and against any and all claims, injuries, liabilities, costs, penalties, forfeitures, losses, and/or expenses or damages, including without limitation, diminution in value of the Property or Site, damages for the loss or restriction on use of the rentable or usable space or of any amenity of the Property or Site, damages arising from any adverse impact or marketing of the Property or Site and sums paid in settlement of claims, response costs, cleanup costs, site assessment costs, attorneys’ fees, consultant and expert fees, judgments, administrative rulings or orders, fines, costs of death of or injury to any person, or damage to any property whatsoever (including, without limitation, groundwater, sewer systems, and atmosphere), arising from, caused, or resulting, either prior to or during the Lease Term, in whole or in part, directly or indirectly, by the presence or discharge in, on, under, or about the Property by Lessee, Lessee’s agents, employees, licensees, or invitees or at Lessee’s direction, of Hazardous Material, or by Lessee’s failure to comply with any law applicable to the use, storage or disposal of Hazardous Materials, whether knowingly or by strict liability. For purposes of the indemnity provided herein, any acts or omissions of Lessee or its employees, agents, customers, sublessees, assignees, contractors, or subcontractors of Lessee (whether or not they are negligent, intentional, willful or unlawful) shall be strictly attributable to Lessee. Lessee’s indemnification obligations shall include, without DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 22 Rev.: 1/29/15 limitation, and whether foreseeable or unforeseeable, all costs of any required or necessary Hazardous Materials management plan, investigation, repairs, cleanup or detoxification or decontamination of the Property or Site, and the presence and implementation of any closure, remedial action or other required plans, and shall survive the expiration of or early termination of the Lease Term. 18.4. Waiver of Claims. Lessee waives any claims against City for injury to Lessee’s business or any loss of income therefrom, for damage to Lessee’s property, or for injury or death of any person in or about the Property, from any cause whatsoever, except to the extent caused by City’s active negligence or willful misconduct. 18.5. Notice. Lessee shall give City immediate notice of any claim or liability indemnified against under this Lease. 19. FORCE MAJEURE, DAMAGE AND DESTRUCTION. 19.1. Nontermination and Nonabatement. Except as provided herein, no destruction or damage to the Property by fire, windstorm or other casualty, whether insured or uninsured, shall entitle Lessee to terminate this Lease. City and Lessee waive the provisions of any statutes which relate to termination of a lease when leased property is destroyed and agree that such event shall be governed by the terms of this Lease. 19.2. Force Majeure. Force Majeure shall excuse the performance by Lessee for a period equal to the prevention, delay, or stoppage, except the obligations imposed with regard to Rent to be paid by Lessee pursuant to this Lease. 19.3. Restoration of Property by Lessee. 19.3.1. Destruction Due to Risk Covered by Insurance. If, during the term, the Property is totally or partially destroyed from a risk covered by the insurance described in Section 27 (Insurance), rendering the Property totally or partially inaccessible or unusable, Lessee shall restore the Property to substantially the same condition as it was in immediately before destruction (“Restoration”), whether or not the insurance proceeds are sufficient to cover the actual cost of Restoration. Such destruction shall not terminate this Lease. If the laws existing at that time do not permit the Restoration, either party can terminate this Lease immediately by giving notice to the other Party. 19.3.1.1. Minor Loss. If, during the term of this Lease, the Property is destroyed from a risk covered by the insurance described in Section 27 (Insurance), and the total amount of loss does not exceed twenty thousand dollars ($20,000.00), Lessee shall make the loss adjustment with the insurance company insuring the loss. The proceeds shall be paid directly to Lessee for the sole purpose of making the Restoration of the Property in accordance with this Lease. 19.3.1.2. Major Loss-Insurance Trustee. If, during the term of this Lease, DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 23 Rev.: 1/29/15 the Property is destroyed from a risk covered by the insurance described in Section 27 (Insurance), and the total amount of loss exceeds twenty thousand dollars ($20,000.00), Lessee shall make the loss adjustment with the insurance company insuring the loss and on receipt of the proceeds shall immediately pay them to an institutional lender or title company as may be jointly selected by the Parties ("the Insurance Trustee"). 19.3.2. Destruction Due to Risk Not Covered by Insurance. If, during the term, the Property is totally or partially destroyed from a risk covered by the insurance described in Section 27 (Insurance), rendering the Property totally or partially inaccessible or unusable, Lessee shall engage in Restoration of the Property, whether or not the insurance proceeds are sufficient to cover the actual cost of restoration. Such destruction shall not terminate this Lease. If the laws existing at that time do not permit the Restoration, either Party can terminate this Lease immediately by giving notice to the other Party. 19.3.2.1. If the cost of Restoration exceeds ten percent (10%) of the then replacement value of the Property totally or partially destroyed, Lessee can elect to terminate this Lease by giving notice to City within sixty (60) days after determining the restoration cost and replacement value. If Lessee elects to terminate this Lease, City, within thirty (30) days after receiving Lessee's notice to terminate, can elect to pay to Lessee, at the time City notifies Lessee of its election, the difference between ten percent (10%) of the replacement value of the Property and the actual cost of Restoration, in which case Lessee shall restore the Property. On City's making its election to contribute, each Party shall deposit immediately the amount of its contribution with such institutional lender or title company as may be jointly selected by the Insurance Trustee. If the destruction does not exceed ten percent (10%) of the then replacement value of the Property, Lessee shall immediately deposit the cost of restoration with the Insurance Trustee as provided in Exhibit “G” (Insurance). This Lease shall terminate if Lessee elects to terminate this Lease and City does not elect to contribute toward the cost of Restoration as provided in this section. 19.3.2.2. If the Property is destroyed from a risk not covered by the insurance described in Section 27 (Insurance), and Lessee has the obligation to engage in Restoration of the Property as provided in section 20.3.2 of this Lease, both Parties shall deposit with the Insurance Trustee their respective contributions toward the cost of Restoration. All sums deposited with the Insurance Trustee shall be held for the following purposes and the Insurance Trustee shall have the following powers and duties: 19.3.2.2.1. The sums shall be paid in installments by the DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 24 Rev.: 1/29/15 Insurance Trustee to the contractor retained by Lessee as construction progresses, for payment of the cost of Restoration. 19.3.2.2.2. A ten percent (10%) retention fund shall be established that will be paid to the contractor on completion of Restoration, payment of all costs, expiration of all applicable lien periods, and proof that the Property is free of all mechanics' liens and lienable claims. 19.3.2.2.3. Payments shall be made on presentation of certificates or vouchers from the architect or engineer retained by Lessee showing the amount due. If the Insurance Trustee, in its reasonable discretion, determines that the certificates or vouchers are being improperly approved by the architect or engineer retained by Lessee, the Insurance Trustee shall have the right to appoint an architect or an engineer to supervise construction and to make payments on certificates or vouchers approved by the architect or engineer retained by the Insurance Trustee. The reasonable expenses and charges of the architect or engineer retained by the Insurance Trustee shall be paid by the insurance trustee out of the trust fund. Both Parties shall promptly execute all documents and perform all acts reasonably required by the Insurance Trustee to perform its obligations under this section. 19.3.2.2.4. If the sums held by the Insurance Trustee are not sufficient to pay the actual cost of Restoration, Lessee shall deposit the amount of the deficiency with the Insurance Trustee within fifteen (15) days after request by the Insurance Trustee indicating the amount of the deficiency. Any undisbursed funds after compliance with the provisions of this section shall be delivered to City to the extent of City's contribution to the fund, and the balance, if any, shall be paid to Lessee. All actual costs and charges of the Insurance Trustee shall be paid by Lessee. 19.3.2.3. If the Insurance Trustee resigns or for any reason is unwilling to act or continue to act, City shall substitute a new trustee in the place of the designated Insurance Trustee. The new trustee must be an institutional lender or title company. 19.3.3. Procedure for Restoring the Property. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 25 Rev.: 1/29/15 19.3.3.1. When Lessee is obligated to engage in Restoration of the Property or a portion of the Property, within sixty (60) days Lessee at its cost shall prepare final plans, specifications, and working drawings complying with applicable laws that will be necessary for restoration of the Property. The plans, specifications, and working drawings must be approved by City. City shall have thirty (30) days after receipt of the plans and specifications and working drawings to either approve or disapprove the plans, specifications, and working drawings and return them to Lessee. If City disapproves the plans, specifications, and working drawings, City shall notify Lessee of its objections and City's proposed solution to each objection. Lessee acknowledges that the plans, specifications, and working drawings shall be subject to approval of the appropriate governmental authorities and that they will be prepared in such a manner as to obtain that approval. 19.3.3.2. The Restoration shall be accomplished as follows: 19.3.3.2.1. Lessee shall complete the Restoration within sixty (60) working days after final plans and specifications and working drawings have been approved by the appropriate governmental authorities and all required Permits have been obtained (subject to a reasonable extension for delays resulting from causes beyond Lessee's reasonable control). 19.3.3.2.2. Lessee shall retain a licensed contractor that is bondable. The contractor shall be required to carry public liability and property damage insurance, standard fire and extended coverage insurance, with vandalism and malicious mischief endorsements, during the period of construction consistent with requirements set forth in Section 27 (Insurance). Such insurance shall contain waiver of subrogation clauses in favor of City and Lessee in accordance with the Provisions of Exhibit “G” (Insurance Requirements). 19.3.3.2.3. Lessee shall notify City of the date of commencement of the Restoration at least ten (10) days before commencement of the Restoration to enable City to post and record notices of non- responsibility. The contractor retained by Lessee shall not commence construction until a completion bond and a labor and materials bond have been delivered to City to insure completion of the construction. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 26 Rev.: 1/29/15 19.3.3.3. Lessee shall accomplish the restoration in a manner that will cause the least inconvenience, annoyance, and disruption at the Property. 19.3.3.4. On completion of the Restoration Lessee shall immediately record a notice of completion in Santa Clara County. 19.3.3.5. The Restoration shall not be commenced until sums sufficient to cover the cost of Restoration are placed with the Insurance Trustee as provided in section 20.3.1.2 of this Lease. 20. SIGNS. Lessee shall not place, construct, maintain, or allow any signs upon the Property without prior written consent of City. 21. ASSIGNMENT AND SUBLETTING. 21.1. City's Consent Required. 21.1.1. No Assignment Without Consent. 21.1.1.1. Lessee shall neither assign this lease, nor any interest therein, and shall neither sublet nor encumber the Property or any part thereof, nor any right or privilege appurtenant thereto, nor allow or permit any other person(s) to occupy or use the Property, or any portion thereof, without the prior written consent of City. 21.1.1.2. Any assignment, subletting, encumbrances, occupation, or use contrary to the provisions of this Lease shall be void and shall constitute breach of this Lease. City may assign any of its rights hereunder without notice to Lessee. 21.1.1.3. At City’s request, Lessee shall promptly deliver financial statements, information and other evidence satisfactory to City regarding any proposed assignment or change of control under this Section 22.1. 21.1.2. Consent. 21.1.2.1. Any direct or indirect change of control of Lessee (whether voluntary or by operation of law) shall be deemed an assignment and shall require the prior written consent of City which may be withheld in its sole discretion. 21.1.2.2. Lessee shall be permitted to assign this Lease as collateral for any financing or refinancing of the Generating Facilities with the prior written consent of Lessor, which consent shall not be DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 27 Rev.: 1/29/15 unreasonably withheld, conditioned or delayed. If Lessor gives its consent, such consent shall be in a form substantially similar to the form of “Lender Consent and Agreement” attached hereto as Exhibit “J”. 21.1.3. No Consent Subject to Creditworthiness Test. Notwithstanding the foregoing, no Consent and Agreement shall be required for: 21.1.3.1. Any assignment or transfer of this Lease by the Lessee to an affiliate of the Lessee, provided that such affiliate’s creditworthiness is equal to or better than that of Lessee, as reasonably determined by Lessor; or 21.1.3.2. Any assignment or transfer of this Lease by the Lessee to a person succeeding to all or substantially all of the assets of Lessee, provided that such person’s creditworthiness is equal to or greater than that of Lessee, as reasonably determined by the Lessor. 21.1.4. Assignment. 21.1.4.1. Written notification of any assignment or transfer of this Lease shall be given to the Lessor. 21.1.4.2. This Lease shall be binding upon any permitted assignee or successor of Lessee. 21.1.4.3. Consent by City to one assignment, subletting, occupation or use by another person shall not be deemed to be consent to any subsequent assignment, subletting, occupation or use by another person. 21.1.4.4. No assignment, subletting, or encumbrance by Lessee shall release it from or in any way alter any of Lessee's obligations under this Lease. 21.2. Hazardous Materials. Without limiting City’s authority to withhold its consent in other circumstances, it shall not be unreasonable for City to withhold its consent to an assignment or sublet to a proposed assignee or sublessee if: 21.2.1. Any anticipated use of the Property by any proposed assignee or sublessee involves the generation or storage, use, treatment, disposal, or release of Hazardous Material in any manner or for any purpose; 21.2.2. The proposed assignee or sublessees has been required by any prior landlord, lender, or governmental authority to take remedial action in connection with Hazardous Material contamination at a property, if the contamination resulted from such assignee or sublessee’s action, omission or other use of the property in question; or, DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 28 Rev.: 1/29/15 21.2.3. The proposed assignee or sublessee is subject to an enforcement order issued by any governmental authority in connection with the release, use, disposal or storage of a Hazardous Material. 21.3. No Release of Lessee. No subletting or assignment as approved by City shall release Lessee of Lessee’s obligation or alter the primary liability of Lessee to pay Rent and to perform all other obligations by Lessee hereunder. The acceptance of Rent by City from any other person shall not be deemed to be a waiver by City of any provision hereof. In the event of default by any assignee of Lessee or any successor of Lessee in the performance of any of the terms hereof, City may proceed directly against Lessee without the necessity of exhausting remedies against said assignee. 22. EVENT OF DEFAULT; REMEDIES. 22.1. Event of Default. The occurrence of any one or more of the following events shall constitute a material default, or breach of this Lease by Lessee (“Lessee Event of Default”): 22.1.1. Abandonment. Abandonment of the Property by Lessee as defined by California Civil Code section 1951.3; 22.1.2. Failure to Pay Rent; Other Payments. Failure by Lessee to make any payment of Rent or any other payment (including, without limitation Parking Fees, if any) required to be made by Lessee hereunder, as provided in this Lease, where such failure continues for a period of ten (10) business days after City provides Lessee with written notice thereof. In the event City serves Lessee with a Notice to Pay Rent or Quit pursuant to applicable Unlawful Detainer statutes (“Notice to Pay Rent or Quit”), such Notice to Pay Rent or Quit shall also constitute the notice required by this subparagraph; 22.1.3. Failure to Satisfy Lease Obligations. Failure by Lessee to observe or perform any of the Representations, Warranties or Covenants set forth in section 18 of this Lease or any of the material covenants, conditions or provisions of this Lease in any material respect where such failure shall continue for a period of thirty (30) days after City provides Lessee with written notice thereof; provided, however, that if the nature of Lessee’s failure is such that more than thirty (30) days are reasonably required for its cure, then a Lessee Event of Default shall not have occurred if Lessee demonstrates to City’s reasonable satisfaction that it has commenced such cure within said thirty (30) day period and thereafter diligently prosecutes such cure to completion. Notwithstanding the foregoing, a Lessee Event of Default shall not occur under this section 23.1.3 if the failure to observe or perform any of the Representations, Warranties or Covenants set forth in Section 18 of this Lease or any of the material covenants, conditions or provisions of this Lease in any material respect is caused by an error or omission of an administrative or operational nature. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 29 Rev.: 1/29/15 22.1.4. Assignment to Creditors; Debtor Status; Bankruptcy and Seizure. 22.1.4.1. Making, by Lessee, of any general arrangement or assignment for the benefit of creditors; 22.1.4.2. Becoming a “Debtor” as defined in 11 U.S.C. §101, as the same may be amended from time to time, (unless, in the case of a petition filed against Lessee, the same is dismissed within sixty (60) days); 22.1.4.3. The appointment of a bankruptcy trustee or receiver to take possession of all or substantially all of Lessee’s assets located at or on the Property or of Lessee’s interest in this Lease where possession is not restored to Lessee within thirty (30) days; or the attachment, execution or other judicial seizure of all or substantially all of Lessee’s assets located at or on the Property or of Lessee’s interest in this Lease, where such seizure is not discharged within thirty (30) days. 22.1.5. Construction of Generating Facility. Failure, by Lessee to diligently pursue construction of the Generating Facility, including where the Delayed Construction Schedule Period results in loss or limited access to the Property or the Site that lasts more than ninety (90) days. Such time period may be extended by City, in its sole discretion, in writing prior to expiration the ninety (90) day period. 22.1.6. Failure to Achieve Commercial Operation Date. Failure by Lessee to complete construction of all Generating Facilities within 12 months of the effective date set forth in the CLEAN PPA. 22.2. Lessor Event of Default; Remedies of Lessee. The occurrence of any one or more of the following events shall constitute a material default, or breach of this Lease by Lessor (“Lessor Event of Default”): 22.2.1. Failure to Satisfy Lease Obligations. Failure by Lessor to observe or perform any of the Representations, Warranties or Covenants set forth in section 18 of this Lease or any of the material covenants, conditions or provisions of this Lease in any material respect where such failure shall continue for a period of thirty (30) days after Lessee provides City with written notice thereof; provided, however, that if the nature of Lessor’s failure is such that more than thirty (30) days are reasonably required for its cure, then a Lessor Event of Default shall not have occurred if Lessor demonstrates to Lessee’s reasonable satisfaction that it has commenced such cure within said thirty (30) day period and thereafter diligently prosecutes such cure to completion. Notwithstanding the foregoing, a Lessor Event of Default shall not occur under this section 23.2.1 if the failure to observe or perform any of the Representations, Warranties or Covenants set forth in Section 18 of this Lease or any of the material covenants, conditions or provisions of this Lease in any material respect is caused by an error or omission of an administrative DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 30 Rev.: 1/29/15 or operational nature. 22.2.2. Assignment to Creditors; Debtor Status; Bankruptcy and Seizure. 22.2.2.1. Making, by Lessor, of any general arrangement or assignment for the benefit of creditors; 22.2.2.2. Becoming a “Debtor” as defined in 11 U.S.C. §101, as the same may be amended from time to time, (unless, in the case of a petition filed against Lessor, the same is dismissed within sixty (60) days); 22.2.2.3. The appointment of a bankruptcy trustee or receiver to take possession of all or substantially all of Lessor’s assets located at or on the Property or of Lessor’s interest in this Lease where possession is not restored to Lessor within thirty (30) days; or the attachment, execution or other judicial seizure of all or substantially all of Lessor’s assets located at or on the Property or of Lessor’s interest in this Lease, where such seizure is not discharged within thirty (30) days. 22.2.3. Lessee Remedies. In the event of any Lessor Event of Default under this Lease, this Lease and the CLEAN PPA shall terminate and Lessor shall pay within thirty (30) days the termination value specified on Schedule 23.2 for each of the Generating Facilities for the year corresponding with when a Lessor Event of Default occurs, plus any reasonable out of pocket expenses of Lessee. 22.3. Termination of CLEAN PPA. Any termination of the CLEAN PPA shall cause this Lease to terminate; provided, however, that in no such event shall the Lessor owe the Lessee the termination value specified on Schedule 23.2, other than as set forth in Sections 4.2.1.2, 13.1.3.3.2 and 23.2.3. 22.4. Remedies of City. In the event of any Lessee Event of Default, City may at any time thereafter, following any notice required by statute, and without limiting City in the exercise of any right or remedy which City may have by reason of such Event of Default or breach: 22.4.1. Termination. Terminate Lessee’s right to possession of the Property by any awful means, in which case this Lease shall terminate and Lessee shall immediately surrender possession of the Property, but not the Improvements, to City. In such event, City shall be entitled to recover from Lessee all damages incurred by City by reason of the Event of Default or breach, including but not limited to: 22.4.1.1. The cost of recovering possession of the Property and all Improvements constructed thereon; 22.4.1.2. Expenses of reletting, including necessary renovation and DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 31 Rev.: 1/29/15 alteration of the Property and the Improvements constructed thereon; 22.4.1.3. Reasonable attorneys’ fees; 22.4.1.4. The worth, at the time of the award of the unpaid Rent that had been earned at the time of termination of this Lease; and 22.4.1.5. The worth, at the time of award of the amount by which the unpaid Rent for the balance of the term after the time of such award exceeds the amount of such rental loss for the same period that Lessee proves could be reasonably avoided. 22.4.2. Continue Lease. Maintain Lessee’s right to possession, in which case this Lease shall continue in effect whether or not Lessee shall have abandoned the Property. In such event, City shall be entitled to enforce all of City’s rights and remedies under this Lease, including the right to recover Rent and other fees and payments as they become due hereunder. 22.4.3. Other Remedies. Pursue any other remedy now or hereafter available to City under the laws or judicial decisions of the State of California. City shall have all remedies provided by law and equity. 22.5. No Relief from Forfeiture After Event of Default. Lessee waives all rights of redemption or relief from forfeiture under California Code of Civil Procedure sections 1174 and 1179, and any other present or future law, in the event Lessee is evicted or City otherwise lawfully takes possession of the Property by reason of any Event of Default or breach of this Lease by Lessee. 22.6. Disposition of Abandoned Personal Property. If the Lessee fails to remove any personal property belonging to Lessee from the Property within forty-five (45) days after of the expiration or termination of this Lease, such personal property shall at the option of City be deemed to have been transferred to City. City shall have the right to remove and to dispose of such personal property without liability to Lessee or to any person claiming under Lessee, and the City shall have no need to account for such personal property. 23. INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly provided herein, any amount due City when not paid when due shall bear interest at the lesser of ten percent (10%) per year or the maximum rate then allowable by law from the date due. 24. HOLDING OVER. If Lessee remains in possession of the Property or any part thereof after the expiration of the Term, including any Extension Term (if any), such occupancy shall be a tenancy from month-to-month with all the obligations of this Lease applicable to Lessee and at a monthly rental obligation of two (2) times the Operations Period Rent or, as applicable, the Extension Term Rent, in effect at the time of expiration. Nothing contained in this Lease shall give to Lessee the DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 32 Rev.: 1/29/15 right to occupy the Property after the expiration of the term, or upon an earlier termination for breach. 25. ACCESS. 25.1. For Lessee. 25.1.1. Ingress & Egress. City hereby grants to Lessee, for the Term as defined in Section 4.1, a non-exclusive right-of-way for vehicular and pedestrian ingress and egress to the Property or the Improvements to the extent required by Lessee and as mutually agreed upon by the Parties. 25.1.2. Access to Sunlight. Lessee shall not cause or permit any interference with the Generating Facility’s access to sunlight; as such access exists as of the Effective Date. 25.1.3. Exclusive Access. Lessee is granted no exclusive access to the Property. 25.2. For City 25.3. Primary Use as Parking Structure. Lessee acknowledges and agrees that the Site, including the Property, retains primary use as a public parking structure operated by the City or it’s assignee at City’s sole discretion and with associated public and operator access. 25.4. Access for Inspection. City and City’s agents shall have the right to open or enter Lessee facilities on the Property at reasonable times, upon not less than twenty-four (24) hours prior notice to Lessee, for the purpose of inspecting same, showing same to prospective City, lenders or lessees, and making such alterations, repairs, improvements, or additions to the Property as City may deem necessary. City may at any time place on or about the Property any ordinary “For Sale” signs and City may at any time during the last one hundred twenty (120) days of the Term hereof place on or about the Property any ordinary “For Lease” signs, all without rebate of Rent or other fees, or liability to Lessee. 25.5. Security Measures. City shall have the right to require a reasonable security system, device, operation, or plan be installed and implemented to protect the Property or the Improvements. Should City, in its sole discretion, require Lessee to install such a security system associated with access to the Lessee’s Improvements, Lessee agrees to bear the sole cost and expense of any security system, device, operation or plan and the installation and implementation thereof. Lessee shall obtain City’s prior approval before installing, implementing or changing any City approved security system, device, operation or plan. 25.6. New Locks. Lessee may install new locks on all exterior doors of the Lessee’s Improvements, including exclusive equipment and facilities. Lessee shall advise City of such action and shall provide City with keys to said locks. Upon termination, Lessee shall leave new locks that shall become the Property of City. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 33 Rev.: 1/29/15 26. INSURANCE. 26.1. Lessee's responsibility for the Property begins immediately upon delivery and Lessee, at its sole cost and expense, and at no cost to City, shall purchase and maintain in full force and effect during the entire term of this Lease insurance coverage in amounts and in a form acceptable to City as set forth in Exhibit “G” (Insurance Requirements) attached hereto and incorporated herein by reference. Said policies shall be maintained with respect to Lessee’s employees, if any, and all vehicles operated on the Property. The policies shall include the required endorsements, certificates of insurance and coverage verifications as described in Exhibit “G” (Insurance Requirements). Lessee also agrees to secure renter's liability insurance. 26.2. Lessee shall deposit with the Lease Administrator, on or before the effective date of this Lease, certificates of insurance necessary to satisfy City that the insurance provisions of this Lease have been complied with, and to keep such insurance in effect and the certificates therefore on deposit with City during the entire term of this Lease. Should Lessee not provide evidence of such required coverage at least three (3) days prior to the expiration of any existing insurance coverage, City may purchase such insurance, on behalf of and at the expense of Lessee to provide six months of coverage. 26.3. City shall retain the right at any time to review the coverage, form, and amount of the insurance required hereby. If, in the opinion of the City’s risk manager (or comparable official), the insurance provisions in this Lease do not provide adequate protection for City and for members of the public using the Property, the Lease Administrator may require Lessee to obtain insurance sufficient in coverage, form, and amount to provide adequate protection as determined by the City’s risk manager. City's requirements shall be reasonable and shall be designed to assure protection from and against the kind and extent of risk that exists at the time a change in insurance is required. 26.4. The Lease Administrator shall notify Lessee in writing of changes in the insurance requirements. If Lessee does not deposit copies of acceptable insurance policies with City incorporating such changes within sixty (60) days of receipt of such notice, or in the event Lessee fails to maintain in effect any required insurance coverage, Lessee shall be in default under this lease without further notice to Lessee. Such failure shall constitute a material breach and shall be grounds for immediate termination of this Lease at the option of City. 26.5. The procuring of such required policy or policies of insurance shall not be construed to limit Lessee’s liability hereunder nor to fulfill the indemnification provision and requirements of this Lease. Notwithstanding the policy or policies of insurance, Lessee shall be obligated for the full and total amount of any damage, injury, or loss caused by or connected with this Lease or with use or occupancy of the Property. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 34 Rev.: 1/29/15 27. RESERVATION OF AVIGATIONAL EASEMENT. City hereby reserves for the use and benefits of the public, a right of avigation over the Properties for the passage of aircraft landing at, taking off, or operating from the adjacent airport operated by the County of Santa Clara. Lessee releases the City from all liability for noise, vibration, and any other related nuisance. 28. EMINENT DOMAIN. 28.1. If all or any part of the Properties (or the building in which the Properties are located) is condemned by a public entity in the lawful exercise of its power of eminent domain, this Lease shall cease as to the part condemned. The date of such termination shall be the effective date of possession of the whole or part of the Properties by the condemning public entity. 28.2. If only a part is condemned and the condemnation of that part does not substantially impair the capacity of the remainder to be used for the purposes required by this Lease, Lessee shall continue to be bound by the terms, covenants, and conditions of this Lease. However, the then monthly rent shall be reduced in proportion to the diminution in value of the Properties. If the condemnation of a part of the Properties substantially impairs the capacity of the remainder to be used for the purposes required by this Lease, Lessee may: 28.2.1. Terminate this Lease and thereby be absolved of obligations under this Lease which have not accrued as of the date of possession by the condemning public entity; or 28.2.2. Continue to occupy the remaining Properties and thereby continue to be bound by the terms, covenants and conditions of this Lease. If Lessee elects to continue in possession of the remainder of the Properties, the monthly rent shall be reduced in proportion to the diminution in value of the Properties. 28.2.3. Lessee shall provide City with written notice advising City of Lessee’s choice within thirty (30) days of possession of the part condemned by the condemning public entity. 28.3. City shall be entitled to and shall receive all compensation related to the condemnation, except that Lessee shall be entitled to: 28.3.1. That portion of the compensation which represents the value for the remainder of the Lease term of any Lessee-constructed improvements taken by the condemning public entity, which amount shall not exceed the actual cost of such improvements reduced in proportion to the relationship of the remaining Lease term to the original Lease term, using a straight line approach; and 28.3.2. Any amount specifically designated as a moving allowance or as compensation for Lessee’s personal property. Lessee shall have no claim against the City the value of any unexpired term of this Lease. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 35 Rev.: 1/29/15 29. POST-ACQUISITION TENANCY. Lessee hereby acknowledges that Lessee was not an occupant of the Property at the time the Property was acquired by City. Lessee further understands and agrees that as a post-acquisition Lessee, Lessee is not eligible and furthermore waives all claims for relocation assistance and benefits under federal, state or local law. 30. DISPUTE RESOLUTION. 30.1. Unless otherwise mutually agreed to, any controversies between Lessee and City regarding the construction or application of this Lease, and claims arising out of this Lease or its breach shall be submitted to mediation within thirty (30) days of the written request of one Party after the service of that request on the other Party. 30.2. The Parties may agree on one mediator. If they cannot agree on one mediator, the Party demanding mediation shall request the Superior Court of Santa Clara County to appoint a mediator. The mediation meeting shall not exceed one day (eight (8) hours). The Parties may agree to extend the time allowed for mediation under this Lease. 30.3. The costs of mediation shall be borne by the Parties equally. 30.4. Mediation under this section is a condition precedent to filing an action in any court. In the event of litigation arising out of any dispute related to this Lease, the Parties shall each pay their respective attorney's fees, expert witness costs and cost of suit, regardless of the outcome of the litigation. 31. NON-LIABILITY OF OFFICIALS AND EMPLOYEES OF THE CITY. No official or employee of City shall be personally liable for any default or liability under this agreement. 32. NON-DISCRIMINATION 32.1. Non-discrimination in Lease Activities. Lessee agrees that in the performance of this Lease and in connection with all of the activities Lessee conducts on the Property, it shall not discriminate against any employee or person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. Lessee acknowledges that is familiar with the provisions set forth in Section 2.30.510 of the Palo Alto Municipal Code relating to nondiscrimination in employment and Section 9.73 of the Palo Alto Municipal Code relating to City policy against arbitrary discrimination. 32.2. Human Rights Policy. In connection with all activities that are conducted upon the Properties, Lessee agrees to accept and enforce the statements of policy set forth in Section 9.73.010 which provides: “It is the policy of the City of Palo Alto to affirm, support and protect the human rights of every person within its jurisdiction. These rights include, but are not limited to, equal economic, political, and educational opportunity; equal accommodations in all business establishments in the city; and equal service and DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 36 Rev.: 1/29/15 protection by all public agencies of the city.” 33. INDEPENDENT CONTRACTOR. It is agreed that Lessee shall act and be an independent contractor and not an agent nor employee of City. 34. CONFLICT OF INTEREST. 34.1. Lessee shall at all times avoid conflict of interest or appearance of conflict of interest in performance under this Lease. Lessee warrants and covenants that no official or employee of City nor any business entity in which any official or employee of City is interested: 34.1.1. Has been employed or retained to solicit or aid in the procuring of this agreement; or 34.1.2. Will be employed in the performance of this agreement without the divulgence of such fact to City. 34.2. In the event that City determines that the employment of any such official, employee or business entity is not compatible with such official's or employee's duties as an official or employee of City, Lessee upon request of City shall immediately terminate such employment. 34.3. Violation of this provision constitutes a serious breach of this Lease and City may terminate this Lease as a result of such violation. 35. MEMORANDUM OF LEASE.1 Following execution of this Lease, either party, at its sole expense, shall be entitled to record the Memorandum of Lease in the form attached hereto as Exhibit “F” (Memorandum of Lease) in the official records of Santa Clara County, which Memorandum shall be executed contemporaneously with this Lease. Upon termination or expiration of this Lease, Lessee shall execute and record a quitclaim deed as to its leasehold interest. 36. ESTOPPEL CERTIFICATE. Lessee shall, from time to time, upon at least thirty (30) days prior written notice from City, execute, acknowledge and deliver to City a statement in writing: 36.1. Certifying this Lease is unmodified and in full force and effect, or, if modified, stating the nature of the modification and certifying that the Lease, as modified, is in full force and effect, and the date to which the rental and other charges, if any, have been paid; and, 36.2. Acknowledging that there are not to Lessee’s knowledge, any defaults, or stating if any defaults are claimed, any statement may be relied upon by any prospective City or encumbrancer of the City Property. 1 NTD: Note to Palo Alto – Memo of Lease needs to be prepared. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 37 Rev.: 1/29/15 37. LIENS. Lessee agrees at its sole cost and expense to keep the Property free and clear of any and all claims, levies, liens, encumbrances or attachments. Notwithstanding the Generating Facility’s presence as a fixture on the site, Lessee shall not directly or indirectly cause, create, incur, assume or suffer to exist any mortgage, pledge, lien (including mechanics’, labor or materialman’s lien), charge, security interest, encumbrance or claim on or with respect to the Generating Facility or any interest therein. Lessee also shall pay promptly before a fine or penalty may attach to the Generating Facility any taxes, charges or fees of whatever type of any payments for which Lessee is responsible. 38. SECURITY. Lessee shall provide and take reasonable measures for security of the Improvements installed on the Property. 39. NOTICES. All notices to the Parties shall, unless otherwise requested in writing, be sent as follows: 39.1. To City: City of Palo Alto Attention: Hamid Ghaemmaghami 250 Hamilton Avenue Palo Alto, CA 94301 Phone: (650) 329-2264 Email: hamid.thaemmaghami@cityofpaloalto.org 39.2. To Lessee: Name: Zach Rubin Address: 329 Middlefield Rd Palo Alto, CA 94301 Phone: 650-847-1191 Email: zrubin@komunaenergy.com 39.3. All notices may be served on one Party by the other in person, by first class mail, or by certified mail whether or not said mailing is accepted the other Party. If notice is sent via facsimile, a signed, hard copy of the material shall also be mailed. The Business Day the facsimile was sent shall control the date notice was deemed given if there is a facsimile machine generated document on the date of transmission. A facsimile transmitted after 1:00 p.m. on a Friday shall be deemed to have been transmitted on the following Monday. These addresses shall also be used for service of process. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 38 Rev.: 1/29/15 40. TIME. Time shall be of the essence in this Lease. 41. AMENDMENTS. No alteration or variation of the terms of this Lease shall be valid unless made in writing and signed by the Parties to this Lease. 42. SIGNING AUTHORITY. If this Lease is not signed by all Lessees named herein, the person actually signing warrants that he/she has the authority to sign for the others. 43. SURRENDER OF LEASE NOT MERGER. The voluntary or other surrender of this Lease by Lessee, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of City, terminate all or any existing subleases or subtenancies, or may, at the option of City, operate as an assignment of any and all such subleases or subtenancies. 44. INTEGRATED DOCUMENT. This Lease, including any Exhibits attached hereto, embodies the entire agreement between City and Lessee. No other understanding, agreements, conversations or otherwise, with any officer, agent or employee of City prior to execution of this Lease shall affect or modify any of the terms or obligations contained in any documents comprising this Lease. Any such verbal agreement shall be considered as unofficial information and in no way binding upon City. All agreements with City are subject to approval of the City Council before City shall be bound thereby. 45. WAIVER. Waiver by City of one or more conditions of performance, of an Event of Default, or of any breach of a condition under this Lease shall not be construed as a waiver of any other condition of performance or subsequent Events of Default or breaches. The subsequent acceptance by a Party of the performance of any obligation or duty by another Party shall not be deemed to be a waiver of any term or condition of this Lease. The exercise of any remedy, right, option or privilege hereunder by City shall not preclude City from exercising the same or any and all other remedies, rights, options and privileges hereunder and City's failure to exercise any remedy, right, option or privilege at law or equity, or otherwise which City may have, shall not be construed as a waiver. 46. SEVERABILITY CLAUSE. If any provision of this Lease is held to be illegal, invalid or unenforceable in full or in part, for any reason, then such provision shall be modified to the minimum extent necessary to make the provision legal, valid and enforceable, and the other provisions of this Lease shall not be affected thereby. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 39 Rev.: 1/29/15 47. NO CONSTRUCTION AGAINST DRAFTING PARTY The Parties agree that this Lease shall be fairly interpreted in accordance with its terms without any strict construction in favor of or against any other Party. 48. GOVERNING LAW. This Lease shall be governed and construed in accordance with the statutes and laws of the State of California. 49. VENUE. In the event that suit shall be brought by any Party to this Lease, the Parties agree that venue shall be exclusively vested in the state courts of the County of Santa Clara. 50. COMPLIANCE WITH LAWS. The Parties hereto shall comply with all applicable laws, ordinances, codes and regulations of the federal, state and local governments in the performance of their rights, duties and obligations under this Lease. 51. BROKERS. Each Party represents that is has not had dealings with any real estate broker, finder, or other person, with respect to this lease in any manner. Each Party shall indemnify and hold harmless the other Party from all damages resulting from any claims that may be asserted against the other Party by any broker, finder, or other person with whom such Party has or purportedly has dealt. 52. COUNTERPARTS Any number of counterparts of this Lease maybe executed and each shall have the same force and effect as the original. 53. NO THIRD PARTY BENEFICIARIES Nothing in this Lease shall provide any benefit to any third party or entitle any third party to any claim, cause of action, remedy or right of any kind, it being the intent of the Parties that this Lease shall not be construed as a third party beneficiary contract. 54. SURVIVAL Any provision of this Lease that expressly or by implication comes into or remains in full force following the termination or expiration of this Lease, including, without limitation section 19 (Hold Harmless/Indemnification) shall survive the termination or expiration of this Lease. 55. PREVAILING WAGE Lessee is required to pay general prevailing wages as defined in Subchapter 3, Title 8 of the California Code of Regulations and Section 16000 et seq. and Section 1773.1 of the California DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 40 Rev.: 1/29/15 Labor Code. Pursuant to the provisions of Section 1772 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of worker needed to execute this Lease from the Director of the Department of Industrial Relations (“DIR”). Copies of these rates may be obtained at the Purchasing Division’s office of the City of Palo Alto. Lessee shall provide a copy of prevailing wage rates to any staff or subcontractor hired, and shall pay the adopted prevailing wage rates at a minimum. Lessee shall comply with the provisions of all sections, including, but not limited to, Sections 1775, 1776, 1777.5, 1782, 1810, and 1813, of the Labor Code pertaining to prevailing wages. [SIGNATURES ON NEXT PAGE] DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page 41 Rev.: 1/29/15 IN WITNESS WHEREOF, the Parties have executed this Lease as of the Effective Date. CITY: LESSEE: CITY OF PALO ALTO KOMUNA PALO ALTO LLC By: _______________________ By: __________________________ City Manager Its: ___________________________ ATTEST: By: ________________________ City Clerk APPROVED AS TO FORM: By: ________________________ Senior Deputy City Attorney DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Zach Rubin   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-1 Rev. 11/18/15  999020‐eml      EXHIBIT “A” DEFINITIONS A-1. “275 Cambridge Garage” means the City’s parking garage facility located in Palo Alto, California at 275 Cambridge Avenue. A-2. “475 Cambridge Garage” means the City’s parking garage facility located in Palo Alto, California at 475 Cambridge Avenue. A-3. “Access Property” means a non-exclusive right-of-way for vehicular and pedestrian ingress and egress to the Premises to the extent required by Lessee to install, maintain, and operate the Generating Facilities, and to install the EV Chargers and Infrastructure, as mutually agreed upon by the Parties. A-4. “Air Rights Parcel” has the meaning set forth in Exhibit “C” (Description of Premises) attached to this Lease. A-5. “Bryant Garage” means the City’s parking garage facility located in Palo Alto, California at 445 Bryant Street. A-6. “Business Day” means any day other than Saturday, Sunday, or dates the City is closed for a federal, California, or City holiday. A-7. “City” means the City of Palo Alto, a California chartered Municipal Corporation and all successors and assigns. A-8. “CLEAN PPA” has the meaning set forth in the Recitals of this Lease. A-9. “CLEAN PPA Interconnection Agreement” means the Interconnection Agreement that Lessee must execute with City in connection with the CLEAN PPA. A-10. “CLEAN Program” means the Palo Alto Clean Local Energy Accessible Now Program. A-11. “Common Areas” means those areas of the Site other than the Improvements. A-12. “Commercial Operation Date” means the date on which Commercial Operation of the Generating Facility begins, as specified in Exhibit “E” (Work Schedule). A-13. “Construction Period” has the meaning set forth in section 5.1.2.1.2 of this Lease. A-14. “Construction Period Rent” has the meaning set forth in section 5.1.2.3 of this Lease. A-15. “Construction Start Date” means the date on which Lessee begins construction of the Generating Facility; or in the event that a contractor is constructing the Generating Facility on Lessee’s behalf, the date Lessee delivers to contractor the Notice to Proceed for the Generating Facility. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-2 Rev. 11/18/15  999020‐eml      A-16. “Debtor” has the meaning set forth in section 23.1.4.2 of this Lease. A-17. “Delay Liquidated Damages” has the meaning set forth in section 6.2.2 of this Lease. A-18. “Delayed Construction Period” has the meaning set forth in section 5.1.2.1.4 of this Lease. A-19. “Effective Date” has the meaning set forth in the Preamble to this Lease. A-20. “Electric Vehicle Chargers and Infrastructure” or “EV Chargers and Infrastructure” means three (3) Chargepoint brand electric vehicle chargers, or an equivalent acceptable to City in its sole discretion, each with two level 2 ports capable of charging six vehicles in each of the 275 Cambridge Garage, the 475 Cambridge Garage and the Bryant Garage; and installation of wire, conduit, switchgear and any electrical capacity upgrades necessary to support an additional ten (10) electric vehicle chargers capable of charging upon full installation twenty (20) vehicles in each of the 275 Cambridge Garage, the 475 Cambridge Garage, the Bryant Garage and the Webster Garage. A-21. “EV Chargers Construction Period” has the meaning set forth in Exhibit “E” (Work Schedule). A-22. “Force Majeure” means (a) natural phenomena, such as storms, hurricanes, floods, lightening and earthquakes; (b) explosions or fires arising from lightening or other causes unrelated to the acts or omissions of the Lessee; (c) acts of war or public disorders, civil disturbances, riots, insurrection, sabotage, epidemic, terrorist acts, or rebellion; and (d) acts of God. Force Majeure shall not include equipment failures or acts or omissions of Lessee’s agents, suppliers or subcontractors, except to the extent such acts or omissions arise from Force Majeure. Changes in prices for electricity or solar equipment shall not constitute Force Majeure. In the event any work performed by Lessee or Lessee’s contractors results in a strike, lockout, and/or labor dispute, such strike, lockout, and/or labor dispute shall not be considered Force Majeure. A-23. “Generating Facility” or “Generating Facilities” means, at times individually and others collectively, the four (4), integrated systems for the generation of electricity from solar energy with a capacity of 1.3MW to be installed, maintained, and operated by Lessee at the Property in accordance with the specifications set forth in Exhibit “D” (Improvements), consisting of, without limitation, photovoltaic panels and associated equipment including, without limitation, controls, meters, switches, connections, conduit, wires and connections, mounting substrates or supports, power inverters, metering and service equipment, and utility interconnections. A-24. “Ground Floor Area” has the meaning set forth in Exhibit “C” (Description of Premises) attached to this Lease. A-25. “Hazardous Materials” means Any toxic or hazardous substance, material or waste or any pollutant or contaminant, or infectious or radioactive material, including but not limited to, those substances, materials, or wastes regulated now or in the future under any of the following statutes or regulations and any and all of those substances included within the definitions of “hazardous substances”, “hazardous waste”, “hazardous chemical substance or mixture”, “imminently hazardous chemical substance or mixture,” “toxic substances,” “hazardous air pollutant”, “toxic DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-3 Rev. 11/18/15  999020‐eml      pollutant” or “solid waste” in the: CERCLA or Superfund as amended by SARA, 42 U.S.C. Sec. 9601 et seq., RCRA, 42 U.S.C. Sec. 6901 et seq., CWA., 33 U.S.C. Sec. 1251 et seq., CAA, 42 U.S.C. 78401 et seq., TSCA, 15 U.S.C. Sec. 2601 et seq., the Refuse Act of 1899, 33 U.S.C. Sec. 407, OSHA, 29 U.S.C. 651 et seq.; hazardous Materials Transportation Act, 49 U.S.C. Sec. 1801 et seq., USDOT Table (40 CFR Part 302 and amendments) or the EPA Table (40 CFR Part 302 and amendments), California Superfund, Cal. Health & Safety Code Sec. 25300 et seq., Cal. Hazardous Waste Control Act, Cal. Health & Safety Code Section 25100 et seq., Porter-Cologne Act, Cal. Water Code Sec. 13000 et seq., Hazardous Waste Disposal Land Use Law, Cal. Health & Safety Code Sec. 25220 et seq., Proposition 65, Cal. Health and Safety Code Sec. 25249.5 et seq., Hazardous Substances Underground Storage Tank Law, Cal. Health & Safety Code Sec. 25280 et seq., California Hazardous Substance Act, Cal. Health & Safety Code Sec. 28740 et seq., Air Resources Law, Cal. Health & Safety Code Sec. 39000 et seq., Hazardous Materials Release Response Plans and Inventory, Cal. Health & Safety Code Secs. 25500-25541, TCPA, Cal. Health and Safety Code Secs. 25208 et seq., and regulations promulgated pursuant to said laws or any replacement thereof, or as similar terms are defined in the federal, state and local laws, statutes, regulations, orders or rules; and any and all other substances, materials, and wastes which are, or in the future become, regulated under applicable local, state or federal law for the protection of health or the environment, or which are classified as hazardous or toxic substances, materials or wastes, pollutants or contaminants, as defined, listed or regulated by any federal, state or local law, regulation or order or by common law decision, including without limitation: Trichloroethylene, tetracholoethylene, perchloroethylene and other chlorinated solvents; any petroleum products or fractions thereof; Asbestos, Polychlorinated biphenyls; flammable explosives; urea formaldehyde; and radioactive materials and waste. A-26. “Improvements” means all physical construction by Lessee on the Site as described more particularly in Exhibit “D”, including the Generating Facility and EV Chargers and Infrastructure described therein. A-27. “In-Lieu Parking Fee” has the meaning set forth in section 6.1 of this Lease. A-28. “Initial Period” has the meaning set forth in section 5.1.2.1.1 of this Lease. A-29. “Initial Period Rent” has the meaning set forth in section 5.1.2.2 of this Lease. A-30. “Insurance Trustee” has the meaning set forth in section 20.3.1.2 of this Lease. A-31. “Lease” means this Lease Agreement between the City of Palo Alto and Komuna Palo Alto LLC, as the same may be amended from time to time. A-32. “Lease Administrator” means, for City the City Manager or his/her designee and, for Lessee Mr. Zach Rubin. A-33. “Lessee” means Komuna Palo Alto LLC, and any successors and assigns permitted pursuant to section 22 of this Lease. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-4 Rev. 11/18/15  999020‐eml      A-34. “Lessee Event of Default” has the meaning set forth in Section 23.1 of this Lease. A-35. “Lessor Event of Default” has the meaning set forth in Section 23.2 of this Lease. A-36. “Notice to Pay Rent or Quit” has the meaning set forth in section 23.1.2 of the Lease. A-37. “Operations Period” has the meaning set forth in section 5.1.2.1.5 of this Lease. A-38. “Operations Period Rent” has the meaning set forth in section 5.1.2.3 of this Lease. A-39. “Option Exercise Notice” has the meaning set forth in section 4.1.2.3 of this Lease. A-40. “Parking Elimination Fees” has the meaning set forth in Section 6.1 of this Lease. A-41. “Parking Fees” means, collectively, any one-time Parking Elimination Fees and any Delay Liquidated Damages. A-42. “Permits” means all federal, state, and City permits, licenses, certificates, approvals, variances and other entitlements necessary for the installation and operation of the Improvements. A-43. “Premises” means that portion of the Site(s), described more particularly in Exhibit “C” on which the Improvements (described more particularly in Exhibit “D”) shall be constructed, installed and maintained, including all installations or equipment required, as a condition of Lessee’s Permits, for the installation, operations and maintenance of the Improvements. A-44. “Property” or “Properties” means the Premises, described more specifically in Exhibit “C” and Access Property, collectively. A-45. “Real Property Taxes” means: A-45.1. All taxes, assessments, levies and other charges, general and special, foreseen and unforeseen, now or hereafter imposed by any governmental or quasi-governmental authority or special district having the direct or indirect power to tax or levy assessments, which are levied or assessed against or with respect to: A-45.1.1. Value, occupancy, use or possession of the Premises and/or the Improvements; A-45.1.2. Any improvements, fixtures, equipment and other real or personal property of Lessee that are an integral part of the Premises; or, A-45.1.3. Use of the Premises, Improvements public utilities or energy within the Premises. A-45.2. “Real Property Taxes” shall also mean all charges, levies or fees imposed by reason of environmental regulation or other governmental control of the premises and/or the DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-5 Rev. 11/18/15  999020‐eml      Improvements, new or altered excise, transaction, sales, privilege, assessment, or other taxes or charges now or hereafter imposed upon City as a result of this Lease, and all costs and fees (including attorneys’ fees) incurred by City in contesting any real property taxes and in negotiating with public authorities as to any real property taxes affecting the Premises. If any real property taxes are based upon property or rents unrelated to the Premises and/or the Improvements, then only that part of such tax that is fairly allocable to the Premises and/or the Improvements, as determined by City, on the basis of the assessor’s worksheets or other available information, shall be included within the meaning of the term “real property taxes.” A-46. “Rent” means, collectively, the Initial Period Rent, Construction Period Rent, and the Operations Period Rent. A-47. “Required Uses” has the meaning set forth in section 8.1 of this Lease. A-48. “Restoration” has the meaning set forth in section 20.3.1 of this Lease. A-49. “Scheduled Construction Period” has the meaning set forth in section 5.1.2.1.3 of this Lease. A-50. “Security Deposit” has the meaning set forth in section 7.1 of this Lease. A-51. “Site” means, collectively, the four (4) City parking garage facilities that are the subject of this Lease described more specifically in Exhibit “B” (Description of Site), including the 275 Cambridge Garage, the 475 Cambridge Garage, the Webster Garage, and the Bryant Garage. A-52. “Term” has the meaning set forth in section 4.1.1.1 of this Lease. A-53. “Total Rent Amount” means an annual amount of twenty thousand dollars ($20,000.00). A-54. “Transfer” has the meaning set forth in section 13.1.3.2 of this Lease. A-55. “Webster Garage” means the City’s parking garage facility located in Palo Alto, California at 520 Webster Street. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-6 Rev. 11/18/15  999020‐eml      EXHIBIT “B” DESCRIPTION OF SITE “Site” means, collectively, the four (4) City parking garage facilities that are the subject of this Lease, including the 275 Cambridge Garage, the 475 Cambridge Garage, the Webster Garage, and the Bryant Garage: SITE NAME SITE LOCATION 1 475 Cambridge Garage 475 Cambridge Avenue, Palo Alto, California 2 275 Cambridge Garage 275 Cambridge Avenue, Palo Alto, California 3 Webster Garage 520 Webster Street, Palo Alto, California 4 Bryant Garage 445 Bryant Street, Palo Alto, California DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-7 Rev. 11/18/15  999020‐eml      EXHIBIT “C” DESCRIPITION OF PREMISES “Premises” means, collectively, that portion of each of the Sites described herein on which the Generating Facility (described more particularly in Exhibit “D” (Improvements)) shall be constructed, installed and maintained, including all installations or equipment required, as a condition of Lessee’s Permits, for the installation, operations and maintenance of the Generating Facility: PREMISES NAME GROUND FLOOR AREA AIR RIGHTS PARCEL Ground floor area to allow for installation, operation and maintenance of Improvements, including the necessary support structures and equipment for the Generating Facility as reflected and described more fully in Exhibit “D” (Improvements) Rights to use the space at the designated distance above the Ground Floor Area of the top floor level at each Site to allow for installation, operation and maintenance of Generating Facilities, as reflected and described more fully in Exhibit “D” (Improvements) Loss of Parking Spaces NOT TO EXCEED TOP FLOOR LEVEL # AIR RIGHTS PARCEL SQ. FT. 1 475 Cambridge Garage 2 spaces 2 28,600 2 275 Cambridge Garage 2 spaces 2 27,500 3 Webster Garage 2 spaces 6 29,700 4 Bryant Garage 2 spaces 5, portion of 4 32,475 The term “Premises” shall also include any necessary Access Property to allow for Lessee’s (a) installation, construction, maintenance and operation of the Generating Facilities; and (b) construction and installation of the EV Chargers and Infrastructure described in Exhibit “D” (Improvements), which upon installation will be solely owned, operated and maintained by City. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-8 Rev. 11/18/15  999020‐eml      EXHIBIT “D” IMPROVEMENTS Lessee agrees to provide City with diagrams and detailed description of the Improvements, including the Generating Facilities and the EV Chargers and Infrastructure in accordance with the following schedule: 1. Initial diagrams/descriptions at the planning/entitlement stage; 2. Updated diagrams/descriptions at the plan check phase; and 3. Final diagrams within four (4) days of Lessee’s receipt of its Building Permit from City. Upon acceptance by City, each submission of such diagrams and descriptions from Lessee to City shall be incorporated into this lease, and supersede any prior submission. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-9 Rev. 11/18/15  999020‐eml      EXHIBIT “E” WORK SCHEDULE WORK SCHEDULE FOR GENERATING FACILITIES Within ten (10) days of City’s issuance of a building permit to Lessee, Lessee shall provide City with an updated version of the Work Schedule for Generating Facilities to be signed by both City and Lessee. The updated Work Schedule for Generating Facilities shall be substantially in the form of this Exhibit, mutually agreeable to City and Lessee, shall identify with specificity the start and end dates of the Scheduled Construction Period and areas of any Site to which the City will lose or have limited access over the course of the Scheduled Construction Period. Such updated Work Schedule shall supersede this Work Schedule for Generating Facilities SITE NAME SCHEDULED CONSTRUCTION PERIOD DESCRIPTION OF SITE AREAS WITH LOST OR LIMITED ACCESS Time period from Construction Start Date to Commercial Operation Date 1 475 Cambridge Garage 6 weeks Level 2 completely closed to third party and City pedestrian and vehicle traffic for duration of Scheduled Construction Period 2 275 Cambridge Garage 6 weeks Level 2 completely closed to third party and City pedestrian and vehicle traffic for duration of Scheduled Construction Period 3 Webster Garage 6 weeks Level 6 completely closed to third party and City pedestrian and vehicle traffic for duration of Scheduled Construction Period 4 Bryant Garage 6 weeks Level 5, and a portion of Level 4 completely closed to third party and City pedestrian and vehicle traffic for duration of Scheduled Construction Period CITY: LESSEE: CITY OF PALO ALTO KOMUNA PALO ALTO LLC By: _______________________ By: __________________________ City Manager Its: ___________________________ DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Zach Rubin   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-10 Rev. 11/18/15  999020‐eml      WORK SCHEDULE FOR EV CHARGERS AND INFRASTRUCTURE Within ten (10) days of City’s issuance of a building permit to Lessee, Lessee shall provide City with an updated version of the Work Schedule for EV Chargers and Infrastructure to be signed by both City and Lessee. The updated Work Schedule for EV Chargers and Infrastructure shall be substantially in the form of this Exhibit, shall be mutually agreeable to City and Lessee, shall identify with specificity the start and end dates of the EV Charger Construction Period, any areas of any Site to which the City will lose or have limited access over the course of the Scheduled Construction Period, any additional compensation (if any) due from Lessee to City for loss or limitation of access. Such updated Work Scheduled shall supersede this Work Schedule for EV Chargers and Infrastructure. SITE NAME EV CHARGER CONSTRUCTION PERIOD DESCRIPTION OF SITE AREAS WITH LOST OR LIMITED ACCESS Start and Completion Date for Lessee installation of EV Chargers and Infrastructure 1 475 Cambridge Garage 1 week 2 275 Cambridge Garage 1 week 3 Webster Garage 1 week 4 Bryant Garage 1 week CITY: LESSEE: CITY OF PALO ALTO KOMUNA PALO ALTO LLC By: _______________________ By: __________________________ City Manager Its: ___________________________ DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Zach Rubin   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-11 Rev. 11/18/15  999020‐eml      EXHIBIT “F” MEMORANDUM OF LEASE RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: [City of Palo Alto Administrative Services Department, Real Estate Division 250 Hamilton Avenue Palo Alto, CA 94303] MEMORANDUM OF LEASE This Memorandum of Lease (“Memorandum”) is entered into as of this ____ day of ___________, 2016, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“Lessor”) and KOMUNA PALO ALTO LLC, a Delaware limited liability company ("Lessee"), with respect to that certain Lease Agreement dated ________________, 2016 (“Lease”), between Lessor and Lessee. Pursuant to the Lease, Lessor leases to Lessee and Lessee leases from Lessor a portion of each of the parking facilities known as the 275 Cambridge Garage, the 475 Cambridge Garage, the Bryant Garage and the Webster Garage, located in the City of Palo Alto, County of Santa Clara, California, for the purpose of installing constructing, operating and maintaining a solar powered electric generating facilities on each facility (the “Generating Facilities”) to be owned, maintained and operated by Lessee, all subject to the terms and conditions more fully set forth in the Lease. Pursuant to the Lease, Lessor leases to Lessee and Lessee leases from Lessor a portion of each of the parking facilities known as the 275 Cambridge Garage, the 475 Cambridge Garage and the Bryant Garage, located in the City of Palo Alto, County of Santa Clara, California, for the purpose of installing three (3) electric vehicle chargers capable of charging six vehicles, and a portion of each of the parking facilities known as the 275 Cambridge Garage, the 475 Cambridge Garage, the Bryant Garage and the Webster Garage, located in the City of Palo Alto, County of Santa Clara, California, for the purpose of installing wire, conduit, switchgear and any electrical capacity upgrades necessary to support an additional ten (10) electric vehicle chargers capable of charging upon full installation twenty (20) vehicles; all of which upon installation will be owned, maintained and operated by City; and all subject to the terms and conditions more fully set forth in the Lease. The Lease shall commence on ____________, and shall end on the date that is twenty-five (25) years after the commencement of commercial operation date of the all of the Generating Facilities. Pursuant to Section 4.3 of the Lease, Lessor has the right to purchase all Generating Facilities or one or DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-12 Rev. 11/18/15  999020‐eml      more individual Generating Facilities (“Buy-Out Option”) on the date that is ten (10), fifteen (15), twenty (20) and twenty-five (25) years after commencement of commercial operation of the Generating Facilities on the first parking facility. This Memorandum is solely for recording purposes and shall not be construed to alter, modify, amend or supplement the Lease, of which this is a memorandum. Lessor and Lessee desire to have this Memorandum recorded in the Official Records of Santa Clara County, California, in order to put interested parties on notice of the Buy-Out Option. In Witness Whereof, the parties hereto have executed this Memorandum on the day and year first written above. LESSOR: CITY OF PALO ALTO, a California chartered municipal corporation By: ____________________ Its: ____________________ ATTEST: By: ________________________ City Clerk APPROVED AS TO FORM: By: ________________________ Senior Deputy City Attorney LESSEE: KOMUNA PALO ALTO LLC, a Delaware limited liability company By: ____________________ Its: ____________________ DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Zach Rubin   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-13 Rev. 11/18/15  999020‐eml      STATE OF CALIFORNIA ) COUNTY OF SANTA CLARA ) On ________________, before me, ___________________, a notary public in and for said County, personally appeared _______________________________ who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. ________________________ DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-14 Rev. 11/18/15  999020‐eml      Exhibit A 475 Cambridge Garage 275 Cambridge Garage Webster Garage Bryant Garage DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-15 Rev. 11/18/15  999020‐eml      EXHIBIT “G” INSURANCE REQUIREMENTS STANDARD INSURANCE REQUIREMENTS Insurance Requirements for Lessee: Lessee shall purchase and maintain the insurance policies set forth below on all of its operations under this Lease at its sole cost and expense. Such policies shall be maintained for the full term of this Lease and the related warranty period (if applicable). For purposes of the insurance policies required under this Lease, the term "City" shall include the duly elected or appointed council members, commissioners, officers, agents, employees and volunteers of the City of Palo Alto, California, individually or collectively. Coverages (RL 28.1A) S Minimum Scope of Insurance Coverage shall be at least as broad as: 1) Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001). 2) Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any auto). 3) Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance (for lessees with employees). 4) Property insurance against all risks of loss to any tenant improvements or betterments The policy or policies of insurance maintained by Lessee shall provide the following limits and coverages: POLICY MINIMUM LIMITS OF LIABILITY (1) Commercial General Liability $1,000,000 per each occurrence for bodily injury, personal injury and property damage (2) Automobile Liability $ 1,000,000 Combined Single Limit Including Owned, Hired and Non-Owned Automobiles (3) Workers’ Compensation Statutory Employers Liability $1,000,000 per accident for bodily injury or disease (4) Lessee’s Property Insurance DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-16 Rev. 11/18/15  999020‐eml      Lessee shall procure and maintain property insurance coverage for: (a) all office furniture, trade fixture, office equipment, merchandise, and all other items of Lessee’s property in, on, at, or about the Premises and the building, include property installed by, for, or at the expense of Lessee; (b) all other improvements, betterments, alterations, and additions to the premises. Lessee’s property insurance must fulfill the following requirements: (a) it must be written on the broadest available “all risk” policy form or an equivalent form acceptable City of Palo Alto, including earthquake sprinkler leakage. (b) for no less than ninety percent (90%) of the full replacement cost (new without deduction for depreciation) of the covered items and property; and (c) the amounts of coverage must meet any coinsurance requirements of the policy or policies. (RL 28.2) Deductibles and Self-Insured Retentions Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees and volunteers; or the Lessee shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. Insurance shall be in full force and effect commencing on the first day of the term of this Lease. Each insurance policy required by this Lease shall: 1. Be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. 2. Include a waiver of all rights of subrogation against the City and the members of the City Council and elective or appointive officers or employees, and each party shall indemnify the other against any loss or expense including reasonable attorney fees, resulting from the failure to obtain such waiver. 3. Name the City of Palo Alto as a loss payee on the property policy. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-17 Rev. 11/18/15  999020‐eml      4. Provide that the City, its officers, officials, employees, agents and volunteers are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of the Lessee; products and completed operations of the Lessee; premises owned, occupied or used by the Lessee; or automobiles owned, leased, hired or borrowed by the Lessee. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees, agents or volunteers. 5. Provide that for any claims related to this Lease, the Lessee's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, agents and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents or volunteers shall be excess of the Lessee's insurance and shall not contribute with it. 6. Provide that any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees, agents or volunteers. 7. Provide that Lessee's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. 8. Lessee agrees to promptly pay to City as Additional Rent, upon demand, the amount of any increase in the rate of insurance on the Premises or on any other part of Building that results by reason of Lessee’s act(s) or Lessee’s permitting certain activities to take place. Acceptability of Insurers All insurance policies shall be issued by California-admitted carriers having current A.M. Best's ratings of no lower than A-:VII. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 1 POWER PURCHASE AGREEMENT ELIGIBLE RENEWABLE ENERGY RESOURCE (Palo Alto Clean Local Energy Accessible Now Program) This Power Purchase Agreement - Eligible Renewable Energy Resource, dated, for convenience, , 20 (the “Effective Date”), is entered into by and between the CITY OF PALO ALTO, a California chartered municipal corporation, and , a corporation (individually, a “Party” and, collectively, the “Parties”). RECITALS 1.The Buyer has adopted and implemented its CLEAN Program, which allows an owner of a qualifying electric generation system to sell to the Buyer the power output of a small-scale distributed generation Eligible Renewable Energy Resource, subject to the CLEAN Program’s rules and requirements. 2.The Seller owns or operates and desires to interconnect its Facility in parallel with Buyer’sDistribution System and sell the Energy produced by its Facility, net of Station Service Load, directly to the Buyer in furtherance of the CLEAN Program. 3.The Parties do not intend this Agreement to constitute an agreement by the Buyer to provide retail electrical service to the Seller. 4.The Parties wish to enter into a power purchase agreement for the sale and purchase of theOutput of the Facility. The Parties will enter into a separate “Interconnection Agreement” in connection with this Agreement. NOW THEREFORE, in consideration of the foregoing recitals and the following covenants, terms and conditions, the Parties agree, as follows: AGREEMENT 1.1 DEFINITIONS The initially capitalized terms, whenever used in this Agreement, have the meanings set forth below, unless they are otherwise herein defined. The terms “include,” “includes,” and “including,” when used in this Agreement, shall mean, respectively, “include, without limitation,“ “includes, without limitation” and “including, without limitation.” “Agreement” means this Power Purchase Agreement – Eligible Renewable Energy Resource between the Buyer and the Seller. “Business Day” means any day except a Saturday, Sunday, or a day that the City observes as a regular holiday under Palo Alto Municipal Code section 2.08.100(a). “Buyer” refers to the City of Palo Alto, California, with a principal place of business at 250 Hamilton Avenue, Palo Alto, California 94301. “Buyer’s Distribution System” means the wires, transformers, and related equipment used by the Buyer to deliver electric power to the Buyer’s retail customers, typically at sub-transmission level voltages or lower. “CAISO” means the California Independent System Operator Corporation, or successor entity. “CAISO Tariff” means the CAISO FERC Electric Tariff, as amended. “Capacity” means the ability of a generator at any given time to produce Energy at a specified rate, as EXHIBIT "H" FORM OF CLEAN PPA DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 2 measured in megawatts (“MW”) or kilowatts (“kW”), and any reporting rights associated with it. “Capacity Attributes” means any current or future defined characteristic, certificate, tag, credit, or ancillary service attribute, whether general in nature or specific as to the location or any other attribute of the Facility, intended to value any aspect of the Contract Capacity of the Facility to produce Energy or ancillary services, including contributions towards Resource Adequacy (including those requirements defined in Section 40 of the CAISO Tariff) or reserve requirements (if any), and any other reliability or power attributes. “CEC” means the California Energy Resources Conservation and Development Commission, or successor agency. “Certificate of RPS Eligibility” means a certificate issued by the CEC as evidence of RPS Certification of the Facility. “City” means the government of the City of Palo Alto, California. “CLEAN Program” refers to the Palo Alto Clean Local Energy Accessible Now Program, a renewable energy program established by the City by adoption of resolution number , dated , of the Palo Alto City Council, whereby the Buyer will purchase from the Seller the Output of Eligible Renewable Energy Resources that meet specified criteria set forth in the City’s applicable ordinances and resolutions. “Commercial Operation” means the period of operation of the Facility, once the Commercial Operation Date has occurred. “Commercial Operation Date” means the date specified in the Commercial Operation Date Confirmation Letter, which the Parties execute and exchange in accordance with this Agreement. “Contract Capacity” means the installed electrical Capacity available upon the Commercial Operation Date of the Facility in an amount, as specified in Exhibit “PPA-A.” “Contract Capacity” is measured at the Buyer’s revenue meter at the Delivery Point and is net of any Station Service Loads, any applicable Facility step-up transformer losses, and distribution losses on Buyer’s Distribution System up to the Delivery Point. “Contract Price” means the price paid by the Buyer to the Seller for the Output generated at the Facility and received by the Buyer, as set forth in Exhibit “PPA-A.” “CPUC” means the California Public Utilities Commission, or successor agency. “Delivery Point” means the point of interconnection to Buyer’s Distribution System, where the Buyer accepts title to the Output. “Delivery Term” has the meaning set forth in Section 14.2 hereof. “Eligible Renewable Energy Resource” means an electric generating facility that is defined and qualified as an “eligible renewable energy resource” under California Public Utilities Code Section 399.12(e) and California Public Resources Code Section 25471, respectively, as amended. “Energy” means electrical energy generated from the Facility and delivered to Buyer’s Distribution System with the voltage and quality required by the Buyer, and measured in megawatt-hours (“MWh”) or kilowatt- hours (“kWh”), as metered at the Delivery Point. “Facility” means the qualifying renewable energy generation equipment and associated power conditioning and interconnection equipment that deliver the Output to the Buyer at the Delivery Point. “FERC” means the Federal Energy Regulatory Commission, or successor agency. 9512 5/27/15 DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 3 “Forced Outage” means an unplanned outage of one or more of the Facility’s components that results in a reduction of the ability of the Facility to produce Capacity. “Force Majeure” means an event or circumstance, which prevents a Party from performing its obligations under this Agreement, and which is not in the reasonable control of, or the result of negligence of, the Party claiming Force Majeure, and which by the exercise of due diligence is unable to overcome or cause to be avoided. “Force Majeure” shall include: (a) An act of nature, riot, insurrection, war, explosion, labor dispute, fire, flood, earthquake, storm, lightning, tidal wave, backwater caused by flood, act of the public enemy, terrorism, or epidemic; (b) Interruption of transmission or generation services as a result of a physical emergency condition (and not congestion-related or economic curtailment) not caused by the fault or negligence of the Party claiming Force Majeure and reasonably relied upon and without a reasonable source of substitution to make or receive deliveries hereunder, civil disturbances, strike, labor disturbances, labor or material shortage, national emergency, restraint by court order or other public authority or governmental agency, actions taken to limit the extent of disturbances on the electrical grid; or (c) Other similar causes beyond the control of the Party affected, which causes such Party could not have avoided by the exercise of due diligence and reasonable care. A Party's financial incapacity, the Seller’s ability to sell the Output at a more favorable price or under more favorable conditions, or the Buyer’s ability to acquire the Output at a more favorable price or under more favorable conditions or other economic reasons shall not constitute an event of Force Majeure. “Force Majeure” does not include a Forced Outage to the extent such event is not caused or exacerbated by an event of Force Majeure, as described above, and does not include the Seller’s inability to obtain financing, permits, or other equipment and instruments necessary to plan for, construct, or operate the Facility. “Good Utility Practice” means those practices, methods and acts that would be implemented and followed by prudent operators of electric energy generating facilities in the western United States, similar to the Facility, during the relevant time period, which practices, methods and acts, in the exercise of prudent and responsible professional judgment in the light of the facts known at the time the decision was made, could reasonably have been expected to accomplish the desired result consistent with good business practices, reliability, and safety. The Seller acknowledges that its use of Good Utility Practice does not exempt it from performing any of its obligations arising under this Agreement. “Good Utility Practice” includes, at a minimum, those professionally responsible practices, methods and acts described in the preceding paragraph that comply with manufacturers’ warranties, restrictions in this Agreement, the interconnection requirements of Buyer, the requirements of governmental authorities, and WECC and NERC standards. “Good Utility Practice” also includes the taking of reasonable steps to ensure that: (a) Equipment, materials, resources, and supplies, including spare parts inventories, are available to meet the Facility’s needs; (b) Sufficient operating personnel are available at all times and are adequately experienced and trained and licensed as necessary to operate the Facility properly and efficiently, and are capable of responding to reasonably foreseeable emergency conditions at the Facility and emergencies whether caused by events on or off the Facility’s site; (c) Preventive, routine, and non-routine maintenance and repairs are performed on a basis that ensures reliable, long-term and safe operation of the Facility, and are performed by knowledgeable, trained, and experienced personnel utilizing proper equipment and tools; (d) Appropriate monitoring and testing are performed to ensure equipment is functioning as designed; and (e) Equipment is not operated in a reckless manner, in violation of manufacturer’s guidelines or in a manner unsafe to workers, the general public, or the connecting utility’s electric system or contrary to environmental laws, permits or regulations or without regard to defined limitations such as, flood conditions, safety inspection requirements, operating voltage, current, volt ampere reactive (VAR) loading, frequency, rotational speed, polarity, synchronization, and control system limits; and equipment and components are designed and manufactured to meet or exceed the standard of durability that is generally used for electric energy generating facilities operating in the western United States and will function properly over the full range of ambient temperature and weather conditions reasonably expected to occur at the Facility site and under both normal and emergency conditions. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 4 “Green Attributes” refers to the definition set forth in the Standard Terms and Conditions, Appendix A-2, as amended, Decision D.07-02-011, as modified by D.07-05-057, of the CPUC, which incorporates the definition of “Environmental Attributes” set forth in the Standard Terms and Conditions, Appendix A-1, as amended, D. 04-06-014. “Green Attributes” includes any and all credits, benefits, emissions reductions, environmental air quality credits, offsets, and allowances, howsoever entitled, attributable to the generation from the Facility, and its displacement of conventional energy generation, whether existing now or arising in the future. “Green Attributes” includes RECs, as well as (1) any avoided emissions of pollutants to the air, soil or water, such as sulfur oxides (“SOx”), nitrogen oxides (“NOx”), carbon monoxide (“CO”) and other pollutants; (2) any avoided emissions of carbon dioxide (“CO2”), methane (“CH4”), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, and other greenhouse gases (“GHGs”) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; and (3) the reporting rights to these avoided emissions such as Green Tag Reporting Rights and RECs. “Green Tag Reporting Rights” are the right of a Green Tag Purchaser to report the ownership of accumulated Green Tags in compliance with federal or state law, if applicable, and to a federal or state agency or any other party at the Green Tag Purchaser’s discretion, and include those Green Tag Reporting Rights accruing under Section 1605(b) of the Energy Policy Act of 1992 and any present or future federal, state, or local law, regulation or bill, and international or foreign emissions trading program. Green Tags are accumulated on a kWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of Energy. “Green Attributes” do not include (i) any Energy, Capacity, reliability, or other power attributes of the Facility, (ii) production or investment tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, grants, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular pre-existing pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered, used or created by the Facility for compliance with or sale under local, state, or federal operating and/or air quality permits or programs. If the Facility is a biomass or landfill facility and the Seller receives any tradable Green Attributes based on the Facility’s greenhouse gas reduction benefits or other emission offsets attributed to its fuel usage, the Seller shall provide the Buyer with sufficient Green Attributes to ensure that there are zero net emissions associated with the production of electricity from the Facility. “Green Attributes” includes any other environmental credits or benefits recognized in the future and attributable to Energy generated by the Facility during the Term that may not be represented by Green Tag Reporting Rights or RECs, unless otherwise excluded herein. Any Green Attributes provided under this Agreement shall be documented by RECs, or any other representation of the environmental benefits of the Output, the monthly cumulative total of which shall be provided to the Buyer, as specified herein. “Interconnection Agreement” refers to the agreement between the Buyer and the Seller, specific to the interconnection of the Facility to Buyer’s Distribution System. “NERC” means the North American Electric Reliability Corporation, or successor organization. “NCPA” means Northern California Power Agency, a California joint action agency, or successor agency. “Output” means all Capacity associated with Contract Capacity and associated Energy made available from the Facility, as well as any Capacity Attributes, Green Attributes, or other attributes existing now or in the future associated with Contract Capacity and/or associated Energy. “Output” does not include production or investment tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, grants, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation. “Planned Outage” means an outage, scheduled in advance, of one or more of the Facility’s components that results in a reduction of the ability of the Facility to produce Capacity. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 5 “Pre-Certification Price” means the contract price to be paid for all Energy delivered to the Buyer prior to the RPS Certification Date, as specified in Exhibit “PPA-A”. “Renewable Energy Credit” or “REC” has the meaning set forth in Section 399.12(h)(1) and (2) of the California Public Utilities Code, and includes a certificate of proof that one unit of electricity was generated by an Eligible Renewable Energy Resource. Currently, RECs are used to convey all Green Attributes associated with electricity production by a renewable energy resource. RECs are accumulated on a kWh basis and one REC represents the Green Attributes associated with the generation of 1 MWh (1,000 kWhs) from the Facility. For purposes of this Agreement, the term REC shall be synonymous with the term Green Tag, green ticket, bundled or unbundled renewable energy credit, tradable renewable energy certificates, or any other term used to describe the documentation that evidences the renewable and Green Attributes associated with electricity production by an Eligible Renewable Energy Resource. “Renewables Portfolio Standard” or “RPS” means the standard adopted by the State of California pursuant to Senate Bill 2 1st Extraordinary Session (SBX1 2, Chapter 1, Statutes 2011-12), and California Public Utilities Code Sections 399.11through 399.31, inclusive, as may be amended, setting minimum renewable energy targets for local publicly owned electric utilities. “Reservation Deposit” means the monetary deposit submitted by the Seller (or the Facility sponsor on behalf of the Seller) to secure a reservation of the CLEAN Program’s prices. The Reservation Deposit is set forth in Exhibit “PPA-A.” “Resource Adequacy” means a requirement by a governmental authority or in accordance with its FERC- approved tariff, or a policy approved by a local regulatory authority, that is binding upon either Party and that requires that Party to procure a certain amount of electric generating capacity. “RPS Certification” means certification by the CEC that the Facility qualifies as an Eligible Renewable Energy Resource for RPS purposes, and that all Energy produced by the Facility qualifies as generation from an Eligible Renewable Energy Resource, as evidenced by a Certificate of RPS Eligibility. “RPS Certification Date” means the date on which the RPS Certification begins, as specified in the Certificate of RPS Eligibility. “Seller” means with a principal place of business at , , . “Station Service Load” means the electrical loads associated with the operation and maintenance of the Facility, which may at times be supplied from the Facility’s Energy. “Term” has the meaning set forth in Section 14.1 hereof. “WECC” means the Western Electricity Coordinating Council, the regional entity responsible for coordinating and promoting regional bulk electric system reliability in the Western Canada and the United States, or any successor organization. 2.0 SELLER’S GENERATING FACILITY, PURCHASE PRICE AND PAYMENT 2.1 Facility. This Agreement governs the Buyer’s purchase of the Output from the Facility, as described in Exhibit “PPA-A.” The Seller shall not modify the Facility to increase or decrease the Contract Capacity after the Commercial Operation Date. 2.2 Products Purchased. During the Delivery Term, the Seller shall sell and deliver, or cause to be delivered, and the Buyer shall purchase and receive, or cause to be received, the Output from the Facility. The Seller shall not have the right to procure the Output from sources other than the Facility for sale or delivery to the Buyer under this Agreement or to substitute the Output. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 6 2.3 Delivery Term. The Delivery Term shall commence on the Commercial Operation Date under this Agreement, and shall continue for an uninterrupted period of [twenty (20) or twenty-five (25)] years. This period will commence on the first day of the calendar month immediately following the Commercial Operation Date. As evidence of the Commercial Operation Date, the Parties shall execute and exchange the “Commercial Operation Date Confirmation Letter,” attached hereto as Exhibit “PPA-B.” The Commercial Operation Date shall be the date on which the Parties acknowledge, in writing, that the Facility starts operating and is otherwise in compliance with applicable interconnection and system protection requirements, including the final approvals by the City’s building department official. 2.4 Payment for Products Purchased. 2.4.1 Deliveries Prior to RPS Certification Date. Once the Facility has achieved Commercial Operation, if the CEC has not issued a Certificate of RPS Eligibility for the Facility or the Facility has not been registered with the appropriate entity for the tracking of Green Attributes, the Buyer will pay the Seller for the Output by multiplying the Pre-Certification Price by the quantity of Energy. 2.4.2 Deliveries After RPS Certification Date. Once the Facility has achieved Commercial Operation, the CEC has issued a Certificate of RPS Eligibility for the Facility, and the Facility has been registered with the appropriate entity for the tracking of Green Attributes, the Buyer shall pay the Seller for all Output on or after the RPS Certification Date by multiplying the Contract Price by the quantity of Energy. 2.4.3 True-up Upon Issuance of Certificate of RPS Eligibility. Once the Facility has achieved Commercial Operation, the CEC has issued a Certificate of RPS Eligibility for the Facility, and the Facility has been registered with the appropriate entity for the tracking of Green Attributes, the Buyer will pay the Seller an amount equal to the difference between the Contract Price and the Pre-Certification Price for the Output (a) that was delivered on or after the RPS Certification Date and (b) for which the Seller has already received payment at the Pre- Certification Energy Price. 2.4.4 Energy in Excess of Contract Capacity. The Seller shall not receive payment for any Energy or Green Attributes delivered in any hour to the Buyer in excess of the following amount of energy (in kilowatt-hours): 110% of the Contract Capacity (in kilowatts) multiplied by one hour. Any payment in excess of this amount shall be refunded to the Buyer, on demand. 2.5 Billing. The Buyer shall pay the Seller by check or electronic funds transfer, on a monthly basis, within thirty (30) days of the meter reading date. 2.6 Title and Risk of Loss. Title to and risk of loss related to the Output shall be transferred from the Seller to the Buyer at the Delivery Point. The Seller warrants that it will deliver to the Buyer the Output free and clear of all liens, security interests, claims, encumbrances or any interest therein or thereto by any person, arising prior to the Delivery Point. 2.7 No Additional Incentives. The Seller warrants that it has not received any other incentives funded by the Buyer’s ratepayers and it further agrees that, during the Term, it shall not seek additional compensation or other benefits from the Buyer pursuant to the following programs of the Buyer: (a) Photovoltaic (PV) Partners Program; (b) Power from Local Ultra-Clean Generation Incentive (PLUG- In) Program; or (c) other similar programs that are or may be funded by the Buyer’s ratepayers. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 7 3.0 RPS CERTIFICATION; GREEN ATTRIBUTES 3.1 CEC Certification. The Seller, at its own cost and expense, shall obtain the RPS Certification within six (6) months of the Commercial Operation Date. The Seller shall maintain the RPS Certification at all times during the Delivery Term. The foregoing provision notwithstanding, the Seller shall not be in breach of this Agreement and the Buyer shall not have the right to terminate this Agreement, if the Seller’s failure to obtain or maintain the RPS Certification is due to a change in California law, occurring after the Commercial Operation Date, so long as the Seller has used commercially reasonable efforts to obtain and maintain the RPS Certification and the Seller’s actions or omissions did not contribute to its inability to obtain and maintain the RPS Certification. 3.2 Obligation to Deliver Green Attributes. The Seller shall sell and deliver to the Buyer, and the Buyer shall buy and receive from the Seller, all right, title, and interest in and to Green Attributes associated with Energy, produced by the Facility and delivered to the Buyer at the Delivery Point, whether now existing or that hereafter come into existence during the Term, except as otherwise excluded herein; provided, the Buyer shall not be obligated to purchase and pay the Seller for any Green Attributes associated with any amount of the Output, that is generated by any fuel which is not renewable and which cannot be counted for the purpose of the production of Green Attributes. The Seller agrees to sell and make all such Green Attributes available to the Buyer to the fullest extent allowed by applicable law, in accordance with the terms and conditions of this Agreement. The Seller warrants that the Green Attributes provided under this Agreement to the Buyer shall be free and clear of all liens, security interests, claims and encumbrances. 3.3 Conveyance of Green Attributes. The Seller shall provide Green Attributes associated with the Facility, which shall be documented and conveyed to the Buyer in accordance with the procedure described in Exhibit “PPA-D.” 3.4 Additional Evidence of Green Attributes Conveyance. At the Buyer’s request, the Seller shall provide additional reasonable evidence to the Buyer or to third parties of the Buyer’s right, title, and interest in the Green Attributes and any other information with respect to Green Attributes, as may be requested by the Buyer. 3.5 Modification of Green Attributes Conveyance Procedure. The Buyer may unilaterally modify Exhibit “PPA-D” in order to reflect changes necessary in the Green Attributes conveyance procedures, so that the Buyer may be able to receive and report the Green Attributes, purchased under this Agreement, as belonging to the Buyer. 3.6 Reporting of Ownership of Green Attributes. The Seller shall not report to any person or entity that the Green Attributes sold and conveyed to the Buyer belong to any person other than the Buyer. The Buyer may report under any applicable program that Green Attributes purchased by the Buyer hereunder belong to it. 3.7 Greenhouse Gas Emissions. The Seller shall comply with any laws and/or regulations regarding the need to offset emissions of GHGs by delivering to the Buyer the Energy from the Facility with a net zero GHG impact. 4.0 CONVEYANCE OF CAPACITY ATTRIBUTES 4.1 Conveyance of Resource Adequacy Capacity. The Seller shall not report to any person or entity that the Resource Adequacy Capacity, as defined in the CAISO Tariff) associated with the Facility, if any, belongs to a person other than the Buyer, which may report that Resource Adequacy Capacity purchased hereunder belongs to it to fulfill the Resource Adequacy requirements, as defined in Section 40 of the CAISO Tariff, as amended, or any successor program. The Seller shall take those actions described in Section 6.0 hereof, as applicable, to secure recognition of Resource Adequacy Capacity by the CAISO. 4.2 Conveyance of Other Capacity Attributes. In addition to the obligations imposed on the DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 8 Seller under Section 4.1, the Seller will undertake any and all actions reasonably needed to enable the Buyer to effect the recognition and transfer of any Capacity Attributes in addition Resource Adequacy, to the extent that such Capacity Attributes exist now or will exist in the future; provided, if such actions require any actions beyond the giving of notice by the Seller, then the Buyer shall reimburse all out-of- pocket costs and charges of such actions. 4.3 Reporting of Ownership of Capacity Attributes. The Seller shall not report to any person or entity that the Capacity Attributes sold and conveyed to the Buyer belong to any person other than the Buyer. The Buyer may report under any such program that such Capacity Attributes purchased hereunder belong to it. 5.0 METERING AND OPERATIONS 5.1 Timing of Outages. The Seller may not schedule or take any Planned Outage from 12:00 p.m. through 7:00 p.m. Pacific Time during the months of June through October. 5.2 Outage Reporting. 5.2.1 Buyer Request. The Seller is not required to report any Planned Outage or Forced Outage, unless the Buyer first submits a written request to the Seller to commence Outage reporting. Upon receipt of such a request, the Seller shall report all subsequent Planned Outages and the Forced Outages according to the procedures described in subsections 5.2.2 and 5.2.3, and shall continue such reporting until (a) the termination of this Agreement for any reason, or (b) the Buyer subsequently provides written notice to the Seller that the Seller may cease such reporting in the future. 5.2.2 Planned Outage Notifications. The Seller shall notify the Buyer at least 72 hours in advance of any Planned Outage that would result in a reduction in the effective Output of the Facility during the period over which the Planned Outage is scheduled. Notification shall be provided by e-mail to the e-mail address (or addresses) set forth in Exhibit “PPA-F.” 5.2.3 Forced Outage Notifications. Within 24 hours of the occurrence of a Forced Outage of the Facility that impacts the ability of the Facility to produce Energy, the Seller shall notify the Buyer of the Forced Outage, including the Capacity of the Facility that is impacted, and the expected duration of the Forced Outage. Within 24 hours of the return of the Facility to service following the Forced Outage, the Seller shall notify the Buyer of the return-to-service details. Notification shall be made by e-mail to the address (or addresses) set forth in Exhibit “PPA-F.” 5.3 Metering. The Buyer shall furnish and install one or more standard watt-hour meters to read Energy generated by the Facility, and it will charge a meter fee to the Seller to cover the costs associated with the meter’s purchase and installation. As requested, the Seller shall provide and install a meter socket in accordance with the Buyer’s metering standards. The Buyer reserves the right to install additional metering equipment at its sole cost and expense. 6.0 PARTICIPATING GENERATORS 6.1 Applicability. This Section 6.0 shall apply if the Facility meets the definition of a “Participating Generator,” as may be defined by the CAISO Tariff. This Section 6.0 shall not apply if the definition applies to the Facility only upon the election by the Seller. For the purposes of this Section 6.0, all special terms not otherwise defined in Section 1.0 are defined in the CAISO Tariff. 6.2 Participating Generator Agreement. The Buyer will notify the CAISO of the Seller’s interconnection to Buyer’s Distribution System. If the CAISO requires it, the Seller, at its own expense, shall negotiate and enter in to two contracts, a “Participating Generator Agreement” and a “Meter Services Agreement for CAISO Metered Entities,” with the CAISO. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 9 6.3 Scheduling Coordination. If the CAISO requires the Seller to enter in to a Participating Generator Agreement, then the Seller shall designate NCPA as the Buyer’s scheduling coordinator. The Buyer, acting in its sole discretion, may replace NCPA as the scheduling coordinator for the Facility. If NCPA ceases to be the scheduling coordinator for the Facility and the Buyer has not, upon fourteen (14) days’ prior written notice of inquiry from the Seller, appointed a replacement scheduling coordinator, then the Seller shall have the right to appoint a replacement scheduling coordinator on the Buyer’s behalf. Thereafter, the Buyer shall enter into all reasonable and appropriate agreements with such replacement scheduling coordinator at its own costs. 6.4 Scheduling Procedure. The Buyer may require the Seller to provide the Buyer with Energy forecasts on a periodic basis, as may be necessary for the Buyer to account for expected Facility generation in its daily power scheduling process. The requirements are set forth in Exhibit “PPA-C.” 6.5 Modification of Scheduling and Outage Notification Procedure. The Buyer may unilaterally modify Exhibit “PPA-C” to reflect changes necessary in the scheduling and Outage notification procedures. The Buyer shall give the Seller reasonable notice of any such changes. 6.6 Provision of Other Equipment. If the Seller is required to enter into a Participating Generator Agreement with the CAISO, then the Seller, at its own cost and expense, shall provide and maintain data transmission-grade phone line and telecommunications equipment at the meter location that complies with applicable requirements of the CAISO, the Buyer, and NCPA. Any meter installed by the Seller shall comply at all times with the CAISO’s metering requirements. If the Seller fails to provide or maintain any such required equipment or data connection, then the Buyer shall acquire, install and maintain the same at the Seller’s sole cost and expense. 6.7 Designation as Resource Adequacy Resource. The Buyer may submit a written request to the Seller to obtain the CAISO’s designation of the Facility as a Resource Adequacy Resource. Upon receipt of such request, the Seller shall provide such information and undertake such steps as may be required by the CAISO in order to complete such an assessment. If the Buyer makes such a request, then the Buyer shall be responsible for the following: (1) any costs charged to the Seller by the CAISO as a condition of applying for or receiving designation as a Resource Adequacy Resource, including any deposits required during the study process or the cost of any related studies or deliverability assessments performed by the CAISO; (2) the capital, installation, and maintenance costs of any additional equipment required by the CAISO as a condition of receiving designation as a Resource Adequacy Resource; (3) the costs of any Network Upgrades, as defined in the CAISO Tariff, as may be required by the CAISO, provided, the Buyer shall receive any subsequent repayments from the CAISO or the Participating Transmission Owner related to such upgrades; and (4) any charges or penalties assessed by the CAISO as a consequence of the Facility’s designation as a Resource Adequacy Resource. 6.8 CAISO Charges. The Buyer shall be solely responsible for paying all costs and charges associated with the receipt of Energy under this Agreement, at the Delivery Point, and for the transmission and delivery of Energy from the Delivery Point to any other point downstream of the Delivery Point, including transmission costs and charges, competition transition charges, applicable control area service charges, transmission congestion charges, inadvertent energy flows, any other CAISO charges related to the transmission of such Energy by the CAISO and any charge assessed or collected in the future pursuant to any utility tariff or rate schedule, however defined, for transmission or transmission-related service rendered by or for any transmission-owning or operating entity. The Seller will undertake any and all actions reasonably needed to allow the Buyer to comply with any obligations, and minimize any potential liability, under the CAISO tariff. If and to the extent that the Seller fails to comply with the notice provision in Exhibit “PPA-C,” concerning Outages, or with its obligations as outlined in the previous sentence, the Seller shall be wholly responsible for all imbalances, deviations, or any other CAISO charges or penalties associated with such Outage or other CAISO Tariff obligation. 6.9 Inclusion in Metered Subsystem. At the option of the Buyer, the Facility may be included within NCPA’s metered sub-system in connection with the scheduling of power over the CAISO grid and related functions; provided, however, that such inclusion shall have no adverse effect on the Facility’s operations or the Seller (or any such effect shall be fully mitigated by the Buyer). The Seller will undertake any and all actions reasonably needed to allow the Buyer to comply with any obligations, and DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 10 minimize any potential liability, under the CAISO Tariff; provided, that if such actions require any actions beyond the giving of notice to be provided by the Buyer, then the Buyer shall reimburse the Seller for all out-of-pocket costs and charges of such actions. 7.0 COMMERCIAL OPERATION DATE; REFUND OF RESERVATION DEPOSIT 7.1 Commercial Operation Date. The Facility shall achieve Commercial Operation by the Commercial Operation Date deadline (the “Deadline”), which is one (1) year from the Effective Date. 7.2 Reservation Deposit. The Buyer acknowledges that, as of the Effective Date or other date established by the Buyer, the Seller has provided the Reservation Deposit to the Buyer. 7.2.1 If the Commercial Operation Date occurs on or prior to the Deadline, the Buyer shall refund to the Seller the Reservation Deposit without interest. 7.2.2 If the Commercial Operation Date commences within seventy (70) days of the Deadline, the Seller, as liquidated damages and not as a penalty, shall relinquish its claim to a ten percent (10%) portion of the amount of the Reservation Deposit for every full week transpiring between the Deadline and the Commercial Operation Date, but the total amount to be relinquished to the Buyer shall not exceed 100% of the Reservation Deposit. 7.2.3 If the Facility has not achieved Commercial Operation within seventy (70) days of the Deadline, then the Buyer may terminate this Agreement without liability of either Party to the other Party by giving written notice of termination to the Seller. 7.2.4 If the Seller gives notice of termination to terminate the Agreement before Commercial Operation occurs, then the Buyer shall refund a percentage of the Reservation Deposit equal to the following: the percentage to be refunded will equal A/B, where A equals the number of days between the date of the Seller’s notice of termination, received by the Buyer, and the Deadline, and B equals the number of days between the Effective Date and the Deadline. 7.3 Return of Reservation Deposit. The Buyer shall return to the Seller the Reservation Deposit, without interest, in the event that (a) the Buyer furnishes written notice of the costs of interconnection (defined in the Interconnection Agreement to include the costs related to the Interconnection Facilities and Distribution Upgrades) to the Seller and (b) within thirty (30) days of receipt of the notice regarding costs of interconnection, the Seller provides the Buyer with written notice that the Seller does not intend to sign the Interconnection Agreement and does intend to proceed with the project. 8.0 REPRESENTATION AND WARRANTIES; COVENANTS 8.1 Representations and Warranties. On the Effective Date, each Party represents and warrants to the other Party that: DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 11 8.1.1 It is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation; 8.1.2 The execution, delivery and performance of this Agreement is within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it; 8.1.3 This Agreement and each other document executed and delivered in accordance with this Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; 8.1.4 It is not bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming bankrupt; 8.1.5 There is not pending or, to its knowledge, threatened against it or any of its affiliates, if any, any legal proceedings that could materially adversely affect its ability to perform its obligations under this Agreement; and 8.1.6 It is acting for its own account, has made its own independent decision to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of, and understands and accepts, the terms, conditions and risks of this Agreement. 8.2 General Covenants. Each Party covenants that, during the Term: 8.2.1 It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation; 8.2.2. It shall maintain (or obtain from time to time as required, including through renewal, as applicable) all regulatory authorizations necessary for it to legally perform its obligations under this Agreement; and 8.2.3 It shall perform its obligations under this Agreement in a manner that does not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it. 8.3 Covenant by Seller. The Seller covenants that, during the Term: 8.3.1 If the Eligible Renewal Energy Resource or the Facility is considered an ‘eligible qualifying facility’ under applicable law and has a net power production capacity of greater than one (1) megawatt, then the Seller covenants and agrees that, within thirty (30) days of the Effective Date or longer period allowed by law, it will complete and file Form No. 556 or other similar form with FERC as the same may be required by law.” 9.0 GENERAL CONDITIONS 9.1 Facility Care and Interconnection. During the Delivery Term, the Seller shall execute and maintain an “Interconnection Agreement” with the Buyer, whereby the Seller shall pay and be responsible for designing, installing, operating, and maintaining the Facility in accordance with all applicable laws and regulations and shall comply with all applicable Buyer, WECC, FERC, and NERC requirements, including applicable interconnection and metering requirements. The Seller shall also comply with any modifications, amendments or additions to the applicable tariff and protocols. The Seller also shall arrange and pay independently for any and all necessary costs under the Interconnection Agreement with the Buyer. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 12 9.2 Standard of Care. The Seller shall: (a) operate and maintain the Facility in a safe manner in accordance with its existing applicable interconnection agreements, manufacturer’s guidelines, warranty requirements, Good Utility Practice, industry norms (including standards of the National Electrical Code, Institute of Electrical and Electronic Engineers, American National Standards Institute, and the Underwriters Laboratories, and in accordance with the requirements of all applicable federal, state and local laws and the National Electric Safety Code, as such laws and code norms may be amended from time to time; (b) obtain any governmental authorizations and permits required for the construction and operation thereof. The Seller shall make any necessary and commercially reasonable repairs with the intent of optimizing the availability of electricity to the Buyer. The Seller shall reimburse the Buyer for any and all losses, damages, claims, penalties, or liability that the Buyer incurs as a result of the Seller’s failure to obtain or maintain any governmental authorizations and permits required for the construction and operation of the Facility throughout the Term. 9.3 Access Rights. The Buyer, its authorized agents, employees and inspectors shall have the right to inspect the Facility on reasonable advance notice during normal business hours and for any purposes reasonably connected with this Agreement or the exercise of any and all rights secured to the Buyer by law, including, without limitation, its ordinances, resolutions, tariffs, utility rate schedules or utilities rules and regulations. The Buyer shall make reasonable efforts to coordinate its emergency activities with the safety and security departments, if any, of the Facility’s operator. The Seller shall keep the Buyer advised of current procedures for communicating with the Facility operator’s safety and security departments. 9.4 Protection of Property. Each Party shall be responsible for protecting its own facilities from possible damage resulting from electrical disturbances or faults caused by the operation, faulty operation, or non-operation of the other Party’s facilities and such other Party shall not be liable for any such damages so caused. 9.5 Insurance. During the Term, the Seller shall obtain and maintain and otherwise comply with the insurance requirements, as set forth in Exhibit “PPA-E.” 9.6 Buyer’s Performance Excuse; Seller Curtailment. 9.6.1 Buyer Performance Excuse. The Buyer shall not be obligated to accept or pay for the Output during Force Majeure that affects the Buyer’s ability to accept Energy. 9.6.2 Seller Curtailment. The Buyer may require the Seller to interrupt or reduce deliveries of Energy: (a) whenever necessary to construct, install, maintain, repair, replace, remove, or investigate any of its equipment or part of the Buyer’s Distribution System or facilities; or (b) if the Buyer determines that curtailment, interruption, or reduction is necessary due to a System Emergency, as defined in the CAISO Tariff, an unplanned outage on Buyer’s Distribution System, Force Majeure, or compliance with Good Utility Practice. 9.7 Notices of Outages. Whenever possible, the Buyer shall give the Seller reasonable notice of the possibility that interruption or reduction of deliveries may be required. 9.8 No Additional Loads. The Seller shall not connect any loads not associated with Station Service Loads at the location of the Facility in a manner that would reduce Energy provided from the Facility to the Buyer hereunder. The Seller shall obtain separate retail electric service under the Buyer’s rate schedules for the service of such additional loads. 10.0 FORCE MAJEURE 10.1 Effect of Force Majeure. A Party shall be excused from its performance under this Agreement to the extent, but only to the extent, that its performance hereunder is prevented by Force Majeure. A Party claiming Force Majeure shall exercise due diligence to overcome or mitigate the effects DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 13 of Force Majeure; provided, that nothing in this Agreement shall be deemed to obligate the Party affected by Force Majeure (a) to forestall or settle any strike, lock-out or other labor dispute against its will; or (b) for Force Majeure affecting the Seller only, to purchase electric power to cure Force Majeure. 10.2 Remedial Action. A Party shall not be liable to the other Party if the Party is prevented from performing its obligations hereunder due to Force Majeure. The Party rendered unable to fulfill an obligation by reason of Force Majeure shall take all action necessary to remove such inability with all due speed and diligence. The nonperforming Party shall be prompt and diligent in attempting to remove the cause of its failure to perform, and nothing herein shall be construed as permitting that Party to continue to fail to perform after that cause has been removed. Notwithstanding the foregoing, the existence of Force Majeure shall not excuse any Party from its obligations to make payment of amounts due hereunder. 10.3 Notice of Force Majeure. In the event of any delay or nonperformance resulting from Force Majeure, the Party directly impacted by Force Majeure shall, as soon as practicable under the circumstances, notify the other Party, in writing, of the nature, cause, date of commencement thereof and the anticipated extent of any delay or interruption in performance. 10.4 Termination Due to Force Majeure. If a Party will be prevented from performing its material obligations under this Agreement for an estimated period of twelve (12) consecutive months or longer due to Force Majeure, then the unaffected Party may terminate this Agreement, without liability of either Party to the other, upon thirty (30) Days’ prior written notice at any time during Force Majeure. 11.0 INDEMNITY 11.1 Indemnity by the Seller. The Seller shall indemnify, defend, and hold harmless the Buyer, its elected and appointed officials, directors, officers, employees, agents, and representatives against and from any and all losses, claims, demands, liabilities and expenses, actions or suits, including reasonable costs and attorney’s fees, resulting from, or arising out of or in any way connected with claims by third parties associated with (A) (i) Energy delivered at the Delivery Point; (ii) the Seller’s operation and/or maintenance of the Facility; or (iii) the Seller’s actions or inactions with respect to this Agreement, and (B) any loss, claim, action or suit, for or on account of injury, bodily or otherwise, to, or death of, persons, or for damage to or destruction of property belonging to the Buyer or other third party, excepting only such loss, claim, action or suit as may be caused solely by the willful misconduct or gross negligence of the Buyer, its agents, employees, directors or officers. 11.2 Indemnity by the Buyer. The Buyer shall indemnify, defend, and hold harmless the Seller, its directors, officers, employees, agents, and representatives against and from any and all losses, claims, demands, liabilities and expenses, actions or suits, including reasonable costs and attorney’s fees resulting from, or arising out of or in any way connected with claims by third parties associated with acts of the Buyer, its officers, employees, agents, and representatives, relating to: (A) Energy delivered by the Seller under this Agreement after the Delivery Point, and (B) any loss, claim, action or suit, for or on account of injury, bodily or otherwise, to, or death of, persons, or for damage to or destruction of property belonging to the Seller or other third party, excepting only such loss, claim, action or suit as may be caused solely by the willful misconduct or gross negligence of the Seller, its agents, employees, directors or officers. 12.0 LIMITATION OF DAMAGES EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT ACTUAL DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED UNLESS EXPRESSLY HEREIN PROVIDED. NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 14 CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE. UNLESS EXPRESSLY HEREIN PROVIDED, AND SUBJECT TO THE PROVISIONS OF SECTION 11 (INDEMNITY), IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. 13.0 NOTICES Notices shall, unless otherwise specified herein, be given, in writing, and may be delivered by hand delivery, United States mail, overnight courier service, facsimile or electronic messaging (e-mail) to the addresses set forth in Exhibit “PPA-F.”. Whenever this Agreement requires or permits delivery of a “notice” (or requires a Party to “notify”), the Party with such right or obligation shall provide a written communication in the manner specified below. A notice sent by facsimile transmission or electronic mail will be recognized and shall be deemed received on the Business Day on which such notice was transmitted if received before 5 p.m. Pacific Time (and if received after 5 p.m., on the next Business Day) and a notice by overnight mail or courier shall be deemed to have been received two (2) Business Days after it was sent or such earlier time as is confirmed by the receiving Party unless it confirms a prior oral communication, in which case any such notice shall be deemed received on the day sent. A Party may change its addresses by providing notice of same in accordance with this provision. A Party may request a change to Exhibit “PPA- F” as necessary to keep the information current. 14.0 TERM, TERMINATION EVENT AND TERMINATION 14.1 Term. The Term shall commence upon the execution by the duly authorized representatives of each of the Parties, and shall remain in effect until the conclusion of the Delivery Term, unless terminated sooner pursuant to the terms and conditions of this Agreement. All indemnity rights shall survive the termination of this Agreement for twelve (12) months. 14.2 Delivery Term. The Delivery Term of the Agreement is _______ years and is defined as the period of time from the Commercial Operation Date through the expiration or early termination of this Agreement. 14.3 Termination Event. 14.3.1 The Buyer shall have the right, but not the obligation, to terminate this Agreement upon the occurrence of any of the following, each of which is a “Termination Event”: (a) The Facility has not achieved Commercial Operation within seventy (70) days following the Deadline; (b) After the Commercial Operation Date, the Seller has not sold or delivered Energy from the Facility to the Buyer for a period of twelve (12) consecutive months; (c) If the Facility does not obtain RPS Certification within six (6) months of the Commercial Operation Date and maintain RPS Certification as required by Section 3.2; or (d) The Seller breaches any other material obligation of this Agreement. 14.3.2 The Seller shall have the right, but not the obligation, to terminate this Agreement upon the occurrence of any of the following, each of which is a “Termination Event”: (a) The Buyer fails to make a payment due and payable under this Agreement within thirty (30) days after written notice that such payment is due; or (b) The Buyer breaches any other material obligation of this Agreement. The preceding sentence notwithstanding, the Seller may terminate this Agreement without cause at any time prior to the Commercial Operation Date, subject to the provisions of Section 7 of this Agreement. 14.4 Time to Cure. None of the events described in Section 14.2.1 and 14.2.2 shall constitute a Termination Event if the Buyer or the Seller cures the event, failure, or circumstance within thirty (30) days after receipt of written notification sent by the other Party, seeking termination, or such longer period as may be necessary to cure so long as the Party subject to the Terminating Event is exercising diligent efforts to cure. 14.5 Termination. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 15 14.5.1 Declaration of a Termination Event. If a Termination Event has occurred and is continuing, the Party with the right to terminate shall have the right to: (a) send notice, designating a day, no earlier than thirty (30) days after such notice is deemed to be received (as provided in Section 13), as an early termination date of this Agreement (the “Early Termination Date”), unless the Seller has timely communicated with the Buyer and the Parties have agreed to resolve the circumstances giving rise to the Termination Event; (b) accelerate all amounts owing between the Parties; and (c) terminate this Agreement and end the Delivery Term effective as of the Early Termination Date. 14.5.2 Release of Liability for Termination Event. Upon termination of this Agreement pursuant to this section neither Party shall be under any further obligation or subject to liability hereunder, except with respect to the indemnity provision in Section 11 hereof, which shall remain in effect for a period of 12 months following the Early Termination Date. 14.6 No Limitation on Damages. Nothing in this Agreement shall be deemed or construed to limit a Party’s right to recover damages from the other Party, except as otherwise provided in this Agreement. 15.0 RELEASE OF DATA Except as may be exempt from disclosure under applicable law, the Seller authorizes the Buyer to release to any regulatory authority having jurisdiction over the Facility or a Party, or to any request made pursuant to the California Constitution or the California Public Records Act, information regarding the Facility, including the Seller’s name and location, operational characteristics, the Term of this Agreement, the Facility resource type, the scheduled Commercial Operation Date, the actual Commercial Operation Date, the Contract Capacity, payments made to the Seller and Energy production information. The Seller acknowledges that this information may be made publicly available. 16.0 ASSIGNMENT Neither Party shall assign this Agreement or its rights hereunder without the prior written consent of the other Party, which consent shall not be unreasonably withheld. 16.1 Upon the written request of the Seller, the Buyer will execute a “Lender Consent and Agreement” between the Seller and the Seller’s lender(s), if any, in the form acceptable to the Parties; provided, for illustration purposes only, an exemplar is attached hereto as Exhibit “PPA-G.” 16.2 Notwithstanding the foregoing, no Consent and Agreement shall be required for: 16.2.1 Any assignment or transfer of this Agreement by the Seller to an affiliate of the Seller, provided that such affiliate’s creditworthiness is equal to or better than that of Seller, as reasonably determined by the non-assigning or non-transferring Party; or 16.2.2 Any assignment or transfer of this Agreement by the Seller or the Buyer to a person succeeding to all or substantially all of the assets of such Party, provided that such person’s creditworthiness is equal to or greater than that of such Party, as reasonably determined by the non-assigning or non-transferring Party. 16.2.3 Notification of any assignment or transfer of this Agreement under Section 16.2.1 or 16.2.2 shall be given to the non-assigning or non-transferring Party in accordance with Exhibit “PPA-F.” 17.0 APPLICABLE LAW, VENUE, ATTORNEYS’ FEES, AND INTERPRETATION This Agreement will be governed by and construed in accordance with the laws of the State of California. The Parties will comply with applicable laws pertaining to their obligations arising under this DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 16 Agreement. In the event that an action is brought, the Parties agree that trial of such action will be vested exclusively in the state courts of California or in the United States District Court for the Northern District of California in the County of Santa Clara, State of California. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. If a court of competent jurisdiction finds or rules that any provision of this Agreement, the Exhibits, or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement, the Exhibits, or any amendment thereto will remain in full force and effect. The Parties agree that the normal rule of construction to the effect that any ambiguity is to be resolved against the drafting party will not be employed in the interpretation of this Agreement or any Exhibit or any amendment thereof. 18.0 SEVERABILITY If any provision in this Agreement is determined to be invalid, void or unenforceable by any court having jurisdiction, such determination shall not invalidate, void, or make unenforceable any other provision, agreement or covenant of this Agreement and the Parties shall use their best efforts to modify this Agreement to give effect to the original intention of the Parties. 19.0 COUNTERPARTS; INTERPRETATION OF CONFLICTING PROVISIONS This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall be deemed one and the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile or portable document format (“PDF”) transmission will be deemed as effective as delivery of an originally executed counterpart. Each Party delivering an executed counterpart of this Agreement by facsimile or PDF transmission will also deliver an originally executed counterpart, but the failure of any Party to deliver an originally executed counterpart of this Agreement will not affect the validity or effectiveness of this Agreement. In the event of a conflict between the Agreement and any, some or all of the Exhibits, the document imposing the more specific duty or obligation will prevail. 20.0 GENERAL No amendment to or modification of this Agreement shall be enforceable unless reduced to writing and executed by both Parties. This Agreement shall not impart any rights enforceable by any third party other than a permitted successor or assignee bound to this Agreement. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default. The headings used herein are for convenience and reference purposes only. // // // // // // DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 17 21. EXHIBITS The following exhibits shall be deemed incorporated in and made a part of this Agreement. Exhibit “PPA-A” - Facility Description, Prices, and Reservation Deposit Exhibit “PPA-B” - Commercial Operation Date Confirmation Letter Exhibit “PPA-C” - Scheduling and Outage Notification Procedure Exhibit “PPA-D” - Green Attributes Reporting and Conveyance Procedures Exhibit “PPA-E” - Insurance Requirements Exhibit “PPA-F” - Notices Exhibit “PPA-G” - Form of Lender Consent and Agreement IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed by their authorized representatives as of the Effective Date. CITY OF PALO ALTO SELLER APPROVED AS TO FORM Senior Deputy City Attorney APPROVED City Manager Director of Utilities DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 18 EXHIBIT “PPA-A” Facility Description, Rates, and Reservation Deposit Program Rates Contract Term: Twenty (20) or twenty-five (25) years Contract rate: $0.165 per kWh for solar resources, 20-year or 25-year contract term $0.093 per kWh for non-solar resources, 20-year contract term $0.094 per kWh for non-solar resources, 25-year contract term Pre-certification rate: $0.08 per kWh Reservation Deposit Reservation Deposit ($20/kW of Contract Capacity) $ Service address: Facility Description: Contract Capacity: kW (CEC-AC), based on solar array rating (Panel rated output at PV USA test conditions x inverter efficiency) Facility primary fuel/technology: DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 19 EXHIBIT “PPA-B” Commercial Operation Date Confirmation Letter In accordance with the terms of the Power Purchase Agreement (Palo Alto CLEAN), dated (the “Agreement”) by and between the City of Palo Alto, as the Buyer, and , as the Seller, this Confirmation Letter serves to document the Parties’ agreement that (i) the conditions precedent to the occurrence of the Commercial Operation Date have been satisfied, and (ii) the Buyer has received Energy, as specified in the Agreement, as of , . The actual installed Contract Capacity is kW. This Confirmation Letter shall confirm the Commercial Operation Date, as defined in the Agreement, as of the date referenced in the preceding sentence. IN WITNESS WHEREOF, each Party has caused this letter to be duly executed by its authorized representative as of the date of last signature provided below: Buyer Seller By: By: Name: Name: Title: Director of Utilities Title: Date: Date: In recognition of the Commercial Operation Date relative to the Effective Date of the Agreement by and between the Buyer and the Seller, the Seller hereby calculates the amount to return, if any, of the Seller’s deposit, as follows: Original Reservation Deposit Amount: $ Commercial Operation Date Deadline: □ Commercial Operation Date is prior to Deadline □ Commercial Operation Date occurred weeks following the Deadline, meaning that % of the Reservation Deposit is relinquished by Seller per Section 7.2.2 of the Power Purchase Agreement. Amount (if any) of Reservation Deposit to return to the Seller is: $ DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 20 EXHIBIT “PPA-C” Scheduling and Outage Notification Procedure C.1 Applicability. This Exhibit” PPA-C” shall apply if the Facility is subject to Section 6.0 of this Agreement. C.2 Annual Operations Forecast C.2.1 By the tenth (10th) day September of each calendar year, the Seller will provide NCPA with an annual operations forecast detailing hourly expected generation and all proposed planned Outages for the next calendar year. The annual operations forecast for the calendar year shall be provided by not later than ninety (90) days prior to the scheduled Commercial Operation Date of the Generating Facility. C.2.2 NCPA may request modifications to the annual operations forecast at any time, and the Seller shall use good faith efforts to accommodate the requested modifications. C.2.3 The Seller shall not conduct Planned Outages at times other than as set forth in its annual operations forecast, unless approved in advance by NCPA, which approval shall not be withheld or delayed unreasonably. C.2.4 The Seller shall not schedule or conduct Planned Outages from 12:00 p.m. through 7:00 p.m. Pacific Time during the months of June through October. C.3. Short Term Operations Forecasts C.3.1. Quarterly Operations Forecast C.3.1.1 By the fifth (5th) day of January, April and July of each Contract Year, the Seller shall provide a calendar quarter-operations forecast by hour of expected generation and all proposed Planned Outages for the next full calendar quarter and the twelve (12) months following that calendar quarter. As an example, by January 5, 2014, the Seller would provide a calendar quarter-operations forecast by hour of expected generation for the period, April 1, 2014 through June 30, 2014, and identify all proposed Planned Outages for the period, April 1, 2014 through June 30, 2015. C.3.1.2 NCPA will approve or require modifications to the proposed calendar quarter-operations forecast within ten (10) days of receipt of the forecast. C.3.1.3 If required by NCPA, the Seller will provide a modified calendar quarter-operations forecast within seven (7) days after receipt of required modifications from NCPA. C.3.2 Weekly Update C.3.2.1 By 14:00 of each Wednesday, the Seller shall provide an electronic update, in a format specified by NCPA, to the calendar quarter-operations forecast for the following seven (7) days (Thursday through the next Wednesday). C.3.2.2 The weekly update shall include hourly expected generation and all proposed planned Outages for the relevant seven (7) day period. C.4 Outage Detail for Annual and Short Term Operations Forecasts. Outage information provided by the Seller shall include, at a minimum, the start time and stop time of the Outage, capacity out of service (kW), the equipment that is or will be out of service, and the reason for the Outage. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 21 C.5 General Scheduling Protocols C.5.1 Daily Modifications to Forecasts. Unless otherwise mutually agreed, the Seller may make changes to the weekly update to the calendar quarter-operations forecast by providing such changes to NCPA prior to 08:00 of the day that is two (2) Business Days before the active scheduling day as determined by the WECC prescheduling calendar. Example: For power that is scheduled for generation or delivery on Friday, March 29, 2014, changes must be submitted to NCPA by 08:00 on Wednesday, March 27, 2014. C.5.2 Hourly Modifications to Active Schedules. Unless otherwise mutually agreed, the Seller may request changes to active schedules by providing such changes to NCPA with a minimum of four (4) hours’ notice prior to the applicable CAISO market deadline (e.g. Hour Ahead Scheduling Process (“HASP”) Scheduling deadline, as defined in the CAISO Tariff). Active day Schedule changes are not binding. Changes to active Schedules are limited to two (2) changes per day, excluding forced Outages, unless otherwise agreed to between the Parties. One request for a Schedule change, of one-hour or multiple-hours duration, constitutes one Schedule change. Example: For power that is scheduled for generation or delivery in hour ending 15:00 (for the period from 14:01 to 15:00), changes must be submitted to NCPA by 10:00. C.5.3. Unforeseen Circumstances. At the Seller’s request, NCPA may, but is not required to, modify the Schedules for the Generation Facility Output due to unforeseen circumstances in accordance with the above scheduling timeline constraints described in this Exhibit PPA-C. C.5.4. Absence of Forecasts. In the absence of forecasts and schedules as required by this Agreement or this Exhibit, NCPA shall utilize the most current information the Seller provides in the development and submission of Schedules. C.6 Outage Reporting Protocols C.6.1. Notification. The Seller shall notify NCPA of all planned or forced Outages of the Generating Facility to ensure compliance with the CAISO Outage Coordination and Enforcement Protocols. C.6.1.1 Outage information provided by the Seller shall include, at a minimum, the start time and stop time of the Outage, Capacity out of service (kW), equipment out of service, and the reason for the Outage. C. 6.1.2 Seller shall provide the Planned Outages not included in the annual operations forecast, the calendar quarter-operations forecast, or the weekly update, to NCPA at least four (4) Business Days prior to the start of the requested outage. C. 6.1.3 At any time prior to the start of a Planned Outage, the CAISO may deny the Outage due to a System Emergency (as defined in the CAISO Tariff) or as otherwise permitted under the CAISO Tariff. If NCPA receives notice that the CAISO has denied an Outage in accordance with the CAISO Tariff, NCPA will notify the Seller as soon as possible and the Seller shall modify the planned Outage as required by the CAISO. C.6.2 Commencement of an Outage. The Seller shall not begin any Planned Outage without the prior approval of NCPA and the CAISO. C.6.3 Forced Outages C.6.3.1 The Seller shall report the Forced Outages to NCPA within twenty (20) DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 22 minutes of such Outages. C.6.3.2 The Seller’s notice of a Forced Outage sent to NCPA shall include the reason for the Outage (if known), expected duration of the Outage, and the Capacity reduction. C.6.3.3 By the end of the next Business Day following the day on which a Forced Outage has occurred, the Seller shall provide to NCPA a detailed written report, specifying the reason for the Outage, expected duration of such Outage, capacity reduction, and actions taken to mitigate such Outage. C.6.4 Return to Service. The Seller shall notify NCPA as soon as possible, but in any case before the Generating Facility is returned to service. C.7 Notices. All Scheduling notices and Schedules shall be submitted to NCPA by phone, fax or email, or other means as may be mutually agreed by the Parties, to the persons designated in Exhibit “PPA-F.” C.8 Changes in Scheduling and Outage Procedure. The Buyer shall revise Exhibit “PPA-C,” or, as appropriate, give written notice to the Seller regarding the revision, and issue a new Exhibit “PPA-C,” which shall then become part of the Agreement to reflect changes in the scheduling and outage notification procedure. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 23 EXHIBIT “PPA-D” Green Attributes Reporting and Conveyance Procedures D.1 Additional Definitions for the Conveyance of Green Attributes D.1.1 “Certificate Transfers” means the process, as described in the WREGIS Operating Rules, whereby a WREGIS account holder may request that WREGIS Certificates from a specific generating unit shall be directly deposited to another WREGIS account. D.1.2 “WREGIS Certificates” means a certificate created within the WREGIS system that represents all Renewable and Green Attributes from one MWh of electricity generation from an Eligible Renewable Energy Resource that is registered with WREGIS. D.1.3 “WREGIS Operating Rules” means the document published by WREGIS that governs the operation of the WREGIS system for registering, tracking, and conveying, among others, RECs produced from Eligible Renewable Energy Resources that shall be registered with WREGIS. D.1.4 “WREGIS” means Western Renewable Energy Generation Information System. D.2 RECs. Green Attributes shall be conveyed by the Seller to the Buyer through RECs, which shall be registered tracked and conveyed to the Buyer, using WREGIS. D.3 WREGIS Registration. Prior to the Commercial Operation Date, the Buyer will register the Facility in the Buyer’s WREGIS account on behalf of the Seller. The Buyer shall charge back to the Seller any costs of registering and maintaining the registration of the Facility with WREGIS. The Seller shall provide to the Buyer any documents required by WREGIS and assign the Seller’s rights to register the Facility in WREGIS, using agreements provided by WREGIS. D.4 B u yer ’s W REGI S Acco unt . The Buyer shall, at its sole expense, establish and maintain the Buyer’s WREGIS account sufficient to accommodate the WREGIS Certificates produced by the output of the Facility. The Buyer shall be responsible for all expenses associated with (A) establishing and maintaining the Buyer’s WREGIS Account, and (B) subsequently transferring or retiring WREGIS Certificates. D.5 Qualified Reporting Entity. The Buyer shall be the Qualified Reporting Entity (as such term is defined by WREGIS) for the Facility, and shall be responsible for providing the metered Output data to WREGIS. D.6 Reporting of Environmental Attributes. In lieu of the Seller’s transfer of the WREGIS Certificates using Certificate Transfers from the Seller’s WREGIS account to the Buyer’s WREGIS account, the Buyer shall report the Facility as being held directly in its WREGIS account, which will preclude the Seller from reporting the Facility in its own WREGIS account. D.6.1 By avoiding the use of Certificate Transfers, there will be no transaction costs to the Seller or the Buyer for the Certificate Transfers that would otherwise be used. D.6.2 WREGIS Certificates for the Facility will be created on a calendar month basis in accordance with the certification procedure established by the WREGIS Operating Rules in an amount equal to the Energy generated by the Project and delivered to the Buyer in the same calendar month. D.6.3 WREGIS Certificates will only be created for whole MWh amounts of energy generated. Any fractional MWh amounts (i.e., kWh) will be carried forward until sufficient generation is accumulated for the creation of a WREGIS Certificate and all such accumulated DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 24 MWh of Environmental Attributes will then be available to Buyer. D.6.4 If a WREGIS Certificate Modification (as such term is defined by WREGIS) will be required to reflect any errors or omissions regarding the Green Attributes from the Facility, then the Buyer will manage the submission of the WREGIS Certificate Modification. D.6.5 Due to the expected delay in the creation of WREGIS Certificates relative to the timing of invoice payments under Section 2, the Buyer will normally be making an invoice payment for the Output for a given month in accordance with Section 2 before the WREGIS Certificates for such month may be created in the Buyer’s WREGIS account. Notwithstanding this delay, the Buyer shall have all right and title to all such WREGIS Certificates upon payment to the Seller in accordance with Section 2. D.7 Changes in Green Attributes Reporting and Conveyance Procedures. The Buyer shall revise this Exhibit “PPA-D,” as appropriate, give written notice to the Seller regarding the revision, and issue a new Exhibit “PPA-D,” which shall then become part of this Agreement in the event that: D.7.1 WREGIS changes the WREGIS Operating Rules (as defined by WREGIS) after the Effective Date or applies the WREGIS Operating Rules in a manner inconsistent with this Exhibit “PPA-D” after the Effective Date; or, D.7.2 WREGIS is replaced as the primary method that the Buyer uses for conveyance of Green Attributes, or additional methods to convey all Green Attributes, are required. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 25 EXHIBIT “PPA-E” Insurance Requirements CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, WILL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH A BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRED TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION AUTOMOBILE LIABILITY STATUTORY STATUTORY YES COMMERCIAL GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $2,000,000 $2,000,000 $2,000,000 YES COMPREHENSIVE AUTOMOBILE LIABILITY, INCLUDING, OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 NO PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: PROPOSER, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY PROPOSER AND ITS SUBCONSULTANS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSURES CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY – SEE, SAMPLE AGREEMENT FOR SERVICES. II. SUBMIT CERTIFICATE(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE, OR COMPLETE THIS SECTION AND IV THROUGH V, BELOW. A. NAME AND ADDRESS OF COMPANY AFFORDING COVERAGE (NOT AGENT OR BROKER): B. NAME, ADDRESS, AND PHONE NUMBER OF YOUR INSURANCE AGENT/BROKER: DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 26 C. POLICY NUMBER(S): D. DEDUCTIBLE AMOUNT(S) (DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL): III. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AND PROPOSER’S SUBMITTAL OF CERTIFICATES OF INSURANCE EVIDENCING COMPLIANCE WITH THE REQUIREMENTS SPECIFIED HEREIN. IV. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSURES” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSURES. B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSURES UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. V. PROPOSER CERTIFIES THAT PROPOSER’S INSURANCE COVERAGE MEETS THE ABOVE REQUIREMENTS: THE INFORMATION HEREIN IS CERTIFIED CORRECT BY SIGNATURE(S) BELOW. SIGNATURE(S) MUST BE SAME SIGNATURE(S) AS APPEAR(S) ON SECTION II, ATTACHMENT A, PROPOSER’S INFORMATION FORM. Firm: Signature: Name: (Print or type name) Signature: Name: (Print or type name) DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 27 NOTICES SHALL BE MAILED TO: PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 28 EXHIBIT “PPA-F” Notices Contract Administration BUYER: SELLER: City of Palo Alto Utilities Resource Management 250 Hamilton Avenue Palo Alto, CA 94301 Ph: 650-329-2689 Email: UtilityCommoditySettlements@CityofPaloAlto.Org Billing and Settlements BUYER: SELLER: City of Palo Alto Utilities Resource Management 250 Hamilton Avenue Palo Alto, CA 94301 Ph: 650-329-2689 Email: UtilityCommoditySettlements@CityofPaloAlto.Org Forecasting and Outage Reporting under Section 6 of this Agreement Planned Outages: BUYER: SELLER: Northern California Power Agency Real- Time Dispatch 651 Commerce Drive Roseville, CA 95678 Ph: 916-786-3518 Forced Outages BUYER: SELLER: Northern California Power Agency Real-Time Dispatch 651 Commerce Drive Roseville, CA 95678 Ph: 916-786-3518 Forecasting and Scheduling BUYER: SELLER: Northern California Power Agency Operations and Pre-Scheduling 651 Commerce Drive Roseville, CA 95678 Ph: 916-786-0123 DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 29 EXHIBIT “PPA-G” Form of Lender Consent and Agreement This CONSENT AND AGREEMENT (this “Consent”), dated as of , 20 , is entered into by and among the CITY OF PALO ALTO, a California chartered municipal corporation (the “City”), , a corporation (the “Lender),” by its agent, (the “Administrative Agent”), and , a corporation (the “Borrower”) (collectively, the “Parties”). Unless otherwise defined, all capitalized terms have the meaning given in the Contract (as hereinafter defined). RECITALS A. Borrower intends to develop, construct, install, test, own, operate and use an approximately MW electric generating facility located in the city of Palo Alto in the State of California, known as the Project (the “Project”). B. In order to partially finance the development, construction, installation, testing, operation and use of the Project, Borrower has entered into that certain financing agreement dated as of (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Financing Agreement”), among Borrower, the financial institutions from time to time parties thereto (collectively, the “Lenders”) , and Administrative Agent for the Lenders, pursuant to which, among other things, Lenders have extended commitments to make loans and other financial accommodations to, and for the benefit of, Borrower. C. The City and Borrower have entered into that certain Power Purchase Agreement, dated as of (attached hereto and incorporated herein by reference, as amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof, the “Power Purchase Agreement”). D. The City and Borrower have entered into that certain Interconnection Agreement, dated as of _ (attached hereto and incorporated herein by reference, as amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof, the “Interconnection Agreement”). E. Pursuant to a security agreement executed by Borrower and Administrative Agent for the Lenders (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”), Borrower has agreed, among other things, to assign, as collateral security for its obligations under the Financing Agreement and related documents (collectively, the “Financing Documents”), all of its right, title and interest in, to and under the Power Purchase Agreement and Interconnection Agreement to Administrative Agent for the benefit of itself, the Lenders and each other entity or person providing collateral security under the Financing Documents. F. It is a requirement under the Financing Agreement that the Parties hereto execute this Consent. AGREEMENT NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the Parties agree, as follows: 1. CONSENT TO ASSIGNMENT. The City acknowledges the assignment referred to in Recital E above, consents to an assignment of the Power Purchase Agreement and Interconnection Agreement pursuant thereto, and agrees with Administrative Agent, as follows: (a) Administrative Agent shall be entitled (but not obligated) to exercise all rights and to cure any DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 30 defaults of Borrower under the Power Purchase Agreement or Interconnection Agreement, as the case may be, subject to applicable notice and cure periods provided in the Power Purchase Agreement and Interconnection Agreement. Upon receipt of notice from Administrative Agent, the City agrees to accept such exercise and cure by Administrative Agent if timely made by Administrative Agent under the Power Purchase Agreement or Interconnection Agreement, as the case may be, and this Consent. Upon receipt of Administrative Agent's written instructions and to the extent allowed by law, the City agrees to make directly to such account as Administrative Agent may direct the City, in writing, from time to time, all payments to be made by the City to Borrower under the Power Purchase Agreement or Interconnection Agreement, as the case may be, from and after the City’s receipt of such instructions, and Borrower consents to any such action. The City shall not incur any liability to Borrower under the Power Purchase Agreement, Interconnection Agreement, or this Consent for directing such payments to Administrative Agent in accordance with this subsection (a). (b) The City will not, without the prior written consent of Administrative Agent (such consent not to be unreasonably withheld), (i) cancel or terminate the Power Purchase Agreement or Interconnection Agreement, or consent to or accept any cancellation, termination or suspension thereof by Borrower, except as provided in the Power Purchase Agreement or Interconnection Agreement and in accordance with subparagraph 1(c) hereof, (ii) sell, assign or otherwise dispose (by operation of law or otherwise) of any part of its interest in the Power Purchase Agreement or Interconnection Agreement, except as provided in the Power Purchase Agreement or Interconnection Agreement, or (iii) amend or modify the Power Purchase Agreement or Interconnection Agreement in any manner materially adverse to the interest of the Lenders in the Power Purchase Agreement and Interconnection Agreement as collateral security under the Security Agreement. (c) The City agrees to deliver duplicates or copies of all notices of default delivered by the City under or pursuant to the Power Purchase Agreement or Interconnection Agreement to Administrative Agent in accordance with the notice provisions of this Consent. The City shall deliver any such notices concurrently with delivery of the notice to Borrower under the Power Purchase Agreement or Interconnection Agreement. To the extent that a cure period is provided under the Power Purchase Agreement or Interconnection Agreement, Administrative Agent shall have the same period of time to cure the breach or default that Borrower is entitled to under the Power Purchase Agreement or Interconnection Agreement, except that if the City does not deliver the default notice to Administrative Agent concurrently with delivery of the notice to Borrower under the Power Purchase Agreement or Interconnection Agreement, then as to Administrative Agent, the applicable cure period under the Power Purchase Agreement or Interconnection Agreement shall begin on the date on which the notice is given to Administrative Agent. If possession of the Project is necessary to cure such breach or default, and Administrative Agent or its designee(s) or assignee(s) declare Borrower in default and commence foreclosure proceedings, Administrative Agent or its designee(s) or assignee(s) will be allowed a reasonable period to complete such proceedings so long as Administrative Agent or its designee(s) continue to perform any monetary obligations under the Power Purchase Agreement or Interconnection Agreement, as the case may be. The City consents to the transfer of Borrower's interest under the Power Purchase Agreement and Interconnection Agreement to the Lenders or Administrative Agent or their designee(s) or assignee(s) or any of them or a purchaser or grantee at a foreclosure sale by judicial or nonjudicial foreclosure and sale or by a conveyance by Borrower in lieu of foreclosure and agrees that upon such foreclosure, sale or conveyance, the City shall recognize the Lenders or Administrative Agent or their designee(s) or assignee(s) or any of them or other purchaser or grantee as the applicable party under the Power Purchase Agreement and Interconnection Agreement (provided that such Lenders or Administrative Agent or their designee(s) or assignee(s) or purchaser or grantee assume the obligations of Borrower under the Power Purchase Agreement and Interconnection Agreement, including, without limitation, satisfaction and compliance with all credit provisions of the Power Purchase Agreement and Interconnection Agreement, if any, and provided further that such Lenders or Administrative Agent or their designee(s) or assignee(s) or purchaser or grantee has a creditworthiness equal to or better than DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 31 Borrower, as reasonably determined by City). (d) In the event that either the Power Purchase Agreement or Interconnection Agreement, or both is rejected by a trustee or debtor-in-possession in any bankruptcy or insolvency proceeding, and if, within forty-five (45) days after such rejection, Administrative Agent shall so request, the City will execute and deliver to Administrative Agent a new power purchase agreement or interconnection agreement, as the case may be, which power purchase agreement or interconnection agreement shall be on the same terms and conditions as the original Power Purchase Agreement or Interconnection Agreement for the remaining term of the original Power Purchase Agreement or Interconnection Agreement before giving effect to such rejection, and which shall require Administrative Agent to cure any defaults then existing under the original Power Purchase Agreement or Interconnection Agreement. Notwithstanding the foregoing, any new renewable power purchase agreement or interconnection agreement will be subject to all regulatory approvals required by law. The City will use good faith efforts to promptly obtain any necessary regulatory approvals. (e) In the event Administrative Agent, the Lenders or their designee(s) or assignee(s) elect to perform Borrower's obligations under the Power Purchase Agreement and Interconnection Agreement, succeed to Borrower’s interest under the Power Purchase Agreement and Interconnection Agreement, or enter into a new power purchase agreement or interconnection agreement as provided in subparagraph 1(d) above, the recourse of the City against Administrative Agent, Lenders or their designee(s) and assignee(s) shall be limited to such Parties’ interests in the Project, and the credit support required under the Power Purchase Agreement and Interconnection Agreement, if any. (f) In the event Administrative Agent, the Lenders or their designee(s) or assignee(s) succeed to Borrower's interest under the Power Purchase Agreement and Interconnection Agreement, Administrative Agent, the Lenders or their designee(s) or assignee(s) shall cure any then-existing payment and performance defaults under the Power Purchase Agreement or Interconnection Agreement, except any performance defaults of Borrower itself, which by their nature are not susceptible of being cured. Administrative Agent, the Lenders and their designee(s) or assignee(s) shall have the right to assign all or a pro rata interest in the Power Purchase Agreement and Interconnection Agreement to a person or entity to whom Borrower’s interest in the Project is transferred, provided such transferee assumes the obligations of Borrower under the Power Purchase Agreement and Interconnection Agreement and has a creditworthiness equal to or better than Borrower, as reasonably determined by the City. Upon such assignment, Administrative Agent and the Lenders and their designee(s) or assignee(s) (including their agents and employees) shall be released from any further liability thereunder accruing from and after the date of such assignment, to the extent of the interest assigned. 2. REPRESENTATIONS AND WARRANTIES. The City hereby represents and warrants that as of the date of this Consent: (a) It (i) is duly formed and validly existing under the laws of the State of California, and (ii) has all requisite power and authority to enter into and to perform its obligations hereunder and under the Power Purchase Agreement and Interconnection Agreement, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby; (b) the execution, delivery and performance of this Consent, the Power Purchase Agreement and the Interconnection Agreement have been duly authorized by all necessary action on its part and do not require any approvals, material filings with, or consents of any entity or person which have not previously been obtained or made; (c) each of this Consent, the Power Purchase Agreement, and the Interconnection Agreement is in full force and effect; DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 32 (d) each of this Consent, the Power Purchase Agreement, and the Interconnection Agreement has been duly executed and delivered on its behalf and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, except as the enforceability thereof may be limited by (i) bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general equitable principles (whether considered in a proceeding in equity or at law); (e) there is no litigation, arbitration, investigation or other proceeding pending for which the City has received service of process or, to the City’s actual knowledge, threatened against the City relating solely to this Consent, the Power Purchase Agreement, or the Interconnection Agreement and the transactions contemplated hereby and thereby; (f) the execution, delivery and performance by it of this Consent, the Power Purchase Agreement, and the Interconnection Agreement, and the consummation of the transactions contemplated hereby, will not result in any violation of, breach of or default under any term of any material contract or material agreement to which it is a party or by which it or its property is bound, or of any material requirements of law presently in effect having applicability to it, the violation, breach or default of which could have a material adverse effect on its ability to perform its obligations under this Consent; (g) neither the City nor, to the City’s actual knowledge, any other party to the Power Purchase Agreement or Interconnection Agreement, is in default of any of its obligations thereunder; and (h) to the City’s actual knowledge, (i) no Force Majeure Event exists under, and as defined in, the Power Purchase Agreement or Interconnection Agreement and (ii) no event or condition exists which would either immediately or with the passage of any applicable grace period or giving of notice, or both, enable either the City or Borrower to terminate or suspend its obligations under the Power Purchase Agreement or the Interconnection Agreement. Each of the representations and warranties set forth herein shall survive the execution and delivery of this Consent and the consummation of the transactions contemplated hereby. 3. NOTICES. All notices required or permitted hereunder shall be given, in writing, and shall be effective (a) upon receipt if hand delivered, (b) upon telephonic verification of receipt if sent by facsimile and (c) if otherwise delivered, upon the earlier of receipt or three (3) Business Days after being sent registered or certified mail, return receipt requested, with proper postage affixed thereto, or by private courier or delivery service with charges prepaid, and addressed as specified below: If to the City: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ] If to Administrative Agent: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ] DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 33 If to Borrower: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ] Any party shall have the right to change its address for notice hereunder to any other location within the United States by giving thirty (30) days written notice to the other parties in the manner set forth above. 4. ASSIGNMENT, TERMINATION, AMENDMENT. This Consent shall be binding upon and benefit the successors and assigns of the Parties hereto and their respective successors, transferees and assigns (including without limitation, any entity that refinances all or any portion of the obligations under the Financing Agreement). The City agrees (a) to confirm such continuing obligation, in writing, upon the reasonable request of (and at the expense of) Borrower, Administrative Agent, the Lenders or any of their respective successors, transferees or assigns, and (b) to cause any successor-in-interest to the City with respect to its interest in the Power Purchase Agreement or Interconnection Agreement to assume, in writing and in form and substance reasonably satisfactory to Administrative Agent, the obligations of City hereunder. Any purported assignment or transfer of the Power Purchase Agreement or Interconnection Agreement not in conjunction with the written instrument of assumption contemplated by the foregoing clause (b) shall be null and void. No termination, amendment, or variation of any provisions of this Consent shall be effective unless in writing and signed by the parties hereto. No waiver of any provisions of this Consent shall be effective unless in writing and signed by the party waiving any of its rights hereunder. 5. GOVERNING LAW. This Consent shall be governed by the laws of the State of California applicable to contracts made and to be performed in California. The federal courts or the state courts located in California shall have exclusive jurisdiction to resolve any disputes with respect to this Consent with the City, Assignor, and the Lender or Lenders irrevocably consenting to the jurisdiction thereof for any actions, suits, or proceedings arising out of or relating to this Consent. 6. COUNTERPARTS. This Consent may be executed in one or more duplicate counterparts, and when executed and delivered by all the parties listed below, shall constitute a single binding agreement. 7. SEVERABILITY. In case any provision of this Consent, or the obligations of any of the Parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other Parties hereto, shall not in any way be affected or impaired thereby. 8. ACKNOWLEDGMENTS BY BORROWER. Borrower, by its execution hereof, acknowledges and agrees that neither the execution of this Consent, the performance by the City of any of the obligations of the City hereunder, the exercise of any of the rights of the City hereunder, or the acceptance by the City of performance of the Power Purchase Agreement by any party other than Borrower shall (1) release Borrower from any obligation of Borrower under the Power Purchase Agreement or Interconnection Agreement, (2) constitute a consent by the City to, or impute knowledge to the City of, any specific terms or conditions of the Financing Agreement, the Security Agreement or any of the other Financing Documents, or (3) except as expressly set forth in this Consent, constitute a waiver by the City of any of its rights under the Power Purchase Agreement or Interconnection Agreement. Borrower and Administrative Agent acknowledge hereby for the benefit of City that none of the Financing Agreement, the Security DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 040914 jrm 0180042 34 Agreement, the Financing Documents or any other documents executed in connection therewith alter, amend, modify or impair (or purport to alter, amend, modify or impair) any provisions of the Power Purchase Agreement. CITY OF PALO ALTO ADMINISTRATIVE AGENT APPROVED AS TO FORM Senior Deputy City Attorney BORROWER APPROVED City Manager Director of Utilities DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 1 INTERCONNECTION AGREEMENT This Interconnection Agreement (the “Agreement”), dated, for convenience, ____________________, 20__ (the “Effective Date”), is entered into by and between the CITY OF PALO ALTO, a California chartered municipal corporation (the “City”), acting by and through its Department of Utilities (“CPAU”), and ABC COMPANY, a California corporation (the “Facility Owner”), located at the address stated below (the City and the Facility Owner are referred to, individually, as a “Party”, and, collectively, as the “Parties”). 1.0 TERM 1.1 This Agreement takes effect on the Effective Date, and it will continue for a term of ten (10) years, until it is earlier terminated, as follows: (a) the Facility Owner gives the City or CPAU thirty (30) days’ prior written notice of termination; (b) if Operating Mode #2 or Operating Mode #3 is selected in Exhibit A, upon the effective date of termination of the Power Purchase Agreement or the Other Agreement between the Parties; or (c) a Party effectively terminates due to a material default and breach by the other Party. 1.2 Upon a default referred to in Section 1.1(c), the non-defaulting Party shall give written notice of such event of default to the defaulting Party. The defaulting Party shall have sixty (60) days from the receipt of notice of default in which to cure the default; provided, if the defaulting Party informs the non-defaulting Party that it cannot cure the default within the sixty-days period and it in good faith has continuously and diligently attempted to cure the default, then, if the defaulting Party cures within six (6) months from the receipt of the notice of default, the non-defaulting Party may not terminate this Agreement.. No default shall be deemed to exist if the failure to discharge an obligation (other than the payment of money) is the result of force majeure or an act or omission of the other Party 2.0 GENERATING FACILITY INTERCONNECTION AND METERING 2.1 The Facility Owner will install, operate, maintain, and repair the Generating Facility and use the meter(s) that meet(s) the requirements of CPAU’s Rules and Regulations, as amended, and other applicable laws, rules and regulations, including, without limitation, CPAU’s interconnection standards, as set forth in its Utilities Rule and Regulation 27 (“Rule 27”). 2.2 CPAU, at its sole cost and expense, may inspect and approve the installation of the Generating Facility and verify or otherwise authenticate the accuracy of the meter(s) as a condition precedent to its obligation to interconnect. 2.3 The Facility Owner grants to the City, including CPAU, its officers, employees, agents and representatives the non-exclusive right of ingress and egress on, over and across the Premises, upon reasonable prior notice, for the purpose of inspecting and approving the installation and operation of the Generating Facility and authenticating the accuracy of the meter(s), or without notice, in the event of an emergency, to protect the public health, safety and welfare, or in regard to a disconnection of the Generating Facility, if CPAU reasonably determines that a condition hazardous to person or property exists and immediate action is necessary to protect person or property from damage or interference caused by the Facility or as a result of the lack of properly operating protective devices of the Facility. 2.4 The Facility Owner will obtain and maintain the required governmental approvals, authorizations, permits, and any policy (or policies) of insurance, including, without limitation, commercial general liability, property, and professional liability insurance, as may be required by the City or CPAU or applicable laws. 2.5 The Facility Owner will comply with all applicable federal, state and local safety and performance standards applicable to the Generating Facility and established by or under the National Electrical Code (NEC), the Institute of Electrical and Electronics Engineers (IEEE) and accredited testing laboratories, including, without limitation, Underwriters Laboratories (UL), and in accordance with the applicable orders, rules and regulations of the California Public Utilities Commission, pertaining to the safety and reliability of electrical generating systems, and applicable City building codes. EXHIBIT "I" FORM OF CLEAN PPA INTERCONNECTION AGREEMENT DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 2 2.6 Neither the City nor CPAU will be obligated to accept or pay for, and the City or CPAU may require the Facility Owner to temporarily interrupt or reduce, the delivery of available energy generated by the Generating Facility in the event of the following: (a) whenever CPAU determines that the interruption or reduction is necessary in order for CPAU to construct, install, maintain, repair, replace, remove, investigate, or inspect any part of CPAU’s electric utility distribution system; or (b) if CPAU determines that the interruption or reduction is necessary on account of an emergency, voluntary or involuntary outage, force majeure, or compliance with good utility practice. 2.7 Notwithstanding any other provision of this Agreement, if CPAU determines that either (a) the operation of the Generating Facility may threaten or endanger the public health, safety or welfare or the City or CPAU’s personnel or property, or (b) the continued operation of the Generating Facility may endanger the operational integrity of CPAU’s electric utility distribution system, then CPAU will have the right to temporarily or permanently disconnect the Generating Facility from CPAU’s electric utility distribution system upon the delivery of prior reasonable notice to the Facility Owner; provided, CPAU may act without giving prior notice to the Facility Owner, if CPAU determines that it is impracticable to provide the notice. The Generating Facility will remain disconnected until such time as CPAU is satisfied that the conditions referred to in this subsection have been corrected or sufficiently addressed. 2.8 The Facility Owner will (a) maintain the Generating Facility, which interconnects with CPAU’s electric utility distribution system, in a safe and prudent manner and in conformance with all applicable laws, rules and regulations, including, without limitation, the requirements of this Section 2, and (b) obtain any governmental approvals, authorizations and permits required for the construction and operation of the Generating Facility. 2.9 The Facility Owner will reimburse CPAU for any and all losses, damages, claims, penalties, or liability that the City or CPAU may incur or sustain as a result of the Facility Owner’s failure to obtain and maintain any and all governmental approvals, authorizations and permits that may be required for the construction, installation, operation, repair or maintenance of the Generating Facility. 3.0 INTERCONNECTION FACILITIES, DISTRIBUTION SYSTEM UPGRADES, AND AFFECTED SYSTEMS 3.1 The Facility Owner shall, in accordance with CPAU Rule 27 or other applicable CPAU Rule, pay, in advance and in full, for all of CPAU’s estimated design and construction costs of the Interconnection Facilities and the Distribution System Upgrades, which are specified in Exhibit A. 3.2 In the event that the Facility Owner owns the real property, on which the Interconnection Facilities are or will be located, then the Facility Owner shall grant to the City and CPAU (or in the event that Facility Owner is leasing or otherwise obtaining rights to locate the Generating Facility on real property of a third party, the Facility Owner shall obtain for the City and CPAU): 3.2.1 The right to install the Interconnection Facilities and related equipment or materials on that real property along the most practical route, which is of sufficient width to provide the appropriate and safe clearance from all structures now or hereafter erected on that real property; and 3.2.2 The right of ingress and egress to and from that real property, as may be reasonably necessary for CPAU to operate, maintain, repair, and remove the Interconnection Facilities. 3.3 Where rights-of-entry or easements are required on or over that real property or the property of a third party for the installation of the Interconnection Facilities, the Facility Owner acknowledges and agrees that CPAU’s obligation to install the Interconnection Facilities is expressly conditioned on the granting, without cost to the City or CPAU, of any and all necessary rights-of-entry or easements to the City. 3.4 THE CITY MAKES NO REPRESENTATIONS, WARRANTIES, COVENANTS OR ASSURANCES WITH RESPECT TO THE DESIGN, CONSTRUCTION, DURABILITY OR SUITABILITY OF THE DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 3 NEW INTERCONNECTION FACILITIES OR ANY PART THEREOF, WHETHER EXPRESS OR IMPLIED, AND THE CITY EXPRESSLY DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY, QUIET ENJOYMENT, AND ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE APPLICABLE TO SUCH WORK. 3.5 The one-line diagram of the interconnection (at the Delivery Point) is described in Exhibit A. The Interconnection Facilities are the sole and exclusive property of and shall be owned, operated, maintained, and repaired by the City and CPAU, and the Facility Owner disclaim any interest therein. 3.6 The Facility Owner shall pay CPAU for the costs of the Interconnection Facilities. The direct costs for the design and construction of the Interconnection Facilities shall be paid in advance by the Facility Owner. The Facility Owner shall be additionally responsible for costs related to ongoing operations, maintenance, and replacement of the Interconnection Facilities. 3.7 Upon the Facility Owner’s discontinuation of use of the Interconnection Facilities due to termination of this Agreement, or otherwise, CPAU shall have the right to remove any portion of the Interconnection Facilities from the real property on which the Interconnection Facilities are installed or located. 3.8 As may be required by applicable agreements between the City or CPAU and one or more Affected Systems’ owners and/or operators, CPAU shall coordinate with those Affected Systems’ owners and/or operators to support the interconnection. An “Affected System” is an electric system not owned by the City or CPAU but to which CPAU’s electric utility distribution system is connected. “Affected System” includes, without limitation, the transmission system that is owned by the Pacific Gas and Electric Company but is operated by the California Independent System Operator Corporation (“CAISO”). If upgrades to an Affected System are required by an Affected System owner and/or operator as a condition of interconnection of the Generating Facility, then the Facility Owner shall be responsible for the costs of such upgrades. The Facility Owner and each Affected System owner and/or operator shall enter into one or more agreements that provide(s) for the financing of such upgrades, as needed, and any repayment as set forth in applicable tariffs of the Affected System’ owner and/or operator. The Facility Owner, at its own cost and expense, shall be responsible for entering into any other agreements as may be required by an Affected System’s owner and/or operator as a condition of interconnected operation and complying with the requirements of any applicable tariffs. Such agreements may include the “Participating Generator Agreement” (ISO Tariff Appendix M) and the “Meter Services Agreement for CAISO Metered Entities” with the CAISO. 4.0 INDEMNITY 4.1 Each Party, as indemnitor, shall defend, protect, indemnify and hold harmless the other Party, as indemnitee, its elected and appointed officials, directors, officers, employees, agents and representatives of the other Party from and against any and all losses, liability, damages, claims, costs, charges, demands, or expenses (including any direct, indirect or consequential loss, liability, damage, claim, cost, charge, demand, or expense, and reasonable attorneys’ fees) for personal injury or death and property damage, arising, directly or indirectly, out of or in connection with (a) the engineering, design, construction, maintenance, repair, operation, supervision, inspection, testing, protection or ownership of the indemnitor’s facilities, or (b) the making of replacements, additions, betterments to, or reconstruction of the indemnitor’s facilities; provided, however, the Facility Owner’s duty to indemnify the City and CPAU shall not extend to any loss, liability, damage, claim, cost, charge, demand, or expense resulting from interruptions in electrical service to CPAU’s electric utility customers other than the Facility Owner. Neither Party shall be indemnified hereunder for its loss, liability, damage, claim, cost, charge, demand, or expense arising out of or resulting from its sole negligence or willful misconduct. 4.2 Notwithstanding the foregoing indemnity, and excepting a Party’s willful misconduct or sole negligence, each Party shall be solely responsible for damage to its own facilities resulting from electrical disturbances or faults. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 4 4.3 This Section 4 shall not be construed to relieve any insurer of its obligations to pay any insurance claims in accordance with the provisions of any valid insurance policy to be procured by a Party. 4.4 EXCEPT AS OTHERWISE PROVIDED IN SECTION 4.1, A PARTY SHALL NOT BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL, PUNITIVE, EXEMPLARY, SPECIAL OR INCIDENTAL DAMAGES (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS, LOSS OF REVENUE, LOSS OF OPPORTUNITY OR LOSS OF DATA), HOWSOEVER CAUSED, WHETHER ARISING UNDER TORT, CONTRACT, OR OTHER LEGAL THEORY, AND WHETHER OR NOT FORESEEABLE, THAT ARE INCURRED BY THE OTHER PARTY. 5.0 NOTICE 5.1 Any notice required to be given under this Agreement will be delivered, in writing, and electronically mailed or delivered by the United States Postal Service, with postage prepaid and correctly addressed to the Party, or personally delivered to the Party, at the address below. Changes to such designation may be made by notice similarly given. All written notices will be directed, as follows: TO CITY: City of Palo Alto Department of Utilities 250 Hamilton Ave Palo Alto, CA 94301 ATTN.: Utilities Resource Management Phone: (650) 329-2689 FAX: (650) 326-1507 Email: UtilityCommoditySettlements@CityofPaloAlto.org TO FACILITY OWNER: ABC Company 123 Main Street Anytown, CA 90909 ATTN: Senior Vice-President of Operations Phone: (999) 999-9999 FAX: (999) 111-1111 Email: RenewableEnergyOperations@ABCInc.org 6.0 MISCELLANEOUS PROVISIONS 6.1 This Agreement is governed by and interpreted in accordance with the laws of the State of California as if executed and to be performed wholly within the State of California. 6.2 Any amendment or modification to this Agreement will not be binding upon the Parties, unless the Parties agree thereto, in writing. The failure of a Party at any time or times to require performance of any provision hereof will in no manner affect the right at a later time to enforce the same. No waiver by a Party of the breach of any covenant, term or condition contained in this Agreement, whether by conduct or otherwise, will be deemed or be construed as a further or continuing waiver of any such breach or a waiver of the breach of any other covenant, term or condition, unless such waiver is stated, in writing. 6.3 This Agreement supersedes any existing agreement, to which the City and the Facility Owner are parties, under which the Facility Owner is currently operating the Generating Facility, and any such agreement shall be deemed terminated as of the date this Agreement becomes effective. IN WITNESS WHEREOF, the Parties by their duly appointed representatives have executed this Interconnection Agreement in Palo Alto, County of Santa Clara, as of the Effective Date. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 5 CITY OF PALO ALTO ABC COMPANY _________________________________ _________________________________ City Manager President APPROVED AS TO FORM: APPROVED: _________________________________ _________________________________ Senior Asst. City Attorney Director of Utilities DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 6 EXHIBIT A PART 1. GENERATING FACILITY DESCRIPTION 1. Service address: ___________________________________, Palo Alto, CA ____________ (the “Premises”) 2. Generating Facility Description: ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ 3. Gross power rating of the Generating Facility ________ kW, based on: □ Inverter rating □ Solar array rating (Panel rated output at PV USA test conditions x inverter efficiency) □ Generator nameplate □ Prime mover nameplate 4. Generating Facility primary fuel/technology: ____________________________________________________ 5. Net power rating of the Generating Facility: ____ kW, which is the gross power rating stated above net of power used in the Generating Facility to power lights, motors, control systems, and other electrical loads used in operation, including losses on the Generating Facility’s electric distribution system 6. Maximum instantaneous power to be exported through the Point of Common Coupling: ______ kW 7. Generating facility is connected to the CPAU distribution system at ______ Kv 8. Operating Mode (select one of following): □ #1 Power used on-site; no energy export or incidental energy export (default choice); □ #2 Sale to CPAU (feed-in tariff (FIT) rate or merchant generator), which requires disclosure of the Power Purchase Agreement # ______________; □ #3 Other Agreement: Description: ____________________________________________________________, which requires disclosure of the Other Agreement # ______________. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F 110927 dm 0073626 7 PART 2. INTERCONNECTION FACILITIES DESCRIPTION; ESTIMATED COSTS □ No Interconnection Facilities are required. □ Interconnection Facilities are required (provide information below). 1. The Interconnection Facilities Description: _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 2. The direct costs of the design and construction of the Interconnection Facilities shall be paid in advance by the Facility Owner in accordance with Rule 27, as amended. 3 The Final Estimated CPAU Design and Construction Costs is $_____________. 4 The Final Estimated CPAU Operations and Maintenance Cost is $ ________________. 5. The Total Cost of Interconnection Facilities is $______________. 6. A One-line Diagram of the Interconnection is inserted as Page(s) __ through __. 7. A diagram of the Site Layout is inserted as Page(s) __ through __. PART 3. DISTRIBUTION SYSTEM UPGRADES REQUIRED □ No Distribution Upgrades are required. □ Distribution Upgrades are required (provide information below). 1. Description of Distribution Upgrades: _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 2. The direct costs of the design and construction of the Distribution Upgrades shall be paid in advance by the Facility Owner in accordance with Rule 27, as amended. 3. The Final Estimated CPAU Design and Construction Cost is $_____________. 4. The Final Estimated CPAU Operations and Maintenance Cost is $ ________________. 5. The Total Cost of the Distribution Upgrades is $______________. 6. A description of the Distribution Upgrades is inserted as Page(s) __ through __. DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F EXHIBIT “J”   FORM OF LENDER CONSENT AND AGREEMENT   This CONSENT AND AGREEMENT (this “Consent”), dated as of , 20 , is entered into by and among the CITY OF PALO ALTO, a California chartered municipal corporation (the “City”), , a corporation (the “Lender),” by its agent, (the “Administrative Agent”), and , a corporation (the “Borrower”) (collectively, the “Parties”). Unless otherwise defined, all capitalized terms have the meaning given in the Contract (as hereinafter defined).   RECITALS  A. Borrower intends to develop, construct, install, test, own, operate and use an approximately MW electric generating facility located in the city of Palo Alto in the State of California, known as the Project (the “Project”).   B. In order to partially finance the development, construction, installation, testing, operation and use of the Project, Borrower has entered into that certain financing agreement dated as of (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Financing Agreement”), among Borrower, the financial institutions from time to time parties thereto (collectively, the “Lenders”) , and Administrative Agent for the Lenders, pursuant to which, among other things, Lenders have extended commitments to make loans and other financial accommodations to, and for the benefit of, Borrower.  C. The City and Borrower have entered into that certain Lease Agreement, dated as of (attached hereto and incorporated herein by reference, as amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof, the “Lease”).  D. Pursuant to a security agreement executed by Borrower and Administrative Agent for the Lenders (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”), Borrower has agreed, among other things, to assign, as collateral security for its obligations under the Financing Agreement and related documents (collectively, the “Financing Documents”), all of its right, title and interest in, to and under the L e a s e to Administrative Agent for the benefit of itself, the Lenders and each other entity or person providing collateral security under the Financing Documents.   E. It is a requirement under the Financing Agreement that the Parties hereto execute this Consent.   AGREEMENT  NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the Parties agree, as follows:  1. CONSENT TO ASSIGNMENT. The City acknowledges the assignment referred to in Recital E above, consents to an assignment of the Lease pursuant thereto, and agrees with Administrative Agent, as follows:  (a) Administrative Agent shall be entitled (but not obligated) to exercise all rights and to cure any DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F defaults of Borrower under the Lease, as the case may be, subject to applicable notice and cure periods provided in the Lease. Upon receipt of notice from Administrative Agent, the City agrees to accept such exercise and cure by Administrative Agent if timely made by Administrative Agent under the Lease, as the case may be, and this Consent. Upon receipt of Administrative Agent's written instructions and to the extent allowed by law, the City agrees to make directly to such account as Administrative Agent may direct the City, in writing, from time to time, any and all payments to be made by the City to Borrower under the Lease, as the case may be, from and after the City’s receipt of such instructions, and Borrower consents to any such action. The City shall not incur any liability to Borrower under the Lease or this Consent for directing such payments to Administrative Agent in accordance with this subsection (a).  (b) The City will not, without the prior written consent of Administrative Agent (such consent not to be unreasonably withheld), (i) cancel or terminate the Lease, or consent to or accept any cancellation, termination or suspension thereof by Borrower, except as provided in the Lease and in accordance with subparagraph 1(c) hereof, (ii) sell, assign or otherwise dispose (by operation of law or otherwise) of any part of its interest in the Lease, except as provided in the Lease, or (iii) amend or modify the Lease in any manner materially adverse to the interest of the Lenders in the Lease as collateral security under the Security Agreement.  (c) The City agrees to deliver duplicates or copies of all notices of default delivered by the City under or pursuant to the Lease to Administrative Agent in accordance with the notice provisions of this Consent. The City shall deliver any such notices concurrently with delivery of the notice to Borrower under the Lease. To the extent that a cure period is provided under the Lease, Administrative Agent shall have the same period of time to cure the breach or default that Borrower is entitled to under the Lease, except that if the City does not deliver the default notice to Administrative Agent concurrently with delivery of the notice to Borrower under the Lease, then as to Administrative Agent, the applicable cure period under the Lease shall begin on the date on which the notice is given to Administrative Agent. If possession of the Project is necessary to cure such breach or default, and Administrative Agent or its designee(s) or assignee(s) declare Borrower in default and commence foreclosure proceedings, Administrative Agent or its designee(s) or assignee(s) will be allowed a reasonable period to complete such proceedings so long as Administrative Agent or its designee(s) continue to perform any monetary obligations under the Lease, as the case may be. The City consents to the transfer of Borrower's interest under the Lease to the Lenders or Administrative Agent or their designee(s) or assignee(s) or any of them or a purchaser or grantee at a foreclosure sale by judicial or nonjudicial foreclosure and sale or by a conveyance by Borrower in lieu of foreclosure and agrees that upon such foreclosure, sale or conveyance, the City shall recognize the Lenders or Administrative Agent or their designee(s) or assignee(s) or any of them or other purchaser or grantee as the applicable party under the Lease (provided that such Lenders or Administrative Agent or their designee(s) or assignee(s) or purchaser or grantee assume the obligations of Borrower under the Lease, including, without limitation, satisfaction and compliance with all credit provisions of the Lease, if any, and provided further that such Lenders or Administrative Agent or their designee(s) or assignee(s) or purchaser or grantee has a creditworthiness equal to or better than DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Borrower, as reasonably determined by City).  (d) In the event that the Lease is rejected by a trustee or debtor-in-possession in any bankruptcy or insolvency proceeding, and if, within forty-five (45) days after such rejection, Administrative Agent shall so request, the City will execute and deliver to Administrative Agent a new lease, which lease shall be on the same terms and conditions as the original Lease for the remaining term of the original Lease before giving effect to such rejection, and which shall require Administrative Agent to cure any defaults then existing under the original Lease. Notwithstanding the foregoing, any new lease will be subject to all regulatory approvals required by law. The City will use good faith efforts to promptly obtain any necessary regulatory approvals.  (e) In the event Administrative Agent, the Lenders or their designee(s) or assignee(s) elect to perform Borrower's obligations under the Lease, succeed to Borrower’s interest under the Lease, or enter into a new lease as provided in subparagraph 1(d) above, the recourse of the City against Administrative Agent, Lenders or their designee(s) and assignee(s) shall be limited to such Parties’ interests in the Project, and the credit support required under the lease, if any.  (f) In the event Administrative Agent, the Lenders or their designee(s) or assignee(s) succeed to Borrower's interest under the Lease, Administrative Agent, the Lenders or their designee(s) or assignee(s) shall cure any then-existing payment and performance defaults under the Lease, except any performance defaults of Borrower itself, which by their nature are not susceptible of being cured. Administrative Agent, the Lenders and their designee(s) or assignee(s) shall have the right to assign all or a pro rata interest in the Lease to a person or entity to whom Borrower’s interest in the Project is transferred, provided such transferee assumes the obligations of Borrower under the Lease and has a creditworthiness equal to or better than Borrower, as reasonably determined by the City. Upon such assignment, Administrative Agent and the Lenders and their designee(s) or assignee(s) (including their agents and employees) shall be released from any further liability thereunder accruing from and after the date of such assignment, to the extent of the interest assigned.  2. REPRESENTATIONS AND WARRANTIES. The City hereby represents and warrants that as of the date of this Consent:  (a) It (i) is duly formed and validly existing under the laws of the State of California, and (ii) has all requisite power and authority to enter into and to perform its obligations hereunder and under the Lease, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby;   (b) the execution, delivery and performance of this Consent and the Lease have been duly authorized by all necessary action on its part and do not require any approvals, material filings with, or consents of any entity or person which have not previously been obtained or made;   (c) each of this Consent and the Lease is in full force and effect; DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F (d) each of this Consent and the Lease has been duly executed and delivered on its behalf and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, except as the enforceability thereof may be limited by (i) bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general equitable principles (whether considered in a proceeding in equity or at law);  (e) there is no litigation, arbitration, investigation or other proceeding pending for which the City has received service of process or, to the City’s actual knowledge, threatened against the City relating solely to this Consent, the Lease and the transactions contemplated hereby and thereby;  (f) the execution, delivery and performance by it of this Consent and the Lease, and the consummation of the transactions contemplated hereby, will not result in any violation of, breach of or default under any term of any material contract or material agreement to which it is a party or by which it or its property is bound, or of any material requirements of law presently in effect having applicability to it, the violation, breach or default of which could have a material adverse effect on its ability to perform its obligations under this Consent;  (g) neither the City nor, to the City’s actual knowledge, any other party to the Lease, is in default of any of its obligations thereunder; and  (h) to the City’s actual knowledge, (i) no event or condition exists which would either immediately or with the passage of any applicable grace period or giving of notice, or both, enable either the City or Borrower to terminate or suspend its obligations under the Lease.  Each of the representations and warranties set forth herein shall survive the execution and delivery of this Consent and the consummation of the transactions contemplated hereby.  3. NOTICES. All notices required or permitted hereunder shall be given, in writing, and shall be effective (a) upon receipt if hand delivered, (b) upon telephonic verification of receipt if sent by facsimile and (c) if otherwise delivered, upon the earlier of receipt or three (3) Business Days after being sent registered or certified mail, return receipt requested, with proper postage affixed thereto, or by private courier or delivery service with charges prepaid, and addressed as specified below:   If to the City: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ]  If to Administrative Agent: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ] DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F     If to Borrower: [ ] [ ] [ ] Telephone No.: [ ] Facsimile No.: [ ] Attn: [ ]       Any party shall have the right to change its address for notice hereunder to any other location within the United States by giving thirty (30) days written notice to the other parties in the manner set forth above.   4. ASSIGNMENT, TERMINATION, AMENDMENT. This Consent shall be binding upon and benefit the successors and assigns of the Parties hereto and their respective successors, transferees and assigns (including without limitation, any entity that refinances all or any portion of the obligations under the Financing Agreement). The City agrees (a) to confirm such continuing obligation, in writing, upon the reasonable request of (and at the expense of) Borrower, Administrative Agent, the Lenders or any of their respective successors, transferees or assigns, and (b) to cause any successor-in-interest to the City with respect to its interest in the Lease to assume, in writing and in form and substance reasonably satisfactory to Administrative Agent, the obligations of City hereunder. Any purported assignment or transfer of the Lease not in conjunction with the written instrument of assumption contemplated by the foregoing clause (b) shall be null and void. No termination, amendment, or variation of any provisions of this Consent shall be effective unless in writing and signed by the parties hereto. No waiver of any provisions of this Consent shall be effective unless in writing and signed by the party waiving any of its rights hereunder.  5. GOVERNING LAW. This Consent shall be governed by the laws of the State of California applicable to contracts made and to be performed in California. The federal courts or the state courts located in California shall have exclusive jurisdiction to resolve any disputes with respect to this Consent with the City, Assignor, and the Lender or Lenders irrevocably consenting to the jurisdiction thereof for any actions, suits, or proceedings arising out of or relating to this Consent.  6. COUNTERPARTS. This Consent may be executed in one or more duplicate counterparts, and when executed and delivered by all the parties listed below, shall constitute a single binding agreement.   7. SEVERABILITY. In case any provision of this Consent, or the obligations of any of the Parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other Parties hereto, shall not in any way be affected or impaired thereby.  8. ACKNOWLEDGMENTS BY BORROWER. Borrower, by its execution hereof, acknowledges and agrees that neither the execution of this Consent, the performance by the City of any of the obligations of the City hereunder, the exercise of any of the rights of the City hereunder, or the acceptance by the City of performance of the Lease by any party other than Borrower shall (1) release Borrower from any obligation of Borrower under the Lease, (2) constitute a consent by the City to, or impute knowledge to the City of, any specific terms or conditions of the Financing Agreement, the Security Agreement or any of the other Financing Documents, or (3) except as expressly set forth in this Consent, constitute a waiver by the City of any of its rights under the Lease. Borrower and Administrative Agent acknowledge hereby for the benefit of City that none of the Financing Agreement, the Security DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Agreement, the Financing Documents or any other documents executed in connection therewith alter, amend, modify or impair (or purport to alter, amend, modify or impair) any provisions of the Lease.     CITY OF PALO ALTO ADMINISTRATIVE AGENT    APPROVED AS TO FORM        Senior Deputy City Attorney BORROWER     APPROVED       City Manager       Director of Utilities   DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F   EXHIBITS LEASE AGREEMENT/CITY OF PALO ALTO & KOMUNA PALO ALTO LLC Page EX-21 Rev. 11/18/15  999020‐eml      Schedule 23.2 Termination Value Year 275 Cambridge 475 Cambridge 520 Webster 445 Bryant 1 $995,014 $1,222,788 $992,017 $683,323 2 $959,623 $1,179,296 $956,733 $659,018 3 $925,897 $1,137,849 $923,108 $635,857 4 $893,564 $1,098,115 $890,873 $613,653 5 $862,366 $1,059,775 $859,769 $592,227 6 $660,578 $811,795 $658,589 $453,650 7 $646,500 $794,494 $644,553 $443,982 8 $631,414 $775,955 $629,512 $433,622 9 $615,219 $756,052 $613,366 $422,500 10 $597,801 $734,647 $596,000 $410,538 11 $579,035 $711,585 $577,291 $397,651 12 $558,786 $686,701 $557,103 $383,745 13 $536,903 $659,808 $535,286 $368,716 14 $513,220 $630,704 $511,674 $352,452 15 $487,556 $599,165 $486,087 $334,827 16 $459,710 $564,945 $458,325 $315,704 17 $429,462 $527,773 $428,169 $294,932 18 $396,571 $487,353 $395,377 $272,344 19 $360,770 $443,356 $359,684 $247,758 20 $321,767 $395,424 $320,798 $220,972 21 $279,238 $343,160 $278,397 $191,766 22 $232,830 $286,128 $232,129 $159,895 23 $182,153 $223,850 $181,604 $125,093 24 $126,778 $155,799 $126,396 $87,064 25 $66,233 $81,395 $66,034 $45,485 DocuSign Envelope ID: 09D09B17-A2E0-4787-B4B8-67BAA0A28C3F Certificate Of Completion Envelope Id: 09D09B17A2E04787B4B867BAA0A28C3F Status: Completed Subject: Please DocuSign: Komuna Lease Agreement Exhibits FINAL 1.14.2016.pdf Source Envelope: Document Pages: 106 Signatures: 4 Envelope Originator: Certificate Pages: 1 Initials: 0 Janet Billups AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 janet.billups@cityofpaloalto.org IP Address: 199.33.32.254 Record Tracking Status: Original 1/14/2016 10:03:46 AM Holder: Janet Billups janet.billups@cityofpaloalto.org Location: DocuSign Signer Events Signature Timestamp Zach Rubin zrubin@komunaenergy.com Security Level: Email, Account Authentication (None) Using IP Address: 24.130.60.185 Sent: 1/14/2016 10:14:13 AM Viewed: 1/14/2016 10:17:40 AM Signed: 1/14/2016 10:21:48 AM Electronic Record and Signature Disclosure: Not Offered ID: In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Notary Events Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 1/14/2016 10:21:50 AM Certified Delivered Security Checked 1/14/2016 10:43:57 AM Signing Complete Security Checked 1/14/2016 10:43:55 AM Completed Security Checked 1/14/2016 10:43:55 AM City of Palo Alto (ID # 6534) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: 2016 City Council Priority Setting and Annual Retreat Title: Policy and Services Committee Recommendation Regarding 2016 City Council Priority Setting and Annual Retreat From: City Manager Lead Department: City Manager Recommendation: Consider 2016 City Council Priorities by reviewing attached documents in preparation for the Annual Retreat scheduled for January 30, 2016 at Mitchell Park Community Center. Background On December 1, 2015 the Policy and Services Committee discussed feedback from City Council members and the community regarding priorities for 2016. Attached is the staff report from the meeting as well as the guidelines which includes the definition, purpose, and process for priority setting. Additional attachments include a table indicating feedback from Councilmembers and copies of community feedback received from Open City Hall, an online civic engagement site. Discussion The majority of Councilmember feedback recommended continuing the 2015 priorities: Comprehensive Plan Completion The Built Environment: Multi-modal transportation, parking and livability Infrastructure Strategy and Implementation Healthy City, Healthy Community In addition to the recommendation the Committee asked to quantify the feedback from the community, whether received through email, phone or Open City Hall. Staff has tabulated the feedback with one point for comments received about each item. Item Points The Built Environment 49 Airplane Noise 46 City of Palo Alto Page 2 Housing 20 Development 17 City Finances 12 Sustainability 11 Infrastructure 7 High Speed Rail 7 Smoking 4 Fiber 3 Government Transparency/Accountability 2 Comprehensive Plan 2 Finally, the committee asked to receive an update on the accomplishments and ongoing items from last year’s retreat which were either referred to the Policy & Services Committee or Committee as a Whole. Item Status Annual Review and Amendments to Procedures and Protocols Policy & Services review complete; final approval scheduled for City Council in February 2016 Meeting Management Discussed at Policy & Services within Procedures and Protocols Staff Relations Discussed at Policy & Services within Procedures and Protocols Core Values Ongoing Revolving Door Policy Council approved update to Municipal Code; further discussion scheduled for Policy & Services Committee in February 2016 Planning Code Updates (Appeals Process) City Council approved on January 11, 2016. One remaining item to return to City Council on February 24, 2016. Discussion of Committees 1. Changing Day of standing committees (Policy &Services; Finance) 2. Creation of Healthy City, Healthy Community 3. Creation of Comprehensive Plan Committee 1. Insert Policy & Services recommended a change; Council pulled the item for further consideration – date to be determined 2. Stakeholder group created with 6 meetings completed in 2015. 3. Citizens Advisory Committee created with 9 meetings completed in 2015. City of Palo Alto Page 3 Related to potential process for the retreat, the Committee felt that there was enough alignment on continuing the 2015 Priorities that the retreat could explore the projects related to the priorities; and possibly provide the opportunity for Council to have a more in-depth conversation about the work plan, resource allocation and timeline for the year. Finally, the committee acknowledged that the retreat itself may not be sufficient time for the Council to finalize these aspects. Timeline The City Manager and staff will work with the Mayor and Vice-Mayor in further refinement of a potential agenda and timeline for Council consideration at the retreat. Attachments:  Attachment A: Table of Council Priorities - 2016 (PDF)  Attachment B: Priority Setting Guidelines (PDF)  Attachment C: 12-1-15 Policy & Services Committee Staff Report (PDF)  Attachment D: Open City Hall Feedback (PDF) Attachment: A   Summary of City Council Feedback  2016 Council Priorities    Page 1 of 1    Name Priority Area  Mayor Burt Continue 2015 Priorities   Vice Mayor Scharff Continue 2015 Priorities   Councilmember Berman Continue 2015 Priorities but add “housing” to The Built Environment  Councilmember Dubois Continue 2015 Priorities and have discussion about work plan and details under each priority at the retreat.  Councilmember Filseth Continue 2015 Priorities  Councilmember Holman  Continue 2015 Priorities  Councilmember Kniss Continue 2015 Priorities  Councilmember Schmid 1. Comprehensive Plan Completion  2. The Built Environment  3. Long term fiscal analysis  Councilmember Wolbach 1. The Built Environment  a. Housing supply and affordability  b. Transportation:   i. Grade separation of Caltrain crossings (funding and planning)  ii. Working with local partners (Stanford, Transportation Management Agency, PAUSD,  Chamber of Commerce, etc.) on Transportation Demand Management and mobility  iii. VTA ballot measure negotiations  iv. Safety and mobility for all (including non‐drivers)  v. Parking management  2. Healthy City, Healthy Community  a. Services and facilities for vulnerable populations: homeless, youth, seniors, disabled, and low  income.  3. Infrastructure Strategy  and Implementation  a. Climate change risk preparations: flooding, water security, and fire risk.      City of Palo Alto  City Council Priority Setting Guidelines  Approved by City Council: October 1, 2012 Last revised: October 1, 2012 Background The City Council adopted its first Council priorities in 1986. Each year the City Council reviews it’s priorities at its Annual Council Retreat. On October 1, 2012 the City Council formally adopted the definition of a council priority, and the Council’s process and guidelines for selection of priorities. Definition A Council priority is defined as a topic that will receive particular, unusual and significant attention during the year. Purpose The establishment of Council priorities will assist the Council and staff to better allot and utilize time for discussion and decision making. Process 1. Three months in advance of the annual Council Retreat, staff will solicit input from the City Council on the priorities to be reviewed and considered for the following year. a. Council members may submit up to three priorities. b. Priorities should be submitted no later than December 1. c. As applicable, the City Manager will contact newly elected officials for their input by December 1. d. The City Clerk will provide timely notice to the public to submit proposed priorities by December 1. The Policy and Services Committee shall recommend to the Council which suggestions if any shall be considered at the City Council retreat. 2. Staff will collect and organize the recommended priorities into a list for Council consideration, and provide to Council no less than two weeks in advance of the retreat. 3. The Policy and Services Committee, each year at its December meeting, shall make recommendations about the process that will be used at the Annual Retreat paying particular attention to the number of priorities suggested by Council members. The recommended process is to be forwarded to Council for adoption in advance of the Council retreat. Guidelines for Selection of Priorities 1. There is a goal of no more than three priorities per year. 2. Priorities generally have a three year time limit. Attachment A City of Palo Alto  City Council Priority Setting Schedule    Last Updated: 8/17/2012   Attachment A City of Palo Alto (ID # 6376) Policy and Services Committee Staff Report Report Type: Agenda Items Meeting Date: 12/1/2015 City of Palo Alto Page 1 Summary Title: 2016 City Council Priorities Title: Discussion and Recommendations for 2016 City Council Priority Setting Process From: City Manager Lead Department: City Manager Recommendation Policy and Services Committee discuss and consider making recommendations to the City Council in January on the process to be used at the Annual Retreat to identify the 2016 Council Priorities. Background On October 1, 2012, the City Council approved the Council Priority Setting Guidelines included as Attachment A. The guidelines define a Council priority and lay out the purpose, process and general parameters for annual priority setting. Consistent with these guidelines, the Council established early December as the deadline for Council submitting 2015 priorities to staff. Each year the Policy and Services Committee, at its December meeting, is to review the priorities suggested and consider making recommendations to the City Council about the process that will be used to identify priorities at the Annual Retreat. The recommended process is to be forwarded to the Council for adoption. As the Council directed, after the submittal period closes, staff is to collect and organize the Council recommended priorities into a list and provide to the Council no later than two weeks in advance of the 2016 Annual Retreat. Discussion This staff report provides the input received from the Council and the public on the priorities to be reviewed and considered for 2016. A Council priority is defined as a topic that will receive particular, unusual and significant attention during the year. The purpose of establishing priorities is to assist the Council and staff City of Palo Alto Page 2 to better allot and utilize time for discussion and decision making. There is a goal of no more than three priorities per year and priorities have a three year time limit. The Policy and Services main focus is to make process recommendations for Council conduct of the priority setting at the retreat. In some years, the Council used the “nominal group voting technique” (dot voting) to work through suggestions and generate a collective recommendation. In recent years, Council Members briefly presented their suggestions and explanations as needed and Council discussion led to relatively easy decisions. The 2012 policy helped add definition and limitations on the priorities which helped. Staff is collecting Council member feedback and will provide a summary at the Policy & Services Committee through an At Places Memo. Policy and Services may want to offer some suggestions to staff regarding groupings. Whatever staff presents, Council, obviously, can amend or modify the recommendations at the retreat. Input from City Council Staff will provide an At Places Memo on the input received from Council members on recommended priorities. Input from Community In October 25, 2015, the City posted the question, “What are the priorities you would like to see the City Council adopt for 2016?” to its Open City Hall online civic engagement site to solicit input and feedback from the community. As of November 18, 2015 a total of 212 individuals had visited the topic with 62 posting responses. The community is still able to provide feedback on Open City Hall, but below is a summary of comments received to date, and identification of a number of themes that emerged from the responses:  Reduce airplane noise  Housing: low cost/high density, more affordable, charge all new housing Mello-Roos fees, increase supply, build housing near transit, moderate public housing near Caltrain stations and along El Camino  Growth and development: no parking exemptions for developers, stop office development, charge all new commercial development $25,000 per job to trench Caltrain, recognize the Palo Alto is at limit of growth, infrastructure to support growth, finish Comprehensive Plan  Parking and transportation: policies to encourage biking, walking and EVs, support high speed rail, close all inner streets, address influx of parking in residential neighborhoods, safe bike routes, TDM measures including demand-based parking downtown, parking permits for Evergreen neighborhood, multi-modal transportation solutions, shuttle service improvements, train grade crossing  Municipal governance: eliminate appearance of conflict of interest between electeds/developers/city employees after leaving city responsibilities, clarify role of City of Palo Alto Page 3 Planning Commission, cut Palo Alto’s unfunded liabilities for current and past employees, manage benefits and salary to city employees, reduce utility costs  Smoking: no smoking in apartments/condos  Other: fiber-to-the-premise/high speed internet, sustainability, more open space, closed circuit TV on all major arteries to prevent crime, flood control, no home construction on Saturday Attachment B is the detailed responses from Open City Hall. As of November 18, 2015 no feedback was received from the community through email, telephone or mail. Timeline Upon the Policy & Services Committee’s approval, staff will forward the recommendation to the City Council in January. Staff will update the January staff report to include any additional community feedback received prior to agenda publication. Upon approval by the City Council in January, staff will publish results in advance of the retreat. At this time, the Council’s 2016 Annual Retreat is tentatively set for January 30, 2016. Attachments:  Attachment A: Priority Setting Guidelines and Schedule (PDF) All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM As with any public comment process, participation in Open City Hall is voluntary. The statements in this record are not necessarily representative of the whole population, nor do they reflect the opinions of any government agency or elected officials. All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? As of January 11, 2016, 12:25 PM, this forum had: Attendees:357 On Forum Statements:88 All Statements:127 Hours of Public Comment:6.4 This topic started on October 25, 2015, 9:45 PM. All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 2 of 25 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? David Coale in Barron Park January 9, 2016, 8:02 PM Priorities for Palo Alto in 2016 The top priority for Palo Alto should be addressing climate change. With the Climate Action Summit, the finalization of the city's Sustainability Climate Action Plan and the momentum of the COP-21 talks in Paris, now is the time to take strong action on climate change. Since transportation is the largest part of the city's carbon emissions, the city should work on TDM measures first as this is the most cost effective means to reduce GHG emissions while addressing the parking and congestion complaints that many people have listed as a priority for the city. This will also increase the quality of life and health in our busy downtown and business areas. Next would be to work on fuel switching ordinances to move away from natural gas and to meet the states mandate of net zero energy homes by 2020. Fuel switching should be accelerated and incentivized to address new and exiting homes and businesses. While the building department has some plans in place, we should step up this process and lead the way for others to follow. Along with transportation and fuel switching the city should continue strong support for EVs and charging infrastructure. The completion of the waste water treatment plant to an anaerobic facility should also be completed/accelerated. The delay of this facility will only increase the cost and emissions from an outdated plant to one that would be energy positive. In summary: Put in place a strong Sustainability Climate Action Plan that implements - TDM measures for our downtown and business areas, University, Cal Ave and Stanford industrial park - Support mode switching away from signal occupancy vehicles - Promote active transportation, biking, walking and safe routes for everyone - The above three items would be working towards no car new trips - Greater Support for EVs in the community. - Promote and incentivize fuel switching away from natural gas - Streamlined permitting for all electric, net energy zero new homes and retrofits - Accelerate the rebuilding of the waste water treatment plant to an anaerobic net energy positive facility - have all of the above completed in ten years so as to reduce our GHG emissions by 50% Paul Heft in Midtown/ Midtown West January 9, 2016, 1:53 PM 1. Climate action: S/CAP Plan completion and implementation 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 3 of 25 2. The Built Environment: Multi-modal Transportation, Parking and Livability Walt Hays in Greenmeadow January 9, 2016, 9:45 AM I agree with the statement made by David Coale. Specifically: 1. Climate change is the greatest threat to humanity. Congress is blocking action on the national level, so local action is critical. Palo Alto is a leader and model with its carbon-neutral electricity, so a high priority should be to build on that record with aggressive actions such as (a) incentivizing switching from natural gas to electricity; and (b) promoting EVs, through publicizing their benefits and installing more charging stations. Walt Hays Name not shown in Crescent Park December 27, 2015, 11:16 AM Number one priority is for the city to obtain the technical and political support that will stop the invasive, piercing, screeching, incessant loud airplane noise. The loud airplane noise has greatly impacted the quality of my life: 1) the noise is so loud, it is difficult to fall asleep, let alone have quiet time reading in bed. The loud noise awakens me in the middle of the night and begins again early in the morning. The airplane noise sounds like a movie of WW11 dive bombers, ready to drop their bombs. 2) In our lovely garden, having breakfast, enjoying being together, the loud noise disrupts our conversation and makes it very hard to hear one another. Reading a book in the garden, or just relaxing is impossible due to the screeching loud noise. The noise is so loud, I am quite concerned that my ears, my hearing will be damaged. I have keep a log of the frequency of the planes; Many times in the day and night, the planes come about every 3-5 minutes. This is a severe problem that urgently requires action from the city council. Name not shown in Duveneck/ St Francis December 26, 2015, 6:59 PM Please make the reduction of airplane noise in Palo Alto your highest priority. Please do all you can to make the FAA focus on an equitable distribution of air traffic instead of channeling it through Palo Alto. The incessant noise over our homes and schools has become intolerable. We are losing sleep, agitated, can't focus when working from home--concentration is disrupted every 3 minutes with another flight, and don't hang out in our yard because the experience is now miserable. Name not shown in Midtown/ Midtown West December 24, 2015, 2:43 PM Please do all you can to make NextGen jet noise go away. Jet noise has destroyed Palo Alto's quality of life. 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 4 of 25 I'm often angry and depressed because of it and it disturbs my sleep, even with double pane windows, a white noise machine, and earplugs. This is my #1 issue by far. I'm logging complaints to stop.jetnoise.net every two or three minutes as I write this. I don't want to leave Palo Alto but I can't comprehend living here indefinitely with the amount of noise we are battered with. Next, please stop or slow down office, commercial and housing development as much as possible. I don't understand those who are willing to slow down office development but encourage high density housing development. If we develop high density housing, instead of having gridlock only at rush hour because we have so many commuters, we will have gridlock at all hours of the day because of all the new residents. Please try to retain at least some of Palo Alto's quality of life? We've lost so much already. I suppose if the city's TDM program was wildly successful and the number of jobs in Palo Alto was reduced, we could consider more housing, but only if the TDM was proven to dramatically decrease traffic, and I doubt that is going to happen. If the City builds more housing, that housing should be reserved for teachers and other workers to address the city employee recruitment and retention issue, or, change the BMR program to reserve BMR units for city employees. Thank you for listening! Name not shown in Midtown/ Midtown West December 22, 2015, 1:42 PM - Fully address flood control - Ban all wood burning in the city - Reduce airplane noise 1 Supporter Bill Gargiulo in Old Palo Alto December 21, 2015, 10:08 PM We have lived in this wonderful city for 23 years. Nothing has impacted us in those 23 years as much as the recent FAA changes that have brought a significant increase in air traffic and noise to our lives. Please continue to focus on this issue as it can have a significant impact in the value of our city. No one wants to live directly under an airport runway. Name not shown outside Palo Alto December 21, 2015, 9:18 PM Airplane noise is relentless and must be dealt with to have any chance of quality of life. Ronda Rosner in College Terrace December 21, 2015, 2:20 PM Our primary concern is the aircraft noise from the FAA's NextGen program. We ask the City Council to adopt 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 5 of 25 the reduction of this noise as a priority for 2016. There is no escape from the noise and it has had and continues to have a significant negative impact on our quality of life, particularly sleeping and being outdoors. Measures of the loudness of any individual jet underestimate the effect of living under the newly grown NextGen superhighway in the sky over our city. The sonic background in our neighborhood is now dominated by aircraft noise. We've lost our peaceful and healthy community and we want it back. -- Ronda and Jeff Rosner in College Terrace 3 Supporters Patti Kahn in Barron Park December 21, 2015, 1:42 PM I would like to see the Council address, as soon as possible, the issue of noise from low-flying aircraft, which has severely eroded our quality of life since the implementation of the NextGen program. We have planes flying at a low altitude over our home in Barron Park, and the noise is unbelievable. Every three minutes, from before 6:00 am each morning til after 1:00 am each night, planes whine, scream, and roar overhead. The noise is bad enough inside our house, where we have triple-paned glass windows. Spending time outside is out of the question--the noise is unremitting and just too intrusive. 1 Supporter Name not shown in Greenmeadow December 21, 2015, 1:24 PM Leave these priorities in place. They are still appropriate. Suggestion: Please put special emphasis on Safe Routes to School. This year we will celebrate the 10-year anniversary of the formalization of the successful Palo Alto Safe Routes to School partnership of City of Palo Alto, PAUSD, and the Palo Alto Council of PTAs. In the last ten years we have accomplished more than we ever dreamed when we started. We can use that momentum to take these programs to the next level in our next decade. Please highlight this important milestone. Thank you! 1 Supporter Maryanne Welton in Barron Park December 21, 2015, 1:23 PM Please do everything you can to change the flight pattern into SFO. The new flight path means that I am woken up every night multiple times by low-flying and loud jets. I am sleep deprived every single day because of the new flight pattern. It has made it impossible to enjoy time spent outdoors. I didn't choose to live under the flight path when I moved to Palo Alto and I may not retire here because of it. 3 Supporters Name not shown in Green Acres December 19, 2015, 8:16 PM The number one and very urgent priority in 2016 for the City Council should be to stop the commercial aircraft 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 6 of 25 highway over Palo Alto introduced by the FAA's NextGen program. Air traffic and related air craft noise in affected city areas has reached an unacceptable level. Quality of life has been severely negatively impacted by disruption of sleep patterns and daytime productivity by the constant noise pollution. There are hundreds of airplanes crossing on a daily basis at a very low altitude over residential areas with a high density of schools. The city should recognize this as a serious problem that is quickly spiraling out of control. 3 Supporters sallie whaley in Crescent Park December 19, 2015, 7:16 PM 1) Air traffic and noise over Palo Alto. 2) CAR TRAFFIC 3) Speeding cars on University Ave. and Red light violators 2 Supporters Name not shown outside Palo Alto December 18, 2015, 4:32 PM 1. Palo Alto has already passed the tipping point in terms of livability, sustainability, quality of life. Too much urbanization! Do not issue one more commercial space building permit until infrastructure needs are met, e.g., traffic, parking, and WATER. 2. Forget about ABAG demands. We didn't elect ABAG board members, so they shouldn't dictate our future. 3. Say NO to bus lanes on El Camino. They will only drive more car traffic into our neighborhoods. The VTA admits that's part of their plan: frustrated drivers will leave El Camino to look for other routes, and the only place they can go is through residential areas. (It would be nice if all those opposed to airplane noise SUPPORTED the first such statement instead of repeating it over and over. And why can we only SUPPORT 5 comments? That restriction doesn't make sense.) 3 Supporters Lee Christel in Midtown/ Midtown West December 18, 2015, 1:05 PM (1) Lobby strongly for changes to distribute air traffic equitably over the entire bay area. The increase in SFO jet noise over Palo Alto is way out of proportion to the growth in general SFO traffic. The FAA and SFO Roundtable have shifted traffic to us. The City has a part to play both in encouraging Federal leaders and engaging the FAA directly. (2) Restrict the Palo Alto airport to emergency use only. This facility benefits the wealthy few at the expense of noise and leaded fuel pollution over thousands of residents and the Baylands Park. (3) Fund the installation of independent noise monitors for measuring aircraft noise pollution and how it is changing over time. This is the only way to monitor and verify improvements from the FAA. (4) Continue restricting commercial development unless the traffic impacts are addressed. Consider more high density housing near transit. (5) Encourage High Speed Rail as a way to reduce the use of short airline flights and their excessive CO2 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 7 of 25 contribution. (6) Pass ordinances to restrict parking of RVs and other 'live-in' vehicles on our streets. (7) Implement a plan to cut Palo Alto's unfunded liabilities for current and past employees. 1 Supporter Jon Zweig in Midtown/ Midtown West December 18, 2015, 10:43 AM The increase in airplane noise has made our city a much less pleasant place in which to live. The incessant roaring and whining overhead makes it difficult to work, concentrate or relax. This was not the case a few years ago. The level of noise Palo Alto experiences has clearly been shown to affect health, learning and productivity. The FAA will correct the problem if we continue to press aggressively. The City has a part to play both in encouraging Federal leaders and engaging the FAA directly. Please continue to address the problem of airplane noise pollution over our city as aggressively as necessary. 3 Supporters Stan Hutchings in Old Palo Alto December 17, 2015, 3:03 PM If the traffic on ECR is speeded up by coordinating the lights, buses AND autos will get to their destination much faster. It would not be a bad idea to get rid of most left turn signals that are not at a major arterial - people will just have to U-turn to go back. Personally, I think Google, Ford, Toyota, Nissan and other autonomous vehicle manufacturers should contract with VTA to provide "bus" service up and down ECR. Provide 4 or more seats every 5 minutes or less, and the ability to provide portal-to-portal service with ride-sharing. Then trips for us older folk would be much more convenient, especially if it ever starts raining again. We might start taking the "bus", especially if the cost were reasonable. Not having to pay a driver and expensive big bus maintenance would be a plus, and 24/7 service is feasible. I could go to a concert or lecture, and not have to worry about parking. Autonomous "buses" should not even be limited to ECR; they should be called on demand, much like a taxi. This is the 21st Century, the age of Technology. We should use it to our advantage. Buses and trains are so 20th Century. As my wife and I were walking around Old Palo Alto, we commented how noisy it was, with gas powered leaf blowers, noisy trucks, airplanes overhead every few minutes, even some private vehicles were much louder than average. City council should take efforts to reduce noise pollution. A reporting system for gas powered leaf blowers, similar to complaints.serfr1.org, but perhaps on PaloAlto311 that would identify ones location and put in a non-urgent police report, and accept photos of scofflaws in action and their vehicles would be a good start. 1 Supporter Kim Lemmer in College Terrace December 17, 2015, 2:57 PM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 8 of 25 Please make reducing aircraft noise over Palo Alto a priority in 2016. The noise level has increased tremendously in the past several years and I appreciate the efforts of our city government to work on this problem. 1 Supporter Name not shown in Downtown North December 17, 2015, 1:28 PM Please address the issue of aircraft noise over Palo Alto. The NextGen program has resulted in constant noise pollution with planes flying at low altitudes at all hours of the day and night. The FAA put the equivalent of a superhighway (or how about "high speed rail"?) directly over our heads without the appropriate community involvement or environmental impact studies. NextGen has had a very significant negative impact on the quality of life in Palo Alto. We need a better solution, and we need it now! 1 Supporter Michael Harris in Ventura December 17, 2015, 12:23 PM Hello, Please make the noise problem from low-flying commercial aircraft a city priority in 2016. SFO inbound and outbound flights fly over our Ventura neighborhood every five to ten minutes from 6:00 am to 2:00 am. I have tracked so many flights with Flighttracker so it is easy to use this app to see just how many SFO flights all converge over Palo Alto. I wish for the City to put in dB meters to measure the severe noise pollution and to work with our representatives to get the FAA to make the needed changes to their failed nexgen air-traffic control system. Thanks! Michael and Nikki Harris 219 Matadero Ave Palo Alto, CA 94306 650-704-7560 1 Supporter Name not shown in Duveneck/ St Francis December 17, 2015, 12:03 PM Continuing to address the increasing and abhorrent low, loud, and frequent airline traffic in Palo Alto would be the top priority that I would suggest. We literally have an airline freeway above our house and it has totally disrupted my sense of peace while at home. The air pollution also is a concern. The planes are not nearly as frequent in any surrounding cities/towns that I visit and it only seems fair to distribute the planes in an equitable fashion. 1 Supporter Kent Mather in Old Palo Alto December 17, 2015, 11:42 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 9 of 25 Reduce Airport noise over Palo Alto. Current FAA SFIA approach rules have added many more flights directly over my home and the city of Palo Alto resulting in more noise both day and night. Name not shown in Palo Verde December 17, 2015, 11:40 AM Palo Alto priorities in 2016 should be: 1 airplane noise 2 airplane noise 3 airplane noise Name not shown in Old Palo Alto December 17, 2015, 11:23 AM The Council's top priority should be airplane noise. Nathaniel Sterling in Research Park December 17, 2015, 11:19 AM Ordinarily I do not have major concerns with life in our city, but that has changed this past year with the change in aircraft flight patterns into SFO. The incessant air traffic overhead is oppressive and never lets up. Every few minutes another comes thundering in. I can't think of a higher priority for the City Council to address. Thanks. Marcia Sterling in Research Park December 17, 2015, 11:16 AM We hope our elected officials will make reduction of airplane noise over Palo Alto a priority in the year ahead. Marcia and Nat Sterling Ben Zhang in Palo Verde December 17, 2015, 10:51 AM 1. Airplane noise. 2. Traffic in South PA. - How to smooth traffic on road along the schools (Gunn, Terman, JLS, Hoover, etc.) in the morning. It takes me 30 minutes just drive 1.5 mile in the morning to work. Name not shown in Old Palo Alto December 17, 2015, 10:40 AM Please support all the residents that are dealing with the never ending airplane noise over our city. Please give the employees that drive to PA a "great deal" to insure they use the almost empty city parking 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 10 of 25 garages instead of our streets. Please stop all council meeting at a reasonable time, enough talking! The traffic in ridiculous. As a resident for over 40 years I and many of my friends, do not go downtown because of the traffic. No more new office buildings unless the builders provide adequate parking for their employees. Do not offer us a park bench, or 2 low income housing units to make up for lack of a garage. Name not shown in Green Acres December 17, 2015, 10:35 AM Please, please, please do something about the aircraft noise! The planes are flying so low and go screaming or roaring by. The only quiet times at our house are between 1am and 5am. It's insane! My husband wants out of Palo Alto. Something must be done! 2 Supporters Roland Finston in Palo Verde December 17, 2015, 10:31 AM Continue pressuring the FAA to totally revise the NexGen air flight routing over Palo Alto so as to remove the noise sources that have so disrupted our peace of mind. 2 Supporters Name not shown in Charleston Meadows December 17, 2015, 10:29 AM Airplane noise has diminished the quality of life greatly. The city should focus on this as #1 priority. Also: - Do not forget about High Speed Rail and maintaining pressure on them to do the right thing. - Move electric wires underground. 1 Supporter guy livneh in Palo Verde December 17, 2015, 10:22 AM Airplanes are making such a noise. Since Palo Alto became the main place in which almost any airplane from/to SFO or even san jose passes over. The planes make a turn over palo alto, we live in constant noise in the last few years. This has become a major effect on our quality of life. 5 Supporters Name not shown in Crescent Park December 17, 2015, 9:35 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 11 of 25 Aircraft noise is an urgent issue. The quantity of low flying airplanes crossing our City every hour of the day (and in the middle of the night) are a danger to our health and well being. 1 Attachment https://pd-oth.s3.amazonaws.com/production/uploads/attachments/13o3ggwusvs0.3xx/August_complaints.pdf (2.8 MB) 5 Supporters Name not shown in Southgate December 16, 2015, 9:57 AM Please quell the noise from aircraft! 4 Supporters Name not shown in Downtown North December 4, 2015, 3:26 PM Dear Councilmembers, Airline noise is a changeable and unecessary environmental problem in Downtown Palo Alto, disturbing the peaceful life we and our visitors deserve. The airlines are not following the rules and coming in to sfo at illegal low altitudes creating loud upsetting whines and roars over downtown Palo Alto 24/7. You can take action to change the way airlines are disregarding Palo Alto, and taking advantage of us to save fuel on low noisy approaches directly over downtown Palo Alto to SFO. Please help correct these illegal flights. Also, Fix the streets and sidewalks they are hazardous. Cowper street between Lytton and Hawthorne is terrible. We need better walking and bicycling in Palo Alto. Hedges are too high and cars parked causing low visibility at corners, lumpy sidewalks, Toilet in Johnson Park and others. Better reference materials in the Downtown library. Thanks, Larry Alton 3 Supporters Hamilton Hitchings in Duveneck/ St Francis December 3, 2015, 6:22 PM 1. Finish the Comprehensive Plan Update 2. Increase the City's Resiliency -- Build the new police station, replace Chaucer and Newell Bridges, address seismically unsafe buildings, fix unfunded pensions 3. Smart Sustainable Growth -- Ensure new buildings are high quality, conform to zoning rules and integrate with their surroundings -- Update zoning to refocus growth away from commercial (except for Stanford Research Park) towards desperately needed high quality housing within the 50' height limit in downtown areas near services, transportation and jobs. Include affordable housing for teachers, police & community service workers. -- Improve traffic and parking (including more shuttles, Caltrain Go passes, bike infra, parking permits subsidizing alternate transportation) 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 12 of 25 -- Trench Caltrain & Reduce Airplane Noise 6 Supporters John Carlsen in Downtown North December 3, 2015, 3:20 PM Establish transparency and accountability throughout the city. Establish objective metrics for city staff that measure efficient/quality work. Use these to explain compensation level and changes thereto. 2 Supporters Name not shown in Community Center December 3, 2015, 2:53 PM The marked and disproportionate increase in loud, frequent air traffic over our community is one of my top concerns, and I would like to see Palo Alto focus on ensuring that SFO and the FAA make changes to reverse the negative impact on our community. I'm also interested in progress on housing strategy, and continued investment in understanding how we can continue to have an excellent school system while reducing the mental health challenges present in our schools, particularly the high schools. Thank you. 4 Supporters Kerry Yarkin in Midtown/ Midtown West November 28, 2015, 3:25 AM Jet noise from Palo Alto airport and from SFO. The noise is relentless and in every part of Palo Alto. I'm seriously thinking about moving out of Palo Alto until the peace, quiet, nature's sounds can be restored to the level of summer 2014. Restore and maintain standards of noise to a level befitting the NUMBER ONE CITY TO LIVE IN THE U.S. 5 Supporters Name not shown in Barron Park November 27, 2015, 4:54 PM I would like for the City of Palo Alto to look at the needs of families, particularly those with young children. The cost of child care in Palo Alto is exhorbitant. Those who work and live in this community need convenient child care options near our workplaces and homes. Businesses should be given incentives to provide child care options to employees and the City of Palo Alto and Palo Alto Unified School District should be leaders in providing child care options to employees as well. 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 13 of 25 1 Supporter Ashwinee Khaladkar in Fairmeadow November 13, 2015, 4:21 PM I would like 3 things addressed: 1. Traffic calming in residential streets. Drivers are zooming by and the only explanation I can see is that Charleston, E. Meadow and Alma have long lights that cause backup forcing drivers to find alternate routes through residential streets. Moving caltrain underground and avoiding delays at the Alma seems like a no brainer, albeit very expensive. 2. Overhead electric wires make our city look like its stuck in the 1950s. Please underground those. 3. Airplane noise is certainly increased and should be addressed. 2 Supporters Name not shown in Leland Manor/ Garland November 12, 2015, 5:23 PM Airplane noise --it is urgent and it is impacting residents, students, and workers 3 Supporters Name not shown in Barron Park November 12, 2015, 3:11 PM Airplane noise. 2 Supporters Jeff Hoel in Midtown/ Midtown West November 12, 2015, 2:17 PM Commit to a citywide municipal fiber-to-the-premises (FTTP) network, and then start implementing it. In 2013 and 2014, Council adopted Technology and the Connected City (TACC) (FTTP plus various wireless frills) as a priority, but not much happened, apparently because some officials hoped Google Fiber would emerge and be good enough. But it won't be good enough. In 2015, Council failed to adopt TACC as a priority, apparently because the City Manager promised that staff would do the same things whether TACC were a priority or not. I think Council should have made it a priority, since, taking the City Manager at his word, it wouldn't have cost anything, and it would have been clearer to the public. Name not shown in Greenmeadow November 12, 2015, 12:32 PM Stop indoor and outdoor burning of wood, paper etc. all year long. 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 14 of 25 1 Supporter Arthur Liberman in Barron Park November 12, 2015, 10:52 AM Revise and reform the development proposal and approval process: - eliminate the possibility of an 'appearance of conflict of interest' between City appointed and elected officials and City employees who work for and represent developers soon after leaving their City responsibilities; - clarify (and rewrite if necessary) the Planning Commission responsibilities to insure that members ALWAYS follow the Comp Plan guidelines and priorities; - update the Architectural Review Board membership (fewer architects, more open to the public) and insure their responsibilities mesh with - rather than conflict with - the Planning Commission; - make the entire procedure transparent and open to the public, from presentation of plans to approval; 1 Supporter Name not shown in University South November 12, 2015, 8:35 AM 1. Increase in airplane noise is my top priority. Palo Alto and neighboring communities were snookered by FAA, who received a "Categorical Exemption" from Congress, meaning that they could bypass the Environmental Impact Assessment process that every other major development must follow. We need a re-do on approach route changes to SFO, this time with the noise imposed on us groundlings meaningfully considered. 2. Business development. Quit giving developers exemptions from parking space requirements in exchange for sculptures and other such nonsense. Ask the citizens which they want: they'll make it clear that parking is more important. Council's stated reason is to "entice businesses to Palo Alto". Really? They should be enticing us, paying us a premium to move here. 3. Get real on a vision of Palo Alto 20 years from now. Enlightened, educated, sophisticated, community famous for quality of life? Or Cyber-Industrial Park, mostly office space, choking traffic. Name not shown in Crescent Park November 11, 2015, 10:50 PM The surge in airplane noise is by far the most pressing issue for the city, in my opinion. 4 Supporters Name not shown in Professorville November 11, 2015, 8:01 AM Healthy communities - noise from airplanes and pollution from lack of coordinated public transportation Housing - Our teachers cannot afford to live in Palo Alto. There are models in other communities--Sunnyvale-- for building housing for professionals who serve the community. 1 Supporter Jamie Beckett in Evergreen Park November 10, 2015, 5:10 PM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 15 of 25 I'm surprised that addressing traffic and congestion have not come up more so far. It is wonderful that Palo Alto is the place that businesses want to be, but our city is being choked by commercial development that is bringing hundreds or even thousands of cars to our streets. I live in the California Avenue area, which is slated for (or has already seen) six large office developments -- and that's not counting the police station. Yet we have not had a single infrastructure improvement to support these added cars. I am at the point where I cannot exit onto the main street without feeling like I'm in danger of hitting another car or a cyclist. Seriously. But it's not just me at my house. I'm sure people downtown have been facing these sorts of problems for ages. So we need to STOP office development -- applause to the council for action taken so far -- and take some time to take stock of how it is affecting those of us who live here. 1 Supporter Kirsten Flynn in Ventura November 10, 2015, 3:06 PM I am a life long resident of Palo Alto- growing up in Barron Park, living in Ventura, going to PA schools, and sending my 3 kids through PA schools. I believe sustainability must be the primary goal of any level of government at this point in history. So how does that reflect at the city level? First- we must continue to work on our effort to quantify and offset our carbon footprint. This includes looking at the the jobs/housing imbalance and offsetting the transportation footprint of those coming or going from the city for work. This also includes making EVERY effort to decrease that imbalance, because local housing/local jobs are lower carbon that remote jobs. (Read as- limit office construction maximize AFFORDABLE housing!) In order to take serious aim at carbon neutrality, we must design our forms of transportation to prioritize all forms except the single occupant car. I know this pisses folks off, but gridlock is here (try getting through the intersection 1/2mile from my house- Page Mill and El Camino in less that 2 lights) building safer biking or bus commuting infrastructure actually lessens gridlock at this point, by taking cars off the road. Additionally we need to incentivize open space preservation, perhaps even open space dedicated to agricultural uses. This is important both for food security, and air quality. Finally- a truly sustainable city has a diverse economy. We are overly dependent on high tech office space. Any employment sector can crash, and a city with a diverse population and many economic employers can weather such a crash, without draconian cuts to schools and city budget. We have seen this cycle, and yet have not planned for it. We want Palo Alto to be an economically viable, desirable, livable city, and this means prioritizing sustainability and diversity. 1 Supporter Name not shown in Old Palo Alto November 10, 2015, 2:53 PM Main priority for 2016: Traffic and parking! They are out of control. Myra Gilfix outside Palo Alto November 10, 2015, 2:44 PM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 16 of 25 Palo Alto is the center of Silicon Vallley, and yet we often have inadequate internet access. As one responder said, "Why are we still dealing with expensive and low quality comcast service when we have a perfectly decent fiber ring running throughout palo alto?" The City could and should provide a much better home/business offering. Underground electrical lines. Coordinate underground work with anything else that should be done at the same time. 1 Supporter Chris DiBona in Duveneck/ St Francis November 10, 2015, 2:13 PM Frankly: It's the internet, stupid. Why are we still dealing with expensive and low quality comcast service when we have a perfectly decent fiber ring running throughout palo alto? Give/lease it to Google if the city isn't up to the task of provisioning a decent home offering. We don't need to 'study' this anymore. Considering who lives in our town and the industries that have grown up here it is pretty terrible that we have such awful internet services available to our citizens and our businesses. 3 Supporters Michelle Kraus in University Park November 10, 2015, 2:02 PM In adopting the Healthy City, Healthy Community initiatives, please ban cigarette and related smoking in all rental properties in the City now. Second hand smoke kills and we can't afford the fire hazard. Jeff Wheeler in Ventura November 10, 2015, 8:40 AM I would like to see Palo Alto support high speed rail come to CA as quickly and as affordable as possible. Let us help find funding and support enviornmental review for this critical transportation mode that is well-proven throughout the world. 2 Supporters Ihab Awad in Southgate November 9, 2015, 3:16 PM Low cost, high density housing is a must. Current residents who love the village-like character of Palo Alto are already well compensated with a massive return on their real estate investments. To resist changes that make the City a more integral part of the thriving, larger Silicon Valley economy that created these riches is not forward-looking and serves nobody: it does nothing to quell the growth, from which we all benefit, but it forces local workers to live in lower cost bedroom communities far away, putting more pressure on parking and road transportation. 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 17 of 25 4 Supporters Joerg Rathenberg in Crescent Park November 9, 2015, 3:06 PM Here are three critical topics that need to be adressed in this order: 1. How can we stop the intolerable airplane noise caused by FAA's NextGen system ASAP? 2. What can we do to prepare for the expected El Nino? 3. How can we address the massive influx of parked cars in residential neigborhoods after the recent changes in parking downtown, causing people to park in streets that until now were quiet and peaceful? Name not shown in College Terrace November 9, 2015, 2:59 PM Housing is the most important issue we face today because Palo Alto is quickly and increasingly becoming an affluent retirement community. When I grew up here, Palo Alto was a diverse and thriving community, but it's not that way anymore. We need more and more types of housing across all of Palo Alto, particularly around transit nodes. 3 Supporters Ava Hahn in Southgate November 9, 2015, 2:45 PM Safe bike routes (protected from car traffic) for our kids to ride to and from school. Let's encourage kids to bike for their own health, the environment and to improve our intolerable traffic situation. 1 Supporter Name not shown in Charleston Terrace November 9, 2015, 2:43 PM Please develop and implement a plan to cut Palo Alto's unfunded liabilities for current and past employees. City commitments are not inline with the private sector economy and what the tax payers in Palo Alto face for retirement. We need to get away from pensions and aggressively move the obligation for city employee retirement to the employee through defined contribution plans etc. This is how I have to plan for my retirement and I see no reason this is not equitable for our city employees. Further, the public records disclosure of city salaries in The Daily Post has helped debunk the myth that these retirement benefits are needed to make up for meager salaries. If a city employee can make more in the private sector, they are free to go get it, but we should not be fooled into believing that we will not be able to attract and retain good people. 3 Supporters Aaron Nelson in Evergreen Park November 3, 2015, 11:48 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 18 of 25 Charge all new housing probably about 25,000$ in Mello-roos development fees to fund new schools, a water recycling plant, and bike paths. In exchange they get a housing voucher. Charge all new commercial development about 25,000$ per job (about 200 square feet) to trench Caltrain and redo Page Mill road and build more parking. Also require a housing voucher per job created. Stop allowing transferable development rights to make parking and road problems worse. Name not shown in Downtown North November 2, 2015, 11:37 PM Recognize that there are limits to growth and that Palo Alto is at the limit. More growth will lead to diminishing quality of life for current residents. Palo Alto city is like an ecosystem and must not be over-exploited. End all commercial development and housing growth. Stop the ever increasing city staff raises and perks. Outsource more of the city workers jobs so that we don't have to pay into the retirement system that is bankrupting the state. No more automatic raises and moving employees to different classifications so they can get promotions and raises for doing the same job. Stop worrying about what outside entities think of Palo Alto and work on making it the best city possible for the people who currently live here. The best example you can set is to do what is best for this city and let others follow. Every step taken should consider all ramifications city wide. Palo Alto is woefully behind on park space per resident. Put most discretionary money towards acquiring more park space. Yes, you need to buy the land and turn it into parks. And you need to buy lots of land. It will be one of the best ways this city has spent money in a long time. Name not shown in Downtown North October 30, 2015, 2:43 PM Please ban smoking in all units of multi-family dwellings. Reasons: -- The smoke drifts into apartments of those who don't smoke. -- Research indicates that second hand smoke is deleterious to health for everyone, but particularly bad for infants, children, the elderly, and those with asthma, breathing difficulties, and cancer. -- There are more fires in buildings whose occupants smoke. Further, there is precedent for passing laws pertinent to multi- and not single- family dwellings. One such law concerns noise. People should be able to do anything they want in their own apartment provided such activity does not impinge upon the health or safety of others. Thank you for considering my petition. 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 19 of 25 -- 1 Supporter Name not shown in Downtown North October 27, 2015, 7:50 PM Developing Palo Alto into a real city: More housing in Palo Alto and more public transportation 3 Supporters Jeff Rensch in Barron Park October 26, 2015, 9:06 PM Council needs to bite the bullet and build, even subsidize, more middle-income and low-income housing or the city will not be sustainable in coming decades. 3 Supporters Ozzie Fallick in Evergreen Park October 26, 2015, 8:19 PM More housing! All over the Peninsula, cities are building tons of office space and no housing. Palo Alto is one of the worst offenders. This leaves plenty of jobs, with nowhere for the workers to live, so traffic gets bad (because all the workers have to drive in) and rents get ridiculous. I feel unwelcome in Palo Alto because I'm not a millionaire with two kids. Please consider some higher-density housing development near transit. Plenty of small cities do it without compromising their character; my hometown of Bethesda, MD did this with great success, allowing multi-story apartment buildings and mixed-use development in the city center, with a height limit that decreases with distance from the subway station. There are apartments for those who want them and single-family homes for those who don't. 2 Supporters Frank Flynn in Ventura October 26, 2015, 7:20 PM In my mind the biggest problem is supporting the growth which will inevitably happen here. Not only is this more housing but also the infrastructure to support it: particularly significant improvements to Caltrain (no grade level crossings, more service, and faster service), come to terms with high-speed rail, continued improvement to the bicycle and other alternative transportation infrastructure, better roads-although there may not be much room to build them, and the institutions that a population needs schools hospitals grocery stores. 2 Supporters Dan Bloomberg in Barron Park October 26, 2015, 5:43 PM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 20 of 25 In order from highest to lowest priority: (1) Get fiscal house in order. Stop the unsustainable defined-benefit pensions with the SEIU, with their ballooning unfunded liabilities that will severely limit city improvements in the near term and eventually bankrupt Palo Alto. Going forward, get all city employees on 401K plans. (2) Stop ABAG Sunnyvaleization. Push back on ABAG, which is "demanding" thousands of new residential units in high density settings over the next decade. Look at all the traffic we presently have -- this will only get worse with more high-density housing. We don't need the small amount of funds that ABAG has the power to deny us, so we can tell them to stuff it. But we do need to keep Palo Alto livable. We're already gridlocked -- more is worse. (And have you noticed that when traffic gets worse, drivers get worse (impatient, rude), and we lose one of the great qualities of Palo Alto -- civility.) (3) Start the major infrastructure projects, like the new public safety building, that have been repeatedly postponed and require responsible fiscal management of Palo Alto's resources. (4) Install closed circuit TV on all major arteries. Palo Alto is a wealthy city, and hence a ripe target for thieves. CCTV will let potential criminals know that we're serious about preventing crime, and the smart ones will stay away. 4 Supporters Jules Brouillet in Barron Park October 26, 2015, 1:20 PM I take night classes, so I cannot attend the comp. plan update meetings. Here are the priorities that the city should adopt to respond to our urgent housing shortage crisis that render our renters captive to the consciences of our landowners. -Moderate and high-density (private-)public housing projects near Caltrain stations and along El Camino Real. The latter should make the Grand Boulevard Initiative more viable here. -Rent control should be used to preserve existing and new renters' incomes until increased housing supplies make Palo Alto rents affordable. -Preservation of parks and open space. Construction of classrooms to increase PAUSD should be vertical, rather than horizontal encroachments on city parks and fields. -A PAUSD curriculum/program for students grades 1-12 on solving problems facing our city. This could be a collaboration between the city, the school district, and the Palo Alto Youth Commission. -Increased city revenues through reassessment of properties (which requires passage of SCA-5, The Property Fairness Amendment), an income tax, and / or a wealth tax. -TDM measures, including demand-based parking fees downtown (as in San Francisco), permit-only parking neighborhoods walking-accessible from downtown, GoPasses and EcoPasses for all city residents and employees of Palo Alto businesses, subsidies for carpoolers. -More representative and vocal representation of the northwest county region on the Caltrain and VTA board. Lobbying by the city for the extension of BART through south San Mateo County. -Raising the city minimum wage, and city employee wages and benefits, to correspond with the rising housing / other costs of living in Palo Alto 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 21 of 25 2 Supporters Joel Davidson in Barron Park October 26, 2015, 12:29 PM Ban smoking in apts. and condo complexes. increase open space. Bob Moss in Barron Park October 26, 2015, 11:11 AM Comprehensive Plan update has gone on too long. Review latest version in February and adopt agreeable sections, retain current versions of any revised sections that council can't agree on. Assure that current development limits for R-1 and R-2 are retained. Infrastructure for public safety facilities and traffic improvements are priorities. Limit office development and expansion. Preserve retail. Can be made part of Comprehensive Plan update. If revenues exceed predictions by more than 10% use half of excess for traffic improvements including more shuttles. Keep water use low, reduce 5% if possible. 2 Supporters Cedric Chin in Palo Verde October 26, 2015, 11:07 AM Reduce utility costs. For one thing, you don't need to stuff three color utilities flyers in the envelope. Those flyers go *right* into the recyclying bin. Housing's fine as it is, or at least promote housing and services for elderly care. I'm already seeing new units built near Fry's. We already have a shortage of schools. Darryl Fenwick in Downtown North October 26, 2015, 10:49 AM Don't focus on short term fixes or knee-jerk reactions to problems. Longer term issues need attention before they become short-term crises. Benefits to city employees need to be managed so that we can afford to pay tomorrow's city retirees without sacrificing tomorrow's city services. Housing development must be managed to accommodate tomorrow's needs. Moratorium's on office development must be replaced by sensible rules to keep downtown viable for businesses and attractive for residents. Parking for future downtown employees must be increased before the local streets are flooded with their cars. Alternative transport must be encouraged and incentivised. And the HSR-rail debacle must be addressed before the rail crossings become virtual barriers during commute hours. 4 Supporters Name not shown outside Palo Alto October 26, 2015, 10:42 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 22 of 25 Parking permits for the Evergreen neighborhood. Those of us that don't go to offices every day, but occasionally need to run errands during the day find there is no place to park when we come back. People either not willing to pay for Cal Train parking or work on Cambridge or Cal Ave. park on College Ave. between Park and Ash. If that fills they go to Ash or Oxford. We residents need to be able to come and go during the day and not have to hunt for blocks for some place to park. 1 Supporter Stepheny McGraw in Palo Verde October 26, 2015, 10:18 AM Palo Alto is bursting at its seams. Not everyone who works here should or needs to live here and we should not pander to developers' needs, but those of the current tax paying residents. Let's work to keep the city's quality of life -- infrastructure of schools and services and parks -- healthy and balanced. 1 Supporter Jacqueline Grubb outside Palo Alto October 26, 2015, 10:14 AM Banning Smoking in apartments in Palo Alto!!Evolve, it is absurd that it is allowed. Name not shown in Greenmeadow October 26, 2015, 9:18 AM Build Affordable housing - we are your Grandparents! 3 Supporters Name not shown in Downtown North October 26, 2015, 9:07 AM It's very simple: Palo Alto City Council needs to address the massive housing shortage that exists in our city. Building new housing has been too difficult for too long, and that's completely changed the character of Palo Alto, making it look less and less like an innovative college town and more and more like a place for the old and wealthy. 4 Supporters Name not shown in Downtown North October 26, 2015, 7:41 AM Add to the housing stock by changing zoning and allow developers to build housing. 7 Supporters Name not shown in Greenmeadow October 26, 2015, 7:36 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 23 of 25 Airplane noise. This has become so intrusive that our family is expecting, in the absence of a remedy, to sell our house and to leave Palo Alto, at a huge cost to our careers, finances, and social lives. 1 Supporter Name not shown in Midtown/ Midtown West October 26, 2015, 7:34 AM I would like to see the City Council adopt these priorities for 2016: * Flood control * Airplane noise * Reducing compensation and retirement benefits for city workers 1 Supporter Name not shown in Green Acres October 26, 2015, 6:47 AM A study, looking forward into the future, 5, 10 years of the infrastructure and transportation needs given commercial and industrial growth that the city deems appropriate and feasible. If this has been done in the past, update that process to include forward thinking planning, including infrastructure that is out of their control such as Stanford U. and Caltrans highways so they can advise those parties. 1 Supporter Name not shown in College Terrace October 26, 2015, 6:45 AM I would like the city council to discuss how the rent for housing could be better controlled. The cost of living is consistently getting higher and the wages of the retail employees, teachers and middle class income people are not increasing in the same way like the price for renting a place to live. This is a main concern of many. Traffic safety should be ongoing a discussion. The 35 limit on Alma leaves the ones honoring the limit way behind the ones passing you by, making signs and driving 55! The same is on Middlefield Road, while driving the 25, you are passed by speeders. Name not shown in Evergreen Park October 26, 2015, 6:44 AM Deal with housing affordability crisis by limiting amount landlords can raise rent or other measures. Schools are decreasing classes because families are moving away because they can't afford to stay, and we will lose the diversity that is one of the things that makes Palo Alto special 1 Supporter Name not shown in Old Palo Alto October 26, 2015, 6:32 AM 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 24 of 25 I would like to see no home construction on Saturday. The residence need at least two days of quiet per week. I believe that Atherton has this rule. 1 Supporter 2016 Council Priorities What are the priorities you would like to see the City Council adopt for 2016? All On Forum Statements sorted chronologically As of January 11, 2016, 12:25 PM http://www.peakdemocracy.com/3163 Page 25 of 25 CITY OF PALO ALTO OFFICE OF THE CITY CLERK January 25, 2016 The Honorable City Council Palo Alto, California SECOND READING: Adoption of an Ordinance Amending Chapter 9.14 (Smoking and Tobacco Regulations) of the Palo Alto Municipal Code to Include E-Cigarettes, Change Signage Language, and Include Additional Enforcement Options (FIRST READING: January 11, 2016 PASSED: 9-0) This Ordinance was heard by the City Council on Monday, January 11, 2016 and was adopted without change, with a vote of 9-0. ATTACHMENTS:  Attachment A: Smoking Ord (PDF) Department Head: Beth Minor, City Clerk Page 2 ATTACHMENT A *NOT YET APPROVED* Ordinance No. ______ Ordinance of the Council of the City of Palo Alto Amending Chapter 9.14 (Smoking and Tobacco Regulations) of the Palo Alto Municipal Code to Establish New Smoking Restrictions to Include E-Cigarettes, Change Signage Language, and Include Additional Enforcement Options The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Findings and Declarations. The City Council finds and declares as follows: (a) That the adoption of this Ordinance is necessary to protect the public health, safety and welfare for the reasons set forth in amended section 9.14.005. The purposes of this Ordinance are to ban smoking in commercial areas, all dining areas, and worksite in order to reduce the risks of second hand smoke and vapor, reduce litter, and enhance enjoyment of these areas. SECTION 2. Chapter 9.14 of the Palo Alto Municipal Code is hereby amended to read as follows: Palo Alto Municipal Code Chapter 9.14: Smoking and Tobacco Regulations 9.14.005 Purpose. The purpose of this Chapter is to: (a) Protect the public health, safety and general welfare by prohibiting smoking and use of electronic smoking devices in public parks, public places, service locations, city pool cars, child day care facilities, and unenclosed eating establishments. (b) Ensure a cleaner and more hygienic environment within the city, reduce litter, and protect the City's natural resources, including creeks and streams. (c) Enhance the welfare of residents, workers, and visitors by reducing exposure to second hand smoke, which studies confirm can cause negative health effects in non-smokers. (d) Balance the needs of persons who smoke with the needs of nonsmokers, including children and youth, to be free from the discomforts and health threats created by exposure to second-hand smoke and vapor. 9.14.010 Definitions. The following words and phrases, whenever used in this chapter shall be construed as defined in this section: 1 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* (a) "Bar" means an area which is devoted to serving alcoholic beverages and in which serving food is only incidental to the consumption of such beverages. "Bar" shall include bar areas within eating establishments which are devoted to serving alcoholic beverages and in which serving food is only incidental to the consumption of such beverages. (b) ”City pool car" means any truck, van or automobile owned by the city and operated by a city employee. City pool car does not include vehicles operated by the police department. (c) “Commercial Area” means an area, including all publicly owned sidewalks, alleys, parking areas, public places, outdoor dining areas, service areas, etc. within areas zoned in the City’s Comprehensive Plan as regional/community commercial (including Downtown, California Avenue Business District, Town and Country, and Stanford Shopping Center) and Neighborhood Commercial. (d) "Eating establishment" means a coffee shop, cafeteria, short-order café, luncheonette, sandwich shop, soda fountain, restaurant, or other establishment serving food to members of the public. (e) “Electronic smoking device” means an electronic and/or battery-operated device that can deliver an inhalable dose of nicotine to the user. “Electronic smoking device” includes any product meeting this definition, regardless of whether it is manufactured, distributed, marketed or sold as an electronic cigarette, electronic cigar, electronic cigarillo, electronic pipe, electronic hookah, electronic vape, vaporizer or any other product name or descriptor. (ef) "Employee" means any person who is employed by any employer in consideration for direct or indirect monetary wages or profit. (fg) "Employee eating place" means any place serving as an employee cafeteria, lunchrooms, lounge, or like place. (gh) "Employer" means any person who employs the services of an individual person or persons. (hi) "Enclosed" means either closed in by a roof and four walls with appropriate openings for ingress and egress or not open to the sky due to a cover or shelter consisting of a tarpaulin, tent structure or other impermeable or semi-permeable materials or fabric. (ji) "Motion picture theater" means any theater engaged in the business of exhibiting motion pictures. (kj) “Public Event” means events open to the general public, including but not limited to a farmers’ market, parade, craft fair, festival, or any other such event. (kl) "Public places" means enclosed areas within publicly and privately owned buildings, structures, facilities, or complexes that are open to, used by, or accessible to the general public. Public places include, but are not limited to, stores, banks, eating 2 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* establishments, bars, hotels, motels, depots and transit terminals, theaters and auditoriums, enclosed sports arenas, convention centers, museums, galleries, polling places, hospitals and other health care facilities of any kind (including clinics, dental, chiropractic, or physical therapy facilities), automotive service centers, general business offices, nonprofit entity offices and libraries. Public places further include, but are not limited to, hallways, restrooms, stairways, escalators, elevators, lobbies, reception areas, waiting rooms, indoor service lines, checkout stations, counters and other pay stations, classrooms, meeting or conference rooms, lecture rooms, buses, or other enclosed places that are open to, used by, or accessible to the general public. (ml) "Service locations" means those enclosed or unenclosed areas open to, used by, or accessible to the general public that are listed below: (1) Bus, train and taxi shelters; (2) Service waiting areas including, but not limited to, ticket or service lines, public transportation waiting areas, and public telephones; (3) Areas within twenty-five feet of the entrance or exit to an enclosed public place, where smoking is prohibited; (4) Areas in dedicated parks or other publicly accessible areas that are within twenty-five feet of bleachers, backstops, or play structures. (nm) "Smoking" means the combustion of any cigar, cigarette, tobacco or any similar article. (on) "Tobacco product" means any substance containing tobacco leaf, including but not limited to cigarettes, cigars, smoking tobacco, and smokeless tobacco. (po) "Tobacco store" means a retail store utilized primarily for the sale of tobacco products and accessories and in which the sale of other products is incidental. (qp) "Tobacco vending machine" means any electronic or mechanical device or appliance the operation of which-depends upon the insertion of money, whether coin or paper bill, or other thing representative of value, which dispenses or releases a tobacco product and/or tobacco accessories. (r) “Vapor” means aerosol produced from use of an electronic smoking device. (sq) "Workplace" means any enclosed area of a structure or portion thereof used as a place of employment as well as unenclosed workplaces, such as outdoor construction sites. 9.14.020 Smoking prohibited - Enclosed Places. 3 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* Smoking and the use of electronic smoking devices is prohibited in the Enclosed Areas of the following places within the City of Palo Alto, except in places subject to prohibition on smoking contained in Labor Code section 6404.5, in which case that law applies (1) Workplaces; (2) Public places; Any places exempted by the California smoke free workplace law (Labor Code Section 6404.5(d)) are not exempt under this chapter. Smoking is prohibited by this chapter in all places exempted by that State law, except as provided in 9.14.070. 9.14.025 Smoking prohibited - Unenclosed Areas. (a) Smoking and the use of electronic smoking devices in all unenclosed areas defined as Service Locations shall be prohibited, including a buffer zone within 25 feet from any doorway, window, opening, crack, or vent into an Enclosed Area in which Smoking is prohibited, except while the Person Smoking is actively passing on the way to another destination and provided Smoke does not enter any Enclosed Area in which Smoking is prohibited. (b) Smoking and the use of electronic smoking devices is prohibited in unenclosed eating establishments and bars. 9.14.030 Smoking prohibited - City pool cars. Smoking and the use of electronic smoking devices is prohibited in all city pool cars. 9.14.035 Smoking Prohibited - Public Parks and Public Events. Smoking and the use of electronic smoking devices is prohibited in all parks, including at public events. 9.14.040 Smoking prohibited - Child day care facilities. Smoking is prohibited in a private residence which is licensed as a child day care facility within the meaning of Health and Safety Code Section 1596.750 and Section 1596.795 and amendments. 9.14.050 Smoking prohibited – Commercial Areas and Public Events. Smoking and the use of electronic smoking devices is prohibited in commercial areas, except places where smoking is already prohibited by state or federal law, in which case those laws apply. This prohibition includes public events held on public streets. A shopping center or commercial areas may establish a designated smoking area that is at least 25 feet away from any openings and includes receptacles to control litter. 9.14.060 Reserved.* 4 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* * Editor's Note: Former Section 9.14.060, Regulation of Smoking in the Workplace, previously codified herein and containing portions of Ordinance Nos. 4056 and 4164 was repealed in its entirety by Ordinance No. 4294. 9.14.070 Exemptions. The following places and workplaces are exempt from Section 9.14.020: (a) Smoking at theatrical production sites is not prohibited by this subsection if the theater general manager certifies that smoking is an essential part of the story and the use of a fake, prop, or special effect cannot reasonably convey the idea of smoking in an effective way to a reasonable member of the anticipated audience. This exception will not apply if minors are performers within the production. (b) Bingo games, consistent with prohibition on smoking contained in Labor Code section 6404.5 and licensed pursuant to the Palo Alto Municipal Code, which do not permit access by minors under eighteen years of age (c) A fully enclosed room in a hotel, motel, other transient lodging establishment similar to a hotel, motel, or public convention center which is being used entirely for a private function and which is not open to the general public, except while food or beverage functions are taking place, including setup, service, and cleanup activities, or when the room is being used for exhibit purposes, and except for sixty-five percent of the guest rooms in a hotel, motel, or similar transient lodging establishment; (d) Tobacco stores with private smokers' lounges meeting the requirements of the applicable portions of subdivision (d)(4) of Labor Code Section 6404.5. 9.14.80 Location of tobacco vending machines. (a) No person shall locate, install, keep or maintain a tobacco vending machine except in a place which under state law is not lawfully accessible to minors. (b) This section shall become effective ninety days after its enactment. Any tobacco vending machine not in conformance with this section upon its effective date shall be removed. 9.14.090 Display of tobacco products for sale. No person shall display or offer tobacco products for sale except in an area, or from within an enclosure, which physically precludes the removal of the tobacco products without the assistance of the person authorizing such display or offer, or an employee of such person. (Ord. 4056 § 4 (part), 1991) 9.14.100 Posting of signs required. 5 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* With the exception of service locations, wherever this ordinance prohibits smoking and the use of electronic smoking devices, conspicuous signs shall be posted so stating, containing all capital lettering not less than one inch in height, on a contrasting background. Signs of similar size containing the international "no smoking" symbol consisting of a pictorial representation of a burning cigarette and electronic smoking device enclosed in a red circle with a red bar across it may be used in addition to or in lieu of any signs required hereunder. Such signs shall be placed by the owner, operator, manager, or other persons having control of such room, building, or other place where smoking and the use of electronic smoking devices is prohibited. Signs placed at each entrance of buildings in which smoking is totally prohibited shall be sufficient. The absence of signs shall not be a defense to a violation of any provision of this chapter. // // 9.14.110 Enforcement. Pursuant to Section 6 of Article IV of the Palo Alto City Charter, the city manager is hereby granted authority to enforce the provisions of this chapter and Labor Code Section 6404.5. 9.14.120 Public nuisance. Any violation of this chapter is a public nuisance and may be abated in accordance with Chapter 9.56 of the Palo Alto Municipal Code and/or Code of Civil Procedure Section 731. 9.14.130 Violations to be misdemeanors. Violation of any provision of this chapter shall be a misdemeanor punishable as provided in this code. Violations shall be punishable by any of the following: warning, administrative citation, infraction, or misdemeanor. Violations shall also be punishable by the following fines: (1) A fine not exceeding $250 for the first violation; (2) A fine not exceeding $300 for the second violation; (3) A fine not exceeding $500 for each additional violation within one year. SECTION 3. Severability. If any provision, clause, sentence or paragraph of this ordinance, or the application to any person or circumstances, shall be held invalid, such invalidity shall not affect the other provisions of this Ordinance which can be given effect without the invalid provision or application and, to this end, the provisions of this Ordinance are hereby declared to be severable. SECTION 4. The Council finds that this project is exempt from the provisions of the California Environmental Quality Act (“CEQA”), pursuant to Section 15061 of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that the ordinance will have a significant effect on the environment. 6 150310 sh 0170010 ATTACHMENT A *NOT YET APPROVED* // // // // // // // // // // SECTION 5. This ordinance shall be effective on the thirty-first day after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ Assistant City Attorney City Manager ____________________________ Director of Public Works 7 150310 sh 0170010 CITY OF PALO ALTO OFFICE OF THE CITY CLERK January 25, 2016 The Honorable City Council Palo Alto, California SECOND READING: Adoption of an Ordinance Amending Title 5 (Health and Sanitation) and Title 18 (Zoning) of the Palo Alto Municipal Code to Require all Businesses to Subscribe to Recycling and Compost Services and Comply With Refuse Sorting Requirements (FIRST READING: January 11, 2016 PASSED: 9-0) This report was heard by the City Council on January 11, 2016 and was adopted without change, with a vote of 9-0. ATTACHMENTS:  Attachment A: Compost Ord (PDF) Department Head: Beth Minor, City Clerk Page 2 150807 jb 00710649B 1 Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Amending and Restating Chapter 5.20 of Title 5 and Amending Section 18.23.020 of Chapter 18.23 of Title 2 of the Palo Alto Municipal Code Pertaining to the Collection, Removal and Disposal of Refuse The Council of the City of Palo Alto does ordain as follows: SECTION 1. Chapter 5.20 of Title 5 of the Palo Alto Municipal Code is hereby amended to read, as follows: "CHAPTER 5.20 COLLECTION, REMOVAL AND DISPOSAL OF SOLID WASTE AND RECYCLABLE MATERIALSREFUSE 5.20.010 Definitions. Within and limited to this chapter, theThe following words and phrases whenever used in this chapter shall be construed as defined in this section, unless the context indicates otherwise. (1) “Bin” shall means a detachable solid waste or recycablerefuse container used in connection with commercial/industrial premises with a 1 to 8 cubic yard capacity, equipped with a lid, and designed for mechanical pick-up by collection vehicles. (2) “Box”, sometimes known as a "roll-off" or "drop" box, means a wheeled or sledded container or compactor, generally 7 to 50 cubic yards in size, suitable for the storage and collection of commercial or industrial solid waste or recyclable materials. (3) “Cart” means a wheeled container receptacle larger than a Standard container and smaller than a bin, equipped with a lid, and designed for mechanical pick-up by collection vehicles. (4) “City” means the government of the City of Palo Alto, defined in Section 1.04.050(1) of the municipal code, with a principal place of business at 250 Hamilton Avenue, Palo Alto, County of Santa Clara. (4) “City landfill” means the City of Palo Alto’s landfill, located at 2380 Embarcadero Road, Palo Alto, California. (5) “City manager” means the person referred to in Section 2.08.140 of the municipal code,City Manager of the City of Palo Alto or the city manager’s or designee. (6) “Collection agreement” means a contract with the cityCity for the collection of 150807 jb 00710649B 2 solid waste and recyclable materials,refuse pursuant to Section 5.20.040. (7) “Collector” means one or more persons authorized under by Section 5.20.040 to provide solid waste, recyclable materials, or solid waste and recyclable materialsthe collection, removal processing and disposal services of refuse pursuant to one or more written contracts with the city. (8) “Commercial/industrial business owner” means any person , firm, corporation or other enterprise or organization holding or occupying, alone or with others, commercial/industrial premises, whether or not it is the person holdser of the title or the is the record owner of record of the commercial/industrial premises. (9) “Commercial/industrial premises” means all any occupied real property in the cityPalo Alto, except property occupied by federal, state or local governmental agencies which do not consent to their inclusion, and except residential premises as defined in subsection (3127) hereof, and shall include, without limitation, any wholesale and or retail establishments, restaurants and food service establishments, bars, stores, shops, shopping center, offices, industrial establishments, manufacturing establishments, service stations, repair, research and development establishments, professional, services, sports or recreational facilityies, any place or premises where an animal is maintained or sheltered, construction or demolition sites, a multiple dwelling that is not a residential premises, and any other commercial or industrial business facilityies, structures, sites, or other establishments in the cityPalo Alto. (10) “Compostable materials” means organic materials designated by the City as approved for collection and processing, including, without limitation, yard trimmings, food scraps, soiled paper and compostable plastics, but excluding animal manure, sewage sludge, and human biological wastes. (110) “Composting” means the controlled, biological decomposition of organic materials into humus for use as a soil amendment, conditioner or fertilizer or for any other similar use or purpose. (121) “Construction and/or demolition site” means any real property in the cityPalo Alto, in on or fromat which a building or structure, or any portion thereof, is being fabricatedconstructed, assembled, erected or demolished, and which producesduring which construction or demolition waste which must be removed from the property. (132) “Construction and/or demolition waste” means any solid waste generated as the result of construction or demolition work, including, without limitation, discarded packaging or containers and waste construction materials, whether brought on site for fabrication or used in construction or resulting from demolition, excluding liquid waste and hazardous waste. (143) “Container” means any bin, box, cart, compactor, drop box, roll-off box, or receptacle, used for the storage of solid waste, recyclable materials, compostable materials or other materials designated by the City for collection by the collector.standard container, mini- can container of cart. 150807 jb 00710649B 3 (154) “Director” means the person referred to in Section 2.08.190 of the Municipal Code, director of public works for the city of Palo Alto or the director's designee. (165) “Disposal or processing facility” means a landfill facility,or a recycling facility, or a composting facility or a solid waste transfer or processing station. (17) “EPA” means the federal Environmental Protection Agency or successor agency. (18) "Food service establishment" means any establishment, located or providing food within Palo Alto, which provides prepared and ready-to-consume food or beverages, for public consumption, including, but not limited to, any retail service establishment, eating and drinking service (as defined in Chapter 18.23), takeout service (as defined in Chapter 18.23), supermarket, delicatessen, restaurant, food vendor, sales outlet, shop, cafeteria, catering truck or vehicle, cart or other sidewalk or outdoor vendor or caterer which provides prepared and ready-to-consume food or beverages, for public consumption. (1916) “Hazardous waste” means waste defined as hazardous by Public Resources Code section 40141, as it now exists or may subsequently be amended, namely, a waste or combination of wastes, which because ofdue to its quantity, concentration, or physical, chemical or infectious characteristics, may do either of the following: (i) cause or significantly contribute to, an increase in mortality or an increase in serious irreversible, or incapacitating reversible, illness; (ii) pose a substantial present or potential hazard to human health or environment when improperly treated, stored, transported, or disposed of, or otherwise managed. "Hazardous waste" includes extremely hazardous waste and acutely hazardous waste, and any other waste as may hereafter from time to time be designated as hazardous by the Environmental Protection Agency ("EPA") or other agency of the United States Government, or by the California Legislature or any agency of the State of California empowered by law to classify or designate waste as hazardous, extremely hazardous or acutely hazardous. (20) “Home composting” means the controlled decomposition of organic material, including, without limitation, yard trimmings and kitchen scraps, into humus by any person owning or occupying any place or premises in Palo Alto. (2117) “Manure” shall means the waste droppings from of any animal. (18) “Manure container” shall mean Standard containers or bins, or other receptacles approved by the Director for the placement of manure, which are equipped with substantial lids or covers adequate to keep flies from the interior thereof. No Manure container shall exceed seventy-two cubic feet in capacity. (19) “Mini-can container” means a round, metallic or plastic can with a close fitting cover, handles and side bails with a maximum capacity of twenty gallons or seven and one-half dekaliters, or such other container not larger than a standard container as may be approved by the director. 150807 jb 00710649B 4 (22) “Multifamily property” means any residential premise with five or more attached units with shared service. (23) “Organic wastes” means “compostable materials.” (240) “Person” means any individual, or entity referred to in Section 1.04.050(5) of the Municipal Code and including any general partnership, limited partnership, limited liability partnership, or limited liability companyassociation, firm, partnership, corporation, or any other group or combination thereof acting as a unit. (251) “Place or premises” means every residential premises and commercial/industrial premises, including any structure, apparatus, or portion thereof occupied or operated by any person and situated on an integral parcel of land undivided by a public street, highway, or railway. (262) “Public solid waste or recycling receptacles” means receptacles any container for the collection of solid waste, or recyclableing materials or compostable materials that are both located on public property and intended for use by the general public. (273) “Recyclable materials” means those materials designated by the City that are as suitable for collection and transport to a material recovery facility for processing into a recycled content product, including, without limitation, newspaper, paper, cans, corrugated cardboard, glass and certain types of plastic, and metalsrecycling. (284) “Recycling” means the process of collecting, sorting, cleansing, treating, and reconstituting materials that would otherwise become Solid solid waste, and returning them to the economic mainstream in the form of raw material for new, reused, or reconstituted products which meet the quality standards necessary to be used in the marketplace. Recycling This term does not include transformation as that term is defined in Public Resources Code section 40180201. (29) “Refuse” means and includes compostable materials, recyclable materials and solid waste. (30) “Refuse service” means the weekly or other periodic collection, processing and disposal of materials properly deposited in the collector-provided containers for solid waste, as well as weekly collection and processing of recyclable materials and weekly collection and processing of compostable materials. (25) “Resident” means any person living within the territorial limits of the city of Palo Alto, whether or not the person owns the place or premises which he or she occupies, and any person who is a nonresident employee of the city of Palo Alto, a municipal corporation, and every member of his or her household related by blood, marriage, or adoption or a domestic regular partner. 150807 jb 00710649B 5 (3126) “Residential householder” means any person or persons holdingowning or occupying residential premises in the cityPalo Alto, whether or not the owner of the residential premise. (3227) “Residential premises” means any residential dwelling unit within the cityPalo Alto, including, without limitation, a multiple unit residential complexes, such as a rental housing projects, condominiums, apartment houses, mixed condominiums and rental housing, and a mobile home parks, except any multiple dwelling which, with the prior written approval of the director, receives commercial bin service. (33) "Salvage" means the controlled removal of construction or demolition debris/material from a permitted building, construction, or demolition site for the purpose of recycling, reuse, or storage for later recycling or reuse. Examples include air conditioning and heating systems, columns, balustrades, fountains, gazebos, molding, mantels, pavers, planters, quoins, stair treads, trim, wall caps, bath tubs, bricks, cabinetry, carpet, doors, ceiling fans, lighting fixtures, electrical panel boxes, fencing, fireplaces, flooring materials of wood, marble, stone or tile, furnaces, plate glass, wall mirrors, door knobs, door brackets, door hinges, marble, iron work, metal balconies, structural steel, plumbing fixtures, refrigerators, rock, roofing materials, siding materials, sinks, stairs, stone, stoves, toilets, windows, wood fencing, lumber and plywood. (28) “Residential recycling collection” means the process by which recyclable materials and yard trimmings are placed at the curb of a residence for collection, removal and disposal. (3429) “Solid waste” shall means all putrescible and nonputrescible solid and semisolid wastes, generated in or upon, related to the occupancy of, remaining in or emanating from Residential residential premises or commercial/industrial premises, including garbage, trash, refuse, paper, rubbish, ashes, industrial wastes, demolition and construction wastes, discarded home and industrial appliances, manure, vegetable or animal carcasses, solid or semisolid wastes, and other solid and semisolid wastes. “Solid waste” shall not include liquid wastes or sewage, abandoned vehicles, hazardous waste, or recyclable materials or compostable materials. (350) “Solid waste enterprise” shall mean any individual, partnership, joint venture, unincorporated private organization, or private corporationperson regularly engaged in the business of providing solid waste, or recyclable materials or compostable materials handling services. (31) “Solid waste or recyclable materials handling services” shall mean the collection, transportation, storage, transfer, or processing of solid waste or recyclable materials. (32) “Source separated commingled recyclable materials” are source separated recyclable materials in any combination of two or more source separated single recyclable materials. 150807 jb 00710649B 6 (33) “Source separated recyclable materials” means recyclable materials which are separated from solid waste by the generator at the location where it was created, not mixed with or containing more than incidental solid waste, as determined by the director. (364) “Source separated single recyclable materials” are source separatedmeans recyclable materials that are separated from other recyclable materials or solid waste and placed in separate containers according to type or category of materials and can be directly marketed as a distinct single commodity, as determined by the director. (35) Standard container means a metallic or plastic can with a close fitting cover, handles and side bails of a capacity of more than twenty gallons or seven and one-half dekaliters but not exceeding thirty-two gallons or twelve dekaliters, or such container other than a mini-can container as may be approved by the director. (376) “Yard trimmings” means any plant trimmings generated from the maintenance or alteration of public, commercial premises or residential premises landscapes, including, without limitation, grass cuttings, yard clippings, leaves, tree trimmings, pruning, brush and weeds, excepting those materials which are prohibited under written rules and regulations promulgated by the director. 5.20.020 Declaration of policy (a) The accumulation, collection, removal and disposal of solid waste and recyclable materialsrefuse must be controlled by the cityCity for the protection of the public health, safety and welfare. The councilCouncil finds that to give practical effect to this policy a comprehensive system for the periodic collection, removal and disposal of solid waste and recyclable materialsrefuse from all places or premises is essential and benefits all occupants of places or premises., and, therefore, Aall such occupants of places or premisesare made shall be liable for the solid waste and recyclable materialsrefuse collection charges established by the councilCouncil for the collection, removal and disposal of solid waste and recyclable materialsrefuse. (b) The City complies with the applicable provisions of the California Integrated Waste Management Act, as amended, codified in the Public Resources Code section 40000 et seq. The law requires that, by and after January 1, 2000, fifty percent (50%) of the solid waste generated must be diverted through some source reduction, recycling, and composting activities. (c) The City also complies with the 75 percent recycling goal included as part of AB 341 Mandatory Commercial Recycling Law, adopted on October 6, 2011, which includes modifications to the Public Resources Code. (d) AB 1826, which amended the law in 2014, imposes organic waste recycling requirements with a mandate that will begin on April 1, 2016. 150807 jb 00710649B 7 (e) The City may adopt, implement, and enforce requirements, rules and regulations for local compostable materials and local recyclable materials that are more stringent or comprehensive than California law. 5.20.030 Discarding of solid waste and recyclable materialsrefuse (a) No person shall throw, drop, leave, place, keep, accumulate, or otherwise dispose of any solid waste or recyclable materialsrefuse upon private property either with or without the intent to later remove the same from such that place or premises, or upon any street, public right-of-way, sidewalk, gutter, stream, or creek, or the banks thereof, or any public place or public property. (b) All persons shall separate their refuse according to its characterization as solid waste, compostable materials, or recyclable materials, and place each type of refuse in a separate container designated for disposal of that type of refuse. No person may mix any type of refuse, or deposit refuse of one type in a collection container designated for refuse of another type, except as otherwise provided in this chapter. This section shalldoes not prohibit the placement of solid waste or recyclable materialsrefuse in public solid waste or recycling receptacles, or in containers, bins or boxes for collection in accordance with the provisions of this chapter, or at the city landfill or posted recycling centers in accordance with the procedures thereof. This section does not prohibit any person from engaging in home composting. Administrative citations or any other enforcement actions will not apply to this paragraph for a person occupying a residential premise. 5.20.040 Collection, removal and disposal only by authorized persons (a) The cityCity shall authorize, permit, regulate and control the collection, removal and disposal of all solid waste and recyclable materialsrefuse generated at all places or premises. For this purpose, the City may enter into a collection agreement with one or more solid waste enterprises may be entered into by the city with or without advertising for bids. The collection agreement shall not be or be deemed or construed as a franchise nor be deemed or construed as such. (b) Notwithstanding any permit issued by any other governmental agency authorizing the collection of solid waste or recyclable materialsany type of refuse, no person other than a person with a collection agreement, or his or herits duly authorized agents or subcontractors, as provided in Section 5.20.070, shall negotiate or contract for, undertake to receive, collect, remove, transport, or dispose of any solid waste or recyclable materialstype of refuse from within the city Palo Alto for a fee, service charge or other consideration therefor, except as specifically provided herein. (c) No person shall interfere in any manner with the lawful operations of the collector or the collector’sits duly authorized agents or subcontractors. 150807 jb 00710649B 8 (d) Except as otherwise provided in this chapter, each residential householder and commercial/industrial business owner shall utilize the services of the collector for the collection of solid waste and recyclable materialsrefuse from the residential or commercial/industrial premises held or occupied by such that owner or occupant and shall pay the fees for such services asthe fees approved by the city councilCouncil. No residential householder or commercial/industrial business owner shall enter into an agreement with a solid waste enterprise for the collection of for agreement for solid waste or recyclable materialsrefuse handling services with any person, firm, or corporation other than the collector, except as otherwise provided in this chapter. 5.20.050 No unauthorized bins, boxes, or containers. (a) Except as expressly authorized by this Chapter 5.20, no person other than a collector may place a bin, box ora container within the cityPalo Alto. (b) The cityCity shall notify, in writing, any person who violates this Section 5.20.050 that the prompt and permanent removal of such the bin, box or container from the place or premises is required. The cityCity shall deliver such the written notice by posting a copy of the notice prominently upon the bin, box, or container. If the bin, box, or container is identified with by the name and telephone number of the solid waste enterprise servicing it, as required by Section 5.20.130(e), the city City shall also endeavor to contact the enterprise by telephone. The Ffailure of the City to notify telephonically the owner of the presence of the container at the place or premises telephonically shall not invalidate the notice. The city City may impound or cause to be impounded any such bin, box or container if the same is not permanently removed from the place or premises within the time set forth in the notice, which time shall be not less than twenty-four hours after the posting of the notice, or not less than six business hours after the telephonic notification, if any notice is provided. For purposes of this Section 5.20.050, “business hours" shall means the hours of 7:00 a.m. to and 6:00 p.m., Monday through Saturday. Any person who violates this Section 5.20.050 shall be liable to the city City for all fines and charges levied in connection with the collection, transportation, storage and handling of such that bin, box or container by the cityCity. The bin, box or container impounded by the city City shall be retrieved by the owner or his or her representative immediately after all applicable fines and charges have been paid. The city City manager may delegate to the collector the authority to impound any unauthorized bins, boxes, and containers and to collect the fines and charges levied by the cityCity. (c) Upon posting of a written notice of violation upon the unauthorized bin, box or container, the customer person using the unauthorized bin, box or container shall immediately cease placing solid waste and recyclable materialsrefuse therein. 5.20.060 Contracting for special hauling services. Any owner, or occupant or tenant of any place or premises may contract with the collector or his or herits duly authorized agents or subcontractors, as provided in Section 5.20.070, but not otherwise, for special hauling services for the collection, removal and disposal of solid waste in excess of the regular services provided by the collector. 150807 jb 00710649B 9 5.20.070 Use of agents or subcontractors by the collector. The city City may provide in any written contract entered into pursuant to Section 5.20.040(a) that the collector may designate, in writing, one or more agents or subcontractors who may collect, remove, and dispose of such solid waste or construction and demolition waste as may be in excess of the regular collection made by the collector, subject to the limitations set forth in the collection agreement. 5.20.080 Number of solid waste containers required. (a) No All persons owning or occupying any place or premises where solid waste is created, produced or accumulated shall subscribe and pay for this type of refuse service and shall subscribe and pay forfail to procure a sufficient number of containers to hold all solid waste created, produced or accumulated at or on the place or premises during a one-week period, unless a more frequentdifferent frequency for a collection schedule has been approved or directed pursuant to this chapter. (b) Every place or premises shall receive solid waste service at the automatic service level, unless a person who is duly authorized to represent the place or premises selects a different service level which meets the requirements of this section. The following automatic service levels shall apply for new customers: (1) Single family residential users: one Standard container; (2) Two-family dwellings, three-family dwellings, apartment houses and multiple dwelling buildings: one Standard container per dwelling unit; and (3) Motel, hotel, trailer park or mobile home park: one Standard container per dwelling unit or space. (4) Manufacturing, commercial or institutional establishments: two Standard containers. (c) In determining the sufficiency of the number of Containers required for any of the following places or premises, the following minimum standards shall apply: (1) Single family residential users: one Mini-can container; (2) Two-family dwellings, three-family dwellings, apartment houses and multiple dwelling buildings: one Mini-can container per dwelling unit; (3) Motel, hotel, trailer park or mobile home park: one Standard container per dwelling unit or space; and (4)Manufacturing, commercial or institutional establishments: one Standard container. 150807 jb 00710649B 10 (d) Unless otherwise approved by the Director pursuant to rules and regulations prescribed by the City: Standard containers shall not exceed sixty pounds or twenty-seven kilograms in weight when filled with Solid waste for collection, removal and disposal; Mini-can containers shall not exceed forty pounds or eighteen kilograms in weight when filled with Solid waste for collection, removal and disposal; and Standard containers or Mini-can containers used for Yard trimmings shall not exceed forty pounds or eighteen kilograms in weight when filled for collection, removal and disposal. 5.20.090 Collection and ownership of recyclable materials – Residential Premises. (a) All persons owning or occupying any place or premises where recyclable materials are created, produced or accumulated shall subscribe and pay for this type of refuse services and shall subscribe and pay for a number of containers sufficient to hold all recyclable materials created, produced or accumulated at the place or premises during a one-week period, unless a different frequency collection schedule has been approved or directed pursuant to this chapter.The city shall provide a program for the collection of recyclable materials from residential premises. For the purposes of this Section, recyclable materials includes yard trimmings and any other similar materials designated by the director. (b) Recyclable materials placed for curbside residential recycling collection in or outside of a container shall become the property of the collector at the time of placement at the curb or other designated location for collection in or outside of the container. The collector shall have the exclusive right to collect such the recyclable materials, unless the collection agreement specifies a different arrangement. (c) The disposal of solid waste and compostable materials in containers designated for the collection of recyclable materials is prohibited. Recyclable materials that are placed in a recyclable materials container for collection by the collector must be free of solid waste and compostable materials. (c) If Recyclable materials placed for curbside residential recycling collection are not collected as part of the city’s program for residential recycling collection, the person who placed the recyclable materials for curbside residential recycling collection is entitled to receive a written explanation pertaining to the failure of the collector to collect and dispose of the recyclable materials. It shall be the responsibility of the person who places the Recyclable materials for residential recycling collection to remove the recyclable materials within twenty- four hours of receipt of the explanation. The collector is expressly authorized to reject Recyclable materials that are not free of all but incidental amounts of putrescible solid and semisolid wastes, or that are not free of hazardous wastes. 5.20.100 Collection and ownership of recyclable compostable materials – Commercial/industrial premises. (a) The city shall provide a program for the collection of recyclable materials from commercial/industrial premises. 150807 jb 00710649B 11 (b) When recyclable materials are placed in bins, boxes, or containers that the city or the collector provide for the collection of recyclable materials, such recyclable materials shall become the property of the city or the collector, as the case may be. The city or the collector shall have the exclusive right to collect recyclable materials from such bins, boxes, or containers. (a) All persons owning or occupying any place or premises where compostable materials are created, produced or accumulated shall subscribe and pay for this type of refuse services and shall subscribe and pay for a number of containers sufficient to hold all compostable materials created, produced or accumulated at the place or premises during a one-week period, unless a different frequency collection schedule has been approved or directed pursuant to this chapter. (b) Compostable materials placed for curbside collection in a container shall become the property of the collector at the time of placement at the curb or other designated location for collection of the container. (c) On or after April 1, 2016, all commercial premises at which 8 cubic yards or more of solid waste refuse service is subscribed per week, multifamily properties, and food service establishments shall subscribe and pay for a number of containers sufficient to hold compostable materials created, produced or accumulated at or on the places or premises during a one-week period, unless a different frequency collection schedule has been approved or directed pursuant to this chapter. (d) On or after January 1, 2017, all commercial premises where 2 cubic yards or more of solid waste refuse service is subscribed per week, shall subscribe and pay for a number of containers sufficient to hold compostable materials created, produced or accumulated at or on the place or premises during a one-week period, unless a different frequency collection schedule has been approved or directed pursuant to this chapter. (e) On or after January 1, 2018, all commercial premises at which solid waste refuse service is subscribed, shall subscribe and pay for a number of containers sufficient to hold compostable materials created, produced or accumulated at or on the place or premises during a one-week period, unless a different frequency collection schedule has been approved or directed pursuant to this chapter. (f) The City may direct the collector to audit individual solid waste streams generated at commercial premises to determine the owner, occupant or tenant’s compliance with this section. 5.20.105 Contamination of containers (a) No person subscribing to refuse service shall dispose or permit the disposal of solid waste in a container designated for the collection of recyclable materials or compostable materials. The person shall remove any solid waste deposited in the recyclable materials and compostable materials containers before the collection of the recyclable materials and compostable containers occurring that week. 150807 jb 00710649B 12 (1) The collector will notify any person who occupies commercial premises whenever the City or the collector determines the recyclable materials or compostable materials container of that person is contaminated with solid waste and the waste must be removed. After the person removes the solid waste from the recyclable materials and compostable materials container, the collector will return to the commercial premises to service the container or containers and the person occupying the commercial premises will be charged a “return trip” fee specified in the refuse rate schedules. (2) If the person occupying the commercial premises does not remove the waste from the recyclable materials and compostable materials containers by the scheduled pick-up date, the containers will be serviced at the next business day and the person occupying the commercial premises will be charged both an “extra solid waste pick-up” fee and a “return trip” fee in addition to the refuse charges that apply to the level of service subscribed by the person occupying the commercial premises. The extra solid waste pick-up fee shall be determined according to the size of the contaminated recyclable materials or compostable materials container and the established rates approved by the City. (3) The fees outlined in 5.20.105 (a)(1) – (2) will also apply if a person occupying a commercial premises places recyclable materials in containers designated for compostable materials or compostable materials in containers designated for recyclable materials. (4) On or after July 1, 2021, if a person occupying a commercial premises places recyclable materials and/or compostable materials in containers designated for solid waste, the person will be subject to a “contamination” fee. (5) A person occupying residential premises will not be subject to a “return trip” fee, an “extra solid waste pick-up” fee, a “contamination” fee, an administrative citation or any other enforcement action. A multifamily property will not be subject to a “return trip” fee or an “extra solid waste pick-up” fee if owners or managers of the multifamily property can demonstrate compliance with Section 5.20.108 to the satisfaction of the director. (b) No person shall dispose of commercial grease or cooking oil in a compostable materials container. 5.20.108 Requirements for owners or managers of multifamily properties and commercial premises. (a) The owner or manager of any multifamily property or commercial premises must provide a level of refuse service sufficient to contain the refuse generated by the owners, occupants, tenants, employees, contractors, and customers of the property or premises. (b) The owner or manager of any multifamily property or commercial premises must provide the number and type of containers at the property or premises sufficient to make the 150807 jb 00710649B 13 source separation of refuse convenient for the owners, occupants, tenants, employees, contractors, and customers of the property or commercial premises. (c) The three types of containers shall: (1) Be appropriate in number and size with respect to the quantity of solid waste, compostable materials, and recyclable materials anticipated to be generated at the property or premises; (2) Bear appropriate signage and be color-coded – blue containers for recyclable materials, green containers for compostable materials, and black containers for solid waste – to identify the type of refuse to be contained and meet any additional design criteria established by the City; and (3) Be placed as close together as practicable to provide equally convenient access to users. (d) The owner or manager of any multifamily property or commercial premises shall provide information or training for new occupants, tenants, employees and contractors, including janitors, on the manner of source separation of solid waste, compostable materials, and recyclable materials. The owner or manager shall provide information or train current occupants, tenants, employees and contractors at least once per calendar year. (e) The owner or manager of any commercial premises or their contractor shall collaborate with on-site janitors to create effective source separation programs. (f) The use of public solid waste, recycling, or composting receptacles by any commercial premises is prohibited. 5.20.109 Requirements for special events. (a) The promoter or coordinator of a special event held in Palo Alto must provide a level of refuse service sufficient to contain the refuse generated at the special event. (b) The promoter or coordinator shall provide containers at appropriate locations at the special event to facilitate the source separation of solid waste, compostable materials, and recyclable materials by event employees, vendors, and attendees. (c) The three types of containers shall: (1) Be appropriate in number and size with respect to the quantity of solid waste, compostable materials, and recyclable materials anticipated to be generated at the property or premises; (2) Bear appropriate signage and be color-coded – blue containers for recyclable materials, green containers for compostable materials, and black containers for solid waste – to identify the type of refuse to be contained and meet any additional design criteria established by the City; and (3) Be placed together as a waste station to provide equally convenient access to users. 150807 jb 00710649B 14 (d) If the promoter or coordinator determines that vendor booths at the special event will require refuse containers, the vendors shall receive from the promoter or coordinator a set of refuse containers that bear appropriate signage and are color-coded to identify the type of waste to be contained. (e) The use of public solid waste recycling or composting receptacles at special events is prohibited. The promoter or coordinator shall remove or cover all public solid waste recycling or composting receptacles to prevent their use during the special event. 5.20.110 Exclusions (a) Residential Householder Exclusion. No provision of this chapter shall prevent a residential householder from collecting and disposing of occasional loads of solid waste generated in or on his or herat the residential premises, or from composting yard trimmingsat home, or from selling, donating or disposing of recyclable or compostable materials generated in or on his or herat the residential premises. The containers provided by the collector may not be used for activities authorized by this paragraph (a). Notwithstanding the foregoing, no residential householder shall employ or engage any solid waste enterprise, other than the collector to haul or transport solid waste, or recyclable materials, or compostable materials to a disposal or processing facility.; nor shall any No residential householder may collect or dispose of solid waste generated elsewhere than in or on his or herat a location that is not the residential premises. (b) Gardener's Exclusion. No provision of this chapter shall prevent bar a gardener, tree trimmer or other person engaged in a similar trade from collecting and disposing of grass cuttings, prunings, and similar materialyard trimmings not containing other solid waste whenever the collection and disposal are incidental to providing such the gardening, tree trimming or similar services. (c) Commercial Source Separated Recyclable Materials and Compostable Materials (1) Commercial/industrial business owners shall retain the right to donate or sell recyclable materials and compostable materials, or to pay fees for services to solid waste enterprises other than the collector for the collection of particular recyclable materials and compostable materials, so long as all recyclable materials and compostable materials collected are source separated single recyclable materials and compostable materials. Glass, tin, aluminum, and plastics can be collected as source separated commingled recyclable materials. The director may authorize, by written rules and regulations, collection of other recyclable materials as source separated commingled recyclable materials. All rRecyclable materials and compostable materials collected pursuant to this paragraph (c) must shall be taken transported to a recyclable materials and compostable materials ing facility achieving a diversion rate of 90 percent and where not more than 10 percent of the materials are, and not disposed of in a landfill. 150807 jb 00710649B 15 (2) Commercial/industrial business owners shall demonstrate compliance with the provisions of this paragraph (c) upon at the request of the director. (3) The city City may require any recycler, junk dealer or other enterprise engaged in the business of buying and marketing recyclable materials and compostable materials to provide the city City with information pertaining to such the collection and, including without limitation, the amount of recyclable materials and compostable materials collected from within the city’sPalo Alto’s territorial limits. (d) Collection of Source Separated Single Recyclable Materials. No provision of this chapter shall prevent a recycler, junk dealer or other enterprise engaged in the business of buying and marketing source separated single recyclable materials in the stream of commerce and which buys such materials for marketing and not for disposition in a landfill or transfer station (as defined in Public Resources Code Section 40200), from buying recyclable materials for a monetary or other valuable consideration. ; nor shall any provision of this chapter prevent suchA recycler, junk dealer or enterprise which buys such recyclable materials shall not be prohibited from removing and transporting such those materials to a destination for marketing in the stream of commerce. (e) Renovation, Rebuilding, Repairs. No provision of this chapter shall prevent a commercial/industrial business owner from arranging for any worn, spent, or defective equipment, or part thereof, used in such the commercial business and requiring renovation, rebuilding, recharging, regeneration or repair, to be picked up, renovated, rebuilt, recharged, regenerated or otherwise restored and repaired and returned to such that commercial/industrial business owner.; nor shall any provision of this chapter prevent aAny person engaged in the business of renovating, rebuilding, recharging, regenerating, or otherwise restoring or repairing such the equipment or part thereof, is not prohibited from transporting the same from or returning it to the commercial business, or from removing, transporting or disposing of any suchthe equipment, or part thereof, replaced in connection with an equipment repair or service contract. (f) Contractors' Exclusions. In addition to the authority granted by paragraph (c) of this Section 5.20.110, no provision of this chapter shall prevent a licensed contractor having aunder contract for the demolition or reconstruction of a building, structure, pavement, or concrete installation from marketing any saleable items salvaged from such the demolition or reconstruction, or from causing such the salvageable items or Cconstruction or demolition waste to be removed and transported from the place or premises aton which such waste is generated, pursuant to the provisions of the demolition or construction contract, subject to the following: (1) Such The collection, removal and disposal activity shall be performed only by the licensed contractor having theunder contract for the Cconstruction or demolition work that generated such the salvageable items or Construction or demolition waste, or by regularly employed personnel carried on the licensed contractor's payroll records as an employee. 150807 jb 00710649B 16 (2) For purposes of this paragraph (f), no bins or boxes that are detachable from the vehicle that delivered them to the Construction or demolition site can be used. (23) All vehicles used in to carrying out suchfacilitate the collection, removal and disposal activities shall be owned by or under the exclusive control of the licensed contractor and shall meet all of the requirements of this chapter and all other laws, statutes, rules, regulations and ordinances of the state of California and the cityCity. All vehicles shall be subject to inspection by and the approval of the director from time to time. (g) Reinforced Concrete Exclusion. In addition to the authority granted by paragraph (f) of this Section 5.20.110, nothing in this chapter shall prevent a commercial/industrial business owner, residential householder, or licensed contractor from using a solid waste enterprise other than the collector to dispose of reinforced concrete. (h) Document Destruction Service. No provision of this chapter shall prevent any person engaged in the business of destroying or disposing of secret, confidential or sensitive documents from transporting or disposing of such those documents, provided the transport and disposal of the documents are incidental to the as a part of such document destruction or disposal service. (i) Self-Haul Exclusion. In addition to the authority granted by paragraph (a) of this Section 5.20.110 nothing in this chapter shall prevent a commercial/industrial business owner or residential householder from, on a regular basis, collecting and disposing of solid waste generated in or onat their place or premises, in lieu of availing themselves of the services of the collector. No residential householder or commercial/industrial business owner shall employ or engage any solid waste enterprise, other than the collector, to haul or transport such materialsthe solid waste to a disposal or processing facility. Any residential householder or commercial/industrial business owner who pursuant to this paragraph (hi) seeks to on a regular basis collect and dispose of solid waste generated in or onat the place orir premises, must shall first obtain a self-haul permitapproval from of the directorcity, and must comply with the procedures for applicable to self-hauling that areto be adopted by the city council by resolution. (j) General Requirement. In all cases where the right to an exclusion pursuant to this Section 5.20.110 is exercised, disposal shall be made at a disposal or processing facility which that meets all applicable regulatory requirements. Any disposal by a person exempted under this section shall not be relieved such person from of any obligation or liability imposed by this chapter or any other city ordinance, resolution, rule or regulation for the payment of the minimum solid waste and recyclable materials disposal rates imposed pursuant to this chapter, or or of rates for the use of the city landfill, or of any other applicable rates or fees. Notwithstanding the foregoing, any person with a valid self-haul permit obtained pursuant to paragraph (hi), and who does not use the solid waste collection services offered by the collector, shall be exempt from the payment of the solid waste collection rates imposed for use of the services provided by the collector. 150807 jb 00710649B 17 (k) Backhauling Compostable Materials. A commercial business may opt out of the compostable materials service levels required by this chapter, provided that business verifies to the satisfaction of the director that all compostable materials generated on-site will be transported to a central facility to be later composted or otherwise recycled at a 90 percent rate and not placed in a landfill. (l) Space Limitations for Existing Structures. The director may grant a written exemption for any existing commercial business structure that lacks sufficient storage space for compostable materials or recyclable materials from all or portions of this section in accordance with the written rules and regulations established by the director. The director, in cases where space constraints are determined to exist, shall also evaluate the feasibility of shared container usage by contiguous businesses or multifamily property structures. (m) De Minimus Exception. The director may waive any of the requirements of this section if documentation satisfactory to the director, based upon rules and regulations, is provided to establish that the materials in any type of container, on an on-going basis is incidental to any other materials originating from that collection location. 5.20.120 Recycling storage design requirementsRefuse containers. The design of any new, substantially remodeled, or expanded building or other facility shall provide for proper storage, handling, and accessibility which will accommodate the Solid waste and Recyclable materials loading anticipated and which will allow for the efficient and safe collection. The design shall comply with the applicable provisions of Sections 18.22.100, 18.24.100, 18.26.100, 18.32.080, 18.37.080, 18.41.080, 18.43.080, 18.45.080, 18.49.140, 18.55.080, 18.60.080, and 18.68.170 of Title 18 of this Code. (a) All types of refuse containers shall be kept in a sanitary condition with the lids closed except whenever they are being loaded or unloaded. (b) Refuse containers suitable for residential places or premises shall be provided by the collector or the City. Any container shall be of a size based upon the subscription service level requested by the person responsible for the payment of charges therefor or as may be required by this chapter. Any container shall not be loaded with more than the quantity of materials that either can fit in the container with its lid closed or is in excess of the weight limit marked on the container, when the lid is closed. All containers for use at commercial premises shall be provided by or approved by the collector, except for industry-approved grease or cooking oil tallow containers that shall be provided by a designated tallow hauler. (c) Refuse containers shall be collected by the collector whenever the containers are placed in a solid waste enclosure or at the authorized collection area. Collection may be made at another location upon approval of the director, based upon the subscription service level requested. 5.20.130 Maintenance and placement of bins, boxes, and containers. 150807 jb 00710649B 18 (a) The commercial/industrial business owners andor residential householder , as the case may be, shall maintain their bins, boxes, and containers on at their places and premises, and the areas in whichwhere the containersy are located, in a good, usable, clean and sanitary condition, and shall ensure that the lids or cover on the bin, box, or container is are kept fully closed, and shall ensure that there is no litter underneath or surrounding the containers. No refusesolid waste or recyclable materials are shall be placed outside of the bin, box, or container. Bins, boxes, and cContainers shall at all times be maintained by the commercial business owners and residential householders kept in a manner that will prevents leakage, spillage and the escape emission of odors. Commercial premises sharing receptacles placed outside of retail areas, must also share equally in the responsibility of emptying the receptacles so that they do not overflow and maintaining the area around the receptacles so that it is free of loose litter. (b) The location or placement of bins, boxes, or containers at any place or premises shall be subject to the approval of the director. Every commercial/industrial business owner shall provide a location on at the commercial/industrial premises for the bins, boxes, and/or containers they use, and shall keep the area in good repair. (c) Any collection agreement may provide for the rental of approved bins, boxes and containers approved by the collector to customers. The collector shall be responsible for maintaining maintenance of the bins, boxes andrental containers by keeping the containers in good and sanitary condition (ordinary wear and tear excepted) and shall repaint such the bins, boxes and containers at a frequency as determined by the citydirector. The collector and the renter shall determine and agree upon plan with the customer the placement of the bins, boxes, and containers to minimize traffic, aesthetics and other potential effects that may be problems associated with their placement. (d) Where a bin, box, or container is not rented from the collector but is rented from another solid waste enterprise and approved by the cityCity, the customer renter shall be responsible for ensureing that the bins, boxes, or containers meets the same standards of quality and upkeep as aremaintenance applicable to the bins, boxes, and containers supplied by the collector. The renter shall procure the written standards or rules and regulations of the collector prior to renting from another solid waste enterprise. (e) Anyll bins, boxes, and containers of a one cubic yard or more greater size shall be identified with the name and telephone number of the collector or other solid waste enterprise servicing the bins, boxes, and containers. The container shall be identified by the type of materials that can be deposited in the container.. 5.20.140 Frequency of solid wasterefuse collection. The Collector or his or herits duly authorized agents or subcontractors shall collect solid wasterefuse from all residential premises and commercial/industrial premises within the cityPalo Alto at least once a week, unless the director authorizes less a different frequency oft collection as provided in Section 5.20. 150807 jb 00710649B 19 5.20.150 Collection hours, quietness of collections, and collection of equipment. (a) Solid waste and recyclable materials collectionsRefuse shall be made collected only between the hours of six 6:00 a.m. and six 6:00 p.m. in residential districts and at schools, churches, and commercial premises located in commercial districts properties adjacent to residential districts. (b) Refuse shall be collected only between the hours of 4:00 a.m. and 9:00 p.m. Solid waste and recyclable materials collections in commercial districts other than as indicated in (a) above shall be made between the hours of four a.m. and nine p.m., subject to such any reasonable modifications of collection periods as the director may impose. (c) All collections shall be made as quietly as possible. All trucks and equipment for solid waste and recyclable materialsrefuse collection shall be operated in a manner that complies comply with the noise ordinance codified in the provisions Chapter 9.10 Title 9 of the municipal Municipal codeCode. All unnecessarily noisy trucks or equipment for such collections are prohibited. 5.20.160 Litter, Sspillage or leakage of solid waste and recyclable materialsrefuse. All solid waste and recyclable materialstypes of refuse hauled by any person over public streets in the cityPalo Alto shall be securely tied and covered during hauling thereof so asin order to prevent litter and the leakage, spillage, or blowing or dropping of refuse of any type on to public streets. No person shall allow any solid waste or recyclable materials of any kind whatsoevertype of refuse to leak, spill, scatter, blow or drop from any vehicle operated on any public streets within the CityPalo Alto. 5.20.170 Special permits in hardship cases. (a) Upon a showing of hardship by the owner, or occupant or tenant of a place or premises, the director may issue or cause to be issueda special written permits authorizing variations froma variance with the provisions of this chapter yet the variance will be subject to the imposition of such terms and conditions as the or shedirector may deem necessary to protect the public health, and safety and welfare. 5.20.180 No Accumulation of solid waste or recyclable materialsrefuse. (a) Every No person shall keep the place or premises occupied by him or her, and every owner of any unoccupied place or premises shall keep the same, in a clean and sanitary condition and shall not cause, suffer or permit any solid wastetype of refuse to accumulate in, on or about suchat its place or premises for a period in excess of one calendar week, except the director may authorize by written rules and regulations a different frequency of less frequent collection, removal and disposal of refuse for compactors at commercial/industrial premises. This provision shall not be construed to prohibit any person from keeping temporarily storing building materials in, on or aboutat any place or premises during the period of active 150807 jb 00710649B 20 construction, reconstruction or repair of a building or structure thereon under a current valid building permit, nor the keeping ofstoring wood neatly piledin an orderly pile upon suchat the place or premise for household use, nor the retaining compostable materials for home composting of yard trimmings purposes. 5.20.190 No bBurning, burial, or dumping of solid waste or recyclable materialsrestrictions. (a) No person shall burn any solid waste or recyclable materialsrefuse within the cityPalo Alto at any time. (b) No person shall bury or dump any solid waste or recyclable materialstype of refuse within the cityPalo Alto. Compostable materials may be buried on-site by the occupant of the residential place or premises, except at the city landfill in accordance with the procedures thereof, at any time. 5.20.200 Hazardous waste. No person shall deposit any Hazardous hazardous waste in the city landfill nor in any bin, box, ora container. 5.20.210 Manure containers required. (a) Any and all manure produced, kept or accumulated within or upon any place or premises shall be placed without delay in a manure container. (b) All manure containers shall be kept closed at all times excepting when the manure is being placed into or taken out of the manure containers and shall be kept at all times in the rear of the place or premises and not less than one hundred feet or thirty and one-half meters from any residence. (c) Manure may be mixed with solid waste in the same standard container when it is to be disposed of with and in the same manner and at the same time as solid waste, but in such case, each standard container so used, including its contents, shall not exceed sixty pounds or twenty-seven kilograms in weight, and shall be equipped with a lid or cover adequate to keep flies from the interior thereof. 5.20.220 Scavenging prohibited. (a) No person shall scavenge in any city-operated Disposal or processing facility, including the city landfill, nor disturb nor remove any material therein, without the express advance permission of the director. (ab) No person shall tamper with, modify, scavenge from or deposit any type of refuse placed in any refuse container solid waste or recyclable materials in, any solid waste or recyclable materials bin, box, or container which has is not been provided for his or herthe use 150807 jb 00710649B 21 of that person, without the permission of the person responsible for owner of the container and payment of the fees therefor under this chapter. (bc ) Except as otherwise provided in Sections 5.20.090110 and 5.20.110090 of this code, no person shall collect any type of refuse originating the recyclable materials from any residential place or premises or any posted recycling centers within the cityPalo Alto. (cd) The foregoing prohibitions are in addition to the prohibitions set forth in Section 41950 et seq. of the Public Resources Code. 5.20.230 No trespassing in city landfill. No person shall enter, be upon, or remain in the city landfill, except during the hours of operation posted on the main entrance thereto, or except as may be authorized in advance by the director. 5.20.240 Schedule of rates for the use of the city landfill. (a) The schedule of rates for the classification of vehicles carrying the solid waste and the maximum load for use of the city landfill shall be set forth in the municipal fee schedule. (b) Vehicles operated by the city may be allowed toll-exempt use of the city landfill. Vehicles operated by any collector of the city may also be exempt if their contract so provides, and the collector produces the same for inspection if requested by a city landfill employee. (c) Vehicles owned by the Palo Alto Unified School district may be allowed toll-exempt use of the City Landfill. 5.20.250 Liability for payment of rates. (b) Except as set forth in Section 5.20.110(h), every person with residential premises or commercialoccupying, owning, controlling, or maintaining place or premises within the cityPalo Alto shall be liable for the payment of the refuse service rates, including any solid waste collection rates authorized by the cityCity. 5.20.260 Penalty for failure to pay collection rate. (a) All collection rates and charges imposed by the council Council pursuant to the provisions of this chapter for the collection, removal and disposal of solid wasteall types of refuse shall be a civil debt owing to the city City from the owner, occupant or person maintaining or controlling the place or premises receiving the services. (b) All such collection rates and charges shall be billed along with other municipal utility bills, if so billed, and shall be subject to the provisions of the city’s City’s utility rates and regulations governing the collection and payment of other utility rates. The City may by agreement permit the collector or other person to collect the applicable rates and charges for 150807 jb 00710649B 22 refuse service. Notwithstanding the foregoing, fees for the use of drop-boxes may be collected by the collector. (c) The collection of the rates imposed pursuant to this chapter shall be in addition to any other remedies available to the city City for the failure of any person to pay the rates. 5.20.280 Administration by city City manager. (a) The city City manager or designee shall adopt such written rules and regulations, not inconsistent with this chapter, as may be necessary for the proper administration and enforcement of this chapter. Such The written rules and regulations may include, but are not limited to, regulations relating to the required frequency of solid waste and recyclable materialsrefuse collection from various types of places or premises, the types of special bins, boxes, and containers required for placement at certain classes of places or premises, and regulations governing the vehicles used in making such collections, and regulations governing the use and operation of the city landfill. (b) The city City manager shall resolve all disputes concerning the administration or enforcement of this chapter, and. H his or her decision in such matters shall be final. 5.20.290 Penalty for violation. Violation of any provision of this chapter shall be subject to the provisions and penalties set forth in Title 1 of the Municipal Code unless otherwise specified.this code. SECTION 2. Section 18.32.020 of Chapter 18.23 of Title 18 is hereby amended to read, as follows: 18.23.020 RefuseTrash Disposal disposal areasand Recycling (A) Purpose Assure that development provides adequate and accessible interior areas or covered exterior enclosures for the storage of trash and recyclable materialsrefuse in appropriate containers with storage capacity for a maximum of one week,, and that trash refuse disposal and recycling areasstructures and enclosures are located as far from abutting residences as is reasonably possible. (B) Requirements (i) Refuse disposal and structures and enclosures Trash disposal and recyclable areas shall be accessible to all residents or users of the property. (ii) Compostable materials and recyclable materials Recycling facilities shall be located, sized, and designed to encourage and facilitate convenient use. 150807 jb 00710649B 23 (iii) Refuse disposalTrash disposal and recyclable areas shall be screened from public view by masonry or other opaque and durable material, and shall be enclosed and covered. Gates or other controlled access shall be provided where feasible. Chain link enclosures are strongly discouraged. (iv) Refuse disposal structures and enclosures Trash disposal and recycling structures shall be architecturally compatible with the design of the project. (v) The design, construction and accessibility of recycling refuse disposal areas and enclosures shall be subject to approval by the architectural review boardArchitectural Review Board, in accordance with design guidelines adopted by that board Board and approved by the city councilCouncil pursuant to Section 18.76.020. SECTION 3. The Council finds that the adoption of this ordinance is not considered a project under the California Environmental Quality Act or the CEQA Guidelines, therefore, no environmental impact assessment is necessary. // // // // SECTION 4. This ordinance shall be effective on the commencement of the thirty-first day after the date of its adoption. • CITY OF PALO ALTO TO: FROM: CITY OF PALO ALTO MEMORANDUM HONORABLE CITY COUNCIL CITY MANAGER 14 AGENDA DATE: JANUARY 25, 2016 SUBJECT: AGENDA ITEM #14 -Approval of Agreement With Empowerment Institute on Cool Block Small Pilot Program Staff requests this item be continued to February 1, 2016. City of Palo Alto (ID # 6557) City Council Staff Report Report Type: Consent Calendar Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Draft Process Letter from Palo Alto to the CHSRA and Caltrain Title: Review and Approval of a Draft Process Letter from the City of Palo Alto to the California High Speed Rail Authority and Caltrain From: City Manager Lead Department: City Manager Recommendation Staff and the City Council Rail Committee recommend that Council review and approve the attached draft process letter to be sent from the City of Palo Alto to the California High Speed Rail Authority and Caltrain. Background At the October 13, 2015 City Council meeting, staff was directed by Council to clearly convey to both the California High Speed Rail Authority (CHSRA) and Caltrain the following: 1. That the full Context Sensitive Solutions (CSS) approach should be retained for the process of High Speed Rail (HSR) along the Peninsula; and 2. That the timeline for the CHSRA’s Environmental Impact Report (EIR) for the San Francisco to San Jose project segment be adjusted to include adequate time to fully integrate the CSS process. At the December 15, 2015 City Council Rail Committee meeting, staff presented a draft letter on these issues to the Committee for their discussion and review. Following their discussion and review the Committee made recommendations to staff on the letter and voted 4-0 to forward it to Council for approval. The draft letter is attached (Attachment A). Attachments:  ATTACHMENT A: Draft Process Letter to the CHSRA and Caltrain_1-25-2016 (DOCX) Draft January 25, 2016 California High Speed Rail Authority Peninsula Corridor Joint Powers Board Dan Richard Adrienne Tissier Chair Chair 770 L Street, Suite 1160 P.O. Box 3006 Sacramento, CA 95814 San Carlos, CA 94070 RE: City of Palo Alto Comment Letter on the California High Speed Rail Authority Environmental Clearance Process for the San Francisco to San Jose Segment Dear Chair Richard & Chair Tissier: I am writing you regarding the process that has been proposed by the California High Speed Rail Authority (CHSRA) for completing the environmental clearance work necessary for the CHSRA’s San Francisco (SF) to San Jose (SJ) project segment. This letter is addressed to you jointly because with the “Blended System” concept no action taken on the corridor by either agency can be done in isolation. Action taken by Caltrain impacts the CHSRA and action taken by the CHSRA impacts Caltrain. The CHSRA is proposing to have the environmental clearance work for the CHSRA’s SF to SJ project segment completed by the end of 2017. The City of Palo Alto believes strongly that trying to complete such a complex process on this timeline is not only rushed but is likely to result in less than desirable results. Therefore, the City of Palo Alto requests the CHSRA along with the Peninsula Corridor Joint Powers Board (PCJPB) take the following actions: 1. That the CHSRA adjust its timeline for the Environmental Impact Report (EIR) for the SF to SJ project segment so there is adequate time for the EIR and CSS processes; 2. That the CHSRA use the full Context Sensitive Solutions (CSS) process for developing High Speed Rail (HSR) along the Peninsula as the CHSRA agreed to do under the Peninsula Rail Program (PRP) in 2009. CSS is a clearly defined process used by the United States Department of Transportation and other agencies for project design and implementation. CSS is “a collaborative, interdisciplinary, holistic approach to the development of transportation projects. It is both process and product, characterized by a number of attributes. It involves all stakeholders, including community members, elected officials, interest groups, and affected local, state, and federal agencies. It puts project needs along with agency and community values on a level playing field and considers all trade-offs in decision making. Often associated with design in transportation projects, CSS should be a part of all phases of program delivery including long range planning, programming, environmental studies, design, construction, operations, and maintenance.” Source: (www.contextsensitivesolutions.org); 3. That the CHSRA and Caltrain enhance their communication protocols with both policymakers and staff of the cities along the SF to SJ portion of the rail corridor to ensure no action is taken without community awareness and input; and 4. That the CHSRA include grade separations as an essential part of the project description to be evaluated pursuant to CEQA. Failure to include grade separations as an element of the project would not only result in more significant impacts to be mitigated by CHRSA and other agencies, but would also effectively segment the cumulative effects of high speed rail operation and subsequent localized construction projects necessary for the CHSRA project to safely and effectively operate. Thank you for your time and if you have any questions or comments, please contact Palo Alto City Manager James Keene at (650) 329-2563 or by email at james.keene@cityofpaloalto.org. Sincerely, Patrick Burt Mayor, City of Palo Alto cc: Palo Alto City Council Palo Alto City Manager Congresswoman Anna Eshoo Senator Jerry Hill Assemblymember Rich Gordon Executive Director of Caltrain Jim Hartnett Peninsula Corridor Joint Powers Board City of Palo Alto (ID # 6566) City Council Staff Report Report Type: Study Session Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Sustainability/Climate Action Plan Study Session Title: Study Session Regarding Ongoing Preparation of a Sustainability/Climate Action Plan (S/CAP) to Update and Replace the City's 2007 Climate Protection Plan From: City Manager Lead Department: City Manager Recommendation Staff recommends that the Council review and discuss the City’s developing Sustainability and Climate Action Plan (S/CAP), including the proposed Greenhouse Gas (GHG) reduction goals and key measures regarding transportation, energy, and water. Note: This is the first in a series of Council meetings on this subject scheduled for the spring of 2016. No Council action is proposed ay this time, but has been scheduled in the aftermath of the S/CAP summit to allow for Council discussion. Summary The Office of Sustainability, working with consulting partner DNV GL, has collected input from the community of Palo Alto, researched global best practices for greenhouse gas (GHG) emission reductions and resource conservation, and evaluated the cost/benefit ratios for a range of carbon reduction strategies. Based on that work, staff is pursuing development of a multi- faceted plan to deliver pace-setting GHG reductions and energy use strategies in ways that enhance quality of life, prosperity and resilience in Palo Alto. These measures should also reduce operating costs when implemented holistically, and deliver tangible economic, quality of service, and quality of life benefits to all residents. This overview of the draft S/CAP includes potential key elements for Council’s consideration and comment, with the understanding that the S/CAP is a long-term plan with varying time horizons for potential changes. It is clear that transportation and natural gas present our biggest challenges -- road transportation accounts for more than 61% of Palo Alto’s remaining carbon footprint, while natural gas accounts for more than 25%—and that Palo Alto will be unable to achieve the State of California GHG reduction goals of 80% by 2050 without significantly reducing emissions from both these categories. (Key elements are summarized here, and described in more detail in the Discussion session that follows.) •Transportation: Make it more convenient not to drive by developing responsive, multimodal, service-focused transportation services—and ending subsidies such as City of Palo Alto Page 2 free parking or shifting them to support non-SOV travel—to reduce congestion and climate impacts. •Electricity: Support a systematic shift from natural gas to all-electric systems powered by carbon neutral electricity, wherever technically and legally feasible and cost- effective. Given the consumer costs and stranded costs to the Utility, this may require various transition strategies over time. •Buildings: Explore building stock upgrades to Zero Net Energy or Net Positive through design, efficiency, renewables and bundled services packages, and (if technically and legally feasible and directed by City Council) encourage all-electric new construction. •Resource Efficiency: Aggressively cut energy and water demand in buildings and operations, reduce emissions and impacts and save money for the residents, business, and the City with an emphasis on integrative design1 and policy approaches to drive large gains in resource efficiency2. •Sustainable Water Management: Balance water importation, rainwater harvesting, groundwater management, recycled water use and onsite treatment options in an integrated, long-term strategy. •Municipal Operations: Embed sustainability in city procurement, operations and management, including “default to green,” adoption of internal carbon pricing and reporting of sustainability impacts in staff reports, capital improvement project proposals and management reports. •Financing Strategies: Finance cost-effective initiatives by pricing carbon, applying a portion of parking revenues to mobility alternatives, and channeling local and external investment in support of these goals. Note that the legal and financial implications and cost-effectiveness, and degree of public support of these elements, and other elements throughout this report, will require detailed careful consideration and review, and are subject to Council direction. Future staff analysis and reports will focus on: •Sea Level Rise Response: Build resilience through risk mapping, mitigation, adaptation and, where necessary as a secondary response, retreat strategies. •Ecosystem and Human Systems Protection: Provide a healthy, resilient environment where all species can thrive and enjoy life. •Buildings: Rapidly upgrade the resource efficiency of residential and commercial building stock •Utility of the Future: Adapt CPAU to the business model challenges facing the utility industry •Information systems: Advance “smart city” platforms for transportation, utilities, buildings, operations, finance, etc. 1 “The conventional definition of integrated design is that project team members from all disciplines work together early and often throughout the project design process. The enhanced definition presented here includes what goes on when the design team gets together - the synthesis of climate, use, building design and systems.” http://designsynthesis.betterbricks.com/what-integrated-design 2 http://www.rmi.org/rmi/Whole%20System%20Thinking%20and%20Integrative%20Design City of Palo Alto Page 3 •Community engagement, Support household practices and behavior change and including expanded potential to reduce “scope three” emissions.”3 Relationship to Comprehensive Plan Staff received instruction from Council to synchronize with the City’s ongoing Comprehensive Plan Update and provide a holistic approach to sustainability and climate action across all City activities. The City Council has also -- on several occasions -- indicated its desire to reflect sustainability and climate adaptation in the vision and goals of all elements of the Comprehensive Plan Update. Integration of these two plans will provide a policy framework and a roadmap for achieving emission and consumption reduction targets, and support the City’s efforts to maintain ecosystems and biodiversity in our parks, gardens, forests and food systems, and provide a clear process for addressing community needs with high quality services. As part of its review of the Comprehensive Plan, Council will want to discuss the format in the plan for linkage to the S/CAP and adopted sustainability goals. Staff is asking Council to consider a portfolio of GHG emission reduction strategies that could collectively achieve GHG reductions at a faster pace than proposed by the State of California, which has set a reduction target of 80% by 2050, and an intermediate target of 40% by 2030. Could—and should—Palo Alto, which has already reduced emissions by an estimated 35%, seek to achieve the State’s 80% reduction goal to be achieved earlier than 2050? What should that target be and what would be the requirements and implications of doing so? As Council and community discuss the S/CAP and the options before us, we will need to consider several key questions: Leadership: What level of GHG emission reduction goals will Palo Alto target? Pace: How fast will Palo Alto attempt to achieve these reductions? Implementation: Which measures will Palo Alto enact to achieve these reductions? Invest: How much will Palo Alto invest? Funding: How will Palo Alto fund those investments? Criteria: What factors will Palo Alto use to make these decisions? Organization of this report Background: The Climate Challenge. Technology and the Pace of Change. Palo Alto History and Opportunities. Why Act Now. Objectives. Discussion: Footprint. Ten Realms of Action. Key Levers: Rethinking Mobility; Electrifying Our City; Water. Other Levers: Buildings; Municipal Operations; Palo Alto Utilities; Information Technology; Engaging the Community; Ecosystems. Potential Sources of Funds. Key Questions. Timeline: Next Steps/Plan. Environmental Review NOTE: This staff report provides a summary of the S/CAP, which is still a work in progress and 3 Indirect emissions, such as those resulting from purchased goods and services and air travel City of Palo Alto Page 4 provides substantially more detail than presented here. Given the complexity of the issues discussed, staff decided not to complete and circulate a draft plan until benefiting from Council and community input on general directions and issues. The full draft will be presented for future study sessions, at which Council will have the opportunity to go deeper into specific issues, the extensive quantitative analysis that supports them, and the requirements of both a 15-year strategic plan (including goals, key strategies and decision criteria) and a series of five-year action plans to implement them. The focus of this initial study session is to lay out the key components of the SCAP and strategies under consideration-- focusing more on identifying aspirations, priorities and concerns rather than detailed assessment of specific actions--and then come back to Council for deep dives on transportation, energy, water and adaptation (and other issues that Council may direct). Background Palo Alto is at the heart of the region that drives the eighth largest economy in the world, and what is created in Palo Alto has influence far beyond its borders. Palo Alto has made remarkable progress toward reducing its carbon impacts, GHG emissions and resource consumption since establishing one of the first Climate Protection Plans in the US in 2007. In the eight years since then, the world has gotten hotter, the west has gotten dryer, and more cities have stepped into the ranks of climate leadership. As the climate heats up, cities will need to act wisely in order to ensure the wellbeing of their communities in the face of the challenges ahead. Palo Alto can help show the way ahead, improve our community’s quality of life and inspire changes elsewhere. Cities around the world are ratcheting up their own sustainability initiatives, and we can also learn and be challenged by their efforts. In the course of developing this new Sustainability and Climate Action Plan, we face two fundamental choices with regard to climate: - Will we move from carbon neutral electricity to a carbon neutral utility to eventually become a carbon neutral city (which will require major changes in transportation as well as energy use)? - And how quickly will we do that? The Climate Challenge Science: The International Panel on Climate Change (IPCC) has determined that “we risk severe, pervasive and irreversible impacts” from climate change, and need “substantial” greenhouse gas emissions reductions (of 40-70% or more) by mid-century. The International Energy Agency has asserted that 80% of proven fossil fuel reserves must “stay in the ground” if the planet is to avoid the worst climate change projections. Meanwhile, climate disruption records continued to be broken in 2014, which was the warmest year recorded since 1880. Munich Re America reported that “Insured winter storm losses in the United States in 2014 were the highest in eight years, at $2.3 billion, while insured losses due to severe thunderstorm events exceeded City of Palo Alto Page 5 $10 billion for the sixth year in a row.”4 The UN World Meteorological Organization (WMO)5 reported that high ocean temperatures contributed to exceptionally heavy rainfall and floods in many countries and extreme drought in others. Twelve major Atlantic storms battered the United Kingdom in early months of 2014, while floods devastated much of the Balkans throughout May. Crippling droughts have struck large swathes of the continental United States while Northeast China and parts of the Yellow River basin did not reach half of average summer rainfall, causing severe drought. State of California: Assembly Bill 32 (the California Global Warming Solutions Act of 2006), committed the State to reduce its GHG emissions by 20% from 1990 levels by 2020, and Executive Order S-3-05, signed in June 2005, set an aspirational goal to reduce emissions 80% by 2050. The first scoping plan by the California Air Resources Board (CARB) detailed ways to achieve the AB32 goal; CARB’s recent update addressed the need to accelerate reductions to meet the 2050 goal, and the need for local jurisdictions to meet or exceed the State’s goals.6 Then in April 2015, Governor Jerry Brown issued Executive Order B-30-15 establishing a California GHG reduction target of 40% below 1990 levels by 2030.7 Recent revisions to California’s Title 24 will require that all new residential buildings be Zero Net Energy (ZNE) by 2020, and all new commercial buildings by 2030; this will apply to retrofit projects above certain thresholds.8 Meanwhile, Governor Brown has challenged the state to increase the renewable portfolio standard (RPS) to 50% of needs, reduce petroleum up to 50% and double the efficiency of existing buildings by 2030.9 A milestone climate change bill, SB 350, which passed in 2015, enshrined most of these proposals into law (though it was stripped of the goal to reduce petroleum use by 50% before it was passed). A companion bill, SB 32, which would have made the state’s long-term targets for carbon emissions reductions, currently set by executive order, a matter of law, did not garner sufficient support and staff expects it will be re- introduced in 2016. United States: President Obama’s March 19, 2015 Executive Order10 requires the federal government to cut GHG emissions by 40% by 2025 from 2008 levels and increase Federal renewable energy sources to 30%; budget savings from these initiatives are estimated at $18 billion. Several major federal suppliers, including Lockheed Martin, General Electric, and IBM, announced new voluntary GHG reduction commitments; IBM says it will cut energy-related GHG emissions 35% (against 2005 levels) by 2020. (Among local companies, HP has set a goal to reduce the GHG emissions from operations 20% by 2020 compared to 2010 levels and SAP plans a 51% reduction in its total GHG emissions from its year 2007 published baseline levels.) Europe: The European Union has adopted an emissions reduction target of 40% below 1990 levels by 2030. The United Kingdom has committed to reduce its emissions by 50% below 1990 4 http://www.claimsjournal.com/news/national/2015/03/04/262111.htm 5 http://www.un.org/apps/news/story.asp?News=49970#.VRm-yvnF-So 6 First Update to the Climate Change Scoping Plan: Building on the Framework Pursuant to AB32 – The California Global Warming Solutions Action of 2006 7 http://gov.ca.gov/news.php?id=18938 8 http://cleantechnica.com/2014/04/15/californias-net-zero-energy-building-will-reshape-us-construction-industry/ 9 http://gov.ca.gov/news.php?id=18828 10 https://www.whitehouse.gov/the-press-office/2015/03/19/executive-order-planning-federal-sustainability-next-decade City of Palo Alto Page 6 levels within the 2022–2027 timeframe, and Germany has set 2030 emissions target of 55% below 1990 levels. Other cities: Other cities around the region and around the world have been actively engaging this issue, with innovative programs around flexible transportation systems, congestion management, electric vehicles, energy efficiency, and renewable power development—and in many ways have been leading ahead of their national governments. Examples include: Table 1: Examples of Climate Action Goals of Other Cities City of Palo Alto Page 7 Figure 1: Climate Neutral Cities Alliance (CNCA) Goals Technology and the Pace of Change Rapid technology change and behavior shifts make the usual practice of planning based on extrapolation of past trends a bit uncertain. For example, Vehicle Miles Travelled (VMT), the widely used transportation metric, has risen steadily for decades, but recently shows signs of turning down, as Millennials buy fewer cars (and reportedly even forego getting drivers’ licenses); car buying by the 18-30 demographic in the US peaked in 1983. The chart below shows recent projections from the US Department of Transportation, which indicate a flattening of historically rising VMT projections, with a downturn expected. City of Palo Alto Page 8 Prices for solar photovoltaic (PV) systems, electric vehicles (EVs), batteries, autonomous vehicle controls, sensors and many other technology categories have been plummeting for years. Tony Seba, Stanford lecturer and author of Clean Disruption, asserts that this combination of trends portends a profound shift in US automobile culture, with potentially rapid displacement of internal combustion engine (ICE) vehicle by EVs, perhaps by 2030, and potentially a dramatic reduction in private vehicle ownership in the same time frame. Such trends could make conservative planning risky; for example, ExxonMobil’s 2014 projection of battery prices in 2040 will likely be reached in the market by 2020. This makes the job of transportation planners, for example, and parking garage developers, uncertain and challenging. How will we determine what, where and how much to build in the face of these trends, and neither overbuild nor underbuild? Palo Alto History and Opportunity11 For more than 20 years, Palo Alto has been an internationally recognized leader in sustainability innovation, with a wide range of initiatives—citizen-led, staff-initiated, and council-directed—that have in many cases raised the bar on urban sustainability. This status is well deserved, given our community's deep-rooted environmental values and City's early climate initiatives. Early actions like our 2007 Climate Protection Plan (one of the first five city climate plans in the US), bold recent actions like carbon neutral electricity, and systematic improvements ranging from water conservation and EV readiness to green building ordinances and safe routes to schools, and hundreds of other measures12 have put Palo Alto in the forefront of sustainability leadership internationally. Based on annual data for the calendar year 2014, the community of 11 Transportation Research Institute, University of Michigan. National trends. 12 https://www.cityofpaloalto.org/civicax/filebank/documents/45024 Figure 2: Changing Vehicle Miles Travelled Forecasts 11 City of Palo Alto Page 9 Palo Alto has cut its overall greenhouse gas (GHG) emissions by an estimated 34% from 2005 levels and 35% from 1990 levels13—one of the largest reductions of any city in the world. Because of its community commitments and past accomplishments, Palo Alto is uniquely positioned to advance a world-leading climate plan. Some of the needed initiatives are within the capacity of City government. Some will require the active collaboration of neighboring jurisdictions. All will require the support, commitment and actions our entire community. While many people still assume that “sustainability” is expensive, and that the initiatives identified here would require sacrifice of money, comfort or both, the evidence that staff has reviewed from cities and businesses around the world suggest that well designed and managed sustainability programs can be fiscally prudent, cost effective and in many cases can yield attractive returns on investment of public resources. 13 These are revisions of previous estimate, due to an August 2015 modification of their 2013 estimate of 1990 and 2012-2014 transportation emissions by consultants Fehr and Peers. City of Palo Alto Page 10 Figure 3: Palo Alto Community-wide GHG Emissions (net of Renewable Energy Credits) Extrapolating from its historic GHG reduction trend suggests that Palo Alto is well on its way to an estimated 47% reduction by 2030 and 80% reduction by 2050; note however that this trend includes the one-time drop in reportable GHG emissions that resulted from the carbon neutral electricity policy in 2012 and 2013.14 Staff estimates that existing initiatives (including EV-ready and PV-ready mandates and the electrification initiatives that Council has directed staff to explore) could bring those reductions still lower.15) 14 The estimate of a 47% reduction by 2030 is calculated by staff based on extending Palo Alto’s 2005-2012 rate of GHG reductions forward to 2030; it excludes the dramatic one-time reduction gained by the City’s carbon neutral electricity policy. There is of course no guarantee that Palo Alto will sustain that rate of reduction; it may achieve less, or, as proposed in this report, may achieve greater reductions. Note that the Draft EIR being prepared for the Comprehensive Plan Update will contain a more conservative (i.e. lower) estimate for purposes of compliance with the California Environmental Quality Act (CEQA). 15 Placeholder estimate. Will be refined by consultant work authorized by Amendment 1 to S/CAP consultant DNV GL’s contract, December 14 2015. Staff anticipates having those results in advance of this January 25 study session. City of Palo Alto Page 11 Why Act Now The International Energy Agency has determined that 80% of fossil fuels need to “stay in the ground for the 2°C target to be within reach. ExxonMobil recently predicted “catastrophic” climate change, with global temperatures rising 5-7°C. The global climate agreement reached at the COP21 conference in Paris in December 2015 saw nearly 200 countries agree to common action on climate. The New York Times noted (quoting from the agreement) that The Agreement 'calls for “holding the increase in the global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels....” This language recognizes the scientific conclusions that an increase in atmospheric temperatures of more than 2 degrees Celsius, or 3.6 degrees Fahrenheit, would lock the planet into a future of catastrophic impacts...But it also recognizes the scientific conclusions that warming of just 1.5 degrees Celsius, or 2.7 degrees Fahrenheit, could present an existential threat to low- lying island nations that would be inundated by sea level rise at that rate of increase.' The existing national plans submitted for the conference 'would probably result in an increase above 3 degrees Celsius.' 'When countries update their commitments, they will commit to the “highest possible ambition,” but the agreement does not set a numeric target.' Objectives In the wake of the Paris conference—where Canada and other countries called the 2°C target inadequate and proposed a 1.5°C target—we may expect to see changes in global expectations, and perhaps in California climate policy.16 There are multiple reasons for Palo Alto to pursue the sustainability and climate initiatives outlined in this plan: to improve the living standards, quality of life and value delivered to residents; to save the City and community money through improved efficiency; to reduce future risk from climate related events and their impacts on the community; to balance fiscal responsibility with other community values; to attract and retain innovative clean businesses; to make our contribution in support of State and international commitments to reducing global emissions; to provide a leadership example to other cities and the community for which Palo Alto is known. 16 Note also that the “80% reductions by 2050” that stands as the global reference target, and California’s stated goal, was a political consensus based on the “the scientific conclusions that an increase in atmospheric temperatures of more than 2 degrees Celsius, or 3.6 degrees Fahrenheit, would lock the planet into a future of catastrophic impacts”—in other words, a minimal rather than maximal goal, though many today consider it a “best practice.” In view of the 1.5 degrees Celsius target that was proposed at the Paris COP by Canada and other countries, that reference target may change. In any case, it may be advisable to consider “80x50” a minimal rather than a maximal goal. City of Palo Alto Page 12 Meeting or exceeding California’s GHG reduction goal of 80% by 2050 will require both staying the course on our current efforts, and building on, intensifying and evolving them in the face of changing technologies and conditions. Solutions appropriate for Palo Alto will need to address specific local economic considerations and community needs. This in turn requires understanding the specific needs of the City and community related to energy and resource consumption, transportation, development and the considerations of daily life. And it requires the data systems that provide this view into the systems that produce the experience of living and working in Palo Alto. Discussion For the past year, hundreds of Palo Altans have provided input to the S/CAP planning process, contributing their ideas regarding objectives of the plan as well as emission reduction measures that could be used to achieve meaningful GHG reductions and other measures that could achieve sustainability objectives related to water conservation, adapting to climate change, and other issues. Based on this input, the Office of Sustainability considered three possible emission reduction targets17: 80% emissions reduction by 2050, or “80X50,” consistent with the State’s goal; 80% emissions reduction by 2030 or “80X30”; or 100% reduction (to carbon neutral or better) by 2025 or “100X25.” In each case, staff identified and started to evaluate (technically and economically) the mix of strategies that could achieve each goal. Interestingly, staff found that each target could be achieved with similar strategies implemented at a very different pace. Based on this analysis, this staff report presents potential strategies for Council consideration and discussion, and asks whether the Council is interested in further planning to develop an S/CAP that exceeds the State’s goal, and if so, by how much? Specifically, staff invites Council to consider whether to: - Set a goal of reducing GHG emissions by at least 80% by 2030—20 years ahead of California’s 80% goal, and achieve that goal by: - Building, step by step, on Palo Alto’s historic Carbon Neutral Electricity Plan to next become a Carbon Neutral Utility18, by encouraging electrification (and other measures) to eliminate the impact and eventually the use of natural gas, - Becoming a Carbon Neutral City soon after by working with its own resources and in collaboration with neighboring jurisdictions to dramatically reduce dependence on the internal combustion engine and private vehicles - Advocating for policies that advance climate positive initiatives across the Bay Area and the state. 17 Note that in all these scenarios, reductions are partially driven by factors outside our control, including Federal and state policy, legal and regulatory constraints, cost-effectiveness of measures and technology, the pace of technology innovation, and behavioral changes by our population. In this way, the S/CAP may be similar to California Air Resources Board’s (CARB’s) update to the State’s scoping plan, which suggests that near-term actions and targets need to be specific, quantifiable, and within an agency’s control, while longer term actions and targets may require changes in technology and/or actions by others, and could be less precise. 18 A Carbon Neutral Utility could be achieved in an estimated 15-20 years through the efficiency and electrification strategies discussed below, or immediately by using carbon offsets as a bridging strategy modeled on Palo Alto’s use of RECs to accelerate the transition to Carbon Neutral Electricity. Note that this would mean significant economic changes for the gas utility, and could require a full or partial exit strategy for the gas utility. (This is a “back of the envelope” estimate. S/CAP consultants are producing a more refined estimated under a Contract amendment authorized by Council December 14 2015.) City of Palo Alto Page 13 Footprint Palo Alto has systematically reduced its GHG emissions through a series of measures, many of them predating the 2007 Climate Protection Plan (CPP). The figures below show Palo Alto’s emissions reduction trajectory in relation to the State of California’s declared 2050 trajectory, and the 80x30 trajectory proposed for consideration here. Figure 4: Projected Emissions Based on Current Palo Alto Trends vs Emissions Reductions Required to Meet State of California Targets: 1990-2050 City of Palo Alto Page 14 Figure 5: Projected Emissions Based on Current Palo Alto Trends vs Emissions Reductions Required to Meet State of California Targets: 1990-2030 These historic reductions have been achieved most significantly though the CNE initiative, ongoing CPAU efficiency and incentive programs; the Green Building Ordinance (GBO) and Energy Reach Code (which are perhaps the most aggressive in the state and nation) including its EV-ready and PV-ready requirement; operational improvements at the RWQCP; the ZeroWaste and Environmentally Preferable Purchasing initiatives; the Urban Forest Master Plan; and more. Initiatives already in motion or under consideration will drive additional reductions: electrification analysis; the next green building ordinance (GBO), including potential “zero net energy” requirements; “default to green” purchasing policy, including rapid electrification of the City fleet; launching the Downtown Transportation Management Association (TMA) to achieve a City Council initiated goal of reducing single occupant vehicle (SOV) trips in and around the City’s commercial centers by 30% or more19; build-out the City’s adopted bicycle and pedestrian plan; implementing parking technologies to better manage existing downtown parking supplies; initiating a paid parking study for downtown; and establishing Transportation Demand Management (TDM) requirements on new development projects.20 It is clear from the chart that transportation and natural gas present our biggest challenges: road transportation accounts for more than 61% of Palo Alto’s remaining carbon footprint, while natural gas accounts for more than 25%—and that Palo Alto will be unable to achieve the State of California goals without significantly reducing emissions from both these categories. Ten Realms of Action Staff and consultants have examined ten realms of action: Transportation, Energy, Water, Buildings, City operations, Palo Alto Utilities, Infrastructure, Adaptation/Resilience, Ecosystems and Engaging the Community. Key strategies and actions are summarized in Figure 6 and Table 19 https://www.cityofpaloalto.org/civicax/filebank/documents/39106, 2/24/14 20 https://www.cityofpaloalto.org/civicax/filebank/documents/46324 City of Palo Alto Page 15 2; Others are summarized later in this report. This staff report focuses on three: transportation and energy, because they represent the vast majority of Palo Alto’s emissions (excluding “scope three” emissions, which are not considered in this analysis), and water, because of the challenges of the current drought and potential risks of long-term drought. The others are summarized here but will be addressed in detail in future reports. Figure 6: S/CAP Levers, Goals and Strategies City of Palo Alto Page 16 Table 2: Key Actions—Summary As noted earlier in this staff report, any specific proposals that are developed to implement the above listed “realms of action” and “key actions” would need to be assessed for their cost- effectiveness, potential policy trade-offs and legal constraints that might influence the City of Palo Alto Page 17 design of any such proposal or identify areas where the City could intervene at the federal, state or local level to advocate for constitutional, statutory or regulatory change. Investment and Impacts The charts that follow summarize the investments and impacts associated with the strategies presented below.21 This “waterfall chart” shows the current estimates of the GHG reductions that could result from each initiative (in metrics tons of CO2 equivalent, or MTCO2e). Figure 7: "Waterfall" Chart Showing Potential GHG Reductions from Each Measure This “McKinsey chart” shows the estimated “mitigation cost” (in $/MTCO2e reduced) for each strategy. 21 The methodology behind these analyses is explained in Attachment A. 600,000 500,000 400,000 300,000 200,000 100,000 0 City of Palo Alto Page 18 Figure 8: McKinsey Chart": Estimated "Mitigation Cost" (in $/mTCO2e reduced) It is evident from these charts that the greatest GHG reductions are likely to come from electrification of vehicle fleets (largely through provision of EV charging infrastructure), encouraging all-electric new construction, electrification of water and space heating, and pricing parking; the most economic reductions are to be gained from encouraging all- electric new construction, issuing universal transit passes, electrification of water heating, pricing parking, and electrification of vehicle fleets. The intersection of these lists provides an initial set of priority actions for Council consideration.22 Key Levers: Detail 1.Key Levers: Rethinking Mobility Road transportation represents about 61% of Palo Alto’s carbon footprint—and a headache for everyone. Palo Alto’s Comprehensive Plan calls for reducing reliance on the automobile, and 22 Note: The quantities displayed here are estimated, using analytical models based on projections of the potential impacts of different actions, and assumptions of the potential rates of adoption that could be achieved. As with all such models, it would be prudent to assume that near term projections (such as the next five years) are more accurate than linger term projections (such as the next 15 or even 35 years), and staff recommends revisiting and recalibrating the S/CAP every five years—or more often, as new information warrants. The potential impacts of some actions—like replacing natural gas water heaters with electric heat pump water heaters (HPWH)—are relatively straightforward to analyze with a high degree of confidence; the potential impacts of other actions—like advanced mobility strategies—are much more difficult to analyze, because causal relationships for new technologies are not yet well understood, and because the academic literature often used as a basis for these technologies generally lags the technologies. As such, these should not be taken as predictions of what will happen, but as a portfolio of strategies that could potentially achieve the targets set. The S/CAP consultants have constructed these models to be transparent and flexible; it’s relatively straightforward to modify assumptions and observe the effect those modifications have on outcomes. City of Palo Alto Page 19 we've made progress in some areas: for example, 44% of high school students commute by bicycles. Beyond our borders, federal CAFE standards have reduced the carbon intensity of the US vehicle fleet. But congestion continues unabated, and the majority of Palo Altans, and commuters to Palo Alto, still make Single Occupancy Vehicle (SOV) trips. Traditional approaches to transportation—adding capacity by building roads and parking—send the wrong signals, encourage SOV travel and add pain. But what if we asked a different question: How could we make it more convenient for anyone, anywhere, anytime to not have to get into a car and drive? Issue(s): Emissions. Congestion, Quality of life. Goals: Reduce congestion. Reduce emissions. Increase convenience. Triple bike share, double walk mode share and reduce SOV trips 30% in the Downtown area by 2020. Eventually, eliminate 80- 100% of road transportation emissions, while increasing mobility and convenience Levers: Expand non-automobile mobility options. Expand transit facilities and services. Create the right incentives. Strategies: Reduce GHG/VMT by shifting vehicle fleets (City owned, privately owned and commercially owned) from fossil-powered to electric. Phase out automobile subsidies by requiring drivers to pay for parking. Reduce trips and vehicle miles travelled (VMT) by developing mobility services that make not driving more convenient than driving. Collaborate with regional partners. Barriers/concerns/unknowns: Significant dependence on external factors including technology, policy, other actors. Possible reluctance to change behavior. Possible resistance to paying for parking directly (as opposed to indirectly). Significant investments in transit, rideshare, and non-SOV incentives may be required (though much of this could come from other actors than the City). GHGs from road travel are a function of two factors: Vehicle Miles Travelled (VMT), and the carbon intensity of that travel (GHG/VMT). Reducing GHG/VMT is largely a function of vehicle technology, driven for example by Federal CAFE standards, state policy, improved fuel efficiency, electrification and customer adoption. Most of these factors are outside the purview of cities, but Palo Alto has some ways to influence VMT, by developing attractive alternatives to SOV trips, and GHG/VMT, largely by encouraging electrification of City, resident and commuter fleets. The City supports a number of emerging transportation demand management (TDM) initiatives including its first Transportation Management Association (TMA)23 to develop, manage, and market transportation programs to reduce single occupancy vehicle trips in the Downtown Core area. The Comprehensive Plan Update also provides an opportunity to establish policies that outline when TDM should be applied and programs that specify how compliance will be periodically measured and enforced. TDM plans for individual development projects can establish TDM requirements and set enforceable SOV mode-share targets. TDM plans would establish a list of acceptable TDM measures that include transit use, prepaid transit passes, commuter checks, car sharing, carpooling, parking cash-out, bicycling, walking, and education 23 http://www.paloaltotma.org/ City of Palo Alto Page 20 and outreach to support the use of these modes. They should provide a system for incorporating alternative measures as new ideas for TDM are developed. Staff has identified seven strategies for addressing these goals, each with one or more specific strategies: Expand non-auto mobility options; Expand transit facilities and services; Facilitate shared transportation; Provide universal transit access; Phase out SOV subsidies by charging for parking; Ensure that any new development addresses and mitigates its impacts (e.g. through trip caps or other TDM initiatives); Reduce the carbon intensity of vehicular travel. The most significant strategies (in terms of potential impact and cost) are summarized here. Actions 1.a. Reduce the carbon intensity of vehicular travel by encouraging shift to EVs Expanding the percentage of trips taken in EVs would have the largest impact on emissions from road transportation, which is in turn the largest category of Palo Alto emissions. Palo Alto has one of the highest rates of EV ownership in the country (estimated by staff at 2-3% of registered vehicles), but several factors limit EV adoption, including price (which is dropping rapidly), total cost of ownership (often poorly understood), and vehicle performance— especially “range anxiety.” The City has undertaken a number of measures to address those limitations, including hosting periodic “ride and drive” events to provide staff and residents direct experience of EV performance and economics; analyzing total cost of ownership; establishing an “EV first” preference for the City fleet; and working to expand EV charging infrastructure in Palo Alto by parking garage operators, employers and potentially third party providers. City ordinances require all new construction and significant renovations for commercial and multi-family buildings to pre-wire and allocate parking spaces for Electric Vehicle Supply Equipment (EVSE), or EV chargers, at specified rates. The City has been adding additional public charging stations, with grant support from regional agencies; third party providers of charging systems could enable flexible expansion of charging infrastructure without requiring commitment of City funds. (The City may want to consider flexible rather than maximal approach to charging infrastructure, since as the range of available EVs expands, the importance of “away from home” charging may become less significant, and if private vehicle ownership continues to decline, as some have suggested, saturation may be achieved at a lower volume of chargers.) 1.b. End incentives to private car use. Ending parking subsidies and significantly increasing the cost of parking all over Palo Alto is a strategy that could reduce reliance on the private automobile and encourage residents and employees to use transit, ride-hailing services, biking, walking, or other modes. Use parking revenues to finance non-SOV alternatives, modeled on the “Stanford Engine”.24 Palo Alto provides approximately 4,000 off-street and 7,000 on-street parking spaces in the downtown and California Avenue areas. A quick web survey of other workplaces and shopping 24 Stanford’s commute alternatives program finances the Marguerite shuttle and other services from a $3/day parking fee. The program is responsible for reduction of SOV rates from 78% to 48%; it also saved $107m in capital not spent on parking garages that were no longer needed (and freed land for more academically pertinent uses). City of Palo Alto Page 21 districts suggests approximately 30,000 additional spaces. The on-street spaces are provided at no cost to drivers (in contrast to many other cities in the region), and the publicly- owned off- street spaces are provided at either no cost (short-term parking) or at a cost that is below comparable rates in neighboring communities (long-term parking). Given the actual cost of creating and maintaining on- and off-street parking spaces (an estimated $3,600/year for parking garages, based on the amortized cost of providing parking spaces at a capital cost of $60,000 per space), free parking provides a significant incentive for SOV trips, despite the City’s long-standing policy commitment (as noted in the 1998 Comprehensive Plan) to reduce those trips. Instituting and/or requiring parking fees commensurate with this cost would remove that incentive, reduce SOV trips, and provide a funding source for programs that make the use of alternative modes easier for all. Potentially, in combination with other strategies listed here and the shift in driving trends already noted, it could also reduce the need to build additional parking structures (as has been the case at Stanford). Preliminary analysis, based on parking rates in surrounding jurisdictions, suggests that Palo Alto could potentially realize parking revenues of $5-15 million per year25, which would in turn provide substantial resources for the programs discussed here. The City has contracted for a paid parking study, now getting underway, that will provide additional insight into Palo Alto’s options and more closely examine costs and revenues. 1.c. Provide low cost transit benefits to all Palo Alto residents and employees A universal EcoPass provides one of the most economical ways to reduce emissions. (See mitigation costs chart.) EcoPasses are transit passes sold by VTA that enable the carrier to use their bus system. Presently EcoPasses are available to employers similar to GoPasses (for the train), and could potentially be made available to residents in transit served areas. The EcoPass (and comparable passes from other transit providers) could be provided at relatively modest cost, potentially funded by parking revenues and employer “feebates,” and provide residents and workers with free access to select transit services. A variant of this approach, already being explored by the Downtown Transit Management Association, would provide discounts for use of ride-hailing services like Lyft and Uber as a “first and last mile” solution for commuters. 1.d. Develop “Mobility as a Service” (MaaS) in Palo Alto and the region: Financial incentives are not the most effective level to change behavior, unless convenience is addressed as well. “Mobility as a Service” (MaaS) is a concept that proposes to shift the focus from fixed transportation to flexible, responsive transportation services designed to meet people’s diverse and changing needs by providing seamless regional multi-modal mobility services, including improved transit, and bike share; dynamic, on-demand shuttles; flexible first & last mile solutions; and walkable/bikeable communities. The full MaaS concept, articulated most fully by Tekes, the Finland technology funding agency and the Finland Ministry of Transportation and Communications (with which Palo Alto has developed a collaboration) and the SV MaaS initiative which Palo Alto initiated with Joint Venture Silicon Valley (JVSV), envisions one or more “Mobility Aggregator” services that provide subscription-based, customer-centered 25 This is a wide range, estimated by staff by applying a range of regional parking rates to the quantity of Palo Alto’s on street and off street parking spaces. City of Palo Alto Page 22 experience that provides “plan/book/buy/ride” access to multiple transportation modes in a single unified smartphone app with easy fare payment, one-stop billing and integrated employer subsidies.26 The elements of MaaS are increasingly familiar, as Transportation Network Companies (TNCs) like Lyft and Uber and responsive shuttle services like Chariot and Bridj grow in familiarity and market share, and transit agencies struggle to adapt to shifting rider expectations.27 In response to Council’s challenge to reduce SOV trips 30% for key commercial centers by 2020, staff are exploring pilots of such programs, initially through “first and last mile” programs being developed by the Downtown TMA, enhancement the City’s own commute alternative program for employees, and developing an RFP for technology providers that could develop a mobile app or “wallet” allowing the user to conveniently plan, book, access and pay for a bundle of transit/rideshare services. (Companies at the Stanford Research Park are exploring comparable programs.) 1.e. Evaluate what would be required to achieve bicycle mode share levels being t targeted by other cities, ranging from Portland and Copenhagen and LA. Palo Alto is a bicycle-friendly city, and the City is making a significant investment in new bicycle boulevards and other improvements included in the adopted Bicycle and Pedestrian Plan. However, bicycle ridership is low compared to cities like Portland and Copenhagen and the next iteration of the Bicycle and Pedestrian Plan could set higher goals and seek to achieve higher bicycle and pedestrian mode share levels. Provisioning protected bike lanes can be expensive in terms of GHG mitigation, but provides health and quality of life benefits as well. On the other hand, expanding surface area for bike at the expense of surface area for cars may prove controversial, at least until the potential decline in VMT and automobile demand becomes apparent and palpable to more people. 1.f. Explore “zero impact” standards in residential and commercial development Adopt plans that target future residential and commercial development in specific transit- friendly districts. Impose “no net impact” caps for energy, GHGs, water--and trips. Scenario Four of the Comprehensive Plan EIR contemplates this approach. The cities of Menlo Park, Mountain View, Sunnyvale, and Cupertino and Helsinki and others have begun to impose trip caps; for example, developments in North Bayshore in Mountain View are required—as a condition of permitting—to provide transportation amenities that will keep SOV rates under 45%. A combination of these four caps is unprecedented (as far as we know), and could provide a powerful incentive to property owners and developers to build innovative, efficient and affordable buildings and developments. 26 SV MaaS is testing and refining, with major Silicon Valley employers, a three-pronged strategy to reduce incentives for SOV commutes and make non-SOV travel increasingly convenient—that could readily scale to other employers throughout the region. The key elements: a. Gradually increasing the price for parking at major employers. b. Application of parking revenues to non-SOV transportation alternatives. (Parking pricing + incentives = revenue-neutral workplace feebate--a self-financing system of charges and rebates to encourage environmentally-preferable practices.) c.Smart applications (apps) to increase non-SOV convenience for commuters and benefits tracking/management for employers. 27 The Shared Use Mobility Center has developed databases and interactive maps of “shared use mobility” services, programs and policies across the country. http://www.sharedusemobilitycenter.org/ City of Palo Alto Page 23 Embrace “tactical urbanism” Many of the innovations in transportation planning and land use encourage small, fast local experiments are new, some unprecedented, and would benefit by a more flexible and agile and experimental planning and learning process. (Tactical urbanism is an umbrella term used to describe a collection of low-cost, temporary changes to the built environment, usually in cities, intended to improve local neighborhoods and city gathering places. Tactical Urbanism is also commonly referred to as guerilla urbanism, pop-up urbanism, city repair, or D.I.Y. urbanism.28) Leverage existing Open Data & Smart City initiatives to support mobility services Real time access to relevant data is essential to efficient platforms for public & private mobility service providers. Palo Alto should provide open access to its own transportation data. Since transportation issues are regional, Palo Alto should work with other communities in the region to share data and develop common or compatible protocols. Palo Alto should encourage mobility providers to share their data in turn (or perhaps require that as a condition of operation.) Benefits: These transportation-focused strategies will provide both direct and indirect benefits. Direct benefits include reduced congestion, reduced GHG emissions, and health and economic benefits to commuters and developers. Indirect benefits include, for example, reduced CapX and OpX for roads and parking structures; less capacity pressure on roadways enabling release of some surface area to bicycle and pedestrian modes; more permeable surfaces as road demand declines, enabling enhanced storm water capture (see “green infrastructure,” below) and reduced heat island effect. 2.Electrifying our City Key Levers: Energy (general) Issue(s): Natural gas emissions currently represent ~25% of Palo Alto’s carbon footprint. Natural Gas (i.e., methane, is a potent greenhouse gas, with a global warming potential (GWP) at least 23 times that of CO2.29 Carbon Neutral Electricity opens the option of fuel switching from natural gas. Goals: Reduce or eliminate emissions from natural gas. Reduce costs. Increase comfort, reliability and resilience. Means: Efficiency. Renewables. Electrification. Expand PPAs and distributed generation & storage. Build the “smart grid.” Set a price on carbon. Adapt CPAU’s business model to the challenges facing the utility industry. Levers: Staff has identified several “levers” for addressing these goals, each with one or more specific strategies: Reduce demand through resource efficiency and conservation electrification of heating and cooking functions currently provided with natural gas; encourage zero net energy, zero net carbon and all-electric design in new construction; periodically evaluate the suitability of biogas as pipeline gas; and, potentially, use of carbon offsets as a bridging 28 https://en.wikipedia.org/wiki/Tactical_urbanism#cite_note-1 29 Recent research indicates that the impact natural gas may be 180% of current analysis, due to leakage throughout the supply chain and the lifecycle of methane in the atmosphere. City of Palo Alto Page 24 strategy. Actions: Set high energy & carbon performance standards for new construction and renovations. Accelerate retrofits, including electrification. Raise efficiency & RPS goals; aggressively market toward them; challenge staff and community to improve efficiency 10% per year for the next ten years. Develop contingency plans to maintain carbon neutral electricity in face of potential reduced reliability of hydroelectric power Explore microgrid and district energy strategies in key districts Proactively explore “utility of the future” strategies to take advantage of potential disruptive change facing the industry30 Benefits: Emissions. Savings. Health31. Agility. Resilience. Palo Alto has made remarkable progress in decarbonizing its electricity sector. In addition to the City’s purchase of hydro-electric power resources, CPAU has worked actively to develop its renewable electricity portfolio. In 2013, Palo Alto approved a Carbon Neutral Electric Resource Plan committing Palo Alto to using carbon neutral electric resources from that year on—through purchase of Renewable Energy Credits (RECs) for the “brown power” portion of CPAU’s portfolio that will largely be replaced by 2017 with expanded purchases of renewable power. However, low hydro production may necessitate the purchase of brown power and RECs after 2017 as well. Many CPAU programs are already under way to reduce energy usage in homes and local businesses, through education and outreach, incentive programs and energy use disclosure requirements. But the results have been modest and inconsistent. Palo Alto should accelerate those efficiency gains (to reduce pressure on CPAU’s renewable capacity), drive down natural gas usage and shift to carbon neutral electricity. Further reductions in GHG emissions associated with utility energy consumption could be achieved through: Breakthrough efficiency in electricity consumption to reduce city’s overall energy demand and the need for continued energy purchases through power purchase agreements (PPAs) for renewable power. Innovation technically and financially to move the city away from natural gas by both reducing natural gas consumption as much as possible, partly through energy efficiency, and electrification of traditionally gas uses (i.e. heating) combined with increase local energy generation and, potentially, transitional use of offsets. There are potential concerns regarding “complete” electrification, including: Induced demand. In the absence of adequate energy storage, morning and evening demand peaks in Palo Alto, which would not be met by local renewables, would call upon the resources of the existing grid, which would be met by fossil resources; in 30 Discussed at UAC April 1, 2015: http://cityofpaloalto.org/civicax/filebank/documents/47849 31 E.g., indoor air quality and health benefits from electrifying appliances such as stove tops and clothes dryers that are located IN the home due to reduced hydrocarbon fumes. City of Palo Alto Page 25 this scenario, according to some, electrification intended to reduce GHG emissions could potentially increase them.) Redundancy/resilience. If CPAU customers shifted most or all natural gas demand to electricity, the city system could be more vulnerable to electrical outages. Micro- grids, for example, could reduce that risk, but the risks should to be evaluated as part of any electrification strategy. CPAU economics. A successful electrification strategy could greatly reduce natural gas revenues; yet CPAU would still need to maintain the integrity of the natural gas infrastructure. (See “Utility of the Future,” below.) Regulatory constraints. Publicly-owned utilities operate in a complex, highly regulated legal environment with respect to almost every aspect of the utility business from rate design to safety and reliability to required program and service offerings. Investor- owned utilities (like PG&E) operate under a different legal and regulatory construct, particularly with respect to rate setting. Proposals to address GHG emissions must always harmonize discrete policy proposals with legal and regulatory constraints, cost-effectiveness and cost of service principles, and the overall safety and reliability principles that are at the core of the utility’s mission. In August 2015, the City Council authorized an electrification (a/k/a “fuel switching”) work plan32 to research and analyze ten specific electrification strategies; that work is underway and will yield analytic findings and recommendations over the course of 2016 and early 2017. Key Actions: Natural Gas [broken out from energy for clarity] 2.a. Encourage all-electric in new construction Because new construction of advanced alternatives is generally more economic than retrofits, this strategy is one of the most cost-effective evaluated. 2.b. Make PA GreenGas “opt out.” Shift PAGG from an opt-in program to an opt-out, which would bring Palo Alto to 40% GHG reductions—California’s 2030 target—now!).33 2.c. Reduce energy use through efficiency measures and equipment replacement Continue to support and, where feasible, consistent with legal and regulatory requirements, and cost-effective, accelerate aggressive energy efficiency and accelerated retrofit cycles through building codes and CPAU incentives. Develop programs that take advantage of natural equipment life cycles by encouraging CPAU customers, through focused marketing and/or predictive analytics, to upgrade at time of replacement to most efficient technology, determined on a total cost of ownership basis. 2.d. Pursue and apply electrification feasibility analysis. Encourage “fuel switching” where cost effective from GHG-emitting natural gas to carbon neutral electricity. Initial analysis of the cost-effectiveness of fuel switching strategies identified residential water heating (replacing hot water heaters with heat pump water heaters (HPWH) 32 http://www.cityofpaloalto.org/civicax/filebank/documents/48443 33 Emission offsets are controversial, but may play a successful transitional role in reducing natural gas-related emissions. Other options include: (1) Make the PAGG portfolio the default gas portfolio (2) Explore investing a portion of those funds in qualified local offsets to fund other S/CAP initiatives, using offsets as “bridging” strategy as the City has done with carbon neutral electricity City of Palo Alto Page 26 and some EVs as “cost-effective” within current parameters. CPAU plans to begin a pilot program testing HPWH replacement strategies and customer response in early 2016.34 Other electrification opportunities, including residential space heating electrification, commercial water heating and space heating electrification, and commercial cooking electrification, are less cost effective at this time when assessed as individual measures, but may be more cost-effective when offered as bundled services. (For example, Boulder CO is developing an integrated service offering that combines energy audit, weatherization, efficient appliances, rooftop solar and an EV in a single bundle that lowers monthly cost to the customer and is paid for through on-bill financing. The offering may be target marketed using predictive analytics, based on customer use patterns and permit data, to identify the customer who would benefit the most.) Related actions: Build capacity to serve expanded electrical demand through efficiency, local generation, and continued renewable power purchase. Adjust rate tiers in order to not penalize fuel-switchers. Note that all rates must be based on the cost to provide service. Any rate design proposal must be specifically analyzed for legal, regulatory, and cost-effectiveness issues, or other barriers (e.g. operational implementation) that may impose constraints on using rates as a tool to implement or otherwise incentivize or subsidize fuel switching. 2.e. Monitor biogas options. Biogas (or methane generated from crop or waste resources) is part of the strategy mix in California’s PATHWAYS analysis. CPAU has determined biogas is not an economically viable option for Palo Alto at this time, and PG&E has expressed concerns about the safety and quality of biogas if this commodity is introduced into its pipeline transmission system. 2.f. Monitor the long-range viability of CPAU’s natural gas business. As customers shift away from natural gas, CPAU’s natural gas revenues will decline, while the Utility will still need to maintain the safety and integrity of its natural gas pipelines and systems and retain qualified workers. This could generate financial stress at some point in the future and leave stranded assets. 2.g. Infrastructure considerations for the natural gas utility Longer-term implications of moving away from natural gas in Palo Alto need to be studied in further detail. For instance, natural gas utility estimates for long-term infrastructure planning costs and anticipated infrastructure upgrades need to be assessed relative to costs and benefits of electrification for specific natural gas distribution areas and neighborhoods. Aging natural gas infrastructure needs to be considered as part of assessing electrification opportunities. Steps may include: Identifying natural gas distribution areas requiring costly network upgrades Developing plans to target these areas for electrification and associated electrical upgrades needed with aggressive, targeted incentives Assessing whether and how avoided cost of infrastructure upgrades could pay for 34 In addition to cost-effectiveness hurdles, electrification programs may be legally constrained as well. For example, efforts to shift customers from natural gas to electricity, which will have investment and revenue impacts on each enterprise fund, may raise issues with regard to Prop 26, which prevents municipal utilities from “cross- subsidizing” electricity and gas customers. This will need to be evaluated as part of developing electrification strategies. City of Palo Alto Page 27 electrification Benefits: Emissions. Savings. Agility. Resilience. 3.Key Levers: Water Background/Issue(s): Palo Alto has done an outstanding job of meeting annual water use reduction requirements of the current “drought.” But both potable water supplies and hydroelectric needs could be challenged by long-term shifts in California’s precipitation regime. With shifting climate patterns35, significant uncertainty exists related to whether the drought conditions are the “new normal” for California However, all climate projections show increases in average temperatures and reduced snowpack where Palo Alto sources much of its water— which could impact Palo Alto’s hydroelectric power and thus its carbon neutral electricity strategy. Under state law36, City of Palo Alto Utilities (CPAU) must prepare an Urban Water Management Plan every five years. The Plan must assess the reliability of Palo Alto’s water sources over a 20- year planning horizon and report its progress on a 20% reduction in per-capita urban water consumption by the year 2020.37 CPAU’s 2010 Urban Water Management Plan presumes continuation of modern California precipitation regimes, which might not accurately represent the future we face. CPAU is beginning development of the 2015 plan (due June 2016 to the State). Given current climatic projections, long-term increases in water supplies from San Francisco Public Utilities Commission (SFPUC) appear highly unlikely, and any tapping of groundwater supplies, even with the new storage facilities, would only provide emergency short term relief. The key is therefore to reduce consumption of water while rapidly increasing the availability and use of recycled water. Goals: Safe and reliable water supply for the possible “new normal” of less (and less reliable) precipitation Means: Efficiency. Recycled water. Green infrastructure for local storm water capture and storage. Onsite wastewater treatment. Strategies: Reduce potable water consumption. Supplement existing water supplies. Actions: Develop long-term efficiency goals, and aggressively market toward them Incorporate net zero water standards in future Green Building Ordinances Evolve Palo Alto landscapes to adapt to changing precipitation trends, and allocate water resources to protect our urban canopy Develop and incent local water capture and storage, from household to social scale Pilot and evaluate onsite wastewater treatment technologies Pursue recycled water production and use Benefits: Resilience. Savings. Strategy: Reduce potable water consumption. 35 The California Department of Water Resources (http://www.sei-international.org/news-and-media/3252), the Association of California Water Agencies (http://www.acwa.com/events/2016-executive-briefing-defining-new-normal) and others are examining the potential impacts of Climate Change on Hydrologic Trends and Water Management. 36 Water Conservation Bill of 2009 37 http://www.water.ca.gov/urbanwatermanagement/ City of Palo Alto Page 28 In Palo Alto, overall water use per account decreased by 27% between 2000 and 2010, and all customer classes showed a reduction in annual water use per account. The relative share of the total water usage made up by the residential customers has continued to grow with residential single-family users increasing their share from 41% to 47%. Overall water consumption in the residential sector in total increased its share from 50% to 62% of total citywide consumption. Palo Alto’s drought response has to date achieved reductions of well over 25% in 2015 compared with 2013 levels. Long-term water reduction strategies should focus not only on implementing these procedures during times of drought, but also using the incentives and policy drivers the water management plan to drive sustained water consumption reduction, which will require structural changes in water demand (such as building design and landscaping choices) as equipment and fixture upgrades and behavioral choices. Strategy: Supplement Existing Water Supplies New sources of both potable and non-potable water to support redundant supplies for water security requires 1) increasing ground water capture through capturing rain water, storm water retention and encouraging ground water recharging through green infrastructure investment, design criteria and policies, 2) maximizing the potential for water recycling from the Regional Water Quality Control Plan (RWQCP), and potentially 3) careful exploration of on-site waste water treatment technologies (such as those in use at Moffett Field). Ground water capture and management is critical to provide sufficient on-call reserves during severe droughts, and to maintain sustainable ecosystems. Policies to maximize capture also reduce the risk of storm water outflow and flooding. Policies the city should promote for ground water capture include: Green stormwater infrastructure. Promote the design of green streets and alleys to promote the integration of green infrastructure elements into the street and/or alley design to store, infiltrate, and evapotranspire stormwater. Set policy and codes to require permeable pavement installation on new and retrofit of commercial building and residential projects. These pavements are particularly cost effective where land values are high such as in Palo Alto and where flooding is a problem. Promote rainwater and greywater harvesting. Address through building policy or legally compliant, cost-effective utility incentives the capturing rainwater and greywater and using it for landscape watering needs reducing the use of potable water for landscape irrigation. Incent downspout disconnection. Address through building policy or legally compliant, cost-effective water utility incentive the disconnection of rooftop drainage pipes to drain rainwater to rain barrels, cisterns, or permeable areas instead of the storm sewer. Develop recycled water (and potentially direct delivery of purified water) capacity and uses, from both the RWQCP and onsite waste water treatment. City of Palo Alto should also maximize water recycling from the RWQCP. Under current upgrade plans, the RWQCP could produce as much as 27 million gallons per day, of which approximately 33% meets quality standards for “unrestricted use” and 19.4 MGD of restricted water use. City of Palo Alto Page 29 The City continues to examine methods to expand the use of recycled water. Completion of the Recycled Water Market Survey and Facility Plan is a step in that direction. The City expects that the costs of implementing expanded recycled water use can be reduced through a combination of regional coordination and state and federal matching funds. Other Actions [Summary] These “other actions” are listed in brief summary form, and will be addressed in detail in future study sessions. 4.Key Levers: Buildings Goals: “Net Positive,” healthy, productive, efficient built environment Means: Building ordinances and reach codes. Performance benchmarking and disclosure. Education & outreach to realtors, developers, building trades, financiers Actions: Set & enforce building standards >15% above California’s. Establish a “loading order” for efficiency & ZNE measures: New buildings > Major retrofits > Ownership transfer Apply retro-commissioning and performance benchmarking to ensure and incentivize high performance. (Retro-commissioning is a systematic process to ensure that a building performs as designed. Performance benchmarking is comparing one building’s performance to performance of comparable buildings.) Ensure that City buildings meet green building requirements. Conduct regular building audits, set performance improvement goals, assign accountability Assess and accelerate electrification transition (with CPAU). Use “predictive analytics” to identify and engage likely candidates for retrofit and equipment upgrades, based on expected end-of-life of existing equipment Benefits: Reduced emissions. Operating cost savings. Enhanced asset value. Grid resilience and more manageable energy demand curve. 5.Key Levers: Municipal Operations Efficiency, low carbon and other sustainability initiatives can save money, improve operating performance, reduce emissions, and provide leadership by for the community. Goals: “We go first” Means: Procurement. Procedures. Accountability. Training. Actions: “Default to Green” in procurement (For example, City policy requires that City management procure EVs as first choice, and select fossil fueled vehicles only if appropriate EVs are not available.) Embed sustainability commitments and criteria into CIP process, building construction, renovation and operation Establish internal carbon targets and trading, pricing to increase GHG-reduction City of Palo Alto Page 30 accountability.38 Apply retrofits to cut resource use 5-10%/year—performance contracting. Reinvest operating savings into further sustainability initiatives Collaborate with other cities to share best practices & advance regional initiatives Benefits: Footprint. Cost savings. Happy customers. Lead by example. 6.Key Levers: Palo Alto Utilities Goals: Reliable, safe, economical, sustainable and resilient services Means: Lead the charge. Adapt business model to changing industry dynamics. Actions: Promote—and monetize—radical resource efficiency. Increase PPA contracting to hedge hydro uncertainty, subject to the City’s Risk Management Policies and Procedures; maximize local solar+storage as resilient complement to grid solar. Deploy Smart Grid as key part of “smart and connected city” Restructure rates to not penalize increased electrical demand Explore and develop microgrids; prepare to upgrade grid to meet rising demand from electrification. Adapt CPAU business model to service-focused, Distributed Generation/Storage Benefits: Leadership. Resilience. Savings. 7.Key Levers: Adaptation & Resilience This is a large topic, addressed here only briefly. Santa Clara County has conducted extensive analysis of these topics in their SV 2.0 project. SCAP consultants have provided detailed assessment of risks and potential responses. City staff have several related workstreams underway, some of which will be presented in a parallel study session currently scheduled for January. Goals: Reduce vulnerability to Sea Level Rise (SLR), flooding, rising temperatures, extreme weather events Means: Inform, protect, retreat. Build resilience into City planning. Actions: Continue to pursue “green infrastructure” as required by the Regional Water Quality Control Board and as warranted by staff analysis; include supporting policies in the Comp Plan Update aimed at increasing storm water infiltration. Pursue policies and projects to reduce storm and flood vulnerability Evaluate and if needed strengthen SLR and flooding concerns into planning, zoning, permitting and insurance requirements Address the vulnerability of City assets to sea level rise (SLR) Benefits: Survival of critical assets and services. Reduced costs, public safety. 38 More than 400 companies, 40 nations and 23 cities, states and regions have established internal carbon pricing, as a way of incorporation climate plan goals into management and operating decisions. City of Palo Alto Page 31 8.Key Levers: Information Technology Goals: Enable staff, residents and business to understand trends innovate programs Means: City as platform: Provisioning data and information services that support operational efficiency and program innovation Actions: Extend open data initiatives to include mobility, utility, operations & environmental quality Provide visual performance dashboards that simplify tracking and benchmarking sustainability performance—and support effective action Accelerate smart grid deployment. Enable customer and 3rd party access to accurate, timely data. Protect privacy. Benefits: Agility. Participation. Learning. Data-driven decisions. 9.Key Levers: Engaging the Community Goals: Broad community engagement, participation, guidance, initiative Means: Inform & convene. Support individual & collaborative action. Disclose & report impacts. Actions: Pilot “CoolBlock” collaborations to support neighborhood cooperation toward sustainability and resilience goals Deploy/encourage dashboards and “fitbit for sustainability” apps Estimate/report “scope 3” emissions, to seed conversations about consumption Benefits: QOL, savings, accelerated GHG reductions, conviviality, political support 10.Key Levers: Ecosystems Goals: Protect and enhance the regenerative capacity of ecosystems Means: Value and enhance the common wealth. Actions: Use “ecosystem functionality” layers in planning processes. Expand and protect canopy, biodiversity, soil health and water capture; adapt canopy and parklands to changing climatic regimes Value and enhance the common wealth for future generations. Benefits: Quality of life. Adaptation/resilience. Potential Sources of Funds39 Staff has identified a variety of potential sources of funds to finance the initiatives that Council may choose to purse, though all of these sources (including private financial vehicles) need a more complete assessment of applicable legal and regulatory requirements and the risks and obligations associated with the various approaches. These include operating savings, parking feebates, utility rates, revolving loan funds, local offsets, carbon tax or fee, voluntary contributions, as well as green bonds and private financial vehicles.40 There is evidence that 39 The City of Palo Alto has just been award an $85k grant from USDN for a multi-city exploration of potential sustainability financing strategies 40 This despite a common misperception: Most people who have not been deeply engaged in sustainability work assume that low-carbon and other sustainability initiatives will necessarily require financial, performance or quality of life sacrifices, because “better usually costs more.” As we’ve seen in the world’s product innovation, green building, and corporate eco-efficiency, this is not necessarily the case; in City of Palo Alto Page 32 market demand exceeds supply for well- constructed sustainability and climate related investment opportunities; as a result some initiatives discussed here may be financeable through private investors. (Subject to Council selection of goals and measures, the strategies outlined here could yield Net Present Value in the hundreds of millions of dollars.) Key questions As Council and community discuss the S/CAP and the options before us, we will need to consider several key questions: Leadership: What level of GHG reduction goals will Palo Alto target? Pace: How fast will Palo Alto attempt to achieve these reductions? Implementation: Which measures will Palo Alto enact to achieve these reductions? Invest: How much will Palo Alto invest? Funding: How will Palo Alto fund those investments? Criteria: What factors will Palo Alto use to make these decisions? Legal Issues Subsequent Study Sessions and Council Reports will address the cost implications and policy trade-offs of various mandates and proposals, and identify and assess any constraints that may exist (including any imposed by legal, statutory or regulatory requirements) in more detail. All measures and actions identified in this broad overview of the current state of the S/CAP process must be specifically analyzed and considered in the context of all applicable legal, statutory and regulatory requirements, including, for instance, constitutional limitations on utility rates and use of ratepayer funds imposed by Californians when they adopted Proposition 26, obligations set forth in the Cap-and-Trade regulations adopted by the California Air Resources Board, and other miscellaneous requirements embedded in the California Public Utilities Code. Timeline: Next steps/Plan Staff proposes a series of events over the course of the spring, to support Council and community in developing and reviewing the draft S/CAP and deciding together how to proceed. - A community summit on January 24, 2015 to engage several hundred Palo Altans (and most of the Council) in an open discussion of the potential goal and the critical elements of Transportation, Energy and Water. - This study session, which can explore the overall strategic sweep and key elements of the entire SCAP, and begin a high level conversation to surface aspirations and identify concerns, and frame the study sessions which will follow. fact a growing body of evidence documents that attractive returns on investment are possible from well-designed and well-executed sustainability initiatives. In the words of the late Ray C. Anderson, founder and CEO of Interface Flor, “If you think sustainability is too expensive, you’re doing it wrong.”) City of Palo Alto Page 33 - A series of study sessions over the course of the year, to enable deeper consideration of these three elements, and develop understanding of the requirements of both a 15 year strategic plan and a five year action plan. - The annual Earth Day Review of City sustainability initiatives in late April. - An action item—potentially in the early fall— to adopt goals and strategies, appropriate initial funding, establish criteria by which Council will allocate funding in response to specific staff proposals, and identify next steps. Resource Impact This study session has no resource impact beyond the staff and consultant time required to prepare and review this staff report, and participate in the meeting. Climate plan updates are significant undertakings for any jurisdiction, and since 2014 the City of Palo Alto has invested time and resources in this project. The need to allocate multiple members of City staff, significant time on the City Council’s agenda, and financial resources for consultant assistance and event/meeting programming will continue until the adoption of the updated Climate Plan (and its companion environmental document). Implementation of the Climate Plan will require investment of public funds, in amounts to be determined based on selection of goals and strategies, across the various funds of the organization. Policy Implications The Sustainability and Climate Action Plan will set forth proposed City policies and actions with regard to the topics addressed, and a framework for future discussions regarding these topics. The S/CAP Plan addresses many issues that are also addressed by the Comprehensive Plan. While staff has attempted to coordinate the two work streams as much as possible, there are inevitable differences, given the nature of each initiative, which will need to be reconciled as the planning processes advance in 2016. The Comprehensive Plan is an update of Palo Alto’s 1998 Comprehensive Plan, and has been underway since 2008; it will build on the existing plan, and incorporate goals, policies, and programs addressing climate change and climate adaption for the first time. The EIR for the Comp Plan Update will take a conservative look at potential GHG emissions through the year 2030. The S/CAP is a de novo undertaking, commenced in 2014; it is disruptive in nature, presenting possible strategies for making Palo Alto more sustainable in 2030 and beyond. As is typical for such planning efforts, near term actions can be specific and quantifiable, while longer term actions are necessarily more aspirational and specific, focusing on externally driven goals and attempting to determine if and how to meet them. These two different processes will converge on some matters, and not others; however staff recognizes that the two plans must ultimately work together to express the community’s vision for the future, and establish specific policies and strategies to guide future investments and decisions. Staff has not attempted to resolve all these differences as the staff level, since many of them are a matter of political, not professional, judgment, and thus within the purview of Council and community, not staff. City of Palo Alto Page 34 Environmental Review Adoption of a Climate Plan will require review pursuant to the California Environmental Quality Act (CEQA). While some sustainability measures have been included in the Draft EIR that is being developed for the Comprehensive Plan Update, the final S/CAP may include strategies that have not been adequately addressed by the Update. Thus the final S/CAP will have to be reviewed to determine the appropriate level of CEQA review required. This review may utilize the Comprehensive Plan EIR, or require preparation of an Initial Study/Negative Declaration, or even preparation of an additional EIR, depending on the strategies and commitments it contains. Attachment: ATTACHMENT A: Stabilization Wedges and Analytical Assumptions (DOC) Attachment: Stabilization Wedges and Analytical Assumptions The projected GHG reductions presented in this CMR are based on extensive analysis, summarized in these “stabilization wedges” and tables of assumptions. The wedges, based on the methodology developed by Robert Socolow of Princeton University, illustrate the GHG reductions delivered over time by each element of a portfolio of strategies. The wedges are driven (through an Excel model not presented here, but available for review) by these tables of assumptions, which show the target implementation levels and adoption rates for each measure. As these assumptions are changed, projected GHG reductions change, as shown by the accompanying charts. These projections were developed using analytical models based on projections of the potential impacts of different actions (in turn based on engineering analysis or published research), and assumptions of the potential rates of adoption that could be achieved. As with all such models, it would be prudent to assume that near term projections (such as the next five years) are more accurate than longer-term projections (such as the next 15 or even 35 years), and staff recommends revisiting and recalibrating the S/CAP every five years—or more often, as new information warrants. Note that the potential impacts of some actions—like replacing natural gas water heaters with electric heat pump water heaters (HMWH)—are relatively straightforward to analyze with a high degree of confidence. The potential impacts of other actions—like advanced mobility strategies—are much more difficult to analyze, because causal relationships for new technologies are not yet well understood, and because the academic literature often used as a basis for these technologies generally lags the technologies themselves. As a result, these should not be taken as predictions of what will happen, but as a portfolio of strategies that could potentially achieve the targets we set. (These projections should be considered estimates within perhaps a +/-20% range.) The S/CAP consultants have constructed these models to be transparent and flexible; it’s relatively straightforward to modify assumptions and observe the effect those modifications have on outcomes. The target implementation levels and adoption rates shown here are aggressive, and would require focused and consistent effort to achieve (for example, replacing most gas water heaters at end-of-life with HPWHs, rather than a few). But these rates provide one possible roadmap for achieving the 2030 target, and a basis for discussion of what we choose to accomplish. Transportation (City & Community GHG Emissions, mTCO2e) Strategy Name Selected? (Yes/No) Assumptions Implementation Level Target Year Annual Adoption Rate BAU - Transportation Build out bike network Yes Convert all class II bike lanes to protected bike lanes (PBL) Increase bike boulevard mileage from 22-32 miles Expand bike share to 28 stations per square mile 40% 2030 2.7% Expand transit facilities and services Yes Caltrain modernization ridership targeted in 2040 achieved Expand SamTrans, VTA and Palo Alto shuttles by 100% El Camino Real and Dumbarton Bus Rapid Transit 60% 2030 4.0% Facilitate shared transport Yes Dynamic ridesharing based on San Francisco casual carpool rates, with Palo Alto share proportionate to Palo Alto Caltrain ridership 60% 2030 4.0% Provide eco- pass/universal transit pass Yes Expanded Universal Transit Pass (UTP) - Caltrain GoPass, SamTrans Way2GoPass, and VTA Ecopass, for all residents and employees 100% 2030 6.7% Utilize parking pricing and management approach Yes All employment sites institute parking pricing, parking cash-out, parking feebate equivalent to market price of parking Full cost pricing of residential parking (unbundling or eliminating minimum parking requirements) 50% 2030 3.3% Adopt a "balanced community" approach for growth Yes Target a jobs-housing balance of 1.44 with growth in specific areas (e.g., Stanford Research Park, downtown core, Stanford Shopping Center, etc). 15% 2030 1.0% Convert Palo Alto vehicles to EV Yes Incentives, rebates and programs to encourage electric vehicle adoption by Palo Alto residents 90% 2030 6.0% Convert all other vehicles to EV Yes Offer charging stations, and other incentives for people coming into Palo Alto to drive EVs 80% 2030 4.0% Carbon offsets No Purchase carbon offsets 0% 2030 Natural Gas (City & Community GHG Emissions, mTCO2e) Strategies Selected? (Yes/No) Implementation Level Target Year Annual Adoption Rate BAU - Natural Gas Residential water heating electrification Yes 100% 2030 7% Residential space heating electrification Yes 70% 2030 5% Commercial water heating electrification Yes 85% 2030 6% Commercial space heating electrification Yes 85% 2030 6% Commercial cooking electrification Yes 50% 2030 3% Restrict natural gas hook-ups/ require ZNE new construction Yes 100% 2030 100% Carbon offsets No 0% 2030 0% Biogas No 0% 2030 0% City of Palo Alto (ID # 6264) City Council Staff Report Report Type: Study Session Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Study Session on the Parks and Recreation Master Plan Title: Study Session on the Parks, Trails, Natural Open Space and Recreation Master Plan From: City Manager Lead Department: Community Services Recommendation This is a study session on the Parks, Trails, Natural Open Space and Recreation Facilities Master Plan (Master Plan) and no action is required. The Council is requested to provide feedback on the overall master planning process to date as detailed in this staff report and the attached consultant report (Attachment A), and to provide input on the draft process for prioritizing projects that is outlined at the end of this report. Executive Summary This report provides an update on the Parks, Trails, Natural Open Space, and Recreation Master Plan (Master Plan), including a summary of the analysis and community outreach that has been completed to date, a review of how new potential projects and programs will be recommended and prioritized for the Master Plan, and an update of the project schedule. The final Master Plan will include the following components:  prioritized list of community identified short-term (within 5 years), mid-term (15 years) and long- term (20 years) projects and programs that will guide the City’s parks and recreation system.  recommendations for acquiring new park land;  overarching policy direction;  a strategic funding plan to successfully implement the Master Plan;  complementary individual concept plans for each City park and recreational facility; and  suggested enhancements and additions to the City’s recreational programs As directed by Council at the August 31 study session, staff is returning this evening with an update that is more comprehensive and inclusive of the in-depth community outreach and analysis staff and the consultant have completed to date. All documents referenced in this staff report are available on the City of Palo Alto’s project website at www.paloaltoparksplan.org in the Plan Documents Section. In addition to this staff report, there is a companion consultant report (Attachment A) that traces the master planning process along its development in greater detail, highlights key findings and discusses City of Palo Alto Page 2 the proposed upcoming process for evaluation and prioritization. Staff has also prepared responses to Council questions asked at the August 31 meeting (Attachment B). The process to develop the Master Plan includes the following three phases: 1. Phase 1: Specific Site and Program Analysis and Community Engagement: Development of a comprehensive inventory and analysis of all Palo Alto parks, trails, developed natural open space areas (picnic areas, parking lots) and recreational facilities and programs; analysis of current and forecasted demographic and recreation trends, and analysis of community recreation needs. Including a proactive engagement of the community, and a broad range of stakeholders to help identify community needs, interests and preferences for system enhancements. (completed) 2. Phase 2: Developing and Prioritizing Project and Program Opportunities: Preparation of recommendations; identification of capital projects, needed renovations and other improvements; and prioritization of projects into an implementation timeline of short (5-year), medium (15- year) and long-term (20-year) ranges. (ongoing) 3. Phase 3: Drafting of the Master Plan, Review and Adoption: Public, Parks and Recreation Commission (PRC), and Council review; and Council approval process to adopt the master plan. (to begin in 2016) At this time, staff and the consultant team have completed the Technical Assessment and Analysis step and have conducted the Community and Stakeholder Engagement activities (Phase 1) necessary to proceed with the Developing and Prioritizing Project and Program Opportunities (phase 2), although community and stakeholder engagement will remain ongoing throughout the Master Planning process. As a result of Phase One, Key Areas of Focus have emerged from the Community and Stakeholder Engagement and Technical Assessment and Analysis. They include:  Distributing park and recreation activities and experiences across the city  Improving and enhancing community center and recreation spaces across the community  Enhancing comfort and making parks more welcoming  Enhancing capacity and quality of sports fields  Increasing the variety of things to do in existing parks  Increasing health and wellness opportunities in parks and programs  Improving spaces and increased options for off-leash dogs  Integrating nature into Palo Alto Parks  Improving the accessibility of the full range of park and recreation opportunities  Offering more of existing program, classes and events  Exploring new types of programs, classes, events and activities for all ages and abilities  Expanding the park system These Areas of Focus form the framework of the current community online survey challenge, and are being used in the refinement of the list of potential project and program ideas. The development of the City of Palo Alto Page 3 Areas of Focus is covered in greater depth in the attached consultant report. (Attachment A - Refer to Section 5 “Data Summary and Opportunity Analysis” pages 32-35). A draft list of potential projects and programs has been developed and is being refined by the Project Team. This comprehensive list will go through a prioritization process currently being formulated and drafted by staff, consultants and the PRC. The prioritization process will score the potential project and program ideas into a ranked list of recommended projects and programs that will be reviewed by both the PRC and Council over the next few months. Some of the projects and programs that have begun to emerge as community priorities from the site analysis and community input include:  Addition of better dog park facilities throughout the City, but most notably in north Palo Alto where no dog parks exist  Addition of community gardens, especially in south Palo Alto where no community gardens exists  Addition of restrooms in parks  Renovation of current athletic fields to provide a wider range of uses. For example, a multi-use field could be striped for football, soccer and lacrosse  Improvement of connections to parks by upgrading the walking experience between parks and surrounding neighborhoods  Increased programs for youth and elderly populations  Maintenance of the high level of services the current park and recreation system provides  Increase of health and wellness activities in parks and programs  Providing more access to nature in parks and programs  Addition of park and recreation opportunities in underserved areas of Palo Alto  Upgrading existing or addition of a new pool, community center and gymnasium facility in south Palo Alto Staff and the consultant team plan to return to the Council in the spring of 2016 to review and discuss the list of prioritized recommendations. Staff will return to Council again in the summer of 2016 to review the draft Master Plan, and expects to bring the final draft to Council for approval by early fall of 2016. Given the additional time that has been used to develop the prioritization process, the updated schedule to complete the Master Plan is extended by approximately six months from the previous schedule. Background A Capital Improvement Project for a Parks, Trails, Natural Open Space and Recreation Master Plan (PE- 13003) was adopted by Council for the 2013 Fiscal Year. The purpose of this project is to provide the necessary analysis and review of Palo Alto’s parks and recreation system for the preparation of a long- range (20-year) Master Plan. The Master Plan will provide the City with guidance regarding future renovations and capital improvement needs for parks and recreation facilities and programs. The master plan will also include recommendations to meet demands for future recreational, programming, environmental, and maintenance needs and establish a prioritized schedule of future park renovations and facility improvements. City of Palo Alto Page 4 Though the Master Plan addresses trails and natural open space, it is not intended to provide specific guidance on how best to manage and maintain the City’s trails and open space preserves. Existing plans, such as the Arastradero Preserve Trail Management Plan (2001) and the Foothills Park Trail Maintenance Plan (2002), provide guidance on the management of trails. There are also future plans, such as the 2017 Capital Improvement Project to complete a Baylands Comprehensive Conservation Plan, which will provide specific guidance on vegetation and habitat management, wildlife management, and wildlife-appropriate public access. Similar comprehensive conservation plans will be created for Foothills Park and Pearson Arastradero Preserve. This Master Plan will only look at developed areas in the City’s natural open space areas such as parking lots, picnic areas and facilities and make recommendations on how they can best be enhanced. The “project team” comprised of City staff and the consultant firm MIG, along with significant review and input from the PRC has spent the first 18 months of the project focused on gathering and analyzing data collected from Palo Alto’s current parks and recreation system and the community. The analysis in Phase One included a thorough physical inventory of parks and recreation assets, extensive community outreach, and a review of projected community demographics. This culminated in a list of potential needs for the overall parks and recreation system and is compiled in a “Data and Needs Summary Matrix”, which references specific data points that support the summarized needs. It should be noted that one of the main needs expressed by the community is to continue to maintain the already high level of quality services and amenities the current parks and recreation system provides, which the community identifies as a tremendous asset to the City The Master Plan process is currently in Phase Two: developing recommendations and prioritization of potential project and program ideas. Over the past three months the project team, with assistance from the PRC, has constructed a draft framework to guide the process of defining and prioritizing recommendations. The third and final phase of the Master Plan process will include the drafting and adoption of the Master Plan inclusive of PRC, community stakeholders and Council review and approval. Discussion At the August 31, 2015 study session, Council requested a more in-depth review of the master planning process and summary of findings to date. This staff report, and the attached consultant report (Attachment A), provide significantly more background and detail on the planning process and public outreach that staff, the consultant and the PRC have been engaged in throughout the project timeline. The consultant report (Attachment A) includes an introduction on the purpose of the Master Plan followed by a summary of the technical assessments of existing conditions, public outreach and data summary and opportunity analysis. For the past year-and-a-half the project team has worked to provide ongoing meaningful opportunities for public input and engagement which will continue throughout the process. As referenced in the consultant report the project team has collected a wide range of community input concerning the parks and recreation system: what the community believes is working well and what is not, community interests and possible areas for greater investment. In the consultant report, at the end of each data collection or source section, a summary of key findings is provided. While not all the data gathered and analyzed are in this updated report, this more detailed report illustrates the extensive outreach and analysis completed to provide Council with a greater understanding and confidence in the process that has been conducted to date. Guided by community input, the Master Plan is designed to be an actionable working document that will City of Palo Alto Page 5 guide staff, and appointed and elected officials, on how to best manage Palo Alto’s parks and recreation system for many years to come. The following areas of discussion represent some of the key highlights in the evolution of the master planning process including:  PRC Involvement  Summary of the community outreach plan and activites  Master Plan Principles and Areas of Focus  Next steps in the Master Plan process The accompanying MIG report (Attachment A) provides the consultants’ perspective on the process, delves into greater detail of anaysis results, and highlights key findings that have emerged during the public outreach of the planning process. Parks and Recreation Commission (PRC) Involvement The PRC has been closely involved with the master planning process from the inception of the project. Beginning in June of 2013 a Commission Ad Hoc Committee was formed to provide feedback on the project’s Request for Proposal (RFP) and to take part in consultant interviews. Per the feedback provided by the PRC, the Master Plan scope was expanded to encompass all the aspects of Palo Alto’s parks and recreation system including: trails, natural open spaces and recreational programming. The Commission has worked closely with the project team to create a meaningful and engaging master planning process, and has provided a strong guiding voice in steering its formulation. To date, the Commission has discussed the Parks Master Plan at all of its monthly meetings since September 2014, has held one special meeting to discuss and finalize the community survey, and has formed several Ad Hoc Committees to assist staff and consultants with stakeholder outreach, survey development, community meetings and the development of a framework for Phase Two - Recommendations and Prioritization. All Parks and Recreation Commissioners have been closely involved with the project, and have provided valuable insight. PRC Involvement and meeting agenda item reviewed: ● July 2013 PRC Meeting: Review the Master Plan RFP ● July 2013 - January 2013 PRC Ad Hoc Committee formed: Review RFP, participate in consultant interviews ● February 2014 PRC Meeting: Introduction of consultant team; discuss involvement of PRC in planning process ● May 2014 PRC Meeting: PRC presents consultant with list of prioritization for the Master Plan ● June 2014 PRC Meeting: Review the community outreach plan ● September 2014 PRC Meeting: Review initial analysis data (Park inventory, demographics, and geographic and planning environment summaries) ● October 2014 PRC Meeting: Review initial analysis data (Mapita survey, recreation programming inventory) and discuss framework for community workshop ● October 2014 – Present: PRC Ad Hoc Committee formed to comment on the structure of and attend community meetings ● March 24, 2014: Master Plan study session with Council and PRC ● October 2014 - November 2014: PRC Ad Hoc Committee formed to draft community survey ● November 2014: Special meeting called to review final draft of community survey City of Palo Alto Page 6 ● December 2014 PRC Meeting: Community Outreach Update ● January 2014 PRC Meeting: Discuss need for providing reference to data ● February 2015 PRC Meeting: Review data matrix summary draft ● March 2015 PRC Meeting: Review initial analysis data (Community survey summary, existing conditions maps of each park and preserve) ● March - June 2015: PRC Ad Hoc Committee formed to draft summary needs matrix ● April 2015 PRC Meeting: Data matrix draft review, distribution of project binder, additional community survey findings discussed. ● May 2015 PRC Meeting: Data survey matrix update and in depth review ● June 2015 PRC Meeting: Introduction and discussion of principles ● June – October 2015: PRC Ad Hoc Committee formed to draft principles, areas of focus, community on-line challenge and criteria ● July 2015 PRC Meeting: Review revised principles and introduced criteria ● August 2015 PRC Meeting: Review on-line community challenge survey ● September 2015 PRC Meeting: Review on-line community challenge and discuss criteria ● October 2015: PRC Ad Hoc Committee formed to assist with drafting Council update ● December 8, 2015 PRC Meeting: Review of rough draft recommendations and prioritization framework The PRC was instrumental in drafting the online survey with staff and consultants. Initially the Commission was concerned that the first draft of questions did not provide sufficient depth and specificity for community feedback to guide the development of the plan. Staff and the Commission Ad Hoc Committee met multiple times to draft the survey, and held a special meeting with the full Commission to review and approve the survey. Key additions and revisions to the survey included: questions regarding the appropriate uses for 10.5 acre land bank at the golf course; priorities for protecting natural resources as well as connecting people with nature; barriers to participation in community/recreation programming; priorities for new or enhanced recreation programs; and preferred ways to accommodate recreation for off-leash dogs. The survey generated over 1,100 responses and along with the other forms of community outreach provided a diverse range of community input (Attachment A - Refer to Section 4 “Community Outreach” pages 21-30). City staff and the PRC felt it was essential to collect, review and reference the broad range of meaningful data in the first phase of the project. Due to the extent of quantitative and qualitative data gathered, the PRC challenged the project team to provide direct reference back to the data set when producing the summary list of potential needs. To meet this challenge, the project team gathered a wide range of site and facility analysis as well as community input and created what is now known as the Data and Opportunity Summary Matrix. To assemble the matrix a set of evaluation categories were defined and used to evaluate the park and recreation system. These included geographic analysis, capacity/bookings, demographic trends, projected needs, facility and programming needs and community preferences. Those measurements superimposed a big-picture perspective on the range of potential needs identified throughout the data collection phase. As a means of documenting the data used to support the matrix findings, a project binder was compiled and is directly referenced in the matrix providing section numbers and specific page numbers within the data binder where the data that supports the findings can be located. The information compiled in the data binder is also available in a virtual binder, and is available on the project website for council, commission and community convenience and accessibility. The project City of Palo Alto Page 7 website is the primary location to review all Master Plan information. As a means of simplifying the web page the project information has been organized to reflect the order of the data binder created for each of the Park and Recreation Commissioners. A data binder index (Attachment C) has been added to the Master Plan web page and directly links all planning documents for the Master Plan into a consolidated and searchable list. This list includes all the analysis data and summaries collected in Phase One as well as the “Data and Opportunity Summary Matrix”. The Council is encouraged to visit the project web site and to review the matrix and associated data and stay updated with the project status. (Attachment A - Refer to Section 5 “Data Summary and Opportunity Analysis” pages 31-35, and the Data Sources Index). Project Web Page: http://www.paloaltoparksplan.org/ Project Binder Index: http://www.paloaltoparksplan.org/pdf/CPA_Parks_MasterPlan_Data%20Sources.pdf Summary of Public Outreach Staff and the consultant, along with input from the PRC, crafted a robust public outreach strategy that included a wide variety of engagement tools and activities allowing multiple opportunities for the community to provide input and participate in the planning process. These numerous opportunities for participation have included a variety of formats, times and levels of interaction, as well as both on-line and in-person outreach methods. (Attachment A - Refer to Section 4, “Public Engagement Activities to Date” in pages 21-30). A Master Plan Stakeholder Advisory Group (Stakeholder Group) was formed to provide a community input source for members of the community directly connected with the parks and recreation system (see list below). The Stakeholder Group has met twice, once during the analysis and feedback portion of the project in spring of 2014, and most recently on October 1, 2015 to receive a project update in preparation for the recommendation and prioritization phase of the project. They will meet again in the coming months to assist in providing input on the prioritization of project and program recommendations, and again in spring 2016 to review the draft Master Plan. The Stakeholder Group assists in promoting the master planning process by distributing information to their organization members and partners (Attachment A - Refer to Section 4 “Community Outreach” Stakeholder Advisory Group pages 24-25). The Stakeholder Group is comprised of representatives from the following groups:  Friends of the Palo Alto Parks  Palo Alto Unified School District  Palo Alto Recreation Foundation  Canopy  Avenidas  Palo Alto Youth Council  Teen Arts Council  Stanford University  Palo Alto Dog Owners  Palo Alto Chamber of Commerce  Girl Scouts City of Palo Alto Page 8  Boy Scouts  Save the Bay  Audubon Society  Palo Alto Parents Club  Teen Advisory Board (Youth Representative)  Cubberley Advisory Group  Palo Alto Unified School District  Acterra  Public Arts Commission  Palo Alto Bike Advisory Committee  Art Center Foundation  Palo Alto Soccer Club  Abilities United The project team has also met separately with several members of the stakeholder organizations such as Avenidas, Palo Alto-based youth sports organizations, the Palo Alto Dog Owners Association and Cubberley Community Center tenants to discuss their specific connection to the parks and recreation system, and their hopes and interests for the future. These interviews provided in-depth feedback regarding dog parks, athletic field use, the middle school sports program and the Cubberley Community Center. Along with community meetings and online survey tools, interactive community workshops provided input at key project milestones. A series of three community meetings were held in fall 2014 that allowed the community to provide input on maintaining and enhancing the parks and recreation system. Furthermore, the project team and PRC members conducted six “intercept surveys” to collect input from visitors at parks, farmers markets and community events that were less formal than the community meetings and provided a diverse range of community feedback. Community Outreach Methods used to Date:  (3) Community workshops  (6) Intercept groups  (2) Stakeholder meetings  Individual stakeholder group meetings o Cubberley tenants o Athletic field users o Middle School Athletic Program staff o Palo Alto dog owners o Avenidas o Rinconada Pool users o Boost Fitness Program staff o Athletic field scheduling staff  Online surveys o Mapita (Interactive Survey) o Community Online Survey City of Palo Alto Page 9 o Online Community Challenge Survey (currently active)  Boards and Commission meetings o PRC monthly review and input on Parks Plan progress (25 meetings) o 2 Council Study Sessions o Public Art Commission meeting The current online survey challenge allows the public to share their relative preferences for how and where they would like the City to invest limited resources. The survey allows participants to allocate a finite amount of virtual funds to the areas of focus the participant feels are most important (prioritization). This ranking task of assigning value to the areas of focus (refer below for a discussion of the areas of focus) occurs multiple times, requiring the participant to consider a variety of options and trade-offs. The online survey challenge is currently active. Staff encourages the community and Council to participate in the survey, which can be found on the project web page. Online Survey Challenge: www.paloaltoparksplan.org http://lime.migwebtech.com/index.php/survey/index/sid/663595/lang/en Master Plan Principles and Areas of Focus As a result of the Master Plan’s extensive public outreach, a number of community Principles for the Parks and Recreation system became apparent. These concepts dovetailed with input from the PRC and staff as well as the data analysis included in the Data and Opportunity Summary Matrix. The principles articulate a common vision and set of values for the parks and recreation system. The Principles were the focus of discussion at the August 31, 2015 Council Study Session. They have been used initially by the project consultant (MIG) as one tool in the development of the draft list of potential projects and program ideas, and will be used in the future by staff, Council, and Commissions to evaluate and improve new proposed projects. The principles are utilized to confirm that a proposed project or program meets the core values of the community. They are not used to rank potential project or programs, but to guide future projects to explore opportunities to include as many of the principles in their scope as feasible. The project team, Commission, and a Commission Ad Hoc Committee have worked closely to refine the principles. The revised Principles in the accompanying MIG report (Attachment A) are the result of community collaborative effort. Council feedback at the August 31, 2015 study session was especially helpful, and led to further refinement of the Principles such that “Nature” was added as an eighth principle (Attachment A - Section 6 “Master Plan Process to Develop and Prioritize Projects” pages 35-36). The following eight Principles provide the foundation for the Master Plan, articulating Palo Alto’s vision and guiding project and program implementation. 1. Playful: Inspires imagination, creativity and enjoyment. 2. Healthy: Supports the physical, social and emotional health and well-being of individuals as well as the connectedness and cohesion of the community. 3. Sustainable: Proactive stewardship of natural, economic and social resources for a system that City of Palo Alto Page 10 endures over the long-term. 4. Inclusive: Responsive to the entire Palo Alto community, all ages, abilities, languages, cultures and levels of income. 5. Accessible: Easy for people of all abilities to use year-round and to get to by all modes of travel. 6. Flexible: Supports multiple uses across time with adaptable spaces that can accommodate traditional, emerging and future uses. 7. Balanced: Is not dominated by any one type of experience or place, and includes historic elements and modern features, highly manicured and more organic spaces, and self-directed and programmed activities. 8. Nature: Incorporates native species and habitat corridors, and creates opportunities to learn about and interact with nature. A subsequent step of the planning process was the development of the Areas of Focus. The Areas of Focus condense the many opportunities compiled in the “Data and Opportunity Summary Matrix”. The twelve Areas of Focus represent the main types of opportunities and improvements identified from the analysis and community input to enhance the parks and recreation system. They were developed to allow the community to provide feedback on priorities, and to structure the draft list of potential projects and program ideas. (Attachment A - Refer to Section 5 “Data Summary and Opportunity Analysis” for the Areas of Focus pages 33-35). The Areas of Focus are:  Distributing park and recreation activities and experiences across the city  Improving and enhancing community center and recreation spaces across the community  Enhancing comfort and making parks more welcoming  Enhancing capacity and quality of sports fields  Increasing the variety of things to do in existing parks  Increasing health and wellness opportunities in parks and programs  Improving spaces and increased options for off-leash dogs  Integrating nature into Palo Alto Parks  Improving the accessibility of the full range of park and recreation opportunities  Offering more of existing programs, classes and events  Exploring new types of programs, classes, events and activities for all ages and abilities  Expanding the park system Next steps Phase 2: Recommendations and Prioritization Phase Two of the Master Plan process, which began in fall 2015, focuses on developing and prioritizing recommendations. The recommendation and prioritization process includes feedback from the PRC and Council. Recommendations will be derived from ranking of the list of potential project and program ideas. The evaluation process provides the basis for determining which potential projects and programs will be included in the final Master Plan report. The process is intended to be concise, defensible and consistent with community interests, and to lead to clear, actionable recommended projects and programs. City of Palo Alto Page 11 The Recommendations and Prioritization process includes two steps: Step 1: Draft the Initial List of project and program recommendations: The consultant (MIG) has generated an initial list of potential recommended projects and programs based on the data analysis and community input from Phase One, as well as compatibility with the Principles. The list of potential recommended projects and programs includes available data that support potential recommendations. The PRC reviewed the initial draft list at its December 8, 2015 meeting. Staff, MIG and the PRC continue to work on the on the list to ensure it is consistent with and addresses public, stakeholder, PRC and Council input. Step 2: Develop and apply criteria for evaluating potential recommended projects and programs: Once the list of potential projects and program ideas has been finalized, each will be evaluated by the project team using the developed criteria and ranked using a point system. The criteria and evaluation point system is currently being refined by the project team and the PRC. Upon completing the criteria evaluation (scoring and ranking), a prioritized list will be assembled. This list will then be reviewed by the project team and the PRC to confirm that it contains a balanced, complete set of recommendations that meets the goals of the project. Draft criteria have been developed with input from the PRC and the Commission Ad Hoc committee. The five identified criteria for prioritizing project and program recommendations are: 1. Fill existing gaps: Bring recreation opportunities (park land, facilities, programs) to areas of the city and to users where gaps were identified. 2. Address community preferences: Target the highest priority types of projects and programs identified through citywide outreach. 3. Respond to growth: Add features or programs; modify or expand components of the system to prepare for and address increasing demand. 4. Leverage public resources: Create the most benefit possible for each dollar spent on capital and operating costs. 5. Realize multiple benefits: Advance the Principles of the Master Plan as well as the goals, projects and directions of other adopted City efforts. Please refer to Attachment D for a graphic representation of the draft Recommendations and Prioritization process. Staff and the consultant team plan to return to the Council in the spring of 2016 to review and discuss the list of prioritized recommendations. Staff will return to Council again in the summer of 2016 to review the draft Master Plan, and expects to bring the final draft to Council for approval by early fall of 2016. Given the additional time that has been used to develop the prioritization process, the updated schedule to complete the Master Plan is extended by approximately six months from the previous schedule. Timeline Project Schedule Phase I (Data Gathering and Analysis Phase): Complete City of Palo Alto Page 12 Phase II (Recommendation and Prioritization Phase): Current – Spring 2016 Phase III (Draft and Adoption of the Master Plan): Summer 2016 – Fall 2016 Anticipated adoption of the Master Plan: Winter 2016 Upcoming Council Involvement Council Study Session January 2016: Review public outeach and draft prioritization process Council Study Session April/May 2016: Review prioritized list of recommendations Council Study Session August/September: Review the draft Master Plan report Council Adoption November/December 2016: Review and approve Master Plan Resource Impact Funding for this study and planning process is provided in Capital Improvement Program project PE- 13003: Parks, Trails, Open Space and Recreation Master Plan. The objective of this study is to assess the long-term needs for development and improvement of existing parks, open space areas, regional trails and recreation facilities; the acquisition of new park land or expansion of existing park land to meet the on-going needs of the community; meeting the strategic maintenance needs of existing facilities in a cost-effective manner; the prioritization of recommended improvement and acquisition projects; and to provide funding strategies (public and private) for the improvements and acquisitions suggested by the report. The intent of this planning is to utilize limited Capital Improvement Fund and other resources wisely and effectively, and to leverage these resources with grants or private funding whenever possible. The Master plan will make recommendations that could call for new investments in the future. As noted earlier, included in this the Master Plan will be the development of a strategic funding plan to successfully implement the recommendations. Due to the in-depth nature of the Master Plan process along with additional meetings, community outreach, data analysis and extended project schedule, the project team is currently analyzing the project budget and scope and anticipates proposing additional funding to complete the final report as part of the FY 2017 capital budget process. Policy Implications The proposed Parks, Trails, Natural Open Space and Recreation Master Plan is consistent with the Comprehensive Plan Policy C-26 of the Community Services element of the Comprehensive Plan that encourages maintaining park facilities as safe and healthy community assets; and Policy C-22 that encourages new community facilities to have flexible functions to ensure adaptability to the changing needs of the community. Environmental Review This is a planning study and therefore exempt from California Environmental Quality Act (CEQA) review pursuant to Section 15262 of the CEQA guidelines. Eventually, as projects and recommendations of the Master Plan are implemented as capital improvement projects, an environmental assessment will be completed in conformance with the provisions of CEQA. Attachments:  Attachment A - Consultant Update Report (PDF)  Attachment B - Council Question Responses (PDF) City of Palo Alto Page 13  Attachment C - Project Binder Index (PDF)  Attachment D - Prioritization Process Diagram (PDF) ATTACHMENT A: PARKS, TRAILS, NATURAL OPEN SPACE AND RECREATION MASTER PLAN COUNCIL UPDATE REVISION 4 12/15/15 CONTENTS   1. INTRODUCTION: NEED, PURPOSE AND INTENT OF THE MASTER PLAN ........................ 1  2. ELEMENTS OF THE PARKS, TRAILS, NATURAL OPEN SPACES AND RECREATION SYSTEM ....................................................................................................................................... 3  3. TECHNICAL ASSESSMENT AND ANALYSIS RESULTS ....................................................... 3  4. COMMUNITY OUTREACH .................................................................................................... 21 5. DATA SUMMARY AND OPPORTUNITY ANALYSIS ............................................................. 31  6. MASTER PLAN PROCESS TO DEVELOP AND PRIORITIZE PROJECTS .......................... 36    FIGURES AND TABLES Figure 1: Planning Process ........................................................................................................... 2 Figure 2: Greer Park ..................................................................................................................... 5 Figure 3: Foothills Park ................................................................................................................. 7 Figure 4: Cubberley Community Center……………………….. ..................................................... 9 Figure 5: Park Walksheds Map ................................................................................................... 17 Figure 6: Exercise and Fitness Analysis Map ............................................................................. 19 Figure 7: Community Engagement Across the Master Plan Process ......................................... 21 Figure 8: Current Content Feature on paloaltoparksplan.org ..................................................... 24 Figure 9: What is Most Important When You Choose Recreation Programs .............................. 25 Figure 10: Site-Specific Comments on Bol Park ......................................................................... 26 Figure 11: Routes to Respondents’ Closest Parks ..................................................................... 27 Figure 12: Visual Preference Survey Results ............................................................................. 28 Figure 13: Data Binder and Summary Matrix .............................................................................. 31 Figure 14: Screen Capture of a Portion of the Data and Opportunities Summary Matrix ........... 33 Figure 15: Developing and Prioritizing Projects in the Master Plan Process .............................. 36 Figure 16: Project and Program Evaluation Process………………………………………………..40 Table 1: Plan Elements and Components .................................................................................. 32 Parks Master Plan: Council Update (12/15/15) 1 1. INTRODUCTION: NEED, PURPOSE AND INTENT OF THE MASTER PLAN This report has been prepared by the MIG team in response to City Council direction at the August 31 study session, as an attachment to the updated Staff Report prepared by the city team. It provides the context for how the principles and criteria discussed at the study session emerged, distilling and providing a summary of the findings to date, as directed by Council. The full reports referenced in this document are available online at http://www.paloaltoparksplan.org/ in the Project Updates library. As noted in the staff report, Palo Alto residents, employees and visitors value and enjoy the City’s high-quality system of parks, recreation programs, trails and natural open spaces. To build on and continue the legacy of a strong parks system, the City is developing a Parks, Trails, Natural Open Space and Recreation Master Plan (Master Plan) that will reflect Palo Alto’s strong commitment to providing high-quality outdoor spaces and recreational activities for our community. The last comprehensive, citywide study of current and projected community recreation and park facility needs was completed in 1965. The new Master Plan will provide clear guidance for managing, improving and expanding park and recreation facilities to keep programs, services and facilities relevant to present and future populations; appropriately balance recreation, open space and conservation; and provide adequate funding to meet on-going needs. The Master Plan will provide recommendations about future renovations and capital improvements for parks, trails, natural open space and recreation facilities. It will also include recommendations for how to meet changing needs and evolving demands for future recreation, programming, environmental and maintenance investments and establish a prioritized schedule of park renovations and facility improvements for the next 20 years. The planning process to develop the Master Plan includes the following tracks, as shown in Figure 1.  Community and Stakeholder Engagement: Proactive engagement of the public and a broad range of stakeholders to identify community needs, interests and preferences for system enhancements.  Technical Assessment and Analysis: A comprehensive inventory and analysis of all Palo Alto parks, trails, natural open spaces and recreational facilities and programs; an analysis of current and forecasted demographic and recreation trends; and an analysis of community recreation needs.  Developing and Prioritizing Projects: Preparation of recommendations; identification of capital projects, needed renovations and other improvements; and prioritization of projects into an implementation timeline of short (5-year), medium (10- year) and long- term (20-year) ranges.  Plan Review and Adoption: Public review and approval process to adopt the plan. Parks Master Plan: Council Update (12/15/15) 2 Figure 1: Planning Process For clarity, the following terms are used:  MIG team or consultant team refers to MIG, Inc., and its staff members, under contract to assist Palo Alto with developing the Master Plan  Project team refers to the joint City/MIG working team, including the project management teams from both entities.  City team refers to the cross-departmental City team leading the Master Plan effort internally. Parks Master Plan: Council Update (12/15/15) 3 2. ELEMENTS OF THE PARKS, TRAILS, NATURAL OPEN SPACES AND RECREATION SYSTEM To facilitate the analysis and understanding of Palo Alto’s system of resources, the project team defined three elements that comprise the citywide network of parks, natural open spaces, trails and recreation facilities and programs:  Parks, Trails and Natural Open Spaces: The public parks, trails and natural open spaces, ranging from small neighborhood parks to urban plazas to the city’s expansive preserves.  Recreation Facilities: The places and buildings or other structures that are the setting for programs, classes, sports, events and other formal or informal activities.  Recreation Programs: The programs, classes and special events coordinated by Recreation Services and partner organizations. By defining these elements, the project team created a common language to articulate Palo Alto’s community assets, providing consistency, clarity and structure that will carry forward into the Master Plan. 3. TECHNICAL ASSESSMENT AND ANALYSIS RESULTS To ensure a comprehensive, data-driven Master Plan, the project team conducted a significant amount of assessment and analysis. The result is a detailed understanding of the current system of parks, trails, natural open space, recreation facilities and recreation services. The project team also evaluated needs and opportunities, including forecasting changes and trends that may influence future demand and preferences. Each work product underwent a thorough review process, first by the City team, and then by the Parks and Recreation Commission (PRC). Each analysis contributed to the next step in understanding and evaluating the system. This section provides brief descriptions of the analysis conducted and what we learned at each step. For more detail, the project website contains the full documents summarized here. Inventory and Base Map The first step of the Master Plan process was to identify all existing parks, trails and natural open spaces, as well as recreation facilities. This effort included a detailed inventory listing the name, location, ownership, size (in acres) and defining features of all city-owned parks, facilities and open space preserves. Recreation facilities were inventoried, including their physical location where they are integrated in parks. The MIG team also prepared a GIS base map linked to the inventory tables, depicting the City-owned sites, school district sites and other recreation resources. Parks Master Plan: Council Update (12/15/15) 4 What we learned:  Palo Alto owns over 173 acres of park space distributed throughout the city as well as over 4,000 acres in natural open space preserves.  City parks are diverse in size and amenities, but many are older and/or have aging facilities.  The Palo Alto Unified School District (PAUSD) owns several facilities that provide important community recreation sites and facilities. One of these is the Cubberley Community Center, owned by PAUSD and operated by the City. How we used this information:  The inventory data was used to guide the site analysis visits, and provided the basis for several community engagement tools (including the online map-based survey) Site Analysis Visits and Existing Conditions Maps The MIG team visited each park, facility and preserve to document and evaluate existing conditions. Following this fieldwork, the MIG team prepared an existing conditions map for each site, which includes site history, a summary of features and a description of opportunities and constraints. Each map also incorporates site-specific public input generated through the community engagement process described in Section 4. This set of maps presents detailed information about each park, preserve and facility, and will become an Appendix in the Master Plan. Three examples of these products (on the following pages) depict Greer Park (a park), Foothills Park (a preserve and natural open space) and Cubberley Community Center (a major recreation facility). What we learned:  Due to the era when they were built, many parks don’t have flexible spaces that allow different uses to be layered in. Rather, they provide a collection of spaces designed for a single activity. With design interventions, many existing parks have the potential to support more use and activity.  Native species and drought-tolerant plants are not present or well integrated in many parks, though the preserves are rich with native species. Mown turf grass is a predominant feature in most parks.  The parks are highly developed with maintained landscapes across their entire acreage. Native species and less manicured landscapes are not incorporated.  The preserves include an extensive network of trails, a variety of wildlife habitats, large expanses of conservation land, and some recreation facilities.  Though there are designated dog parks, these tend to be small and isolated from other park uses.  The community centers vary greatly in their age and condition, but are being used for a broad range of activities.  The city owns, manages and maintains dozens of rectangle and diamond sports fields located throughout the city. Some are in parks, others are adjacent to community centers, and others in field complexes. Electrical towers and power lines Service access road Electrical utilities Adjacent open space EMERSON SCHOOL BAYLANDSNATURE PRESERVE AMA R I L L O A V E COLO R A D O A V E W B A Y S H O R E R D 1 0 1 - B A Y S H O R E F W Y E B A Y S H O R E R D SI M K I N S C T baseball field softball field softball field softball field soccer field soccer field soccer field (2) soccerfields parking play area basketballcourts low-use turf area skate park waterwise plantings picnicarea picnicarea A C D B A | View of freeway from park B | Skate bowl play feature C | Picnic area garbage cans D | Dog run area N GREER PARK Location: 1098 Armarillo AvenueOwner: City of Palo AltoSize: 22 acresYear: 1967 HISTORY Greer Park has grown from a 5-acre neighborhood park to a 22-acre multi-use area. The original five acres were acquired in 1963 and dedicated as Amarillo Park in September of 1965. Originally created as a neighborhood park, it has been expanded to serve as a regional park for a growing population. It was renamed John Lucas Greer Park in 1967, in keeping with the policy of honoring Palo Alto historical figures. Captain John Lucas Greer, an Irish seafarer, was born in 1808 and came to the San Francisco Bay in 1849. He sailed up San Francisquito Creek, decided to settle in the area, and leased some acreage for farming. Greer became a successful rancher, founded the Woodside Library, and was a trustee of the Woodside School. The family moved to Palo Alto in the 1860s. EXISTING CONDITIONS•Located just south of Highway 101•Features several athletic fields, a smalldog park and the City’s only skate park•A blend of recycled and potable wateris used at this site•Has numerous picnic areas, includingthe newly added Scott Meadows withmany benches•Children's playground built in 2010 isaccessible to users of many differentabilities•The fields are often used for largebaseball/soccer tournaments andhave very good drainage•The bathroom building is adequatein size and efficient for cleaning andsafety•Parking is adequate both in the lotand on adjacent streets•Five athletic fields in one locationallow the park to serve as a sports,tournament, and special event facility Figure 2: Greer Park 5 ESSENTIAL PARK ACTIVITIES Play for Children Throw a Ball Exercise and Fitness Gathering Relax and Enjoy Outdoors ADDITIONAL PARK FEATURES•Dog play area•Skate park OPPORTUNITIES AND CONSTRAINTSAccess•The gate between the day care and businessesbetween the park and the freeway is locked Facilities•Basketball courts are in poor condition•There is a very small, dated dog exercise areathat only serves a small number of dog owners•Users sometimes run their dogs on the LittleLeague field. The field could be enclosed withfencing and used as a shared dog exercise areaduring certain hours of the day and playingfields at other hours.•Dog bites to children have occurred, both off-leash and on-leash•The skate bowl is outdated. The bowl is designedfor skaters but is often used by BMX bikersdespite the existing rules stating that it is forskateboarders only. The mix of uses may bedangerous for users.•The skate bowl is also uneven and potentiallyunsafe, and the fencing is in very poor condition•Skate area could be relocated to northwestside of the park at low-use turf area; could beexpanded to a multi-use facility•The upcoming CIP will replace fencing and repairskate bowl surfacing, but does not includeadditional skate park amenities needs•Par course stations are out-of-date and seldomused, but there is potential for an outdoorworkout facility/gym Planting•The use of recycled water has a detrimentaleffect on some of the landscaping•A “Got Space” report suggested one syntheticfield for the north, south, east and west areas ofPalo Alto and Greek Park could serve as the eastlocation Furnishings•Park lighting is fairly old•The picnic area near the parking lot issurrounded with an overabundance of plasticgarbage cans Etiquette/Behavior•There are instances of offensive graffiti, whichneeds to be cleaned up•The parking lot is often used for illegal drugactivity in the evening Expansion•There is a turf area associated with a utilitysubstation across the street from ScottsMeadow that could be acquired and possiblyused as a dog park SITE-SPECIFIC PUBLIC INPUT•A gate prevents bike trailers and tandem bikesfrom passing over the Oregon Expressway/101bicycle pedestrian overcrossing, whichrespondents indicate is a barrier to accessingthe park.•The dog park has a bad odor•Picnickers leave behind a lot of garbage andthere is a lot of smoke from barbeques 6 PEDESTRIANS ONLY ACCESS TO LOS TRANCOS OPEN SPACEPRESERVE PEDESTRIANS ONLY BAY-TO-RIDGE TRAIL PEARSON-ARASTRADEROPRESERVE BAY-TO-RIDGE TRAILACCESS TO LAS TRAMPAS VALLEY WI L D H O RSE VALL E YLOSTRANCOSTRAIL LOSTR A NCO S TRAIL LOSTRANCO S TRAIL LOSTRA NCOSTR AIL LOS T RANCOS TRAIL L O S T R ANCOSTRAIL FERNLOOP C OSTANOANTR AIL SUNR I S E TRAIL C O YO TE TRAIL CHAMISE TRAIL COYOTE TRAIL PAN ORAM A TRAIL W OO D RATTRAIL TOYONTR AIL TOYONTRAIL STEEPHOLLOW TRAIL BORONDALAKE LOSTR A N C O S CREEK PAGE MILL R O A D P AGEMILLROAD 7.7 ACREADDITION GROUP PICNIC AREA(AVAILABLE BYRESERVATION ONLY) INTERPRETIVECENTER ORCHARDGLEN ARBOLEJOOVERLOOK VISTAHILL MADERAPOINT BOBCATPOINT PANORAM ATRAIL ENTRANCEGATE TOWLECAMPGROUND ONEWAYTRAFFIC . PON YTRA C K S F I R E R O A D TRAPPERS FI R E ROAD SHOTGUN FIRE ROAD PONYTRACKS FIRE ROAD VALLE Y VIEW FIRE ROAD MADR ONE FIR E ROAD TR A PP E R S F I R E R O A D CHARLI E B R OWN FIRE ROAD BUCKEYE C R E E K A | Trappers Fire Road B | The Foothills Park visitor center C | Fern Loop D | Boronda Lake N FOOTHILLS PARK Location: 3300 Page Mill RoadOwner: City of Palo Alto Size: 1,400 acres Year: 1965 HISTORY The land for Foothills Park was sold to the City of Palo Alto by Dr. Russel Lee, founder of the Palo Alto Medical Clinic, and his wife Dorothy in 1958, on the condition that it be preserved as open space. The park was formally opened and dedicated in 1965. The Interpretive Center in the park is housed in a building originally built by the Lees as a horse stable. For more information, see the Palo Alto Historical Association's chapter on Foothills Park in their city history. EXISTING CONDITIONS•Bounded by Portola Valley, Los AltosHills, Pearson-Arastradero Preserveand Los Trancos Open SpacePreserve, the 1,400-acre FoothillsPark is a nature lover's paradise.Miles of trails provide access throughrugged chaparral, woodlands, fields,streams, and a lake, and providespectacular views of the Bay Area.Wildlife abounds, and it is commonto see deer and coyotes.•Foothills Park is open to Palo Altoresidents and their accompaniedguests only. Proof of residencyis required. Guests must beaccompanied by a Palo Alto resident.Limit of 15 guests per resident in twoadditional cars.•Groups of 25 or more adults andchildren (both residents and non-residents included) must makea reservation in advance, or geta permit in advance from thesupervising ranger. There must beone Palo Alto resident for each 15non-resident guests. Figure 3: Foothills Park 7 •Groups of 24 or fewer (residents plus non-residents, children included) do not require areservation.•Hiking Trails: There are fifteen miles ofhiking trails, which offer a variety of hikingexperiences. The longest hike is the Los TrancosTrail, which is 7.5 miles. The Toyon Self-GuidedNature Trail enables you to learn about natureat your own pace.•Lake, Fishing, and Boating: Fishing is permittedin Boronda Lake. All anglers age 16 and overmust have a California Sport Fishing License.Fish species in the lake include bass, catfish,and sunfish. While swimming is prohibited youmay enjoy the lake with your non-motorized andhand-launched boat. Canoes are also availablefor rent on the weekends and holidays fromMay 1st to October 31st, weather and staffingpermitting.•Picnic Areas: Five picnic areas are first-come,first-served, and there is one picnic area thatis by reservation only. Tables, barbecues,and water are available. Groups at the non-reservable picnic areas may not exceed 24people (adults and children, residents andnon-residents included). Groups of 25 or morepeople must have a reservation. The Oak Grovegroup picnic area is the only picnic area that isreservable, and can be used by groups of 1-150. ESSENTIAL PARK ACTIVITIES Play for Children Throw a Ball Exercise and Fitness Gathering Relax and Enjoy Outdoors ADDITIONAL PARK FEATURES•Parking•Towle Camp is a seasonal campground availableto residents and their accompanied guests fortent camping from May 1 to October 31. Eightcampsites, each with a charcoal barbecue,water, picnic table, tent pad and food box. Sixof the campsites can accommodate up to eightpeople, and the remaining two campsites canaccommodate up to sixteen people.•The Nature Interpretive Center has exhibits andmaps and is the starting point for many naturewalks. There is a meeting room available forrent.•Nature Programs: Ranger-led activities areavailable throughout the year in Foothills Park.See the Activities and Programs page for moreinformation. OPPORTUNITIES AND CONSTRAINTS•7.7 acres recently added to site•Facilities on site allow for many visitoropportunities•Limited staffing makes regular patrols difficultgiven total mileage of trails•Public is responsible for reporting trail troubles•Small, primitive campground limits the numberof visitors and its location allows for summeruse only•Limited staffing makes it difficult to enforceresidency restrictions SITE-SPECIFIC PUBLIC INPUT•Trails are narrow•Access for bicycles•Allow dogs on one loop•Open park to non-residents 8 CUBBERLEYCOMMUNITYCENTERPAU S D CITY O F P A L O A L T O NE L S O N D R MID D L E F I E L D R D NELSO N D R KEA T S C T softball field soccer fields(2) parking softball field softball field softball field soccer field(1) tenniscourts(6) A C D B A | Outdoor covered walkways B | Asphalt parking lot C | Entrance to sports field area D | Softball field N CUBBERLEY COMMUNITYCENTER Location: 4000 Middlefield RoadOwner: Palo Alto Unified School District (PAUSD) and City of Palo AltoSize: 35 acres Year: 1989 HISTORYOriginally opened as a high school in 1956, Cubberley High School was closed due to decreasing enrollment in 1979. The vacant school has been used as a community center that has grown inuse and importance over the years. The City of Palo Alto owns 8 acres of the site, and the school district owns the remaining 27 acres (see red border). A lease agreement between the City and PAUSD expired at the end of 2014. The City and the school district have agreed on key terms of a new lease agreement. EXISTING CONDITIONS•Structures are old and deteriorating•As of 2013, there is a need torefurbish the physical plant•Layout of current structures is a veryinefficient use of the property•Large concentration of sports fieldsand tennis courts are scheduled andmaintained by the City•Facility contains the only gymnasiumregularly available for City of Palo Altoprograms. Facility is also importantto other public institutions, includingFoothill College SOME OF THE ASSOCIATED USER AND PARTNER GROUPS INCLUDE:•ACME : an organization teaching theChinese culture and language •Acterra: an environmentalstewardship and restorationorganization with sites in Santa Claraand San Mateo Counties •Audubon Society: an environmentalconservation and restoration group 9 N •Bay Area Amphibian & Reptile Society: aneducation and conservation group •Bay Area Arabic School: an organizationteaching Arabic language and Islamicreligion •California Law Revision Commission: abranch office of the state commissionresponsible for reviewing Californiastatutory and decisional law •Canopy: an environmental nonprofitorganization dedicated to planting andprotecting trees in parks, schools andalong streets of Palo Alto, East Palo Altoand neighboring communities •Cardiac Therapy Foundation: non-profitorganization for those with cardiovasculardisease and those at risk of developing it •Children’s Pre-School Center: a child-careorganization •Commonwealth Club: a statewide publicaffairs forum •Dance Connection: an organizationoffering dance classes •Dance Visions: an organization offeringdance classes •Dutch School: an organization thatteaches Dutch language and cultureeducation •Earth Day Film Festival: the city of PaloAlto’s annual film festival •Foothill College: the Palo Alto extensioncampus of a Los Altos Hills communitycollege •Friends of the Palo Alto Library: anorganization supporting the Palo AltoPublic Library •Friends of the Palo Alto Parks: anorganization supporting parks in Palo Alto •Gideon Hausner Jewish Day School: aschool for Jewish students •Good Neighbor Montessori: aneducational organization •Grossman Academy Japanese LanguageSchool: a school for Japanese students •Hua Kuang Chinese Reading Room:a library that offers Chinese culturalprograms •Kumon Math and Reading: after-schooltutoring program •Museo Italo Americano: a museumoffering language classes •Palo Alto Chamber Orchestra: a youthorchestra for regional string musicians •Palo Alto Menlo Park Mothers Club: aparenting organization •PAUSD Adult School: an adult schooloffering gardening classes •Peninsula Piano School: an organizationthat provides group lessons for pianostudents •Save the Bay: an environmentalrestoration organization that focuseson the health of San Francisco Bay’secosystems •SCC Registrar of Voters: the county-levelvoting and election office •Waldorf School of the Peninsula: a privateschool •Zohar Dance: an organization teachingdance classes PROGRAMMING & FACILITIESClassroom/Lecture Space•A2 Classroom•A3 Classroom•A6 Classroom•A7 Classroom•D1 Classroom•FH Classroom•H1 Classroom•H6 Classroom•G4 Activity Room•M4 Activity Room Dance•G6 Dance Studio•L6 Dance Studio Court Sports•Gym A•Gym B Performing Arts•M2 Music Room•M3 Dressing Room•Theatre•Auditorium•Pavilion SITE SPECIFIC PUBLIC INPUT•Update play equipment•Provide water fountains•Picnic areas•Needs more family and kid friendly spaces•Restrooms for field users•Needs major reinvestment 10 Parks Master Plan: Council Update (12/15/15) 11  There are more than 30 play areas in the city. While there are several unique play experiences (e.g., Magical Bridge, the Mitchell Park “gopher hole” playground), most play is focused on manufactured equipment and the play experience is not very diverse. How we used this information:  The qualitative and quantitative information about each site was used to shape community engagement questions such as the intercept boards described in Section 4. In addition, the findings were used to guide the selection of images for the visual preference exercise conducted at the three workshops that occurred in fall 2014.  The Existing Conditions maps document opportunities and constraints, and will be used as the basis for developing the concept diagrams for each site in the system. These illustrative diagrams will illustrate how the Master Plan recommendations apply to each site, and will be an important reference for implementation. Planning Environment Summary The project team worked collaboratively to identify previous plans and studies that could relate to the Master Plan effort, as well as on-going planning efforts such as Our Palo Alto and the Public Art Master Plan. For the completed or adopted plans, the MIG team summarized guiding documents, related plans and programs, and City policies and practices. The MIG team then evaluated facility and program gaps in past planning efforts for consideration in the Master Plan process. For those efforts underway, the project team identified points of coordination with the Master Plan, such as coordinating engagement activities and sharing data with Our Palo Alto, and setting up a separate meeting with the Public Art Master Plan project manager for coordination. What we learned:  The Master Plan has the potential to help advance the recommendations and policies of many existing adopted plans, and is especially timely for alignment with concurrent planning processes such as Our Palo Alto 2035, the Public Arts Master Plan and the Urban Forest Master Plan.  The Master Plan can consider the routes identified in the Bicycle and Pedestrian Transportation Plan, and help prioritize which ones will also increase access to parks, natural open space and recreation facilities. How we used this information:  Throughout the planning process, this summary document has served its intended purpose: to provide an annotated reference to Palo Alto’s guiding policies and plan documents; so that the planning team can ensure that the Master Plan is in alignment with their direction. Parks Master Plan: Council Update (12/15/15) 12 Demographic and Recreation Trend Analysis The MIG team evaluated the existing demographic profile in Palo Alto, including household characteristics and transportation behavior, to identify patterns and trends that could influence the community engagement process and recreation preferences. In addition, this analysis evaluated trends in health, sports, socializing, recreation, family and the shape and form of cities for their potential to affect the direction of the Master Plan. The document was most recently in October 2015 to ensure consistency with the City’s Comprehensive Plan Update. The Demographic and Recreation Trend Analysis includes policy conclusions that will be reflected in the Master Plan, as well as eight policy questions posed for further exploration. These questions helped shape the community engagement. What we learned:  The city has grown steadily since the 1970’s and has a large share of long-term residents.  While the average age of residents is increasing, the city has a sizable population of children under 18 years of age.  The city has a significant share of commuters who travel by bike (11%).  National and regional recreation trends emphasize an outdoor lifestyle, physical and mental health, diverse options for older adults at multiple stages of life, universal design and access for people of all abilities, and a movement to connect children with nature. How we used this information:  The planning team used the trend analysis section to identify areas of potential increased demand, and incorporated these trends into the Data and Opportunities Summary Matrix described in Section 5.  The policy conclusions document direction that is being incorporated into the recommendations currently under development.  The planning team developed community engagement questions to help answer the eight policy questions raised in this document, including specific questions in the online community survey. Sustainability Review  The Sustainability Review identified opportunities to increase sustainable practices associated with the operation and management of parks and open space. Drawing on best practices from other cities and agencies, the MIG team’s fieldwork and inventory findings and staff input, the Sustainability Review evaluated the City’s current policies, programs and practices and identified opportunities across 13 indicators. These indicators are:  Air Quality  Climate Change  Education and Training  Energy Efficiency  Equity  Green Building Parks Master Plan: Council Update (12/15/15) 13  Integrated Pest Management  Natural Resources / Habitat  Operations / Maintenance  Public Health and Safety  Transportation  Waste Management  Water Conservation  Water Quality The City’s Chief Sustainability Officer reviewed this document along with the City team and the PRC. Findings from the Sustainability Review will be carried forward into the Master Plan recommendations. What we learned:  Despite the absence of formal sustainability goals or policies for the Community Services Division, there are a variety of programs and practices in place that further the City’s sustainability goals and that shape the sustainability policies included in the Master Plan.  Staff already reduces water use in parks and golf courses through a variety of programs and has implemented additional reductions to comply with drought-related restrictions. How we used this information:  The planning team is incorporating the findings of the Sustainability Review into the recommendations currently being developed for the Master Plan, including writing guiding policy for sustainable practices already in place. Recreation Program Analysis The Recreation Program Analysis was completed in two parts. In Part I, the project team inventoried programming offered by the Community Services Department, as well as the recreation activities provided throughout Palo Alto by various agencies, organizations, businesses and other community providers. In Part II, the MIG team worked with Community Services staff to export data from the City’s registration system. This system collects data over time that allows Recreation Services to evaluate individual classes as well as categories of classes. The registration system was updated in 2014. The data analyzed was the total of the most recent year of program registrations, from spring 2014 to winter 2015. A crucial performance indicator in recreation programming is minimum participation. This is the minimum number of participants needed to achieve the cost recovery goals of each class. These goals are set according to the department’s cost recovery policy and the individual class budget. To evaluate the capacity of Palo Alto’s facilities and programs to meet demand, the project team reviewed and analyzed data on reservations, minimum participation, program registrations and waitlists, and considered the observations of staff and consultants. Results of this analysis were used to review opportunities with the PRC, as described in the accompanying staff report. In Parks Master Plan: Council Update (12/15/15) 14 addition, key findings are called out that identify potential opportunities, inform policy choices and provide possible Master Plan recommendations. What we learned:  The highest participation in City programs is in sports (adult and youth), aquatic (youth and teen) and day camps.  Middle-school athletics programs are largely over capacity. The current policy of “everyone plays” is widely supported but makes expanding these programs difficult without sacrificing quality due to limited gym and field space.  Demand for some classes and programs vary greatly by time of day.  Facility constraints and a shortage of instructors and coaches prevent the expansion of most sports programs. In contrast, outdoor and open space programs can be more easily expanded because of their setting.  Academic support programs offered to youth and teens are typically operating under capacity.  Programs offered by the Art Center, the Junior Museum and Zoo and the Children’s Theatre that are included in the registration system serve thousands of additional adults, youth and teens. Many of these programs have waitlists, partly because of limited space in the specialized buildings associated with these divisions. How we used this information:  The planning team used the capacity analysis to evaluate demand and need, factoring it into the Data and Opportunities Summary Matrix described in Section 5. Geographic Analysis The MIG team developed a geographic analysis of the parks, trails, and natural open space system to evaluate its walkability and accessibility. To conduct the analysis, the MIG team developed a Geographic Information Systems (GIS) model of the surrounding streets, sidewalks, trails and pathways, using ESRI Network Analyst to identify “walksheds” or catchment areas for each park. This approach reflects the way people move through the city. The desired travel distances used were ¼ and ½ mile, reflecting research on the distance a typical person can walk in five and 10 minutes. The MIG team also factored in physical barriers that impede access, incorporating feedback reported through the public engagement process about specific streets and intersections people report as being difficult to cross. Many communities also analyze park systems using a function-based parks classification scheme (neighborhood parks, community parks, regional parks). However, the parks in Palo Alto serve multiple functions. Feedback from the community through the engagement process indicated that people in Palo Alto are looking for the park system to deliver five categories of activities on a widely accessible basis, regardless of how the park is classified functionally. For the purposes of analysis, the project team called these “essential park activities” to denote that they should be provided throughout the park system, providing a close-to-home opportunity for every resident to enjoy each of these activities. Parks Master Plan: Council Update (12/15/15) 15 The project team then defined criteria to determine whether these “essential park activities” are available.  Relax and Enjoy Outdoors. Palo Altans want their parks to provide a place to relax and enjoy the outdoors as a primary function. This activity is supported by most parks, which usually include a quiet and calm place to walk or sit. However, some Palo Alto parks were identified as not supporting this activity because of their proximity to a highway or a loud/busy street, their dedication to and heavy use for competitive sports, or based on comments made by the public on the online interactive map (and verified in a site visit).  Play for Children. Parks that provide a playground, play area or unique play feature (sculpture, nature play, etc.) support this activity.  Throw a Ball. This activity encompasses throwing, catching, shooting, kicking and hitting a ball, and includes both self-directed and competitive (league-based) play. Parks that have a large open turf area or that incorporate formal sports fields and courts support this activity.  Exercise and Fitness. Exercise and fitness in a park setting generally occurs by walking or running (top recreation activities in Palo Alto, as well as nationally), or by swimming. Those parks with perimeter or looped paths, extensive trail systems, a pool or fitness stations support this activity.  Gathering. The Palo Alto community sees the park system as an important provider of space for family, friends and the larger community to gather for picnics, social events and group activities. Formal picnic areas, shelters and features such as amphitheaters support this activity. In addition to geographic analysis using the GIS-based model, the project team evaluated natural open space and recreation facilities that were identified as highly desired by the community. These include:  The experience and preservation of nature;  Equitable access to natural open spaces (preserves);  Recreation with dogs; and  Distribution of indoor recreation space. Figure 5 shows the ¼ and ½ mile walksheds for all parks in Palo Alto. Figure 6 depicts the Exercise and Fitness analysis map as one example of the activity-based analysis process. What we learned:  Most Palo Alto residents have access to a city park within a ¼ and ½ mile. Gaps exist north of the Oregon Expressway near Highway 101 and south of El Camino Real near commercial and institutional land uses.  Fewer neighborhoods are within a ½ mile service area of every essential activity.  Parks that offer exercise and fitness opportunities are more common south of the Oregon Expressway.  Service areas for dog parks are almost entirely located south of the Oregon Expressway. How we used this information:  The planning team used the trend analysis section to identify areas with gaps in service, factoring it into the Data and Opportunities Summary Matrix described in Section 5. Parks Master Plan: Council Update (12/15/15) 16 Utilizing Analysis Results The series of analyses conducted are foundational to the development of Palo Alto’s data-driven and community-responsive Master Plan. Each of the analyses was designed based on staff and community input (described in more detail in the following section) to identify opportunities to enhance Palo Alto’s system of parks, recreation programs, trails and natural open spaces. The site-specific, geographic and programmatic gaps identified through this process were evaluated and deliberated on by the PRC, through the process described in Section 5 of this report. Baylands Preserve Baylands Athletic Center El Camino Park Greer Park Bol Park Esther Clark Preserve Mitchell Park Terman Park Hoover Park Eleanor Pardee Park Peers Park Seale Park Robles Park Ramos Park Rinconada Park Briones Park Johnson Park Bowden Park Bowling Green Park Boulware Park Monroe Park Werry Park Cogswell Plaza Cameron Park Mayfield Park Weisshaar Park Lytton Plaza Sarah Wallis Park Kellogg Park Stanford Palo Alto Playing Fields Palo Alto Golf CourseHopkins Creekside Park El Palo Alto Park Pearson - Arastradero Preserve Scott Park Heritage Park Cubberley Community Center Ventura Community Center S a n F r a n cisquito C reek Mat ade ro C r ee k Barro n C r e e k Ado b e C r e e k £¤101 §¨¦280 ¬«82 Foothills Park S A N M A T E O C O U N T Y S T A N F O R D 0 10.5 Miles ² Park Walksheds 12.14.2015 | Data Sources: Palo Alto OpenGIS, Santa Clara County GIS City of Palo Alto Parks, Trails, Open Space and Recreation Master Plan Palo Alto Menlo Park Mountain View Los Altos Los Altos Hills Atherton Stanford Loyola East Palo Alto Ladera Foothills Park Arastadero Preserve Park Walksheds 1/4 mile 1/2 mile City Park City Natural Open Spaces Trail Stanford Perimeter Trail - Private trail with public access Private Recreation Route Major Road Street Water Feature School District Land Palo Alto Other City; Other City Santa Clara County San Mateo County Figure 5: Park Walksheds Map Baylands Preserve Baylands Athletic Center El Camino Park Greer Park Bol Park Esther Clark Preserve Mitchell Park Terman Park Hoover Park Eleanor Pardee Park Peers Park Seale Park Robles Park Ramos Park Rinconada Park Briones Park Johnson Park Bowden Park Bowling Green Park Boulware Park Monroe Park Werry Park Cogswell Plaza Cameron Park Mayfield Park Weisshaar Park Lytton Plaza Sarah Wallis Park Kellogg Park Stanford Palo Alto Playing Fields Palo Alto Golf CourseHopkins Creekside Park El Palo Alto Park Pearson - Arastradero Preserve Scott Park Heritage Park Cubberley Community Center Ventura Community Center S a n F r a n cisquito C reek Mat ade ro C r ee k Barro n C r e e k Ado b e C r e e k £¤101 §¨¦280 ¬«82 Foothills Park S A N M A T E O C O U N T Y S T A N F O R D 0 10.5 Miles ² Exercise and Fitness Service Areas 12.14.2015 | Data Sources: Palo Alto OpenGIS, Santa Clara County GIS City of Palo Alto Parks, Trails, Open Space and Recreation Master Plan Palo Alto Menlo Park Mountain View Los Altos Los Altos Hills Atherton Stanford Loyola East Palo Alto Ladera Foothills Park Arastadero Preserve Park Experience Service Areas 1/4 mile 1/2 mile City Park City Natural Open Spaces Trail Stanford Perimeter Trail - Private trail with public access Private Recreation Route Major Road Street Water Feature School District Land Palo Alto Other City; Other City Santa Clara County San Mateo County Figure 6: Exercise and Fitness Analysis Map Parks Master Plan: Council Update (12/15/15) 21 4. COMMUNITY OUTREACH Process Overview The project team integrated community and stakeholder engagement into the entire planning process, as seen in Figure 7. Figure 7: Community Engagement Across the Master Plan Process The Public Engagement Plan, developed early in the process, articulated the goals and strategies for creating a Master Plan that aligns with local needs, preferences and priorities. The project team also met with the “Our Palo Alto” team to ensure the coordination of the efforts. As articulated in the Public Engagement Plan, the community engagement goals are to:  Increase community awareness of the project;  Inform the community about the challenges and opportunities of the project;  Provide easy access to project information and opportunities for participation;  Offer a range of communication and engagement tools to match interests and preferences;  Ensure the final Master Plan reflects community priorities, preferences and values; and  Get community buy in to support plan adoption and its short-, mid- and long-term implementation. Parks Master Plan: Council Update (12/15/15) 22 To achieve these goals, the Public Engagement Plan laid out a robust, layered outreach strategy that included a variety of engagement tools and activities so Palo Alto residents and other interested community members could participate in a manner convenient and comfortable for them. There have been numerous opportunities for participation to date, with a variety of formats, times and levels of interaction offered as well as both online and face-to-face methods.  Interactive community workshops provided input at key project milestones, with a series of three occurring last fall and a prioritization workshop planned for this coming fall.  A series of online surveys gauged community values and priorities, including: o an interactive map-based survey; o a comprehensive community survey; o a community prioritization challenge (currently available); and o a future exercise to comment on the draft plan.  A stakeholder group convened periodically has advised the project team.  Interviews with experts on staff and in the community helped inform topics that emerged from the outreach.  Consultations with the PRC and other appointed commissions deepened understanding.  City Council updates and study sessions kept the Council members informed. What we learned: A number of key findings emerged from the many outreach tools method, each of which is described in greater detail on the subsequent pages of this section. The following topics and findings were referenced multiple times by the community, staff, partners and decision makers through multiple outreach methods. These have been critical in shaping the analysis described in Section 3 above, and the principles and criteria described in Section 6. In addition, these themes and findings provide direction for the shaping of the Master Plan policies and recommended actions, and in some cases have application at the site level.  Respondents value, support and appreciate their parks system. They recognize that it is a high-quality system.  Strategic enhancements and improvements are needed to better meet evolving needs and trends, adapt to growth and changing demographics, and to continue to provide world-class experiences to residents.  Limited land availability and high cost is seen as the major limiting factor to pursuing new park opportunities.  Providing accessible and safe active transportation routes to natural open spaces, community centers and parks is a high priority.  Nature is very important to residents. There is widespread support for the continued protection, enhancement and restoration of open spaces and wildlife habitat.  Residents also want to feel connected to nature in their urban parks. There is interest in adding nature play elements and wildlife habitats to more traditional parks.  Enhancing physical and mental well-being is a critical function of parks for Palo Altans. Loop trails and bicycle and pedestrian paths to parks and places to relax are preferred over exercise equipment or additional classes. Parks Master Plan: Council Update (12/15/15) 23  There is widespread interest in bringing community gardens, dog parks and aquatic facilities to new areas of the city to improve access to these amenities for all neighborhoods.  Residents strongly support improved and additional restrooms in parks. In addition, there is clear preference for features and amenities that support comfort, convenience and longer stays at parks, including water fountains and places to sit.  The Palo Alto community strongly supports universal design and access and there is interest in adding inclusive play elements to more parks.  Current policies that prioritize facility availability for Palo Alto residents are widely supported, and stakeholders generally agree that Palo Alto is (and should be) focused on providing services to local residents, rather than providing regional attractions.  Residents would like to see enhancements to parks throughout the city including more types of play experiences and environments. There is also support for smaller, more locally focused events and programs (e.g., movies in the park) that are held in different parks throughout the city.  Many existing recreation buildings have been repurposed and do not suit current needs well. Newer indoor facilities have greater flexibility but do not have specialized features to support some programs (e.g., outdoor arts programs or lifeguard training).  Local and regional partnerships (particularly with the school district) are extremely important and should be continued and strengthened. How we used this information:  The planning team identified patterns and trends that cut across all the engagement activities and results, and crafted the Master Plan Principles described in Section 6 to articulate a vision for the future.  Park and program-specific findings are currently being considered by the planning team as in the development of the Master Plan recommendation. Public Engagement Activities to Date The project team, with support from the PRC, has successfully collected and analyzed input from hundreds of residents and stakeholders through a variety of methods. These are described on the following pages. Project Webpage One of the first steps was developing a Master Plan project webpage hosted on the City’s website with a project-specific web address (paloaltoparksplan.org). Parks Master Plan: Council Update (12/15/15) 24 Figure 8: The current content feature on paloaltoparksplan.org is the community prioritization challenge Public Information Updates The project team disseminated a series of public information updates through the City’s established mailing lists, newsletters and social media accounts. These updates informed the community about upcoming meetings, online participation opportunities and project status. The contact list grows with each engagement opportunity. Stakeholder Advisory Group The Stakeholder Advisory Group works to boost participation within its networks and constituent groups in the Master Plan process. The group includes representatives from local advocacy groups, recreation organizations, local employers and landowners, community service providers and others. To respect the time of the members of the Stakeholder Advisory Group, the project team designed the process to solicit this group’s input at strategic times during the project. Parks Master Plan: Council Update (12/15/15) 25 The first meeting was held on June 25, 2014 to fine-tune the engagement process and obtain initial input on issues and opportunities. The second meeting was held on October 1, 2015, to discuss findings to date and brief the Stakeholder Advisory Group in preparation for two final meetings. The next meeting will focus on prioritization, and the final meeting will focus on the draft Master Plan. Intercept Events During the summer of 2014, the project team and PRC members conducted six “intercept surveys” to collect input from visitors outdoors at parks, farmers markets and community events. This approach is effective at engaging all age groups, especially families with children, and allows for informal and educational discussions with the public. The intercept format also facilitates interaction with people who do not typically attend public meetings, due to schedule conflicts or a lack of awareness. The project team selected intercept locations to reach a cross- section of Palo Altans:  Rinconada Park, June 28, 2014  Downtown Farmers Market, July 19, 2014  Cogswell Plaza, July 24, 2014 (Summer Concert)  California Street Farmers Market, August 9, 2014  Cogswell Plaza, August 14, 2014 (Summer Concert)  Mitchell Park, August 16, 2014 (Twilight Concert) More than 200 people provided input and learned about the park system and the Master Plan effort. They also provided important feedback about their values and motivations as related to parks, natural open space and recreation, such as what is most important when they choose recreation programs, summarized in Figure 9. Figure 9: What is most important to you when choosing recreation programs, classes and events? Parks Master Plan: Council Update (12/15/15) 26 Online Map-based Survey During the summer of 2014, the project team hosted an online, interactive, map-based survey using MIG’s Mapita application. This tool allows community members to respond to a series of questions and provide geographically tagged comments on specific parks, facilities and transportation routes throughout the city. A total of 487 respondents provided comments on park quality, barriers to access, needs and opportunities. This effort generated a rich data set about how people use the park system, how they travel to the places they go, and what their experience is like, including site-specific data. The MIG team brought the data into GIS, and it was used to inform the geographic analysis described in Section 3. Figure 10 and 11 are graphics from the summary document (available on the project webpage), illustrating the richness of information collected at the site and system-wide level. Figure 10: Site-Specific Comments on Bol Park Parks Master Plan: Council Update (12/15/15) 27 Figure 11: Routes to Respondents’ Closest Park (darker lines indicate more intensely-used routes) Community Input Workshops In fall 2014, the project team conducted two interactive workshops in different areas of Palo Alto. The project team added a third workshop when the San Francisco Giants made it to the World Series and games conflicted with the first two workshops, which had been planned for months. In total, about 65 community members attended this series of workshops, held on October 28, 29 and December 2, 2014. Participants took part in a visual preference survey about the character and design of parks using real-time keypad polling. Facilitated small groups provided the opportunity for people to have an in-depth discussion of what features they would like to protect, preserve, improve or add to Palo Alto. The MIG team collected polling data, recorded group discussion and collected additional input on comment cards. For example, Figure 12 shows the level of support (from the three workshops) for a landscape with integrated natural plantings. Parks Master Plan: Council Update (12/15/15) 28 Figure 12: Visual Preference Survey Results for a Landscape with Natural Plantings Integrated (combined for 3 workshops) Online Community Survey Over 1,100 people completed an online survey developed by the MIG team in close consultation with the PRC and the City team. This tool collected data on community priorities and preferences to inform the development of recommendations and actions. The survey was available online and in hard copy, in both English and Spanish, from mid-November to mid- December 2015. The MIG team developed an initial summary of survey findings for review with the PRC and then completed additional data analysis to provide more detail on specific topics, based on feedback from the PRC. Follow-up Stakeholder Interviews After the geographic and program analysis were completed, the project team identified issues for which additional feedback from stakeholders would be beneficial to understanding needs and identifying potential recommendations. Between October 2014 and March 2015, members of the project team conducted 16 follow-up stakeholder interviews to gather additional data and explore issues in depth. The interviewees included staff, volunteers, partner staff and users across a variety of topics:  Community Gardening  Aquatics Parks Master Plan: Council Update (12/15/15) 29  Cubberley Community Center tenants  Junior Museum and Zoo  Palo Alto Art Center  Children’s Library  Palo Alto Children’s Theatre  Middle School Athletics  Palo Alto Dog Owners  Avenidas  Palo Alto Youth Council  Boost drop-in programming Results were brought into the Data and Opportunities Summary matrix process as described in Section 5, and considered by the PRC. Parks and Recreation Commission The PRC has been involved throughout the Master Plan effort, from the initial scope development and consultant selection through every step of the process. This commission’s involvement has been critical to understanding the full range of issues in the community and in shaping further community engagement. The details of the PRC’s hands-on involvement in defining and considering data and opportunities is described in the accompanying staff report. City Council Decision maker involvement is also an important part of engaging the community in the Master Plan process. At the beginning of the Master Plan process the project team made a presentation to the City Council and the Park and Recreation Commission in a joint study session on March 24, 2014. This presentation introduced the goals and objectives of the planning process as well as preliminary ideas about the community engagement and how the analysis and plan will be used. This report, as well as the August 31 and November 2 Study Sessions, serve as Council updates on the progress of the Master Plan process. In Process and Future Engagement Activities Engagement activities will continue through the end of the process with opportunities to shape prioritization, close the loop with stakeholders and facilitate review of the draft plan by the community, the PRC and the City Council. Community Prioritization Challenge The Community Prioritization Challenge is a trade-off exercise, designed to be compatible with the planned Community Prioritization Workshop. The Challenge is live now, available to access through the Master Plan website. As of December 15, there were 382 complete responses. Data will be analyzed once the Challenge is closed. Community Prioritization Workshop Following up on the Community Prioritization Challenge, the project team will convene an interactive workshop that will also feed into the prioritization process. Building on the findings of the online exercise, this in-person workshop will take advantage of the opportunity for community members to explore trade-offs together. Parks Master Plan: Council Update (12/15/15) 30 Stakeholder Advisory Group As noted, the Stakeholder Advisory Group will meet at least twice more. This group will work with a more detailed view of the park system, reflecting their more nuanced understanding of activities in Palo Alto. Park and Recreation Commission The project team will continue to work closely with the PRC in developing content for the Master Plan. Each regular meeting of the PRC includes an update on the current status of the plan and a review opportunity for the latest pieces developed by the project team. Upcoming topics include the review of a preliminary list of recommended actions, the results of the prioritization discussions and detailed review and input into the prioritization of actions. These steps precede the review of a full draft plan, which will be released first to the PRC and then to the public. City Council This report is part of the project team’s commitment to utilizing the feedback City Council has provided to advance the project toward an adoptable and implementable final document. The detail provided here is intended to clarify the extensive planning process and allow the project team to move forward with clear feedback on the critical prioritization process. Following this step, the next City Council check-in will be at the release of the public draft Master Plan, to introduce the full document and explain how the Council’s input was utilized to shape the direction of the document. During the formal review process, Council will have several opportunities to provide general and detailed feedback on the plan document as it is refined and moved toward adoption. Public Comment on Plan The project team will create an online feedback form to collect comments from the public on the draft Master Plan. As comments are made, they will be logged to track the source of the comment, specific feedback or recommended changes for consideration, and aggregated feedback to identify any patterns. Comments will be discussed with staff and the PRC to determine what action to take for each comment. Parks Master Plan: Council Update (12/15/15) 31 5. DATA SUMMARY AND OPPORTUNITY ANALYSIS As the major elements of the Technical Assessment and Analysis (described in Section 3) and the Community and Stakeholder Engagement (described in Section 4) were completed, the PRC and the project team began a detailed review of the accumulated data as it relates to each element of the Master Plan, tying these two tracks of the Master Plan process together in preparation for the critical track of Developing and Prioritizing Projects. The process for this review, designed by the project team with the input of the PRC, created a detailed reference matrix (with supporting documentation) to refer to as the process moved toward recommended actions. Data Binders To assist both the project team and the PRC in referencing and using the large amount of data developed during the process, the City team created a tabbed binder with each of the completed documents, numbered for quick reference. These binders were produced for each of the PRC members and for the members of the project team. An outline of the deliverables for the Master Plan process became the table of contents for the binder. As additional materials have been developed, they have been added to the binders. Figure 13 shows the binder and accompanying matrix (which is poster size). Once the binders were developed, all working documents, such as the Summary Matrix described in this section, have used the numbered references to sources corresponding to the reference numbers used in the table of contents contained in the binders. To facilitate broader distribution of the data binders (and reduce paper use), the City team is developing a “digital binder” for the project website, which consists of a table of contents with hotlinks to each section. This can be downloaded directly from the following link: http://paloaltoparksplan.org/pdf/CPA_Parks_MasterPlan_Data%20Sources.pdf Figure 13: Data Binder and Summary Matrix Parks Master Plan: Council Update (12/15/15) 32 Data and Opportunities Summary Matrix With the full set of reference materials in the data binders, the PRC needed a process to evaluate opportunities based on the collected data. The project team developed a matrix format that took each of the Master Plan elements (Parks, Trails and Natural Open Space; Recreation Facilities; Recreation Programs) and broke them down further into constituent “components”. Table 1: Plan Elements and Components Master Plan Elements Parks, Trails and Natural Open Spaces Recreation Facilities Recreation Programs Co m p o n e n t s Walkability and Equity of Park and Preserve Access Off-Leash Dog Areas Adult Aquatics Activity Access: Play for Children Community Gardens Adult Fitness Activity Access: Exercise and Fitness Basketball Courts Adult Special Interest Classes Activity Access: Throw/Catch/Shoot/Kick/Hit Tennis Courts Adult Sports Activity Access: Gather Together Rectangular Sports Fields Day Camps Activity Access: Relax and Enjoy the Outdoors Diamond Sports Fields Middle School Athletics Experience Nature Gymnasiums Open Space/Outdoor Recreation Preservation of Nature Swimming Pools Youth and Teen Aquatics Trail Connections Community Centers Youth and Teen Sports Availability of Restrooms Special Purpose Buildings in Parks Youth and Teen Special Interest Classes Site Amenities and Experience Other Indoor Program Facilities Youth and Teen Sports Camps Universal Accessibility Picnic shelters (covered) Special Events Event venues Therapeutic Recreation Senior Programs For each of these components, findings across both the Technical Assessment and Analysis and the Community and Stakeholder Engagement tracks were summarized in a rating or short statement across nine topics:  Current Service/Inventory  Level of Control  Geographic Analysis  Capacity/Bookings  Perception of Quality  Expressed Need  Demographic Trends  Barriers to Access/Participation  Projected Demand Parks Master Plan: Council Update (12/15/15) 33 Where ever possible, the data was summarized with a defined rating (typically high, medium or low). Each of these ratings was tied to a data source (or sources) and a set of thresholds defined in the Data and Needs Summary (which is the document in the data binder and available on the project website). For several of the topics, a short statement is provided instead of a rating due to the type of information collected. The general source materials for each topic are clearly citied (as included in the Data Binders) and where a specific finding is particularly informative the page number(s) are cited. The full matrix was provided to each PRC and project team member in a large format print to provide a quick reference to the relevant data for each component of the system. Figure 14: Screen Capture of a Portion of the Data and Opportunities Summary Matrix The matrix process allowed the PRC to review the large number of possibilities against the extensive data available in a streamlined, more accessible way. The matrix continues to be a reference point that helps justify why the Master Plan is exploring particular directions. The working draft of the matrix can be downloaded from the project website at: http://paloaltoparksplan.org/pdf/PTOSR_Matrix_MASTER_052215.pdf Opportunity Analysis The final column of the matrix for each component is a summary of the opportunity to enhance Palo Alto’s system through the addition, distribution or modification of a particular element and component. These opportunities represent potential actions, and each of these opportunities would be a good addition to the system. However, due to the limited land, staff, funding and other resources in the community, these opportunities still need to be prioritized. Areas of Focus As the development of recommendations has progressed, informed by the opportunity analysis and the development of the principles and criteria, the project team developed a list of areas of focus that represent the categories of recommendations that are forming. These areas of focus Parks Master Plan: Council Update (12/15/15) 34 collapse the many opportunities into a set of twelve areas that cut across the elements of the Master Plan. Each area of focus includes a title, a short description and an example. Distributing park and recreation activities and experiences across the city Ensuring that parks and programs are distributed as evenly as possible across Palo Alto. For example, adding recreation activities into geographically under-served areas, improving access to parks for cyclists and pedestrians and finding new locations for recreation opportunities such as community gardening and swimming. Improving and enhancing community center and recreation spaces across the community Maintaining a mix of programmable space for indoor sports (including gyms) and fitness as well as gatherings, classes, theater, arts and community programs. For example, updating key facilities at Cubberley. Enhancing comfort and making parks more welcoming Improving visibility of parks in the community and providing the amenities that make more frequent or longer visits to parks comfortable. Improvements may include creating a sense of arrival using art or signs; providing drinking water, a variety of seating options, shade and restrooms. Enhancing capacity and quality of sports fields Increasing the playable time at existing sports fields. For example, adding lights, improving natural turf and drainage. Increasing the variety of things to do in existing parks Exploring new, unique and dynamic features and activities to support a diverse and fun system. For example, adding new types of play experiences, creating flexible gathering spaces that can be used for picnics as well as performance art, etc. Increasing health and wellness opportunities in parks and programs Providing programming, information or features that support physical and mental well-being. For example, trails, drop-in activities/classes in parks, signs illustrating exercises that can be completed using existing features (walls, benches, etc.), as well as providing quiet places for relaxing in nature. Improving spaces and increased options for off-leash dogs Supporting recreation with dogs in a variety of ways. For example, using existing fenced features as off-leash areas at particular times or enlarging off-leash facilities to accommodate more dogs. Integrating nature into Palo Alto parks Preserving, enhancing and providing access to nature in parks and open spaces. For example, protecting eco-systems, increasing native plantings and wildlife habitat and creating access to natural elements such as creeks. Parks Master Plan: Council Update (12/15/15) 35 Improving the accessibility of the full range of park and recreation opportunities Actively reducing and removing physical, programmatic, language and financial barriers so that all ages, abilities and cultures can enjoy parks and programs. For example, adapting existing programming for people with disabilities or investing in targeted programs to reduce user fees. Offering more of existing programs, classes, events Increase the capacity in popular and emerging programs/classes by realigning resources and replicating programs. For example, adding more summer camps or recruiting/training additional coaches to offer more middle school sports. Exploring new types of programs, classes, events and activities for all ages and abilities Following input from the community and trends, develop and implement new recreation classes, activities and events. For example regularly trying new programs as one-time or one year pilots. Expanding the system Take a proactive approach to adding more park and open space lands, trail connections and facilities to Palo Alto’s system. For example, dedicating publicly owned spaces as park land or investing in a fund for future park and recreation facility purchases. Parks Master Plan: Council Update (12/15/15) 36 6. MASTER PLAN PROCESS TO DEVELOP AND PRIORITIZE PROJECTS As described in the previous section and the accompanying staff report, the project team worked closely with the PRC to define the full range of opportunities to enhance Palo Alto’s parks, trails, natural open spaces, recreation facilities and recreation programs. As illustrated in Figure 15, the development of these opportunities into actions began in the fall of 2015 and will continue to be refined into a set of recommendations included in the Master Plan. As this report illustrates, there is rich set of data and analysis from which to draw actions and recommendations for the Master Plan. Actions and recommendations will include site and facility improvements, program changes and enhancements, and systemwide policies and practices, all focused on achieving Palo Alto’s vision, as articulated in the Master Plan Principles. The subsequent prioritization of recommendations (informed in part by the Community Prioritization Challenge) will provide guidance to staff and decision-makers in how to sequence the implementation of projects and improvements. Figure 15: Developing and Prioritizing Projects in the Master Plan Process Parks Master Plan: Council Update (12/15/15) 37 Master Plan Principles  Playful  Healthy  Sustainable  Inclusive  Accessible  Flexible  Balanced  Nature In addition, the City team, PRC and Council need a method for evaluating new ideas and proposals that are brought forward after the Master Plan is adopted. Because Palo Alto is largely built out and has finite staff and fiscal resources, the prioritization process needs to be defensible and definitive. Decision-makers must have confidence that they are making the best use of Palo Alto’s resources, and the public must have confidence that decisions are transparent and aligned with community priorities. Inherent in the planning process are trade-offs and opportunity costs. As noted above, the City of Palo Alto is a constrained system. As such, the City will have to choose which of the opportunities identified in this planning process to implement. The principles and criteria developed during the Master Plan process are intended to facilitate prioritization and decision- making both in the development of the Master Plan, and following its adoption. Each is described below. Master Plan Principles The project team developed a set of Master Plan principles that describe the community’s vision and will guide the way projects are implemented. The project team distilled community input and considered the themes emerging from the data summary and opportunities analysis process described in Section 5 to develop draft principles that describe the community’s vision. These were refined with the PRC, and Nature as a principle was added based on Council direction at the August 31 study session. The following eight principles provide the foundation for the Master Plan, articulating Palo Alto’s vision and guiding project and program implementation.  Playful: Inspires imagination and joy.  Healthy: Supports the physical and mental health and well-being of individuals as well as the connectedness and cohesion of the community.  Sustainable: Stewards natural, economic and social resources for a system that endures for the long-term.  Inclusive: Responsive to the entire Palo Alto community, all ages, abilities, languages, cultures and levels of income.  Accessible: Easy for people of all abilities to use year-round and to get to by all modes of travel.  Flexible: Supports multiple uses across time with adaptable spaces that can accommodate traditional, emerging and future uses.  Balanced: Is not dominated by any one type of experience or place, and includes both historic elements and cutting-edge features, highly manicured and more organic spaces, and self-directed and programmed activities.  Nature: Incorporates native species and habitat corridors, and creates opportunities to learn about and interact with nature. Parks Master Plan: Council Update (12/15/15) 38 Prioritization Criteria The prioritization criteria are designed to help staff, PRC and Council make choices about which projects will be the most strategic investments for the Palo Alto community, in accordance with the Master Plan principles. These criteria are designed to be used to help determine which actions and recommendations are included in the Master Plan, as well as the sequencing and timing of implementation. The project team has been working with the PRC for several months on developing and refining these criteria. Currently, there are five identified criteria:  Fill existing gaps: Bring recreation opportunities (park land, facilities, programs) to areas of the city and to users where gaps were identified.  Address community preferences: Target the highest priority types of projects and programs identified through citywide outreach.  Respond to growth: Add features or programs, modify or expand components of the system to prepare for and address increasing demand.  Maximize public resources: Create the most impact for each dollar of capital and operating expenditure possible.  Realize multiple benefits: Advance the principles of this Master Plan as well as the goals, projects and directions of other adopted City efforts. Evaluating Project and Program Ideas The project team is in the process of developing a master list of project and program ideas, organized by area of focus. Because the Master Plan will also address Palo Alto’s organizational direction, the category of System Management has been added to capture operational initiatives and items. These include ideas that affect staff, operations, maintenance, policy and planning functions. In addition, the categories of CIP Project and IBRC Project (Catch-Up) were added to capture those projects already identified in the City’s Capital Improvement Plan. The preliminary list was shared with the PRC at the December meeting and the project team will revise this to reflect their feedback and additions. This list will be evaluated and refined as shown in the following graphic. Parks Master Plan: Council Update (12/15/15) 40 Figure 16: Project and Program Evaluation Process Parks Master Plan: Council Update (12/15/15) 40 Next Steps A clear process for evaluating potential recommendations and actions and a means of documenting decisions will help staff and the PRC be confident that, when projects are implemented, they will be consistent with the Master Plan and based on the best available information. The project team has been working on an evaluation process and tool that will include a numeric scoring of project and program ideas to help prioritize ideas and generate recommendations. As shown in Figure 16, these ideas will also be qualitatively evaluated to ensure they are financially feasible, balanced and strategically distributed across the city. This process will be used to evaluate all potential recommendations and actions for inclusion in the Master Plan and will also serve as a tool for staff and the PRC to evaluate ideas that are suggested in the future, after the Master Plan is adopted. The project team drafted and tested the evaluation process using three different potential recommendations to ensure it works as intended and is applicable to each of the three Master Plan elements. After the test evaluation, the process and tool was refined and forwarded to the PRC for their consideration. The PRC is reviewing and refining the proposed process. With this input, the project team will use it to prepare the Master Plan recommendations. The evaluation process and draft recommendations will be shared with Council in the coming months. ATTACHMENT B 1 Council Questions from Parks Master Plan Study Session 8/31/15 Introduction City Council members asked a number of questions to the project team at the August 31, 2015 study session. While some questions were discussed and answered during that meeting, this document provides further response to the questions. While staff has made every attempt to provide answers to all of the questions raised at the study session, more detailed answers to the questions are in the staff report and/or in Attachment A from the consultant. Questions posed by Council followed by the project team response, or reference to where the response can be found, are presented below. Question 1: How are parks, open spaces and facilities differentiated when applying the principles? Are they weighted differently when the principles are applied? How are the principles and criteria used in a practical way to make decisions? Response 1: The principles are a set of core values that describe the community vision for the City’s system. These principles are considered when determining the overall scope of a specific project or program. They are not weighted differently among the three elements (parks, open spaces, and facilities) of the Master Plan. As described on page 37 of Attachment A, the principles were developed from community input and data analysis. Following discussion with the Council on August 31, an eighth principle “Nature” was added. In addition to expressing the community vision for the Master Plan, the principles will help refine and improve recommended programs and projects included in the Master Plan. The project team is currently developing the process for evaluating and prioritizing recommendations, which will include the use of weighted criteria. The project team and the PRC are currently working to finalize the criteria and are discussing how the evaluation and scoring will be structured. The PRC discussed this topic at the December 8, 2015 PRC meeting, and formed an Ad Hoc group to work with staff and MIG to complete. The draft criteria include:  Fill existing gaps  Address community preferences  Responds to growth  Leverage public resources  Realize multiple benefits Question 2: The principles Accessible and Inclusive seem to be one in the same. Can they be condensed into one principle? ATTACHMENT B 2 Response 2: This was discussed by the PRC and staff when formulating the principles. At the conclusion of the discussion there was a consensus by the project team as well as the commission that the two words have distinct meanings that justify including both in the principles: “Accessible” connotes physical and economic access. Physical access includes the ability to visit parks and recreational facilities (e.g., by walking or biking), as well as being able to visit and access all the amenities in a park or facility. “Accessible” also includes planning and developing the capacity to meet demand for programs, and ensure economic access and affordability of program costs and fees. “Inclusive” refers to universal design and inclusion of all user groups. For example, the Magical Bridge Playground is inclusive and designed for all abilities; it is not a playground designed only for people with disabilities. This level of inclusiveness can be applied to other park projects and programming as well and promotes the concept of designing and implementing projects and programs that are able to be utilized by everyone. This principle also includes linguistic and cultural inclusion to ensure that all Palo Alto residents can easily understand and engage with the parks, recreation, natural open space and trails system in the city. Due to these distinctions, the project team and the PRC were in favor or including both principles. Staff welcomes further discussion and guidance from council. Question 3: Why aren’t Habitat, Ecosystem and Education part of the principles? Response 3: Public input indicated that people in Palo Alto highly value the presence of nature in their park system and in the community. Based on this, as well as other guiding City policy documents, the Master Plan will contain policy language supporting the preservation and expansion of habitat and the stewardship of healthy ecosystems. The overall guidance in the Master Plan will be incorporated into site-specific efforts, including the upcoming Baylands Conservation Plan (CIP scheduled for FY17), as well as the Conservation Plans for Foothills Park, Arastadero Preserve, and Esther Clark (CIP scheduled for FY19), which will address habitat and ecosystems in more detail as it relates to these open spaces. Question 4: Why are the principles competing? Response 4: The principles are not used as a filtering device and are not intended to compete with each other or be used to provide prioritization rankings. Refer to Response 1 of this attachment as well as pages 36-37 of Attachment ‘A’ for further information regarding the principles. ATTACHMENT B 3 Question 5: Why is “Balanced” one of the principles? Response 5: “Balanced” was included as one of the principles by the project team and the PRC to address specific concerns voiced by the community. The Balanced principle expresses the intent to balance the system geographically, between programmed and self-directed use, between dedicated spaces and flexible use spaces, and between developed spaces and natural spaces. For example, geographically Palo Alto has fewer community gardens in the south of Palo Alto than we do in the north. The opposite is true for dog parks. When it comes to determining a future location for one of these facilities, the “Balance” principal means that geographic location will be a factor in determining where a new facility might be located. Likewise, park space will be balanced between providing active areas (e.g., basketball courts) with passive recreation spaces (e.g., meadows and open lawns) to ensure residents have the opportunity for a variety of types of outdoor activities. Another example is illustrated by the community’s value of nature as very important to Palo Alto residents, this Plan will identify ways to improve access to natural areas as well as incorporating nature into urban parks. However, structured activities and developed spaces are also of value and interest to the community and therefore, are needed to provide the full range of experiences sought by Palo Alto residents. Question 6: Why isn’t Nature one the principles? How is nature integrated into the project? Response 6: Nature has been considered throughout the process and public engagement activities and has been a theme of interest by public opinion. Based on feedback from Council, and further discussion with the PRC, “Nature” has been added as one of the principles. Question 7: Are the principles applied toward the overall system or toward specific projects? Response 7: The principles are the high level values for the parks and recreation system. They are intended to be used as the community considers improving the overall system and as we consider individual park projects and programs to best meet community interests. Question 8: Provide a more in-depth snapshot of the process to date to bring the Council up to speed as part of the staff report. Response 8: ATTACHMENT B 4 This question is addressed in the Discussion section of the staff report and the accompanying consultant report Attachment A. Question 9: Provide a summary of the PRC involvement. Provide background on PRC input and staff input in the planning process. Response 9: This is addressed in the Discussion section of the staff report - Parks and Recreation Commission (PRC) Involvement. Staff has been involved in all phases of the planning process. Question 10: Consultant report references 14 indicators of sustainability but doesn’t state what they are. Response 10: The indicators used in the analysis are below and the full report on sustainability can be accessed on the project web page www.PaloAltoParksPlan.org:  Air Quality  Climate Change  Education and Training  Energy Efficiency  Equity  Green Building  Integrated Pest Management  Natural Resources / Habitat  Operations / Maintenance  Public Health and Safety  Transportation  Waste Management  Water Conservation  Water Quality Question 11: Provide a clearer summary in the staff report of what the Master Plan is doing. Response 11: This is addressed in the staff report and related attachments. Question 12: How does Healthy City, Healthy Communities relate/referenced by the Master Plan? ATTACHMENT B 5 Response 12: The Healthy Cities, Healthy Communities resolution has been shared with the Master Plan project team to ensure that the Master Plan is aligned and consistent with the resolution. The extensive public outreach during the first phase of the Master Plan process reflect similar community values and interests as defined in the Healthy Cities, Healthy Communities resolution. Question 13: Provide more information on the community survey and a better summary of the results. Response 13: The staff report and Attachment A provides more background and information on the community survey, which was administered using the City’s Vovici system. Please also visit the links below from the project website www.PaloAltoParksPlan.org and review the summary of the community survey, which was developed with significant input from the PRC and a special Ad Hoc committee. Initial Summary http://www.paloaltoparksplan.org/pdf/10.Palo_Alto_Survey_Initial_Summary_Package_3-17- 15.pdf Supplemental Survey Findings http://www.paloaltoparksplan.org/pdf/7.PTOSR_Supplemental_Survey_Findings_3-24-15.pdf Question 14: What are essential park activities? Response 14: Many communities analyze park systems using a function-based parks classification scheme (neighborhood parks, community parks, regional parks). However, the parks in Palo Alto serve multiple functions. Feedback from the community through the engagement process indicated that people in Palo Alto are looking for the park system to deliver five broad categories of activities on a widely accessible basis, regardless of how the park is classified functionally. For the purposes of analysis, the project team called these “essential park activities” to denote that they should be provided throughout the park system, providing a close-to-home opportunity for every resident to enjoy each of these activities. These essential park activities include:  Play for Children  Exercise and fitness opportunities  Throw/Catch/Shoot/Hit opportunities  Group gathering spaces  Relax and enjoy the outdoor spaces ATTACHMENT B 6 Question 15: Provide another geographic map study showing schools and other facilities like Ventura Community Center. Response 15: A series of geographic analysis maps will be include in the Master Plan, these maps will show school facilities, including the Ventura Community Center. Question 16: How is additional park land being proposed to be added to the system in areas of the city where we are lacking? How does the plan advise how land (city and privately owned) can be repurposed for parks? Response 16: Recommendations for adding future parks and facilities will be addressed in the Master Plan. This topic will be discussed with both the PRC and City Council when reviewing the Prioritized Recommendations and the Draft Master Plan in the spring and summer of 2016. Recommendations may include, for example:  The purchase of new park land  Provide incentives and other opportunities for donation of land or facilities by private citizens  Conversion of land currently owned by the city to park land or recreational facilities  Exploring joint use or long term lease of land owned by other public entities  Using street right-of-ways  Incorporating other city or county agency easements as park space or connector between parks (e.g., Matadero and Arastadero Creek easements, utility easements)  Other strategies for gaining park and open space land that the project team and PRC may identify in the coming months. Question 17: Engage the community about where they perceive there are areas where the park system can be expanded. Be proactive and opportunistic to gain more park space. Response 17: The community has expressed the desire to add more parkland overall and in areas lacking open space in the city. The project team will review city-owned locations and make recommendations if parkland can be added at these locations. These recommendations will be cited in the Master Plan report. It is not recommended that the project team identify specific privately owned locations as potential park sites, as acquisition would occur on an opportunity/willing seller basis. Question 18: Include potential park space ideas and funding options for future developments. Identify funding. ATTACHMENT B 7 Response 18: Funding options for future parkland acquisition and development is still to be developed by the project team and will be addressed in the Master Plan report. City Council and the PRC will have the opportunity to comment on this in the study session review of the draft Master Plan. Question 19: Address the difficulty of accessing the city’s natural open spaces. Provide daily shuttles to these areas. Response 19: This has also been identified as a challenge by the community. Access to open spaces as well as parks and facilities will have specific recommendations in the Master Plan report. Shuttles and other means of transportation are being considered in the Master Plan. Question 20: Is the Master Plan creating a system bias for proposing and supporting future projects? Response 20: The Master Plan is creating a guide for the public, Council, PRC and staff to improve the Parks and Recreation System. It will be a practical planning tool, but all projects will still require community input and review, PRC discussion and recommendations, and Council review and approval. Question 21: Is every park going to be identical by applying this system? Response 21: The Master Plan will not result in or recommend that all parks are identical. This would not represent the desire and needs of the public and what they want for their parks system. The project team understands that residents would like the parks system to be diverse in look and feel, in programs and amenities and to reflect its contextual place in the parks and recreation system. Question 22: Address the Plan’s Bay Area demographic numbers and what actual demographic figures are being used in the Master Plan and how those demographics are used in the Master Plan process. Response 22: The project team is using available demographic data and projections to inform the Master Plan recommendations. Since the study session on August 31, additional coordination between the project team and Planning and Community Services has occurred to ensure that population assumptions are consistent with the most recent General Plan figures. ATTACHMENT B 8 Question 23: What questions does the project team want Council to answer? Response 23: The project team is requesting that Council provide feedback during the upcoming January 11, 2016 Council Study Session on the evaluation process and confirm the Council is satisfied with the data collection and analysis to date. The project team will continue to consult with the PRC, Council and public during the development and review of the Draft Master Plan. Data Sources Index **Click on the Title of the Data Source section you would like to review for access to that material. REF #TITLE DESCRIPTION 1 Data Sources Index A source Index of all the data collected during Phase 1 of the Master Plan Project. 2 Data and Needs Summary Planning process data summarized using a set of criteria to explain the connection between the data sources and the identification of needs. 3 Planning Environment Summary The Planning Environment Summary includes a review of guiding documents, related plans and programs, and city policies and practices. The Summary reveals facility and program gaps identified by past planning efforts for consideration in the PTOSR planning process. 4 Sustainability Review The Sustainability Review identifies opportunities to increase sustainable practices associated the operation and management of parks and open space within the City. Drawing on best practices from other cities and agencies, the site tour and inventory findings and Staff Project Team input, the Sustainability Review evaluates the City’s current policies, programs and practices and identifies opportunities to increase sustainability across 13 indicators. 5 Recreation Program Analysis Recreation Program Data Analysis Part II Program Matrix Summary Recreation Provider Matrix Recreation Program Data The Program Review and Analysis makes recommendations for high-level strategic directions and key findings about Palo Alto’s programming areas, populations and facilities, and identifies gaps and overlaps. The Review includes recreation programs offered by the Community Services Department as well as by private and community providers. 6 Revenue Analysis An examination of the financial factors in the programming, planning, developing and maintaining the PTOSR system. 7 Demographic and Recreation Trends Analysis Delivered to the City in September 2014, the Demographics and Trends Analysis includes Palo Alto’s demographic profile, key findings, and trends that have and will continue to inform the community outreach and the PTOSR planning process. 8 Physical Inventory: Palo Alto Open Space Plan Physical Inventory Matrix Existing System Summary Memo The physical inventory includes a n inventory table, detailed site analysis and a base map that provide a detailed analysis of existing conditions that have been reviewed and updated throughout the analysis. The inventory table quantifies the facilities at each of Palo Alto’s parks and provides each park’s acreage, ownership and field quality rating, as defined by the City. 9 Existing Condition Maps: Parks Preserves The MIG team visited each park site to document and evaluate existing conditions and consider possible improvements and developed an existing conditions map for each of the City’s parks. CITY OF PALO ALTO PARKS MASTER PLAN REF #TITLE DESCRIPTION 10 Geographic Analysis Building upon the base map, the MIG team analyzed the physical data gathered from our site visits, meetings, research, and the interactive map survey to produce maps of park service areas. These maps illustrate park walksheds based on ¼ and ½ mile distances using the existing street and trail network. MIG also generated maps showing access to indoor recreation facilities, off-leash dog facilities, and distance from parks that provide all essential activities. Essential activities include: Play for children, Throw a ball, Gathering, Exercise and fitness, and Relax and enjoy the outdoors. 11 Mapita Online Survey Results The MIG team developed an interactive online map-based questionnaire using the Mapita application, with which more than 487 community members were able to answer questions and provide geo-tagged comments on specific parks throughout the City. The Survey Summary includes site maps with participants’ comments on park quality, barriers to access, needs and opportunities for dozens of parks. Ideas and opportunities uncovered by the interactive map are informing recommendations and geographic analysis. 12 Intercept Results: Intercept Survey Summary During Summer 2014 MIG conducted six intercept events which engaged more that 200 community members at some of Palo Alto’s most popular parks, farmer’s markets and summer events. Community members indicated their responses to questions about what they value about the parks and recreation system using dot stickers placed on large posters. These intercepts captured input from many people who may not otherwise be involved in the process. 13 Workshop Results: Community Workshop Summary MIG facilitated a series of three community workshops, on October 28, 29 and December 2,2014 that engaged a total of 60 community members. These workshops provided residents with an opportunity to provide more specific input on aspects of the system that they would like preserved or improved. The Community Workshop Summary provides the results of the visual preference survey and key themes from the small group discussions and comment cards. 14 Survey Results: Community Survey Results Community Survey Supplemental Findings MIG worked with the City Staff Project Team to launch an online community survey to better understand community priorities. The survey was based on earlier input from the community and the analysis of the system. The PRC and Staff Project Team reviewed the survey and it was available online from November 17 through December 19. It was also available in hard copy in Spanish and in English. 15 Prioritization Workshop and Online Challenge Summary A prioritization workshop was held with the community and stakeholder group as well as an online version for the community to provide input about prioritizing projects. The feedback gathered from this outreach forums directly feeds into the “Address Community Preferences” segment of the Criteria to evaluate potential recommendations. 16 Stakeholder Meetings: Stakeholder Meeting Summary Stakeholder Update Memo Youth Council Discussion Summary The MIG team provided facilitation and graphic recording of Stakeholder Advisory Group meetings to ensure that all voices were heard. Twenty-four community members representing a range of interests and organizations are a part of this group. The group is expected to meet three times to provide ideas, issues, challenges, and feedback on the plan development. Comprehensive Plan Existing Conditions Reports http://www.paloaltocompplan.org/resources/draft-existing- conditions-report/ National Citizen Survey 2014 http://www.cityofpaloalto.org/civicax/filebank/documents/45669 Citizen Centric Report for Fiscal Year 2013 http://www.cityofpaloalto.org/civicax/filebank/blobdload. aspx?BlobID=39434 Performance Report for FY 2013 http://www.cityofpaloalto.org/civicax/filebank/blobdload. aspx?BlobID=39369 ADDITIONAL RESOURCES The following are additional resources that have been identified and used by the planning team. These are not included in the binder but titles and direct web links are provided below. Community Input Master Plan Principles Data and Opportunities Summary Matrix Potential Project and Program Ideas Developed by MIG. Organized by areas of focus. To be reviewed with staff and PRC. Apply Prioritization Criteria and Scoring Finalize List of Recommendations S takeholder an d P u b l i c Review Draft and Refine List of Recommendations e.g., • Cost • Geographic Distribution • Project Type Final Recommendations in Master Plan CITY OF PALO ALTO OFFICE OF THE CITY AUDITOR January 25, 2016 The Honorable City Council Palo Alto, California FY 2015 Performance Report, The National Citizen Survey™, and Citizen Centric Report NOTE: This item may be moved to the Council retreat agenda on January 30, 2016. The Office of the City Auditor presents the 14th annual performance report for the City of Palo Alto, The National Citizen Survey™, and the Citizen Centric Report covering the fiscal year ending June 30, 2015 (FY 2015). The performance report is designed to provide information to the City Council, management, and the public to increase accountability and the transparency of City government. It contains summary information on spending, staffing, workload, and performance results for fiscal years 2006 through 2015. Chapter 1 provides citywide spending and staffing information, Chapter 2 provides citywide information based on themes and subthemes, and Chapter 3 provides information on a department‐by‐department basis. The departments provided us with data specific to their departments, and we collected financial and staffing data from various city documents and the Office of Management and Budget in the Department of Administrative Services and benchmarking data from various external sources. The National Citizen Survey™ is a collaborative effort between the National Research Center, Inc., (NRC) and the International City/County Management Association. The NRC uses a statistically valid survey methodology to gather resident opinions across a range of community issues, including the quality of the community and services provided by the local government. The report includes trends over time, comparisons by geographic subgroups, benchmarks to other communities, responses 10 custom questions and one open-ended question, and details about the survey methodology. The Citizen Centric Report is a four-page summary of highlights in the performance report, financial data, and an overview of our City's economic outlook. Respectfully submitted, Harriet Richardson City Auditor Page 2 ATTACHMENTS:  Attachment A: FY 2015 Performance Report (PDF)  Attachment B: FY 2015 National Citizen Survey (PDF)  Attachment C: FY 2015 Citizen Centric Report (PDF) Department Head: Harriet Richardson, City Auditor Page 3 OUR MISSION: The government of the City of Palo Alto exists to promote and sustain a superior quality  of life in Palo Alto. In partnership with our community, our goal is to deliver cost‐effective services in a  personal, responsive, and innovative manner. Attachment A 1 Attachment A 2 Chapter 2 Themes and Subthemes Stewardship Financial Responsibility Environmental Sustainability Neighborhood Preservation Public Service Emergency Services Utility Services Internal City Services Community Safety, Health, and Well Being Mobility Density and Development Community Involvement Attachment A 3 Performance Measure Title Graphic Benchmark or Performance Measure Title Graphic Performance Measure Title Graphic By the Numbers Workload Indicator Workload Indicator Workload Indicator Workload Indicator Attachment A CHAPTER 1: BACKGROUND Citywide Spending and Staffing ……………………………………………….………………………………………………………………………… 5 CHAPTER 2: THEMES AND SUBTHEMES Stewardship Financial Responsibility ………………………………………………………………………………………………………….……………………… 8 Neighborhood Preservation ………………..…………………………………………………………………………………………………………. 10 Environmental Sustainability ……..…………………………………………………………………………………………………………………… 14 Public Service  Public Safety Service Responsiveness ……………..……………………………………………………………………………………………… 16 Utility Service Responsiveness …………………..…………………………………………………………………………………………………… 17 Internal City Service Responsiveness …………….………………………………………………………………………………………………… 18 Community  Community Involvement and Enrichment ………….…………………………………………………………………………………………… 19 Safety, Health, and Well‐Being …….………………………………………………………………………………………………………………… 21 Density and Development  ..…………………………………………………………………………………………………………………………… 23 Mobility ………………………………………………………………………………………………………………………………………………………… 24 CHAPTER 3: DEPARTMENT DATA TABLES Citywide …………………………………………………………………………………………………………………………………………………………… 25 Community Services ……………….………………………………………………………………………………………………………………………… 28 Development Services ……………………………………………………………………………………………………………………………………… 32 Information Technology ………...………………………………………………………………………………………………………………………… 34 Library Department ………………..………………………………………………………………………………………………………………………… 35 Planning and Community Environment ………………………………………………………………….………………………………………… 37 Public Safety – Fire Department ……………………………………………………………………………..………………………………………… 39 Public Safety – Office of Emergency Services …………………………………………………………………………………………………… 42 Public Safety – Police Department …………………………………………………………………………………………………………………… 43 Public Works Department ……………………………………………………………………………………………………………………………… 46 Utilities Department ………………………………………………………………………………………………………………………………………… 51 Strategic and Support Services ……………………………………………………………………………………………………………………… 55 Office of Council‐Appointed Officers ………….………………………………………………………………………………………………… 55 Administrative Services Department ………..………………………………………………………………………………………………… 57 People Strategy and Operations Department ………...……………………………………………………………………………………… 58 Ta b l e  of  Co n t e n t s 4 Attachment A Authorized Staffing Source: Administrative Services Department Organizational Chart Palo Alto residents elect nine members to the City Council. Council  Members serve staggered four‐year terms. The Council appoints a  number of boards and commissions, and each January, the Council  elects a new Mayor and Vice‐Mayor. Palo Alto is a charter city, operating under a council/manager form of  government. The City Council appoints the City Manager, City  Attorney, City Auditor, and City Clerk. 5Ch a p t e r  1 Ba c k g r o u n d Citywide Spending and Staffing General Fund Employee Costs (in millions) Source: Administrative Services Department 1,160 1,168 1,150 1,150 1,114 1,115 1,129 1,147 1,153  0 500 1,000 1,500 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Regular Temporary 53 . 9 57 . 3 59 . 6 56 . 6 55 . 8 54 . 4 53 . 5 55 . 5 57 . 7 4. 0 4. 2 3. 7 4. 5 4. 1 5. 4 3. 7 4. 7 4. 6 26 . 1 29 . 8 28 . 3 30 . 9 34 . 2 36 . 9 37 . 7 38 . 8 40 . 2 0% 20% 40% 60% 80% 100% FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 Salaries/Wages Overtime Benefits Attachment A Source of FY 2015 General Fund Revenues Source: Administrative Services Department 6Ch a p t e r  1 Ba c k g r o u n d Citywide Spending and Staffing Use of FY 2015 General Fund Dollars (shown on a budgetary basis) Source: Administrative Services Department $102,530,61 7 60% $19,678,146 11% $15,451,997 9% $14,918,997 9% $10,314,291 6% $8,611,445 5% Salary & Benefits Transfer to Infrastructure Allocated Charges Contract Services General Expense All Other Expenses $34,116,747  18% $29,675,408  16% $25,408,852  14%$17,796,222  10% $14,910,801  8% $16,699,331  9% $10,861,304  6% $10,416,496  6% $10,050,841  5% $7,621,113  4% 7,667,295  4% Property Taxes Sales Taxes Charges for Services Operating Transfers‐In Rental Income Transient Occupancy Tax Utility Users Tax Charges to Other Funds Documentary Transfer Tax Permits and Licenses All Other Revenues Attachment A Capital Outlay – Governmental Funds (in millions) Source: Administrative Services Department 7Ch a p t e r  1 Ba c k g r o u n d Citywide Spending and Staffing Capital Expenditures –Enterprise Funds (in millions) Source: Administrative Services Department $2 1 . 6 $2 1 . 5 $2 2 . 0 $3 5 . 5 $2 9 . 2 $2 9 . 5 $3 7 . 6 $4 5 . 4 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 $3 6 . 1 $3 6 . 2 $2 9 . 7 $2 4 . 4 $2 7 . 6 $4 0 . 7 $3 7 . 1 $2 9 . 5 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 5 General Fund Projects With Highest Actual Costs in FY 2015 Main Library New Construction Street Maintenance Mitchell Park Library California Avenue Transit Hub Magical Bridge Playground 5 Enterprise Fund Projects With Highest Actual Costs in FY 2015 Gas Main Replacements Projects Electric System Improvement Electric Customer Connections Refuse Landfill Closure Wastewater Treatment Plant Equipment Replacement Attachment A Cash and Investments and Rate of Return Source: Administrative Services Department Citywide Operating Expenditures Budget to Actual by Department Source: Office of Management and Budget 8Ch a p t e r  2 St e w a r d s h i p Financial Responsibility Utility Average Purchase Costs (per unit) Source: Utilities Department 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% $0 $100 $200 $300 $400 $500 $600 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Cash and investments Rate of return United States Treasury's 5‐year Average Yields  $‐  $10,000,000  $20,000,000  $30,000,000  $40,000,000 Budget Actual Co m m u n i t y   Se r v i c e s De v e l o p m e n t   Se r v i c e s Fi r e Li b r a r y No n d e p a r t m e n t a l OE S PC E Po l i c e Pu b l i c  Wo r k s Op e r a t i n g  Tr a n s f e r s ‐Ou t Tr a n s f e r s  to   In f r a s t r u c t r e St r a t e g i c  & Su p p o r t   Se r v i c e s Attachment A History of Average Monthly Residential Bills Source: Utilities Department 9Ch a p t e r  2 St e w a r d s h i p Financial Responsibility Utility Fund Reserves (in millions) Source: Administrative Services Department $158 $174 $193 $206 $211 $213 $230 $232 $240 $237  $0 $100 $200 $300 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Refuse Storm Drainage Wasterwater Collection Water Gas Electric User Tax $216 $217 $217 $199 $210 $224 $228 $232 $231  $153  ‐$100 $0 $100 $200 $300 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Refuse Storm Drainage Waterwater Collection Water Gas Electric Attachment A Street Lane Miles Resurfaced Source: Public Works Department Number of Potholes Repaired and Percentage Repaired  Within 15 Days of Notification Source: Public Works Department 10Ch a p t e r  2 St e w a r d s h i p Neighborhood Preservation By the Numbers 7% Percent of the City’s total 471  lane miles resurfaced in FY 2015, which decreased by  1% point from FY 2014 3,294 Number of signs repaired or  replaced, which increased 26%  from FY 2014 and increased  88% from FY 2006 51% Citizen Survey: Street repair rated  as “excellent” or “good” in FY  2015,  compared to 55% in FY  2013 and benchmarked as similar  to other jurisdictions 79 2015 Pavement Condition  Index score rated as “good” in  maintaining local street and  road networks, based on a  scale of 0 to 100 Metropolitan Transportation Commission (MTC) CY 2014 Pavement Condition Index (PCI) Ratings Source: MTC – Pavement Condition of Bay Area Jurisdictions CY 2014 1, 0 4 9 1, 1 8 8 1, 9 7 7 3, 7 2 7 3, 1 4 9 2, 9 8 6 3, 0 4 7 2, 7 2 6 3, 4 1 8 2, 4 8 7 0% 20% 40% 60% 80% 100% 0 1,000 2,000 3,000 4,000 5,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Number repaired Percent repaired within 15 days 59 67 70 73 74 76 76 79 79 *East Palo Alto Cupertino Mountain View Santa Clara Milpitas *Menlo Park Sunnyvale *Redwood City Palo Alto 20 32 27 23 32 29 40 36 36 31 0% 2% 4% 6% 8% 10% 0 10 20 30 40 50 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Street lane miles resurfaced % of street lane miles resurfaced PCI Rating Scale:0‐24  25‐49 50‐59 Failed Poor At Risk 60‐69 70‐79 80‐100 Fair Good Very Good ‐Excellent •San Mateo County cities Attachment A Sidewalk Replaced or Permanently Repaired and  Percentage of Temporary Sidewalk Repairs Completed  Within 15 Days of Initial Inspection Source: Public Works Department Trees Maintained and Serviced Source: Public Works Department 11Ch a p t e r  2 St e w a r d s h i p Neighborhood Preservation By the Numbers 305 Number of trees planted,  which include trees planted by  Canopy volunteers, achieving  the 250 target 28% Percent of trees trimmed to  clear power lines, achieving  the 25% target 75% Citizen Survey: Street cleaning  rated as “excellent” or “good”  in FY 2015, compared to 80% in  FY 2014; benchmarked as  similar to other jurisdictions 62% Citizen Survey: Sidewalk  maintenance rated as  “excellent” or “good” in FY 2015,   same as FY 2014; benchmarked  as similar to other jurisdictions Percent of All Sweeping Routes Completed (Residential and Commercial) Source: Public Works Department 34 , 8 4 1 34 , 5 5 6 35 , 3 2 2 35 , 2 5 5 35 , 4 7 2 33 , 1 4 6 35 , 3 2 4 35 , 3 8 3 35 , 3 8 6 35 , 2 8 1 0 2,000 4,000 6,000 8,000 10,000 0 10,000 20,000 30,000 40,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Total number of City‐maintained trees Number of all tree‐related services completed 93 % 90 % 92 % 88 % 92 % 90 % 93 % 95 % 10 0 % 0% 20% 40% 60% 80% 100% 120% FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 87 % 98 % 88 % 86 % 78 % 83 % 82 % 95 % 79 % 68 % 0% 25% 50% 75% 100% 0 50,000 100,000 150,000 200,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Percent of temporary sidewalk repairs completed Square feet of sidewalk replaced or permanently repaired Attachment A Library Visits and Checkouts Source: Library Department Map of Library Branch Locations 12Ch a p t e r  2 St e w a r d s h i p Neighborhood Preservation By the Numbers 51,792 Number of cardholders, which  increased 10% from FY 2014  and decreased 7% from FY 2006 11,334 Total library hours open  annually, which ranged from  8,855 to 11,822 from FY 2006  to FY 2015, and increased 8%  from FY 2006 64% Percent of Palo Alto residents  who are cardholders, which  increased 6% from FY 2014 and  increased 2% from FY 2006 4,339 Meeting room reservations,  which increased 322% from FY  2014 and increased 413% from  FY 2012 Comparison of Library Checkouts Per Capita Source: California State Library Public Library Statistics 2013‐2014 22.0 20.9 20.5 20.4 20.3 18.7 18.4 16.8 Mountain View Redwood City Menlo Park Palo Alto Burlingame Santa Clara Sunnyvale Berkeley 0 400,000 800,000 1,200,000 1,600,000 2,000,000 FY  05 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Checkouts Visits Attachment A Urban Forest: Percent Pruned and Tree Line Cleared Source: Public Works Department Community Services: Parks/Land Maintained (Acres) Source: Community Services Department 13Ch a p t e r  2 St e w a r d s h i p Neighborhood Preservation By the Numbers 169,653 Visitors at Foothills Park, which  decreased 15% from FY 2014  and increased 33% from FY 2006 310 Participants in community  garden program, which  increased 6% from FY 2014  and increased 39% from FY 2006 94% Citizen Survey: Visited a  neighborhood park or City park  at least once in the last 12  months 118,390 Number of native plants in  restoration projects, which  increased 87% from FY 2014  and increased 663% from FY 2006 Citizen Survey: Visited a Neighborhood Park or City Park Source: 2015 National Citizen SurveyTM 48% 46% 49% 41% 42% 46% 62% 62% 45% 48% 45% 50% 53% 47% 29% 32% 7% 6% 6% 9% 5% 6% 9% 6% FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 More than once a month Once a month or less Not at all 0% 20% 40% 60% 80% 100% FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Percent of urban forest pruned Percent of tree line cleared 181 165  31 43  11 26 5  0 100 200 Go l f  Co u r s e Ur b a n / N e i g h b o r h o o d Pa r k s Ci t y  Fa c i l i t i e s Sc h o o l  At h l e t i c  Fi e l d s Ut i l i t y  Si t e s Me d i a n  St r i p s Bu s i n e s s  Di s t r i c t s  an d Pa r k i n g  Lo t s Attachment A Green Building with Mandatory Regulations Source: Development Services Department Tons of Waste Landfilled and Tons of Materials Recycled or Composted (excluding self‐hauled) Sources: Public Works Department, California Department of  Resources Recycling and Recovery (CalRecycle) 14Ch a p t e r  2 St e w a r d s h i p Environmental Sustainability By the Numbers 50,546 Tons of materials recycled or  composted (i.e., do not end  up in a landfill), increased 2%  from FY 2014 and decreased  10% from FY 2006 3,958,713 Green Building energy  savings per year in Kilo  British Thermal Units, which  increased 26% from FY 2014 4,767 Number of households  participating in the Household  Hazardous Waste program, which  decreased 2% from FY 2014 and  increased 8% from FY 2006 28% Percent of commercial  accounts with compostable  service, which increased  8% from FY 2014 Total Water Processed and Recycled Source: Public Works Department 0 50,000 100,000 150,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Tons of materials recycled or composted Tons of waste landfilled 8, 9 7 2 8, 8 5 3 8, 5 1 0 7, 9 5 8 8, 1 8 4 8, 6 5 2 8, 1 3 0 7, 5 4 6 7, 1 8 6 6, 5 1 2 0 50 100 150 200 250 300 0 1,500 3,000 4,500 6,000 7,500 9,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Mi l l i o n s  of  ga l l o n s  of re c y c l e d  wa t e r  de l i v e r e d Mi l l i o n s  of  ga l l o n s  pr o c e s s e d Millions of gallons processed Millions of gallons of recycled water delivered 0 1,000 2,000 3,000 4,000 5,000 $0 $100 $200 $300 $400 $500 $600 $700 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Valuation Square feet Sq u a r e  fe e t  in  th o u s a n d s Do l l a r s  in  mi l l i o n s Attachment A Water Conservation Expenditures and Savings Source: Utilities Department Electric Efficiency Program Expenditures and Savings Source: Utilities Department 15Ch a p t e r  2 St e w a r d s h i p Environmental Sustainability By the Numbers 22% Percent of qualifying renewable  electricity, including biomass,  biogas, geothermal, small  hydro facilities, solar, and wind,  which increased 14% from FY 2006 0 Metric tons of electric supply  carbon dioxide emissions in FY 2015; the carbon neutral  plan effectively eliminated all  greenhouse gas emissions from  the City’s electric supply 31 Average residential water usage  in hundred cubic feet per capita,  which decreased 19% from FY 2014 and decreased 27%  from FY 2006 Gas Energy Efficiency Program Expenditures Savings Source: Utilities Department 0. 5 % 0. 6 % 0. 7 % 1. 5 % 0. 9 % 0. 9 % 0. 6 % 0.0% 0.5% 1.0% 1.5% 2.0% $0.0 $1.0 $2.0 $3.0 $4.0 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Sa v i n g s  (%  of  to t a l  sa l e s ) Ex p e n d i t u r e s  (i n  mi l l i o n s ) First‐year energy savings achieved through electric efficiency programs as a percentage of total sales Energy conservation/efficiency program expenditures (in millions) 0. 2 8 % 0. 4 0 % 0. 5 5 % 0. 7 3 % 1. 3 9 % 1. 3 4 % 0. 9 0 % $0.0 $2.0 $4.0 $6.0 $8.0 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 0.0% 0.5% 1.0% 1.5% 2.0% Ex p e n d i t u r e s  (i n  mi l l i o n s ) Sa v i n g s  (%  of  to t a l  sa l e s ) First‐year gas savings achieved through gas efficiency programs as a percentage of total sales Gas energy conservation/efficiency program expenditures (in millions) 1. 0 % 1. 4 % 0. 5 % 1. 1 % 0. 5 % 0. 6 % 1. 1 % 0.0% 0.5% 1.0% 1.5% 2.0% $0.0 $1.0 $2.0 $3.0 $4.0 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Sa v i n g s  (%  of  to t a l  sa l e s ) Ex p e n d i t u r e s  (i n  mi l l i o n s ) First‐year water savings achieved through efficiency programs as a percentage of total sales Water efficiency program expenditures (in millions) 127 Average residential gas usage  in therms per capita, which  decreased by 18% from FY  2014 and decreased 32% from FY 2006 Attachment A Animal Services: Number of Palo Alto Live Calls  Responded to Within 45 Minutes Source: Police Department Fire: Number of Medical/Rescue Incidents to Response Time Source: Police Department 16Ch a p t e r  2 Pu b l i c  Se r v i c e Responsiveness – Public Safety Services By the Numbers 81 Number of hazardous materials  incidents, which increased 11%  from FY 2014 and increased  80% from FY 2006 89% Police Department  nonemergency calls responded  to within 45 minutes, which  decreased 1% from FY 2014 and  decreased 6% from FY 2006 73% Percent emergency calls  dispatched within 60 seconds,  which decreased 4% from FY 2014 91% Percent of code enforcement  cases resolved within 120 days,  which increased 2% from FY 2014 and decreased 3% from  FY 2006 Police: Calls for Service and Response Time Source: Police Department 3, 7 8 0 3, 9 5 1 4, 5 5 2 4, 5 0 9 4, 4 3 2 4, 5 2 1 4, 5 8 4 4, 7 1 2 4, 7 5 7 5, 2 7 0 0:00 1:00 2:00 3:00 4:00 5:00 6:00 0 1,000 2,000 3,000 4,000 5,000 6,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Re s p o n s e  ti m e  in  mi n u t e s In c i d e n t s Number of medical/rescue incidents Average response time for medical/rescue calls 2, 8 6 1 2, 9 9 0 3, 0 5 9 2, 8 7 3 2, 6 9 2 2, 8 0 4 3, 0 5 1 2, 9 0 9 2, 3 9 8 20 1 3 0 1,000 2,000 3,000 4,000 5,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 0% 20% 40% 60% 80% 100% Number of Palo Alto animal services calls Percent Palo Alto live animal calls for service responded to within 45 minutes 0 10,000 20,000 30,000 40,000 50,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 00:00 05:00 10:00 15:00 20:00 25:00 Po l i c e  Re s p o n s e s Mi n u t e s Total nonemergency calls Total emergency calls Total urgent calls Avg emergency response (minutes) Avg urgent response (minutes)Avg nonemergency response (minutes) Attachment A Water Service Disruptions Source: Utilities Department Electric Service Interruptions Source: Utilities Department 17Ch a p t e r  2 Pu b l i c  Se r v i c e Responsiveness – Utility Services By the Numbers 72,587 Total number of electric, gas, and  water customer accounts Electric – 29,065 Gas – 23,461 Water – 20,061 380 fewer accounts than FY 2014 39 Average power outage  duration in minutes per  customer affected, same as FY 2014 249 Number of gas leaks found, 61  ground leaks and 188 meter  leaks, a decrease of 40% and  37%, respectively, from FY 2014 241 Unplanned water service  outages, which is a decrease of  74% from FY 2014 Gas Service Disruptions Source: Utilities Department 39 48 41 28 20 33 25 25 16 17 0 40 80 120 160 200 0 10 20 30 40 50 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Av g  mi n u t e s  pe r  cu s t o m e r  af f e c t e d Se r v i c e  in t e r r u p t i o n s  ov e r  on e  mi n u t e Service interruptions over 1 minute Avg minutes per customer affected 21 1 30 7 10 5 76 6 93 9 11 4 11 1 26 5 28 5 19 5 0 20 40 60 80 100 0 200 400 600 800 1000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Nu m b e r  of  un p l a n n e d  se r v i c e  di s r u p t i o n s Nu m b e r  of  cu s t o m e r s  af f e c t e d Total customers affected Number of unplanned service disruptions 16 0 78 3 37 4 23 0 29 1 92 70 95 0 94 2 24 1 0 20 40 60 80 100 0 200 400 600 800 1000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Nu m b e r  of  un p l a n n e d  se r v i c e  di s r u p t i o n s Nu m b e r  of  cu s t o m e r s  af f e c t e d Total customers affected Number of unplanned service disruptions Attachment A Information Technology: Percent of Service Desk Requests Resolved Source: Information Technology Department City Attorney: Percent of Claims Resolved Within 45 Days of Filing Source: Office of the City Attorney 18Ch a p t e r  2 Pu b l i c  Se r v i c e Responsiveness –Internal City Services By the Numbers 99 Number of claims handled by  the Office of the City Attorney  in FY 2014, which increased   27% from FY 2014 1,707 Number of purchasing  documents processed; $129.3  million in goods and services  purchased 1,366 Workers’ Compensation days  lost to work‐related illness or  injury in FY 2015, which  decreased 23% from FY 2014 52% Percent of information  technology security incidents  remediated within one day in FY 2015, which increased 24%  from FY 2014 City Auditor: Percent of Open Recommendations Implemented Over  the Last 5 Years Source: Office of the City Auditor 92% 95% 92% 93% 0% 20% 40% 60% 80% 100% FY 12 FY 13 FY 14 FY 15 40% 42% 39% 49% 42% 43% 42% 0% 20% 40% 60% 80% 100% FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 0% 20% 40% 60% 80% 100% FY 12 FY 13 FY 14 FY 15 Over 5 days Within 5 days Within 8 hours Within 4 hours At time of call 9,460 9,734 9,348 9,855 Attachment A Number of Participants in Teen Programs Source: Library Department Community Services and Library Volunteer Hours Sources: Community Services and Library Departments 19Ch a p t e r  2 Co m m u n i t y Community Involvement and Enrichment By the Numbers 180,074 Number of titles in library  collection, which increased  4% from FY 2014 and  increased 10% from FY 2006 2 Average business days for new  library materials to be available  for customer use, which  remained constant from FY 2014  and improved 78% from FY 2010 1,048 Number of library programs  offered, which increased 31%  from FY 2014 and increased  86% from FY 2006 44,892 Library program attendance,  which increased 18% from FY 2014 and increased 46%  from FY 2006 Community Services: Total Enrollment in Classes/Camps Source: Community Services Department 0 5,000 10,000 15,000 20,000 25,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Summer Camps and Aquatics Kids (excluding camps) Adults Preschool 0 20,000 40,000 60,000 80,000 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Restorative/resource management projects Neighborhood parks Library Community Theatre Art Center 1,549 1,573 1,906 2,211 1,188 2,746 0 500 1,000 1,500 2,000 2,500 3,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Attachment A Animal Services: Percent of Cats and Dogs Recovered and  Returned to Owner Source: Police Department Fire: Safety Presentations, Including Demonstrations and  Fire Station Tours Source: Fire Department 20Ch a p t e r  2 Co m m u n i t y Community Involvement and Enrichment By the Numbers 2,143 Police Department number of  animals handled, which   decreased 14% from FY 2014  and decreased 44% from FY 2006 47 Emergency Operations Center  activations/deployments,  which  increased 81% from  FY 2014 8 Police Department average  number of officers on patrol,  which has remained constant  from FY 2006 47 Office of Emergency Services  emergency operations center  activations/deployments, which  increased 81% from FY 2014 Police: Citizen Commendations Received Source: Police Department 115 126 95 88 218 0 50 100 150 200 250 FY  11 FY  12 FY  13 FY  14 FY  15 0% 20% 40% 60% 80% 100% FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Percent of dogs received by shelter and returned to owner Percent of cats received by shelter and returned to owner 14 4 12 1 14 1 12 4 15 6 14 9 13 7 14 7 15 3 13 5 0 50 100 150 200 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 FY 15 Target: >150 Attachment A Code Enforcement: Number of New Cases Source: Planning & Community Environment Department Police: Number and Types of Cases Source: Police Department 21Ch a p t e r  2 Co m m u n i t y Safety, Health, and Well‐Being By the Numbers 28,714 Fire  public demo and  station tour participants,  which increased 473%  from FY 2014 89% Fire Department percent of  permitted hazardous materials  facilities inspected, which  increased 55% from FY 2014 and  increased 40% from FY 2006 69 Reported crimes per 1,000  residents, which increased 11%  from FY 2014 and decreased  18% from FY 2006 1,964 Number of fire inspections  completed, which increased  13% from FY 2014 and  increased 118% from FY 2006 Net Per Capita Expenditures: Fire, Emergency Medical  Services, and Police Source: California State Controller’s Office, U.S. Census Bureau 1,131 1,207 1,464 1,249 1,108 916 1,181 1,191 1,237 0 400 800 1200 1600 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Theft cases closed Homicide cases closed Robbery cases closed Rape cases closed Open cases (all types) $369 $392 $449 $479 $591 $605 $614 $757 Fremont Sunnyvale San Mateo Milpitas Santa Clara Redwood City Mountain View Palo Alto Fire & EMS Police 42 1 36 9 68 4 54 5 68 0 65 2 61 8 68 4 60 9 58 6 0 200 400 600 800 1,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Nu m b e r  of  ne w  ca s e s Note: Palo Alto provides ambulance services as compared to all other jurisdictions  listed which receive ambulance services through a county contractor. Attachment A Office of Emergency Services: Presentations, Training  Sessions, and Exercises Source: Office of Emergency Services Fire: Number of Licensed Paramedics & Certified  Emergency Medical Technicians Source: Fire Department 22Ch a p t e r  2 Co m m u n i t y Safety, Health, and Well‐Being By the Numbers 382 Traffic collisions with injury,  which decreased 10% from FY 2014 and decreased 4%  from FY 2006 346 Fire Department average  training hours per firefighter,  which increased 10% from FY  2014 and increased 20% from FY 2006 92% Percent of fires confined to the  room or area of origin, which  increased 29% from FY 2014  and increased 29% from FY 2006 5,270 Number of medical/rescue  incidents, which increased 11%  from FY 2014 and increased  39% from FY 2006 Police Benchmark: Expenditures Per Capita and Violent and  Property Crimes per 1,000 Residents in Calendar Year Source: California State Controller & FBI Uniform Crime Reporting Program 36 34 34 49 50 50 5011 3 10 9 10 9 70 61 50 48 0 30 60 90 120 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Number of licensed paramedics Number of certified EMTs $0 $100 $200 $300 $400 $500 $600 0 10 20 30 40 50 Pa l o  Al t o Me n l o  Pa r k Re d w o o d Ci t y Mo u n t a i n Vi e w Sa n t a  Cl a r a Mi l p i t a s Sa n  Ma t e o Fr e m o n t Su n n y v a l e Ne t  ex p e n d i t u r e s Cr i m e s Property crimes Violent crimes Net expenditures 38 51 184 193 0 50 100 150 200 250 FY  12 FY  13 FY  14 FY  15 Attachment A Number of Code Enforcement Cases Closed and Resolved Within 120 Days Source: Planning & Community Environment Department Inspections, Building Permits Issued and Valuation Source: Development Services Department 23Ch a p t e r  2 Co m m u n i t y Completed Planning Applications in FY 2015 Source: Planning & Community Environment Department Density and Development By the Numbers 25 Average number of days to  issue 3,844 building permits,  which decreased 7% from FY 2014 and 74% from FY 2006 30 1 26 3 66 7 53 5 61 8 60 3 0 0 54 1 51 9 0% 25% 50% 75% 100% FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Resolved within 120 days Resolved within 121+ days Architectural  Review Board 51% Individual  Review 26% Other 13%Conditional Use 4% Home  Improvement  Exception 2% Temporary Use  & Variances 4% 567 Number of permits routed to  all departments with on‐time  reviews, which increased 3%  from FY 2014 628 Number of permits  approved over the counter,  which increased 13% from  FY 2014 31,000 Number of inspections  completed, which remained  the same as in FY 2013 and  increased 168% from FY 2006 0 300 600 900 1200 0 10,000 20,000 30,000 40,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Inspections completed Building permits issued Building permit valuation Nu m b e r  of  in s p e c t i o n s  co m p l e t e d or  bu i l d i n g  pe r m i t s  is s u e d Bu i l d i n g  pe r m i t  va l u a t i o n (i n  mi l l i o n s ) Da t a  no t  av a i l a b l e Da t a  no t  av a i l a b l e Attachment A Pavement Condition Index (PCI) Ratings Source: Metropolitan Transportation Commission, reported June 2015 Shuttle and Caltrain Boardings Source: Planning & Community Environment Department and Caltrain 24Ch a p t e r  2 Co m m u n i t y Mobility By the Numbers 152,571 Number of shuttle boardings,  which increased 14% from FY 2014 and decreased 13%  from FY 2006 $1.95 City’s cost per shuttle boarding,  which increased 31% from FY 2014 and 2% from FY 2006 8,750 Caltrain average weekday  boardings, which increased  16% from FY 2014 and 126%  from FY 2006 113 Average number of employees  in the City commute program,  which was similar to FY 2014  and increased 9% from FY 2006 Citizen Survey: Percent Rating Ease of Transportation “Excellent” or “Good” Source: 2015 National Citizen SurveyTM 0 2,500 5,000 7,500 10,000 0 50,000 100,000 150,000 200,000 FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 City Shuttle boardings Caltrain average weekday boardings Ci t y  Sh u t t l e  Bo a r d i n g s Ca l t r a i n  av e r a g e  we e k d a y  bo a r d i n g s 0% 20% 40% 60% 80% 100% FY  06 FY  07 FY  08 FY  09 FY  10 FY  11 FY  12 FY  13 FY  14 FY  15 Walking Bicycle travel Car travel 72 74 74 78 77 79 70 71 72 73 74 75 76 77 78 79 80 CY  09 CY  10 CY  11 CY  12 CY  13 CY  14 70‐79 = “Good” 80‐100 = “Very Good‐Excellent”PC I  Ra t i n g Note: Reporting changed from 3 year annual average rating to annual rating. Attachment A 25 OVERALL OPERATING EXPENDITURES General Fund (in millions) Community  Services Development  Services  <NEW> Fire 1 Office of  Emergency  Services1 Library Planning and  Community  Environment Police Public  Works Strategic and  Support  Services2 Non‐ departmental3 Operating  transfers  out4 Total Enterprise  funds (in millions) FY 07 $20.1 ‐$21.6 ‐$5.9 $9.5 $25.9 $12.4 $15.8 $8.5 $12.7 $132.4 $190.3 FY 08 $21.2 ‐$24.0 ‐$6.8 $9.7 $29.4 $12.9 $17.4 $7.4 $12.9 $141.8 $215.8 FY 09 $21.1 ‐$23.4 ‐$6.2 $9.9 $28.2 $12.9 $16.4 $6.8 $15.8 $140.8 $229.0 FY 10 $20.5 ‐$27.7 ‐$6.4 $9.4 $28.8 $12.5 $18.1 $8.7 $14.6 $146.9 $218.6 FY 11 $20.1 ‐$28.7 ‐$6.5 $9.6 $31.0 $13.1 $15.9 $7.9 $11.0 $143.7 $214.0 FY 12 $20.9 ‐$28.8 $0.6 $7.1 $10.3 $33.6 $13.2 $17.8 $7.7 $22.1 $162.1 $219.6 FY 13 $21.5 ‐$27.3 $0.8 $6.9 $12.0 $32.2 $13.1 $17.4 $7.8 $25.1 $164.1 $220.5 FY 14 $22.6 ‐$28.2 $0.9 $7.3 $13.3 $33.3 $13.2 $18.3 $8.4 $18.8 $164.3 $226.5 FY 15 $23.0 $9.9 5 $26.2 $1.2 $8.0 $7.4 $34.6 $13.3 $18.4 $7.3 $22.3 $171.5 $236.7 Change from: Last year +2% ‐‐7% +26% +9%‐44% +4% +1% +1%‐13% +18% +4% +5% FY 07 +14% ‐+21%‐+36%‐22% +33% +7% +16%‐14% +75% +30% +24% 1 Office of Emergency Services (OES) was established as a separate department in FY 2012. FY 2012 data for the Fire Department was restated to remove OES figures.  2 Includes Offices of Council‐Appointed Officers, Administrative Services Department, People Strategy and Operations Department, and City Council. 3 Includes revenue and expenditure appropriations not related to a specific department or function that typically benefit the City as a whole (e.g., Cubberley lease payments to Palo Alto Unified School  District). May also include estimated provisions or placeholders for certain revenues and expenditures that can be one time or ongoing. 4 Funds transferred to the Capital Projects, Debt Service, and Technology Internal Service Funds annually. 5 In FY 2015, Development Services fully transitioned to its own department. Expenditures were formerly classified under the Fire, Planning and Community Environment, and Public Works departments. Ci t y w i d e OPERATING EXPENDITURES PER CAPITA General Fund (in millions) Community  Services Development  Services <NEW> Fire 1 Office of  Emergency  Services1 Library Planning and  Community  Environment Police Public  Works Strategic and  Support  Services2 Non‐ departmental3 Operating  transfers  out4 Total Enterprise funds (in millions) FY 07 $328 ‐$287 ‐$95 $155 $422 $203 $257 $138 $208 $2,092 $3,100 FY 08 $342 ‐$316 ‐$110 $155 $473 $208 $279 $119 $208 $2,210 $3,471 FY 09 $333 ‐$303 ‐$98 $156 $445 $203 $258 $108 $249 $2,152 $3,607 FY 10 $318 ‐$355 ‐$99 $145 $448 $195 $282 $136 $227 $2,206 $3,397 FY 11 $309 ‐$365 ‐$100 $147 $478 $202 $244 $122 $170 $2,138 $3,300 FY 12 $319 ‐$364 $8 $108 $158 $514 $202 $271 $118 $338 $2,399 $3,355 FY 13 $324 ‐$340 $9 $104 $181 $485 $198 $263 $117 $378 $2,400 $3,322 FY 14 $342 ‐$353 $12 $111 $201 $505 $200 $277 $127 $285 $2,412 $3,430 FY 15 $344 $148 $325 $15 $119 $111 $516 $198 $274 $109 $333 $2,492 $3,535 Change from: Last year +1%‐‐8% +25% +7%‐45% +2%‐1%‐1%‐14% +17% +3% +3% FY 07 +5%‐+14%‐+25%‐28% +22%‐2% +7%‐21% +60% +19% +14% 1 Adjusted for the expanded service area (Palo Alto and Stanford). Office of Emergency Services (OES) was established as a separate department in FY 2012. FY 2012 data for the Fire Department was  restated to remove OES figures.  2 Includes Offices of Council‐Appointed Officers, Administrative Services Department, People Strategy and Operations Department, and City Council. 3 Includes revenue and expenditure appropriations not related to a specific department or function that typically benefit the City as a whole (e.g., Cubberley lease payments to Palo Alto Unified School  District). May also include estimated provisions or placeholders for certain revenues and expenditures that can be one time or ongoing. 4 Funds transferred annually to the Capital Projects, Debt Service, and Technology Internal Service Funds. Mission:The government of the City of Palo Alto exists to promote and sustain a superior quality of life in Palo Alto. In partnership with our  community, our goal is to deliver cost‐effective services in a personal, responsive, and innovative manner. Ch a p t e r  3 Attachment A 26 AUTHORIZED STAFFING Authorized Staffing (FTE1) – General Fund Authorized Staffing (FTE1) –Other Funds Community Services Development Services <NEW> Fire Office of Emergency Services Library Planning and Community Environment Police Public Works Strategic  and  Support Services2 Subtotal Refuse Storm Drainage Wastewater Treatment Electric, Gas, Water,  Wastewater Collection, and  Fiber Optics Other 3 Subtotal Total FY 07 148 ‐128 ‐57 55 168 68 100 724 35 10 69 243 78 435 1,160 FY 08 147 ‐128 ‐56 54 169 71 108 733 35 10 69 244 78 436 1,168 FY 09 146 ‐128 ‐57 54 170 71 102 727 35 10 70 235 74 423 1,150 FY 10 146 ‐127 ‐55 50 167 65 95 705 38 10 70 252 77 446 1,151 FY 11 124 ‐125 ‐52 47 161 60 89 657 38 10 70 263 76 457 1,114 FY 12 123 ‐125 2 54 46 161 57 87 655 38 9 71 263 78 459 1,114 FY 13 126 ‐120 3 58 53 157 59 90 667 26 10 71 269 85 462 1,129 FY 14 134 ‐121 3 57 54 158 60 87 674 22 11 70 272 99 473 1,147 FY 15 138 42 4 108 3 59 29 158 56 91 684 16 10 71 272 100 469 1,153 Change from: Last year +4%‐‐11% 0% +5%‐47% 0%‐7% +4% +2%‐26%‐4% +1%0% +1%‐1% +1% FY 07 ‐7%‐‐15%‐+5%‐48%‐6%‐19%‐10%‐6%‐53% +7% +2%+12% +27% +8%‐1% 1 Includes authorized temporary and hourly positions and allocated departmental administration. 2 Includes Offices of Council‐Appointed Officers, Administrative Services Department, and People Strategy and Operations Department. 3 Includes the Technology and other Internal Service Funds, Airport Fund, Capital Projects Fund, and Special Revenue Funds. 4 In FY 2015, the City fully established the Development Services Department by transferring development activity related positions, salaries and benefits costs, and non‐salary expenditures from the Planning  and Community Environment, Public Works, and Fire departments to the Development Services Department. Authorized Staffing (FTE) ‐Citywide General Fund Employee Costs Regular Temporary TOTAL Per 1,000  residents Salaries and  wages1 (in millions) Overtime (in millions) Employee  benefits (in millions) TOTAL (in millions) Employee  benefits rate2 As a percent of total  General Fund  expenditures FY 07 1,080 80 1,160 18.9 $53.9 $4.0 $26.1 $84.0 48% 63% FY 08 1,077 91 1,168 18.8 $57.3 $4.2 $29.8 $91.3 52% 64% FY 09 1,076 74 1,150 18.1 $59.6 $3.7 $28.3 $91.6 48% 65% FY 10 1,055 95 1,150 17.9 $56.6 $4.5 $30.9 $92.1 55% 63% FY 11 1,019 95 1,114 17.2 $55.8 $4.1 $34.2 $94.2 61% 66% FY 12 1,017 98 1,115 17.0 $54.4 $5.4 $36.9 $96.7 68% 60% FY 13 1,015 114 1,129 17.0 $53.5 $3.7 $37.7 $94.9 71% 58% FY 14 1,020 126 1,147 17.4 $55.5 $4.7 $38.8 $98.9 70% 60% FY 15 1,028 125 1,153 17.2 $57.7 $4.6 $40.2 $102.5 70% 60% Change from: Last year +1%‐1% +1%‐1%+4%‐1%+4%+4%0%0% FY 07 ‐5% +56%‐1%‐9%+7%+14% +54% +22% +21%‐3% 1 Does not include overtime. 2 “Employee benefits rate” is General Fund employee benefits as a percent of General Fund salaries and wages, excluding overtime. Ch a p t e r  3 Ci t y w i d e Attachment A 27 CAPITAL SPENDING Governmental Funds (in millions) Enterprise Funds (in millions) Infrastructure  reserves Net general capital assets Capital outlay Depreciation Net capital assets Capital expenditures Depreciation FY 07 $15.8 $335.7 $17.5 $11.0 $383.8 $28.9 $12.7 FY 08 $17.9 $351.9 $21.6 $11.2 $416.6 $36.1 $12.7 FY 09 $7.0 $364.3 $21.5 $9.6 $426.1 $36.2 $13.6 FY 10 $8.6 $376.0 $22.0 $14.4 $450.3 $29.7 $15.3 FY 11 $3.2 $393.4 $35.5 $14.4 $465.7 $24.4 $15.9 FY 12 $12.1 $413.2 $29.2 $16.4 $490.0 $27.6 $16.7 FY 13 $17.5 $428.9 $29.5 $15.9 $522.3 $40.7 $17.6 FY 14 $3.4 $452.6 $37.6 $13.8 $545.5 $37.1 $17.5 FY 15 $9.5 $485.2 $45.4 $15.6 $558.5 $29.5 $18.4 Change from: Last year +180% +7% +21% +13% +2% +2% +5% FY 07 ‐40% +45% +160% +42% +46%‐21% +45% Ch a p t e r  3 Ci t y w i d e Attachment A 28 Co m m u n i t y  Se r v i c e s DEPARTMENTWIDE Operating Expenditures (in millions)1 Authorized Staffing (FTE) Administration  and Human  Services Arts and  Sciences Open Space,  Parks, and Golf Recreation  Services Total 2 CSD  expenditures  per capita Total revenues3 (in millions) Total Temporary Temporary as  a percent of  total Per 1,000  residents FY 06 ‐$4.0 ‐‐$19.5 $318 $6.9 146.2 47.9 33% 2.4 FY 07 ‐$3.9 ‐‐$20.1 $328 $7.1 148.2 48.9 33% 2.4 FY 08 ‐$4.1 ‐ ‐$21.2 $342 $7.4 146.7 49.4 34% 2.4 FY 09 $3.9 $4.6 $6.5 $6.3 $21.2 $333 $7.1 145.9 49.4 34% 2.3  FY 10 $4.2 $4.6 $5.8 $5.8 $20.5 $319 $7.3 146.4 52.1 36% 2.3  FY 11 $4.2 $4.5 $5.7 $5.7 $20.1 $310 $7.2 123.8 49.3 40% 1.9  FY 12 $2.9 $4.6 $8.2 $5.2 $20.9 $319 $6.8 123.5 48.7 39% 1.9  FY 13 $3.1 $4.5 $8.7 $5.1 $21.6 $325 $7.3 125.5 51.8 41% 1.9 FY 14 $3.5 $4.9 $9.0 $5.1 $22.5 $341 $6.9 133.5 59.2 44% 2.0 FY 15 $3.8 $5.0 $8.9 $5.3 $23.0 $344 $6.8 138.3 62.5 45% 2.1 Change from: Last year +8% +3%‐1% +4% +2% +1%‐2% +4% +6% +1% +2% FY 06 ‐+27%‐‐+18%+8%‐1%‐5% +30% +12%‐13% 1 Comparable numbers for some years were not available in the City’s Operating Budgets due to reorganizations. 2 The amount reflects total operating expenditures for the department, including the expenditures of all operating divisions. 3 Revenues include rental revenue generated at the Cubberley Community Center that is passed through to the Palo Alto Unified School District per the City’s agreement with the school district. DEPARTMENTWIDE CLASSES Total number of classes/camps offered1 Total enrollment 1 Summer  Camps and  Aquatics Kids  (excluding  camps) Adults Preschool Total Summer  Camps and  Aquatics Kids (excluding camps) Adults Preschool Total  (Target:  16,400) Percent of class  registrations  online (Target: 57%) Percent of class  registrants who  are nonresidents FY 06 153 235 294 160 842 5,906 4,604 5,485 3,628 19,623 41%15% FY 07 145 206 318 137 806 5,843 4,376 4,936 3,278 18,433 42%13% FY 08 151 253 327 143 874 5,883 4,824 4,974 3,337 19,018 43%15% FY 09 160 315 349 161 985 6,010 4,272 4,288 3,038 17,608 45%13% FY 10 162 308 325 153 948 5,974 4,373 4,190 2,829 17,366 55%14% FY 11 163 290 283 142 878 5,730 4,052 3,618 2,435 15,835 52%14% FY 12 155 279 203 148 785 5,259 4,136 2,688 2,667 14,750 51%12% FY 13 152 235 258 139 784 5,670 3,962 2,461 2,155 14,248 54%12% FY 14 170 301 202 143 816 6,210 4,028 2,274 2,135 14,647 55%14% FY 15 169 275 197 115 756 6,169 3,837 2,676 2,140 14,822 64%17% Change from: Last year ‐1%‐9%‐2%‐20%‐7%‐1%‐5% +18% 0% +1% +9%+3% FY 06 +10% +17%‐33%‐28%‐10% +4%‐17%‐51%‐41%‐24% +23%+2% 1 Types of classes offered include arts, sports, swim lessons, nature and outdoors, and recreation. Mission:To engage individuals and families in creating a strong and healthy community through parks, recreation, social services, arts, and sciences. Ch a p t e r  3 Attachment A 29 ARTS AND SCIENCES DIVISION –PERFORMING ARTS  Children's Theatre Community Theatre Total (Children's and Community Theatres) Number of  performances1 <NEW> Attendance at  performances Participants in performances and programs Enrollment in  music and  dance classes2 Enrollment in theatre  classes, camps, and  workshops3 Outside  funding <NEW> Number of  performances Attendance at  performances Number of  performances <NEW> Attendance at  performances <NEW> FY 06 135 22,788 1,670 1,416 597 ‐183 55,204 318 77,992 FY 07 139 23,117 1,845 1,195 472 ‐171 45,571 310 68,688 FY 08 147 19,811 1,107 982 407 ‐166 45,676 313 65,487 FY 09 134 14,786 534 964 334 ‐159 46,609 293 61,395 FY 10 153 24,983 555 980 1,436 ‐174 44,221 327 69,204 FY 11 165 27,345 1,334 847 1,475 ‐175 44,014 340 71,359 FY 12 160 27,907 1,087 941 1,987 $99,310 175 45,635 335 73,542 FY 13 173 25,675 1,220 1,131 1,824 $54,390 184 45,966 357 71,641 FY 14 150 31,337 1,360 2,037 2,148 $113,950 108 41,858 258 73,195 FY 15 222 33,926 1,401 3,323 3,092 $153,973 172 42,126 394 76,052 Change from: Last year +48% +8%+3% +63%+44% +35% +59% +1% +53% +4% FY 06 +64% +49%‐16% +135%+418%‐‐6%‐24% +24%‐2% 1 The increase in FY 2015 is due to expanded education programs, Friends of the Palo Alto Children’s Theatre partnering presentations, Teen Arts Council performances, and additional student matinees. 2 One program started offering classes on a drop‐in basis in FY 2013. The enrollment for this program was calculated by dividing the number of drop‐in participants by eight, which is a typical number of  classes offered per registration. The department attributes the increase to an expansion of classes taught at schools.   3 The department attributes the increase to a shift in emphasis from performance to education to promote a philosophy of life‐long skills.   ARTS AND SCIENCES DIVISION ‐MUSEUMS Art Center1 Public Art Junior Museum & Zoo Science Interpretation Exhibition  visitors2 Total  attendance  (users) Enrollment in art  classes, camps, and  workshops (adults and children)  Outside  funding for  visual arts  programs Attendance  at Project  LOOK! and  outreach Number  of new  public art  installations Enrollment in  Junior Museum  classes and  camps Estimated number of  children participating  in school outreach programs Number of Arastradero,  Baylands, & Foothill  outreach classes for  school‐age children Enrollment in  open space  interpretive  classes FY 06 19,448 73,305 4,137 $284,838 6,191 4 1,832 2,414 48 1,280 FY 07 16,191 70,387 3,956 $345,822 6,855 1 1,805 2,532 63 1,226 FY 08 17,198 69,255 3,913 $398,052 6,900 2 2,089 2,722 85 2,689 FY 09 15,830 58,194 3,712 $264,580 8,353 2 2,054 3,300 178 2,615 FY 10 17,244 60,375 3,304 $219,000 8,618 0 2,433 6,971 208 3,978 FY 11 13,471 51,373 2,334 $164,624 6,773 2 1,889 6,614 156 3,857 FY 12 29,717 62,055 905 $193,000 14,238 4 2,575 9,701 131 3,970 FY 13 9,865 72,148 2,222 $206,998 10,472 2 2,363 10,689 136 3,575 FY 14 9,463 82,799 2,802 $156,079 8,873 6 1,935 10,696 112 3,044 FY 15 21,798 91,099 3,220 $200,912 7,386 6 2,670 13,280 122 3,178 Change from: Last year +130% +10% +15% +29%‐17% 0% +38%+24%+9%+4% FY 06 +12% +24%‐22%‐29% +19% +50% +46%+450%+154%+148% 1 The Art Center closed to the public for renovation from May 2011 through October 2012, which accounts for some of the decreases in FY 2011 and FY 2012. Some of the increases in FY 2012 are due to  “On the Road” installations and outreach programs in the community.   2 Exhibition visitors include estimated On the Road art installation visitors. Ch a p t e r  3 Co m m u n i t y  Se r v i c e s Attachment A 30 OPEN SPACE, PARKS, AND GOLF DIVISION – OPEN SPACE AND GOLF Open Space Golf Visitors at  Foothills Park Volunteer hours for  restorative/resource  management projects1 Number of native  plants in restoration  projects2 Number of  rounds of golf Golf Course  revenue (in millions) Golf Course operating  expenditures (in millions) Golf course debt  service (in millions) Net revenue/  (cost) FY 06 127,457 10,738 15,516 76,000 $3.0 $2.3 $0.6 $148,154 FY 07 140,437 11,380 14,023 76,241 $3.1 $2.5 $0.6 $43,015 FY 08 135,001 13,572 13,893 74,630 $3.2 $2.2 $0.7 ($23,487) FY 09 135,110 16,169 11,934 72,170 $3.0 $2.4 $0.7 ($326,010) FY 10 149,298 16,655 11,303 69,791 $3.0 $2.3 $0.6 $76,146  FY 11 181,911 16,235 27,655 67,381 $2.8 $2.0 $0.7 $166,017  FY 12 171,413 16,142 23,737 65,653 $2.7 $1.9 $0.6 $271,503  FY 13 205,507 15,551 46,933 60,153 $2.5 $2.1 $0.4 ($18,179) FY 14 198,814 17,196 63,206 46,527 $1.8 $1.9 $0.4 ($579,000) FY 15 169,653 13,445 118,390 42,048 $1.6 $1.8 $0.4 ($638,000) Change from: Last year ‐15%‐22% +87%‐10%‐11%‐7%0%‐ FY 06 +33% +25% +663%‐45%‐48%‐23%‐29%‐ 1 Includes activities through collaborative partnerships with nonprofit groups such as Save the Bay, and community service hours by court‐referred volunteers.  2 The increase is due to the completion of raised planting beds for the propagation of grasses to be used in the Oro Loma Sanitary District’s horizontal levee construction project.  OPEN SPACE, PARKS, AND GOLF DIVISION – PARKS AND LANDSCAPE MAINTENANCE Maintenance Expenditures Parks and landscape  maintenance (in millions)   Athletic fields in  City parks (in millions)    Athletic fields on  school district sites1 (in millions)    Total (in millions) Per acre  Total hours of athletic  field usage  Number of  permits issued for special events Volunteer hours  for neighborhood  parks Participants in  community  gardening program  FY 06 $2.5 $0.6 $0.6 $3.7 $14,302 65,791 16 150 223 FY 07 $2.7 $0.6 $0.7 $3.9 $15,042 70,769 22 150 231 FY 08 $2.9 $0.6 $0.7 $4.2 $15,931 63,212 22 180 233 FY 09 $3.0 $0.7 $0.7 $4.4 $16,940 45,762 35 212 238 FY 10 $3.0 $0.5 $0.6 $4.1 $15,413 41,705 12 260 238 FY 11 $3.2 $0.4 $0.5 $4.1 $15,286 42,687 25 927 260 FY 12 $3.5 $0.4 $0.6 $4.5 $16,425 44,226 27 1,120 292 FY 13 $3.8 $0.4 $0.6 $4.8 $17,563 N/A 2 47 637 292 FY 14 $4.0 $0.4 $0.6 $5.0 $18,244 N/A 2 36 638 292 FY 15 $3.9 $0.5 $0.7 $5.1 $18,593 47,504 37 551 310 Change from: Last year 0%+13%+7%+2% +2%‐+3%‐14%+6% FY 06 +59%‐24%+1% +35% +30%‐28% +131%+267%+39% 1 Palo Alto Unified School District partially reimburses the City for maintenance costs for the school district sites. 2 According to the department, this measure was not accurately tracked during FY 2013 or FY 2014. Ch a p t e r  3 Co m m u n i t y  Se r v i c e s Attachment A 31 RECREATION SERVICES DIVISION Enrollment in Recreational Classes Cubberley Community Center Dance Recreation Middle school sports Therapeutics Private  tennis  lessons Total Aquatics Lap and  Recreational Pool Visits <NEW> Hours rented Hourly rental  revenue (in millions) Number of  lease holders Lease revenue  (in millions) FY 06 1,326 5,681 1,247 175 234 8,862 ‐38,407 $0.9 38 $1.3 FY 07 1,195 5,304 1,391 228 274 8,617 ‐36,489 $0.8 39 $1.4 FY 08 1,129 4,712 1,396 203 346 7,968 ‐32,288 $0.9 39 $1.5  FY 09 1,075 3,750 1,393 153 444 7,081 ‐34,874 $1.0 37 $1.4 FY 10 972 3,726 1,309 180 460 6,906 ‐35,268 $0.9 41 $1.6 FY 11 889 3,613 1,310 178 362 6,580 ‐30,878 $0.9 48 $1.6 FY 12 886 3,532 1,455 135 240 6,444 ‐29,282 $0.8 33 $1.6 FY 13 1,000 2,776 1,479 167 339 5,928 ‐29,207 $0.9 33 $1.6 FY 14 1,130 2,449 1,443 112 457 5,787 ‐28,086 $0.8 32 $1.7 FY 15 1,120 2,977 1,427 159 661 6,417 34,431 29,209 $0.8 36 $1.7 Change from: Last year ‐1%+22%‐1% +42% +45% +11%‐+4% 0% +13%0% FY 06 ‐16%‐48% +14%‐9% +182%‐28%‐‐24%‐5%‐5% +33% Ch a p t e r  3 Co m m u n i t y  Se r v i c e s Attachment A 32 De v e l o p m e n t  Se r v i c e s BUILDING Average days Number of permits routed to all  departments with on‐ time reviews Number of permits approved  over the counter Number of building  permits  issued First response  to plan checks Issuance of  building  permits (Target: 30) Permit issuance to final inspection  for projects up to  $500,000 (Target: 135) Number of  inspections  completed Valuation of  construction for  issued permits (in millions) Building  permit  revenue (in millions) FY 06 ‐‐3,081 28 98 ‐11,585 $277.0 $4.4 FY 07 ‐‐3,136 27 102 ‐14,822 $298.7 $4.6 FY 08 292 ‐3,046 23 80 ‐22,820 $358.9 $4.2 FY 09 230 394 2,543 31 63 123 17,945 $172.1 $3.6 FY 10 218 326 2,847 30 44 162 15,194 $191.2 $4.0 FY 11 371 532 3,559 35 47 109 16,858 $251.1 $5.6 FY 12 345 644 3,320 22 38 127 18,778 $467.9 $6.8 FY 13 470 602 3,682 24 391 121 24,548 $574.7 $10.1 FY 14 550 557 3,624 23 27 139 31,002 $336.1 $9.3 FY 15 567 628 3,844 23 25 156 31,000 $479.8 $9.4 Change from: Last year +3%+13% +6%0%‐7%+12%0% +43%0% FY 06 ‐‐+25%‐18%‐74%‐168% +73% +111% 1 Prior year correction by the Department. Mission:To provide citizens, business owners, developers, and applicants reliable and predictable expectations in the review, permitting, and  inspection of development projects that meet the municipal and building code requirements to safeguard the health, safety, property, and public  welfare while working collaboratively with other departments in the City. Ch a p t e r  3 DEPARTMENTWIDE1 Operating Expenditures (in millions) Administration Building Fire GIS Green Building Planning Public Works Total Expenditures per capita Revenue (in millions) Authorized  staffing (FTE) FY 15 $2.0 $4.3 $1.7 $0.1 $0.2 $0.7 $1.0 $9.9 $148 $12.1 42 Change from: Last year ‐‐‐‐‐‐‐‐‐‐‐ FY 06 ‐‐‐‐‐‐‐‐‐‐‐ 1 In FY 2014, Development Services transitioned to its own department. The FY 2015 Operating Budget document fully established the Development Services Department by transferring development activity related positions, salaries and benefits costs, and non‐salary expenditures from the Planning and Community Environment, Public Works, and Fire departments to the  Development Services Department. Attachment A 33 De v e l o p m e n t  Se r v i c e s GREEN BUILDING1 Green Building with mandatory regulations Construction debris for completed projects2 (in tons) Green Building permit  applications processed Valuation Square feet Salvaged Recycled Disposed to landfill Energy savings  per year3 (in kBtu) FY 09 341 $80,412,694 666,500 67 3,503 575 ‐ FY 10 556 $81,238,249 774,482 69 9,050 1,393 ‐ FY 11 961 $187,725,366 1,249,748 13,004 34,590 4,020 ‐ FY 12 887 $543,237,137 1,342,448 23,617 45,478 5,015 ‐ FY 13 1,037 $569,451,035 2,441,575 9,408 44,221 3,955 1,922,532 FY 14 04 $349,128,085 3,432,025 7,186 38,381 5,421 3,141,510 FY 15 04 $537,328,177 3,982,320 656 93,392 9,067 3,958,713 Change from: Last year ‐4 +54%+16%‐91% +143%+67%+26% FY 09 ‐4 +568%+497%+879% +2,566% +1,477%‐ 1 The Green Building Program was established in FY 2009, and prior year data is not available.  2 For projects requiring either a demolition permit or a building permit with a valuation over $25,000. The Department reports that due to staffing turnover and reorganization, the data may not be  complete. Variances may also be due, in part, to a few large projects and a lower minimum reporting requirement for green building projects. 3 Reported in Kilo British Thermal Units. According to the Department, data prior to FY 2013 is either unavailable or inaccurate due to insufficient tracking resulting from staffing changes. 4 Green Building permit applications were no longer processed separately; they became part of the regular plan check process in FY 2014. Ch a p t e r  3 Attachment A 34 In f o r m a t i o n  Te c h n o l o g y DEPARTMENTWIDE1 Operating Expenditures (in millions) Information  Technology  Project Services IT Operations Enterprise  Systems Office of the  Chief  Information  Officer Capital Improvement  Program2 Total Revenue       (in millions) Authorized  staffing (FTE) Number of  workstations IT expenditures      per workstation FY 12 $2.5 $3.0 $1.8 $1.5 $0.8 $9.6 $13.4 34.2 1,100 $4,658 FY 13 $1.7 $3.8 $1.9 $2.5 $3.4 3 $13.3 $17.5 36.7 1,118 $4,548 FY 14 $1.1 $4.6 $2.6 $4.0 $2.0 $14.3 $13.1 34.2 1,286 $4,491 FY 15 $0.6 $6.7 $2.3 $2.8 $1.3 $13.8 $14.5 33.7 1,454 $4,9414 Change from: Last year ‐43% +46%‐9%‐31%‐34%‐4% +10%‐1% +13% +10% FY 12 ‐76% +124% +31% +83% +68% +43% +8%‐1% +32% +6% 1 The Information Technology (IT) Department was established in 2012. Data prior to FY 2012 is generally not available or applicable for comparison.  2 Consistent with the City’s operating budget, Capital Improvement Program (CIP) expenditures are included as operating expenditures for this department.  3 The increase in FY 2013 is due to an increased number of projects, including the upgrade of the City’s telephone system and the replacement of desktop computers with laptops. 4 Increase in workstation costs due to Office 365 licensing, additional City technology contracts and the increased use of temporary staffing. Percent of service desk requests resolved:1 City Staff Survey Number of service  desk requests At time of call (Target: 34%) Within 4 hours (Target: 26%) Within 8hours (Target 9%) Within 5 days (Target: 26%) Over 5 days (Target: 5%) Percent of security  incidents remediated  within 1 day Percent rating IT services as “excellent”  (Target: 90%) FY 12 9,460 33% 26% 5% 24% 12%‐95% FY 13 9,734 31% 22% 5% 25% 16% 50% 87% FY 14 9,348 31% 21% 5% 26% 17% 28% 2 94% FY 15 9,855 31%23%5%29%12%52%89% Change from: Last year +5%0%+2%0%+3%‐5%+24%‐5% FY 12 +4%‐2%‐3%0%+5%0%‐‐6% 1 Percentages reported in each category do not include service desk requests resolved in any other category. 2 The Department implemented more security incident detection solutions, which resulted in an increase in recorded security incidents and complexity of issues. Mission:To provide innovative technology solutions that support City departments in delivering quality services to the community. Ch a p t e r  3 Attachment A 35 DEPARTMENTWIDE Operating Expenditures (in millions) Authorized Staffing (FTE) Administration Collections  and Technical  Services Public  Services Total Library  expenditures  per capita Regular Temporary/  hourly TOTAL Number of  residents per  library FTE Volunteer  hours Total hours  open  annually1 FTE per  1,000 hours  open FY 06 $0.6 $1.5 $3.6 $5.7 $92 44.0 12.8 56.8 1,079 5,838 10,488 5.4 FY 07 $0.5 $1.5 $3.9 $5.9 $95 44.3 12.6 56.9 1,079 5,865 9,386 6.1 FY 08 $0.5 $1.8 $4.5 $6.8 $110 43.8 12.7 56.5 1,101 5,988 11,281 5.0 FY 09 $0.4 $1.8 $4.0 $6.2 $98 43.8 13.4 57.2 1,110 5,953 11,822 4.8 FY 10 $0.6 $1.8 $4.0 $6.4 $99 42.2 12.8 55.0 1,169 5,564 9,904 5.6 FY 11 $1.0 $1.6 $3.9 $6.5 $100 41.3 10.4 51.7 1,255 5,209 8,855 5.8 FY 12 $1.2 $1.7 $4.2 $7.1 $108 41.3 14.8 56.1 1,166 6,552 11,142 5.0 FY 13 $1.0 $1.8 $4.1 $6.9 $104 41.8 16.7 58.5 1,135 5,514 11,327 5.2 FY 14 $0.9 $2.3 $4.1 $7.3 $111 41.8 14.7 56.5 1,168 3,607 11,277 5.0 FY 15 $1.0 $2.5 $4.5 $8.0 $119 44.7 14.8 59.5 1,126 3,447 11,334 5.2 Change from: Last year +10% +8% +9% +9% +7% +7% 0% +5%‐4%‐4% +1% +5% FY 06 +59% +68% +26% +41% +29% +2% +16% +5% +4%‐41% +8%‐3% 1 The department attributes the fluctuation to facility closures for renovation and reopening.Li b r a r y  De p a r t m e n t COLLECTIONS AND TECHNICAL SERVICES Number of items in collection Checkouts Book  volumes Media  items eBook &  eMusic  items Other  formats1 TOTAL Per  capita Total  number of  titles in  collection Total (Target:  1,480,000)  Per  capita  Average  per item  (Target: 4.23) Percent of first  time checkouts  completed on self‐ check machines Number of  items on hold Average number of  business days for new  materials to be  available for customer  use (Target: 2.0) FY 06 232,602 27,866 ‐260,468 4.25 163,045 1,280,547 20.9 4.92 ‐181,765 ‐ FY 07 240,098 30,657 ‐270,755 4.41 167,008 1,414,509 23.0 5.22 88% 208,719 ‐ FY 08 241,323 33,087 4,993 279,403 4.49 174,683 1,542,116 24.8 5.52 89% 200,470 ‐ FY 09 246,554 35,506 11,675 293,735 4.63 185,718 1,633,955 25.7 5.56 90% 218,073 ‐ FY 10 247,273 37,567 13,827 298,667 4.64 189,828 1,624,785 25.2 5.44 90% 216,719 9.0 FY 11 254,392 40,461 19,248 314,101 4.84 193,070 1,476,648 22.8 4.70 91% 198,574 8.0 FY 12 251,476 41,017 13,667 306,1602 4.68 187,359 1,559,932 23.8 5.10 2 88% 211,270 9.53 FY 13 215,416 41,440 20,893 277,749 4.19 157,594 1,512,975 22.8 5.45 87% 204,581 4.0 FY 14 235,372 47,080 58,968 4 19,683 361,103 2 5.472 173,905 1,364,872 20.4 3.78 2 88% 197,444 2.0 FY 15 247,088 51,178 73,793 57,401 429,460 6.41 180,074 1,499,406 22.4 3.49 92% 186,834 2.0 Change from: Last year +5% +9% +25% +192% +19% +17% +4% +10% +10%‐8%‐‐5%0% FY 06 +6% +84%‐‐+65% +51% +10% +17% +7%‐29% +4%+3%‐ 1 Other formats include digital items such as emagazines, streaming movies, and Discover & Go museum passes.  2 Prior year correction. 3 Estimate. According to the Department, this metric was not consistently monitored in FY 2012 due to staff transitions, including a new division head. 4 The department attributes the increase to the addition of a new ebook resource. Mission:To connect and strengthen our diverse community through knowledge, resources, and opportunities. We inspire and nurture innovation,  discovery, and delight. Ch a p t e r  3 Attachment A 36 PUBLIC SERVICES Programs1 Total number  of  cardholders Percent of  Palo Alto  residents  who are  cardholders Library  visits Meeting room  reservations (Target: 3,400) Total number  of reference  questions Total number  of online  database  sessions Number of  internet  sessions Number of  laptop  checkouts Total offered Total  attendance Number of  participants  in teen   library  programs (Target:  2,500) FY 06 55,909 62% 885,565 ‐69,880 42,094 155,558 9,693 564 30,739 1,549 FY 07 53,099 58% 862,081 ‐57,255 52,020 149,280 11,725 580 30,221 1,900 FY 08 53,740 63% 881,520 ‐48,339 49,148 137,261 12,017 669 37,955 1,573 FY 09 54,878 63% 875,847 ‐46,419 111,228 2 145,143 12,290 558 36,582 1,588 FY 10 51,969 61% 851,037 ‐55,322 150,895 2 134,053 9,720 485 35,455 1,906 FY 11 53,246 64% 776,994 ‐53,538 51,111 111,076 5,279 425 24,092 1,795 FY 12 60,283 69% 843,981 846 43,269 42,179 112,910 4,829 598 30,916 2,211 FY 13 51,007 61% 827,171 1,223 43,476 31,041 70,195 3,662 745 40,405 2,144 FY 14 46,950 58% 678,181 1,027 34,060 35,872 114,520 1,672 801 37,971 1,188 FY 15 51,792 64% 810,962 4,339 73,580 31,953 104,878 1,147 1,048 44,892 2,746 Change from: Last year +10% +6% +20% +322% 3 +116%4 ‐11%‐8%‐31% +31% +18% +131% FY 06 ‐7% +2%‐8%‐+5%‐24%‐33%‐88% +86% +46% +77% 1 Programs include planned events for the public that promote reading, support school readiness and education, and encourage life‐long learning. Many programs are sponsored by the Friends of the Palo Alto Library. New buildings, program spaces and additional service hours allow more programming opportunities for all ages; teens are a special target audience emphasized based on City  Council annual goals and the library strategic plan. 2 The department attributes the increase to enhanced outreach activities targeting teachers and students to promote databases to schools. 3 The department attributes the increase to meeting rooms now being available. 4 The department attributes the increase to new buildings and additional service hours inviting new customers needing assistance with collections and technology. Ch a p t e r  3 Li b r a r y  De p a r t m e n t Attachment A 37 Pl a n n i n g  & Co m m u n i t y  En v i r o n m e n t DEPARTMENTWIDE Operating Expenditures (in millions) Administration Planning &  Transportation Building 1 Economic Development2 Total Expenditures per capita Revenue (in millions) Authorized  staffing (FTE) FY 06 $0.5 $5.6 $3.1 $0.2 $9.4 $153 $5.6 53 FY 07 $0.7 $5.2 $3.4 $0.2 $9.5 $155 $6.6 55 FY 08 $0.6 $5.2 $3.6 $0.2 $9.7 $155 $5.8 54 FY 09 $0.2 $5.7 $3.5 $0.4 $9.9 $156 $5.1 54 FY 10 $0.6 $5.5 $2.9 $0.4 $9.4 $146 $5.5 50 FY 11 $0.9 $5.1 $3.3 $0.3 $9.6 $147 $7.5 47 FY 12 $0.9 $5.2 $4.2 ‐$10.3 $158 $9.3 47 FY 13 $1.1 $5.8 $5.2 ‐$12.0 $182 $12.6 53 FY 14 $1.1 $6.4 $5.8 ‐$13.3 $201 $11.4 54 FY 15 $1.2 $6.2 $0.1 ‐$7.4 $111 $1.8 29 Change from: Last year +9%‐3%‐‐‐44%‐45%‐84%‐47% FY 06 +151%+10%‐‐‐21%‐28%‐68%‐46% 1 Prior to FY 2015, Building was part of the Development Services division of the Planning and Community Environment Department. Effective FY 2015, Development Services became its own  department. During the transition, some Building expenses were erroneously associated with Planning and Community Environment. FY 2015 information is shown here for consistency with  the City’s financial records. 2 In FY 2012, Economic Development was moved to the City Manager’s Office. CURRENT PLANNING & CODE ENFORCEMENT Code Enforcement Planning applications received Planning applications  completed Architectural Review  Board applications  completed Average weeks to complete  staff‐level  applications Number of  new cases Number of reinspections Percent of cases  resolved within  120 days FY 06 414 408 117 13.6 421 667 94% FY 07 386 299 100 13.4 369 639 76% FY 08 397 257 107 12.7 684 981 93% FY 09 312 273 130 10.7 545 1,065 94% FY 10 329 226 130 12.5 680 1,156 88% FY 11 359 238 121 10.4 652 1,228 94% FY 12 325 204 101 12.5 618 1,120 91% FY 13 490 307 148 12.5 684 1,240 90% FY 14 487 310 170 14.9 609 1,398 93% FY 15 425 335 174 15.4 586 1,242 91% Change from: Last year ‐13%+8%+2%+3%‐4%‐11%‐2% FY 06 +3%‐18%+49%+13%+39%+86%‐3% Mission:To provide the Council and community with creative guidance on, and effective implementation of, land use development, planning,  transportation, housing, and environmental policies, and plans and programs that maintain and enhance the City as a safe, vital, and attractive  community. Ch a p t e r  3 Attachment A ADVANCE PLANNING Number of residential units Median price of a single family  home in Palo Alto (in millions) Estimated new jobs (job  losses) resulting from  projects approved during the year1 Number of new housing  units approved Cumulative number of below market rate (BMR) units FY 06 27,767 $1.54 (345) 371 322 FY 07 27,763 $1.52 0 517 381 FY 08 27,938 $1.55 193 103 395 FY 09 28,291 $1.40 (58) 36 395 FY 10 28,445 $1.37 662 86 434 FY 11 28,257 $1.52 2,144 47 434 FY 12 28,380 $1.74 760 93 434 FY 13 28,457 $1.99 142 2 434 FY 14 28,546 $2.04 (580) 311 449 FY 15 28,674 $2.47 399 12 449 Change from: Last year 0%+21%‐‐96%0% FY 06 +3%+60%‐‐97%+39% 1 Job losses are assumed when commercial uses are replaced with residential units. TRANSPORTATION City shuttle boardings1 City’s cost per shuttle  boarding Caltrain average  weekday boardings Average number of employees  participating in the City commute  program2 FY 06 175,471 $1.91 3,876 104 FY 07 168,710 $2.00 4,132 105 FY 08 178,505 $1.97 4,589 114 FY 09 136,511 $2.61 4,407 124 FY 10 137,825 $2.65 4,359 113 FY 11 118,455 $1.82 4,923 92 FY 12 140,321 $1.46 5,730 93 FY 13 133,703 $1.50 6,763 99 FY 14 134,362 $1.49 7,564 114 FY 15 152,571 3 $1.95 8,750 113 Change from: Last year +14%+31%+16%0% FY 06 ‐13%+2%+126%+9% 1 Starting FY 15, a new East Palo Alto route is included.  2 Includes participants in the Caltrain Go Pass pilot program, which began in April 2014. 3 Reflects a disruption in Caltrain shuttle service (on the Embarcadero route) for two months in 2015. 38Ch a p t e r  3 Pl a n n i n g  & Co m m u n i t y  En v i r o n m e n t Attachment A DEPARTMENTWIDE Operating Expenditures (millions) Authorized Staffing Administration Emergency  response Environmental  and fire safety Training and  personnel  management Records and  information Total Resident  population  of area  served1 Expenditures  per resident  served Revenue (in millions) Resident  population  served per  fire station1,4 Total  (FTE) Per 1,000  residents  served Overtime  as a  percent of  regular  salaries  FY 06 $1.3 $14.1 $2.0 $1.9 $0.9 $20.2 75,069 $269 $9.4 12,569 126.5 1.68 18% FY 07 $1.6 $15.0 $2.0 $2.0 $0.9 $21.6 75,194 $287 $9.9 12,532 127.5 1.70 21% FY 08 $1.6 $16.7 $2.4 $2.3 $1.0 $24.0 75,982 $316 $9.7 12,664 128.1 1.69 18% FY 09 $0.4 $17.4 $2.3 $2.3 $1.0 $23.4 77,305 $303 $11.0 12,884 127.7 1.65 16% FY 10 $2.3 $19.3 $2.5 $2.6 $1.0 $27.7 78,161 $355 $10.6 13,027 126.5 1.62 26% FY 11 $1.6 $20.8 $2.6 $2.7 $1.0 $28.7 78,662 $365 $12.0 13,110 125.1 1.59 21% FY 122 $1.7 $20.9 $2.4 $2.8 $1.0 $28.8 79,252 $364 $13.7 13,209 125.2 1.58 37% FY 13 $1.9 $22.5 $1.7 $0.8 $0.3 $27.3 80,127 $340 $12.4 3 13,355 120.3 1.50 19% FY 14 $1.9 $23.3 $1.7 $0.9 $0.3 $28.2 79,838 $353 $12.0 3 13,306 120.8 1.51 27% FY 15 $2.0 $22.9 $0.1 $0.9 $0.3 $26.2 80,474 $325 $12.3 13,412 108.0 1.34 24% Change from: Last year +2%‐2%‐93%‐5% +2%‐7% +1%‐8% +3% +1%‐11%‐11%‐3% FY 06 +53% +62%‐94%‐55%‐65% +30% +7% +21% +31% +7%‐15%‐20% +6% 1 Based on number of residents in the Fire Department’s expanded service area (Palo Alto and Stanford). The decrease in FY 2014 is due to a change in data source from the California Department of  Finance to the City Manager’s Official City Data Set based on the U.S. Census Bureau’s American Community Survey. 2 Office of Emergency Services (OES) was established as a separate department in FY 2012. FY 2012 data was restated to remove OES figures. 3 The department attributes the decline to lower contract revenues from Stanford University. 4 Calculation is based on six fire stations, and does not include Station 8 (Foothills Park, operated during the summer months when fire danger is high). 39 Pu b l i c  Sa f e t y  ‐ Fi r e Mission:To serve and safeguard the community from the impacts of fires, medical emergencies, environmental emergencies, and natural disasters  by providing the highest level of service through action, innovation, and investing in education, training, and prevention. We will actively participate  in our community, serving as role models who preserve and enhance the quality of life. We will effectively and efficiently utilize all of the necessary  resources at our command to provide a product deemed outstanding by our citizens. Pride, the pursuit of excellence, and commitment to public  service is of paramount importance. Ch a p t e r  3 Attachment A SUPPRESSION, FIRE SAFETY, AND EMERGENCY MEDICAL SERVICES Suppression and Fire Safety Emergency Medical Services Fire  incidents Percent of fires  confined to the room  or area of origin1 (Target: 90%) Number of  residential  structure  fires Number  of fire  deaths Fire  response  vehicles2 Fire safety presentations, including demonstrations and fire station tours Average training  hours per  firefighter Medical/rescue  incidents Number of  ambulance  transports Ambulance  revenue (in millions) FY 06 211 63%62 1 25 ‐288 3,780 2,296 $1.7 FY 07 221 70%68 2 25 ‐235 3,951 2,527 $1.9 FY 08 192 79%43 0 25 ‐246 4,552 3,236 $2.0 FY 09 239 63%20 0 25 ‐223 4,509 3,331 $2.1 FY 10 182 56%11 0 29 ‐213 4,432 2,991 $2.2 FY 11 165 38%14 0 30 115 287 4,521 3,005 $2.3 FY 12 186 50%16 0 29 126 313 4,584 3,220 $2.8 FY 13 150 44%18 0 27 95 315 4,712 3,523 $3.0 FY 14 150 63%15 2 27 88 315 4,757 3,648 $2.9 FY 15 135 92%15 0 27 218 346 5,270 3,862 $3.0 Change from: Last year ‐10%+29%0%‐100% 0%+148%+10%+11% +6% +4% FY 06 ‐36%+29%‐76%‐100% +8%‐+20%+39% +68% +80% 1 Includes fires in other jurisdictions responded to as part of the City’s aid agreements. The department indicated that these figures will be restated in the future to exclude fires in other communities to  more accurately measure progress toward its target of 90%, which is for Palo Alto fires only. The department defines containment of structure fires as those incidents in which fire is suppressed and  does not spread beyond the involved area upon firefighter arrival.  2 Includes ambulances, fire apparatus, hazardous materials, and mutual‐aid vehicles.  40 CALLS FOR SERVICE Calls for service Average response time2 (minutes) Percent of calls responded promptly2 Fire Medical/  rescue False  alarms Service  calls Hazardous  condition Other 1 TOTAL Average  number  of calls  per day  Fire calls (Target: 6:00) Medical/rescue calls (Target: 6:00) Fire emergencies  within 8 minutes (Target: 90%)  Emergency  medical requests within 8 minutes (Target: 90%) Paramedic  calls within  12 minutes3 (Target: 90%) FY 06 211 3,780 1,184 399 203 1,120 6,897 19 5:28 5:13 91%94%99% FY 07 221 3,951 1,276 362 199 1,227 7,236 20 5:48 5:17 87%92%97% FY 08 192 4,552 1,119 401 169 1,290 7,723 21 6:48 5:24 79%93%99% FY 09 239 4,509 1,065 328 165 1,243 7,549 21 6:39 5:37 78%91%99% FY 10 182 4,432 1,013 444 151 1,246 7,468 20 7:05 5:29 90%93%99% FY 11 165 4,521 1,005 406 182 1,276 7,555 21 6:23 5:35 83%91%99% FY 12 186 4,584 1,095 466 216 1,249 7,796 21 7:00 5:36 81%91%99% FY 13 150 4,712 1,091 440 194 1,317 7,904 22 6:31 5:35 82%91%99% FY 14 150 4,757 1,044 396 207 1,275 7,829 21 6:01 5:42 86%90%98% FY 15 135 5,270 1,078 448 145 1,472 8,548 23 4:57 5:11 92%82%89% Change from: Last year ‐10% +11% +3% +13%‐30% +15% +9% +10%‐18%‐9%+6%‐8%‐9% FY 06 ‐36% +39%‐9% +12%‐29% +31% +24% +21%‐9%‐1%+1%‐12%‐10% 1 “Other” calls include alarm testing, station tours, training incidents, cancelled calls, and good intent calls (i.e., a person genuinely believes there is an actual emergency when it is not an emergency). 2 Response time is from receipt of 911 call to arrival on scene; does not include cancelled enroute, not‐completed incidents, or mutual‐aid calls. 3 Includes non‐City ambulance responses.  Ch a p t e r  3 Pu b l i c  Sa f e t y  ‐ Fi r e Attachment A 41 HAZARDOUS MATERIALS AND INSPECTIONS Hazardous Materials Incidents1 Permitted facilities Permitted facilities inspected2 Percent of permitted hazardous  materials facilities inspected 2 Number of fire  inspections (Target: 850) Number of plan reviews3 FY 06 45 497 243 49% 899 983 FY 07 39 501 268 53% 1,021 928 FY 08 45 503 406 81% 1,277 906 FY 09 40 509 286 56% 1,028 841 FY 10 26 510 126 25% 1,526 851 FY 11 66 484 237 49% 1,807 1,169 FY 12 82 485 40 8% 1,654 1,336 FY 13 79 455 133 29% 2,069 1,396 FY 14 73 393 132 34% 1,741 1,319 FY 15 81 425 377 89% 1,964 1,227 Change from: Last year +11%+8%+186%+55%+13%‐7% FY 06 +80%‐14%+55%+40%+118%+25% 1 Involve flammable gas or liquid, chemical release or spill, or chemical release reaction or toxic condition. Also known as CBRNE (Chemical, Biological, Radiological, Nuclear, and Explosives). 2 The method for calculating the number of inspections was changed in FY 2010 to avoid over counting. Prior‐year numbers are higher than they would be under the revised method. The department  attributes the FY 2012 decrease to temporary staffing shortages.  3 Does not include over‐the‐counter building permit reviews. Ch a p t e r  3 Pu b l i c  Sa f e t y  ‐ Fi r e Attachment A 42 Pu b l i c  Sa f e t y  – Of f i c e  of  Em e r g e n c y  Se r v i c e s DEPARTMENTWIDE1 Operating expenditures (in millions) Revenues (in millions) Authorized staffing (FTE) Presentations, training  sessions, and exercises (Target: 50) Emergency Operations  Center activations/  deployments2 Grant contributions  received FY 12 $0.60 $0.16 4.0 38 27 $139,300 FY 13 $0.75 $0.14 3.5 51 48 $24,530 FY 14 $0.93 $0.09 3.5 184 26 $13,986 FY 15 $1.17 $0.09 3.5 193 47 $24,500 Change from: Last year +26%0%0%+5%+81%+75% FY 12 +97%‐41%‐13%+408%+74%‐82% 1 The Office of Emergency Services (OES) was expanded and reorganized in 2011. Data prior to FY 2012 is generally not available or applicable.In FY 2012 and FY 2013, the City classified OES  under the Fire Department for budget purposes.  2Includes unplanned (emergency) and planned events involving the Emergency Operations Center, Mobile Emergency Operations Center, and Incident Command Post activations and  deployments (e.g., December 2012 flood, Stanford football games, VIP/dignitary visits). Mission:To prevent, prepare for and mitigate, respond to, and recover from all hazards. Ch a p t e r  3 Attachment A 43 Pu b l i c  Sa f e t y  ‐ Po l i c e DEPARTMENTWIDE Operating Expenditures (in millions) Administration Field Services Technical  Services Investigations  and Crime  Prevention Traffic  Services Parking  Services Police  Personnel  Services Animal  Services Total Expenditures  per resident Revenue (in millions) FY 06 $0.8 $10.5 $5.2 $3.0 $1.4 $1.1 $0.9 $1.4 $24.4 $398 $4.8 FY 07 $0.6 $11.1 $6.1 $3.1 $1.7 $1.0 $1.0 $1.5 $25.9 $422 $5.0 FY 08 $0.5 $13.7 $6.6 $3.3 $1.7 $0.8 $1.1 $1.7 $29.4 $473 $5.0 FY 09 $0.4 $13.6 $5.0 $3.7 $1.8 $1.1 $1.0 $1.7 $28.2 $445 $4.6 FY 10 $0.1 $13.1 $6.6 $3.4 $2.0 $1.1 $1.0 $1.7 $28.8 $448 $4.9 FY 11 $0.2 $14.4 $6.8 $3.5 $2.2 $1.1 $1.1 $1.7 $31.0 $478 $4.4 FY 12 $0.8 $14.9 $7.7 $3.7 $2.5 $1.2 $1.1 $1.8 $33.6 $514 $4.3 FY 13 $0.6 $15.0 $7.5 $3.5 $1.5 $1.2 $1.2 $1.7 $32.2 $485 $4.8 FY 14 $0.6 $16.0 $7.1 $3.3 $2.5 $1.1 $1.4 $1.3 $33.3 $505 $3.7 FY 15 $0.7 $15.6 $7.4 $4.2 $2.4 $1.2 $1.5 $1.6 $34.6 $516 $4.5 Change from: Last year +4%‐3% +5% +28%‐4% +9% +12% +17% +4% +2% +23% FY 06 ‐18% +49% +41% +38% +69% +10% +74% +9% +42% +30%‐7% STAFFING, EQUIPMENT, AND TRAINING Authorized Staffing (FTE) Total Per 1,000  residents Number of  police  officers  Police officers  per 1,000  residents Average  number of  officers on  patrol1 Number of  patrol  vehicles Number of  motorcycles Training hours  per officer2 (Target: 145) Overtime as a percent of  regular salaries Citizen  commendations  received (Target: >150) Citizen complaints filed  (sustained) FY 06 168.8 2.8 93 1.52 8 30 9 153 13% 144 7 (0) FY 07 168.1 2.7 93 1.52 8 30 9 142 16% 121 11 (1) FY 08 168.5 2.7 93 1.50 8 30 9 135 17% 141 20 (1) FY 09 169.5 2.7 93 1.46 8 30 9 141 14% 124 14 (3) FY 10 166.8 2.6 92 1.43 8 30 9 168 12% 156 11 (3) FY 11 161.1 2.5 91 1.40 8 30 9 123 12% 149 7 (0) FY 12 160.8 2.5 91 1.39 8 30 9 178 13% 137 1 (0) FY 13 157.2 2.4 91 1.37 8 30 9 134 14% 147 3 (2) FY 14 158.1 2.4 92 1.39 8 30 9 177 14% 153 4 (2) FY 15 157.6 2.4 92 1.37 8 30 6 139 15% 135 7 (1) Change from: Last year 0% 0% 0%‐1% 0% 0%‐33%‐21%‐1%‐12% +75% FY 06 ‐7%‐14%‐1%‐10% 0% 0%‐33%‐9%+2%‐6%0% 1Does not include traffic motor officers. 2Does not include the academy. Mission:To proudly serve and protect the public with respect and integrity. Ch a p t e r  3 Attachment A 44 CALLS FOR SERVICE Average response time (minutes) Percent of calls responded promptly Police  Department  Total1 (Target: 55,000) False  alarms Percent emergency  calls dispatched  within  60 seconds Emergency calls (Target: 5:00) Urgent calls (Target: 8:00) Nonemergency  calls (Target: 45:00) Emergency calls  within 6 minutes (Target: 90%) Urgent calls within 10 minutes (Target: 90%) Nonemergency  calls within 45  minutes FY 06 56,211 2,419 88%4:41 7:39 20:36 78%78%95% FY 07 60,079 2,610 96%5:08 7:24 19:16 73%79%91% FY 08 58,742 2,539 96%4:32 7:02 19:09 81%80%92% FY 09 53,275 2,501 94%4:43 7:05 18:35 81%82%92% FY 10 55,860 2,491 95%4:44 6:53 18:32 78%83%92% FY 11 52,159 2,254 93%4:28 6:51 18:26 78%83%92% FY 12 51,086 2,263 92%4:28 6:56 19:29 78%83%91% FY 13 54,628 2,601 91%4:57 6:57 18:55 75%83%92% FY 14 58,559 2,450 77%5:341 7:571 20:552 72%77%90% FY 15 59,795 2,595 73%5:40 8:38 21:07 75%74%89% Change from: Last year +2% +6%‐4%+2%+9%+1%+3%‐3%‐1% FY 06 +6% +7%‐15%+21% +13% +3%‐3%‐4%‐6% 1 Includes self‐initiated calls. 2 The department attributes the increase to a methodology change from a call being “received” after the information was entered in the old Computer‐Aided Dispatch (CAD) system to when a  dispatcher begins entering the information into the new system. CRIME Reported crimes Arrests Number of cases/percent of cases cleared or closed for part I crimes1,5 Part I1 (Target: <2,000) Part II2 Per 1,000  residents Per officer3 Total4 Juvenile Homicide Rape Robbery Theft  FY 06 2,520 2,643 84 56 2,530 241 ‐‐‐‐ FY 07 1,855 2,815 76 50 3,059 244 0/(N/A) 2/(50%) 37/(51%) 1,092/(18%) FY 08 1,843 2,750 74 49 3,253 257 2/(100%) 3/(67%) 41/(66%) 1,161/(21%) FY 09 1,880 2,235 65 44 2,612 230 1/(100%) 7/(29%) 42/(31%) 1,414/(20%) FY 10 1,595 2,257 60 42 2,451 222 1/(100%) 9/(33%) 30/(53%) 1,209/(22%) FY 11 1,424 2,208 56 40 2,288 197 0/(N/A) 3/(0%) 42/(36%) 1,063/(20%) FY 12 1,277 2,295 55 39 2,212 170 0/(N/A) 4/(50%) 19/(68%) 893/(19%) FY 13 1,592 2,399 60 44 2,274 115 0/(N/A) 3/(67%) 35/(66%) 1,143/(10%) FY 14 1,540 2,557 62 45 2,589 116 0/(N/A) 4/(75%) 27/(63%) 1,160/(11%) FY 15 1,595 3,050 69 50 3,273 119 2/(100%) 12/(67%) 21/(67%) 1,202/(11%) Change from: Last year +4% +19% +11% +11% +26% +3%‐‐‐‐ FY 06 ‐37% +15%‐18%‐11% +29%‐51%‐‐‐‐ 1 Part I crimes include homicide, rape, robbery, assault, burglary, larceny/theft, vehicle theft, and arson. 2 Part II crimes include simple assaults or attempted assaults where a weapon is not used or where serious injuries did not occur. 3 Based on authorized sworn staffing. 4 Total arrests do not include being drunk in public where suspects are taken to a sobering station, or traffic warrant arrests. 5 Clearance rates (percentages) include cases resolved with or without arrests as of June 2014, but may not reconcile with Department of Justice figures due to differing definitions and timing  differences.Ch a p t e r  3 Pu b l i c  Sa f e t y  ‐ Po l i c e Attachment A 45 TRAFFIC AND PARKING CONTROL Traffic collisions Citations issued Total Per 1,000  residents With injury  (Target: <375) (percent of total) Bicycle/pedestrian Alcohol related DUI  Arrests Traffic stops Traffic Parking FY 06 1,287 21 396 (31%) 113 43 247 11,827 7,687 56,502 FY 07 1,257 20 291 (23%)103 31 257 15,563 6,232 57,222 FY 08 1,122 18 324 (29%)84 42 343 19,177 6,326 50,706 FY 09 1,040 16 371 (36%)108 37 192 14,152 5,766 49,996 FY 10 1,006 16 368 (37%)81 29 181 13,344 7,520 42,591 FY 11 1,061 16 429 (40%)127 38 140 12,534 7,077 40,426 FY 12 1,032 16 379 (37%)123 42 164 10,651 7,505 41,875 FY 13 1,126 17 411 (37%)127 43 144 12,306 8,842 43,877 FY 14 1,129 17 424 (38%)139 47 206 16,006 12,244 36,551 FY 15 1,035 15 382 (37%)125 48 239 15,659 10,039 41,412 Change from: Last year ‐8%‐12%‐10%‐10%+2%+16%‐2%‐18%+13% FY 06 ‐20%‐29%‐4%+11%+12%‐3%+32% +31%‐27% ANIMAL SERVICES Animal service calls Revenue (in millions) Palo Alto Regional 1 Percent of Palo Alto  live calls responded to  within 45 minutes (Target: 93%) Number of animals handled Percent of dogs received by shelter and  returned to owner Percent of cats  received by shelter  and returned to  owner FY 06 $0.9 2,861 1,944 89% 3,839 78% 9% FY 07 $1.0 2,990 1,773 88% 3,578 82% 18% FY 08 $1.2 3,059 1,666 91% 3,532 75% 17% FY 09 $1.0 2,873 1,690 90% 3,422 70% 11% FY 10 $1.4 2,692 1,602 90% 3,147 75% 10% FY 11 $1.0 2,804 1,814 88% 3,323 68% 20% FY 12 $1.0 3,051 1,793 91% 3,379 69% 14% FY 13 $1.3 2,909 1,0572 90%2,675 65%17% FY 14 $0.4 2,398 695 91%2,480 68%10% FY 15 $0.6 2,013 566 88%2,143 70%18% Change from: Last year +55%‐16%‐19%‐3%‐14%+2%+8% FY 06 ‐29%‐30%‐71%‐1%‐44%‐8%+9% 1Includes calls from the City of Los Altos and Los Altos Hills. 2The decline beginning in FY 2013 is due to the City of Mountain View terminating its contract with Palo Alto Animal Services in November 2012. Ch a p t e r  3 Pu b l i c  Sa f e t y  ‐ Po l i c e Attachment A 46 PUBLIC SERVICES – STREETS, SIDEWALKS, AND FACILITIES Operating Expenditures (in millions) Streets Sidewalks Facilities Streets City facilities Number of  potholes  repaired Percent of potholes  repaired within 15  days of notification Number of signs  repaired or  replaced Percent of temporary  repairs completed  within 15 days of  initial inspection Total square  feet of facilities maintained Maintenance  cost per square foot Custodial cost per  square foot FY 06 $1.9 $4.6 1,049 95% 1,754 87% 1,402,225 $1.52 $1.18 FY 07 $2.2 $4.8 1,188 82% 1,475 98% 1,613,392 $1.38 $1.04 FY 08 $2.2 $5.1 1,977 78% 1,289 88% 1,616,171 $1.52 $1.12 FY 09 $2.3 $5.7 3,727 80% 1,292 86% 1,616,171 $1.62 $1.19 FY 10 $2.3 $5.5 3,149 86%2,250 78% 1,617,101 $1.75 $1.18 FY 11 $2.4 $5.6 2,986 81%1,780 83% 1,617,101 $1.70 $1.16 FY 12 $2.5 $5.5 3,047 81%2,439 82% 1,608,137 $1.74 $1.14 FY 13 $2.7 $5.4 2,726 83%2,450 95% 1,608,119 $1.88 $1.08 FY 14 $2.6 $5.1 3,418 75%2,613 79% 1,611,432 $1.89 $1.08 FY 15 $2.8 $4.5 2,487 90%3,294 68%1,656,280 $1.85 $1.06 Change from: Last year +6%‐11%‐27% +15%+26%‐11%+3%‐2%‐2% FY 06 +43%‐1% +137%‐5%+88%‐19%+18% +22%‐10% 1 Estimated. Pu b l i c  Wo r k s PUBLIC SERVICES –TREES Operating  expenditures (in millions) Authorized  staffing1 (FTE) Total number of  City‐maintained  trees2 Number of trees  planted3 (Target: 250) Number of all tree‐related  services completed4 (Target: 6,000) Percent of  urban forest  pruned Percent of total tree line cleared (Target: 25%) Number of tree‐ related electrical  service disruptions FY 06 $2.0 14.0 34,841 263 3,422 10%23%13 FY 07 $2.2 14.0 34,556 164 3,409 10%30%15 FY 08 $2.3 14.0 35,322 188 6,579 18%27%9 FY 09 $2.1 14.0 35,255 250 6,618 18%33%5 FY 10 $2.3 14.0 35,472 201 6,094 18%27%4 FY 11 $2.6 14.0 33,146 150 5,045 15%26%8 FY 12 $2.4 12.9 35,324 143 5,527 16%28%4 FY 13 $2.3 13.3 35,383 245 6,931 17%41%3 FY 14 $2.6 13.3 35,386 148 5,055 12%37%7 FY 15 $2.7 12.9 35,281 305 8,639 20%28%3 Change from: Last year +5%‐3%0%+106%+71%+8%‐9%‐57% FY 06 +35%‐8%+1%+16%+152%+10%+5%‐77% 1 For the General Fund only.  2 FY 2011 was the first year since 1989 that the trees were officially counted; numbers prior to FY 2011 were estimated. 3 Includes trees planted by Canopy volunteers. 4 Excludes trees trimmed to clear power lines. Mission:To provide efficient, cost effective, and environmentally sensitive operations for construction, maintenance, and management of Palo Alto  streets, sidewalks, parking lots, facilities, and parks; ensure continuous operation of our Regional Water Quality Control Plant, City fleet, and storm  drain system; provide maintenance, replacement and utility line clearing services for the City’s urban forest; provide efficient and cost effective  garbage collection; to promote reuse and recycling to minimize waste; and to ensure timely support to other City departments and the private  development community in the area of engineering services. Ch a p t e r  3 Attachment A 47 ENGINEERING SERVICES Number of private development permits issued1 Operating  expenditures  (in millions) Authorized  staffing (FTE) Total (Target: 250) Per FTE (Target: 77) Lane miles  resurfaced Percent of  lane miles  resurfaced Square feet of sidewalk  replaced or permanently  repaired2 Number of ADA3 ramps installed FY 06 $1.9 15.0 284 95 20.0 4% 126,574 66 FY 07 $2.0 14.0 215 83 32.0 7% 94,620 70 FY 08 $2.1 14.6 338 112 27.0 6% 83,827 27 FY 09 $2.2 14.6 304 101 23.0 5% 56,909 21 FY 10 $1.6 10.0 321 107 32.4 7% 54,602 22 FY 11 $1.5 9.2 375 125 28.9 6%71,174 23 FY 12 $1.6 9.2 411 103 40.0 9%72,787 45 FY 13 $1.4 9.7 454 114 36.3 8%82,118 56 FY 14 $1.7 10.4 412 103 35.6 8%74,051 42 FY 15 $1.4 5.8 406 102 30.7 7%120,776 80 Change from: Last year ‐17%‐45%‐1%‐1%‐14%‐2%+63%+90% FY 06 ‐28%‐62%+43%+7%+54% +3%‐5%+21% 1 Includes permits for street work, encroachment, and excavation and grading. 2 Includes both in‐house and contracted work. 3 Americans with Disabilities Act (ADA) requires that accessibility to sidewalks of buildings and facilities be provided to individuals with disabilities. Capital Expenditures1 – General Fund (in millions) Capital Expenditures 1 – Enterprise Funds (in millions) Capital Authorized Staffing (FTE)2 Streets (Target: $3.8) Sidewalks Parks Facilities (Target: $16.9) Storm Drainage Wastewater  Treatment Refuse Streets Sidewalks Parks Structures FY 06 $2.4 $2.5 $1.5 $6.1 $0.3 $2.2 $0.1 1.4 7.4 2.0 8.4 FY 07 $5.2 $2.5 $0.9 $7.2 $1.5 $1.8 $0.0 1.4 7.4 2.0 8.4 FY 08 $3.5 $2.2 $2.7 $8.3 $3.7 $10.9 $0.0 1.4 7.4 2.0 8.4 FY 09 $4.5 $2.1 $1.9 $10.8 $5.4 $9.2 $0.7 1.4 7.1 2.0 9.2 FY 10 $4.0 $1.9 $3.3 $10.1 $1.1 $6.0 $0.2 2.9 7.1 2.7 11.4 FY 11 $5.5 $1.9 $1.4 $25.5 $1.1 $3.1 $0.2 3.0 6.9 1.6 10.0 FY 12 $4.0 $2.0 $1.2 $21.5 $1.9 $1.5 $0.7 3.0 7.0 1.6 10.4 FY 13 $8.4 $2.2 $1.7 $15.2 $2.6 $2.9 $0.5 3.0 7.4 1.6 12.0 FY 14 $7.5 $2.6 $2.2 $21.7 $1.4 $2.7 $1.7 3.2 7.1 3.7 11.3 FY 15 $6.7 $2.9 $6.6 $16.9 $1.8 $4.2 $2.2 3.4 7.3 3.7% 9.1 Change from: Last year ‐11% +8% +196%‐22%+28%+56%+30% +9% +3% 0%‐19% FY 06 +178% +15% +342% +176% +457%+89% +1864% +144%‐1% +85% +8% 1 Capital expenditures include direct labor, materials, supplies, and contractual services; overhead is not included. 2 Budgeted number; actual FTEs at year‐end may differ. Ch a p t e r  3 Pu b l i c  Wo r k s Attachment A 48 STORM DRAINAGE Operating  revenues (in millions) Operating  expenditures1 (in millions) Reserves (in millions) Average  monthly  residential bill Authorized  staffing (FTE) Feet of storm drain  pipelines cleaned (Target: 100,000) Calls for assistance  with storm drains2 Percent of industrial/  commercial sites in   compliance with storm  water regulations (Target: 80%) FY 06 $5.7 $2.9 $3.1 $10.00 9.5 128,643 24 83% FY 07 $5.3 $4.3 $4.5 $10.20 9.5 287,957 4 71% FY 08 $5.9 $7.1 $3.3 $10.55 9.5 157,337 80 65% FY 09 $5.8 $7.5 $1.2 $10.95 9.5 107,223 44 70% FY 10 $5.8 $3.9 $2.7 $10.95 9.5 86,174 119 81% FY 11 $6.3 $3.5 $5.0 $11.23 9.5 129,590 45 81% FY 12 $6.1 $4.3 $6.5 $11.40 9.5 157,398 18 89% FY 13 $6.2 $5.9 $6.2 $11.73 9.6 159,202 32 87% FY 14 $6.4 $4.2 $7.83 $11.99 10.6 173,185 35 79% FY 15 $6.4 $4.9 $5.6 $12.30 10.2 161,895 129 83% Change from: Last year +1%+18%‐28%+3%‐3%‐7%+269%+4% FY 06 +12% +72%+82% +23% +8%+26%+438%0% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Estimated. 3 Includes $1.6 million of rate stabilization reserve. WASTEWATER TREATMENT AND ENVIRONMENTAL COMPLIANCE Wastewater Treatment Fund Regional Water Quality Control Plant Watershed Protection Operating  revenues (in  millions) Operating  expenditures1 (in millions) Percent of  operating  expenditures  reimbursed by  other  jurisdictions Reserves (in millions) Authorized staffing (FTE) Millions of  gallons  processed2 (Target:  8,200) Fish toxicity  test –percent  survival (Target:  100%) Authorized  staffing (FTE) Inspections  of  industrial/  commercial sites3 Percent of  wastewater  treatment  discharge tests in compliance (Target: 99%) Percent of customers using  reusable bags at  grocery stores FY 06 $19.5 $18.1 63% $13.6 54.8 8,972 100% 13.7 192 99.40%‐ FY 07 $17.7 $20.4 64% $13.8 54.8 8,853 100% 13.9 114 99.40%‐ FY 08 $23.9 $31.3 64% $11.1 54.8 8,510 100% 13.9 111 99.25%9% FY 09 $29.1 $39.3 63% $12.9 54.3 7,958 100% 13.7 250 98.90% 19% FY 10 $17.6 $22.4 62% $11.8 54.3 8,184 100% 13.7 300 98.82% 21% FY 11 $20.9 $20.5 61% $15.8 55.5 8,652 100% 13.7 295 99.00% 22% FY 12 $22.8 $19.8 60% $18.0 55.0 8,130 100% 14.6 300 99.27% 21% FY 13 $21.9 $20.8 63% $18.9 55.5 7,546 100% 14.6 362 99.80% 24% FY 14 $18.8 $21.2 61% $14.7 4 55.6 7,186 100% 13.8 443 99.70% 40% FY 15 $24.4 $22.8 64%($2.8)59.7 6,512 100%13.5 450 99.40% 39% Change from: Last year +29% +7% +5%‐119% +7%‐9% 0%‐2% +2% 0% 0% FY 06 +25% +26% +2%‐120% +9%‐27% 0%‐2% +134% 0%‐ 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Includes gallons processed for all cities served by Palo Alto’s Regional Water Quality Control Plant. 3 Prior to 2009, only automotive sites were reported. Beginning in 2009, inspections reported include industrial, automotive, and food service facilities.  4 Includes $5.5 million of rate stabilization reserve.Ch a p t e r  3 Pu b l i c  Wo r k s Attachment A 49 Tons of materials recycled  or composted1 Household Hazardous Waste (HHW)  participation – number of households (Target: 4,430) Percent of households with mini‐can garbage service (20 gallon cart) (Target: 33%) Commercial accounts with compostable  service2 (Target: 36%) FY 06 56,013 4,425 ‐‐ FY 07 56,837 4,789 ‐‐ FY 08 52,196 4,714 ‐‐ FY 09 49,911 4,817 ‐‐ FY 10 48,811 4,710 21% 21% FY 11 56,586 4,876 25% 14% FY 12 51,725 4,355 29% 13% FY 13 47,941 4,409 32% 15% FY 14 49,594 4,878 33% 26% FY 15 50,546 4,767 35%28% Change from: Last year +2%‐2%+2%+8% FY 06 ‐10%+8%‐‐ 1 Tons of materials recycled or composted do not include self‐hauled materials by residents or businesses. 2The new compostable service began in July 2009. The Department reports that the FY 2011 decrease was due to customers stopping their service after too much garbage was found in compostable  containers and the FY 2014 increase is mainly due to more outreach by GreenWaste and more accounts enrolling in the program.   REFUSE/ZERO WASTE Operating  Revenues (in millions) Operating  Expenditures1 (in millions) Reserves Monthly Residential Bill (32 gallon container) Authorized  Staffing (FTE) Total tons of waste  landfilled2 Percent of all sweeping routes completed  (residential and commercial) FY 06 $25.2 $27.7 $4.7 $21.38 35.0 59,276 88% FY 07 $26.3 $25.1 $5.9 $21.38 34.7 59,938 93% FY 08 $29.8 $29.4 $6.3 $24.16 34.9 61,866 90% FY 09 $30.0 $35.5 $0.8 $26.58 35.3 68,228 92% FY 10 $29.2 $31.4 ($1.4) $31.00 38.0 48,955 88% FY 11 $31.6 $31.0 ($0.7) $32.40 38.0 38,524 92% FY 12 $31.6 $32.4 ($1.6) $36.33 37.6 43,947 90% FY 13 $31.5 $29.7 ($0.2) $41.54 26.5 45,411 93% FY 14 $30.8 $30.1 $0.4 3 $41.54 22.0 47,088 95% FY 15 $32.9 $30.3 $1.4 $40.14 18.9 43,730 100% Change from: Last year +7%+1% +281%‐3%‐14%‐7%+5% FY 06 +31%+9%‐70%+88%‐46%‐26%+12% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Reflects all waste landfilled in the previous calendar year, as reported by the California Department of Resources Recycling and Recovery (CalRecycle). 3 Includes ‐$1.6 million of rate stabilization reserve. Ch a p t e r  3 Pu b l i c  Wo r k s Attachment A 50 CITY VEHICLES AND EQUIPMENT Expenditures Operating  revenues (in millions) Operating  expenditures (in millions) Replacements  and additions  (in millions) Operations and  maintenance (in millions) Authorized  staffing (FTE) Current value of  vehicle and equipment (in millions) Number of  alternative fuel vehicles (Target: 67) Percent of  nonemergency vehicles  using alternative fuels or technologies (Target: 26%) FY 06 $5.8 $6.6 $2.9 $3.2 16.0 $11.9 74 19% FY 07 $6.4 $7.0 $1.4 $3.3 16.0 $11.9 79 20% FY 08 $6.8 $6.9 $1.1 $3.8 16.3 $10.8 80 25% FY 09 $8.8 $14.8 $8.7 $4.3 16.2 $10.0 75 25% FY 10 $7.8 $7.5 $0.8 $4.0 16.0 $11.2 74 24% FY 11 $8.1 $6.8 $1.5 $3.1 16.6 $10.8 63 24% FY 12 $8.1 $8.7 $1.6 $3.5 17.0 $10.0 60 25% FY 13 $8.0 $8.0 $1.6 $4.2 18.2 $9.0 57 23% FY 14 $7.8 $7.5 $2.8 $4.7 18.2 $8.5 61 25% FY 15 $8.0 $8.5 $2.9 $5.6 19.9 $10.0 51 26% Change from: Last year +3% +13% +2%+20% +9%+18%‐16%+1% FY 06 +38% +30% +1%+76% +24%‐16%‐31%7% Light‐duty vehicles Total miles traveled Median mileage Median age Maintenance cost per vehicle1 Percent of scheduled preventive  maintenance performed within five  business days of original schedule FY 06 1,674,427 41,153 6.8 $1,781 95% FY 07 1,849,600 41,920 6.8 $1,886 86% FY 08 1,650,743 42,573 7.4 $1,620 74% FY 09 1,615,771 44,784 8.0 $2,123 94% FY 10 1,474,747 47,040 8.7 $1,836 93% FY 11 1,447,816 47,252 8.8 $2,279 98% FY 12 1,503,063 50,345 9.7 $2,168 98% FY 13 1,382,375 52,488 9.7 $2,177 97% FY 14 1,409,342 57,721 10.7 $2,733 92% FY 15 1,406,980 54,630 10.3 $3,083 90% Change from: Last year 0%‐5%‐4%+13%‐2% FY 06 ‐16%+33%+51%+73%‐5% 1 Does not include fuel or accident repairs; includes maintenance costs for 30 police patrol cars. Ch a p t e r  3 Pu b l i c  Wo r k s Attachment A 51 Ut i l i t i e s ELECTRIC Operating  revenues (in millions) Operating  expenditures1 (in millions) Capital expenditures2 (in millions) General  Fund transfers (in millions) Electric Fund  reserves (in millions) Authorized  staffing (FTE) Electricity  purchases (in millions) Average purchase  cost (per  megawatt hour) Energy Conservation/  Efficiency Program  expenditures (in millions) Average monthly  residential bill3 FY 06 $122.4 $109.1 $7.2 $8.7 $161.3 118.8 $55.6 $48.62 $1.5 $32.73 FY 07 $108.7 $118.0 $10.5 $8.8 $156.4 114.0 $62.5 $64.97 $1.5 $32.73 FY 08 $112.6 $130.6 $10.2 $9.4 $145.3 111.0 $71.1 $76.84 $1.9 $34.38 FY 09 $129.9 $139.7 $5.5 $9.7 $129.4 107.0 $82.3 $83.34 $2.1 $38.87 FY 10 $130.7 $126.4 $7.5 $11.5 $133.4 109.0 $68.7 $74.11 $2.7 $42.76 FY 11 $125.9 $116.5 $7.3 $11.2 $142.7 107.0 $61.2 $64.01 $2.7 $42.76 FY 12 $123.1 $118.3 $6.4 $11.6 $147.3 108.9 $58.7 $65.00 $3.2 $42.76 FY 13 $125.3 $124.5 $10.4 $11.8 $143.3 109.6 $61.3 $69.15 $2.6 $42.76 FY 14 $126.1 $128.8 $7.7 $11.2 $140.5 112.9 $68.8 $77.84 $2.6 $42.76 FY 15 $123.7 $138.9 $7.2 $11.4 $96.54 119.0 $78.4 $88.77 $1.8 $42.76 Change from: Last year ‐2% +8%‐7% +2%‐31% +5% +14% +14%‐31% 0% FY 06 +1% +27%‐1% +32%‐40% 0% +41% +83% +20% +31% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Capital expenditures include direct labor, materials, supplies, and contractual services. 3 Electric comparisons based on recent residential median data: 365 kilowatt‐hour (kWh)/month in summer (May‐October), 453 kWh/month in winter (November‐April). Prior years were restated to  more accurately reflect a monthly utility bill. Does not include 5 percent utility users tax. 4 Reduction of reserves resulted from the implementation of GASB Statement No. 68, as described in the Comprehensive Annual Financial Report period ended June 30, 2014. Electric consumption (in MWH1)Percent power content Number of  customer  accounts Residential Commercial and other Average  residential  usage per  capita Renewable  large hydro  facilities Qualifying  renewables2 Electric savings  achieved annually  through efficiency  programs (% of total sales) Electric service  interruptions over 1 minute  in duration Average outage  duration per  customer affected  (Target: <60  minutes) Circuit miles  under‐ grounded  during the  year Electric Supply CO23 emissions (in metric  tons) FY 06 28,653 161,202 804,908 2.58 61% 8%‐39 63 1.0 ‐ FY 07 28,684 162,405 815,721 2.65 84% 10%‐48 48 1.0 156,000 FY 08 29,024 162,680 814,695 2.62 53% 14% 0.56% 41 87 1.2 177,000 FY 09 28,527 159,899 835,784 2.52 47% 19% 0.47% 28 118 0.0 173,000 FY 10 29,430 163,098 801,990 2.53 34% 17% 0.55% 20 132 0.0 150,000 FY 11 29,708 160,318 786,201 2.47 45% 20% 0.70% 33 141 1.2 71,000 FY 12 29,545 160,604 781,960 2.45 65% 20% 1.52% 25 67 1.2 80,000 FY 13 29,299 156,411 790,430 2.36 42% 21% 0.88% 25 139 1.2 57,000 FY 14 29,338 153,190 797,594 2.32 40% 21% 0.87% 16 39 0.0 0 3 FY 15 29,065 145,284 791,559 2.17 27% 22% 0.60% 17 39 1.2 ‐ Change from: Last year ‐1%‐5%‐1%‐6%‐13% +1%‐0.27% +6% 0% +100%‐ FY 06 +1%‐10%‐2%‐16%‐34% +14%‐‐56%‐38% +20%‐ 1 Megawatt hours. 2 Includes biomass, biogas, geothermal, small hydro facilities (not large hydro), solar, and wind. The City Council established a target of 33% renewable power by 2015. 3 In FY 2014, the carbon neutral plan effectively eliminated all greenhouse gas emissions from the City’s electric supply. Mission:To provide safe, reliable, environmentally sustainable, and cost‐effective services. Ch a p t e r  3 Attachment A 52 GAS Operating  revenues (in millions) Operating  expenditures1 (in millions) Capital expenditures2 (in millions) General Fund transfers (in millions) Gas Fund  reserves (in millions) Authorized  staffing (FTE) Gas purchases (in millions) Average purchase cost  (per therm) Average monthly   residential bill3 FY 06 $37.2 $36.3 $3.3 $2.9 $13.2 47.3 $21.4 0.66 $33.43 FY 07 $42.9 $40.0 $3.6 $3.0 $16.9 47.9 $22.3 0.69 $44.00 FY 08 $50.4 $46.2 $4.4 $3.2 $21.8 46.4 $27.2 0.82 $52.20 FY 09 $49.5 $44.4 $4.5 $3.3 $26.4 48.4 $25.1 0.80 $56.60 FY 10 $46.8 $43.0 $5.1 $5.4 $29.6 49.0 $22.5 0.71 $51.03 FY 11 $50.4 $45.7 $2.0 $5.3 $34.4 54.3 $21.5 0.65 $51.03 FY 12 $50.9 $48.7 $5.1 $6.0 $36.2 52.3 $16.2 0.53 $51.03 FY 13 $35.6 $38.1 $5.0 $6.0 $32.0 53.3 $13.5 0.45 $37.50 FY 14 $36.6 $39.9 $9.4 $5.8 $28.3 53.4 $14.3 0.49 $39.89 FY 15 $31.2 $34.4 $7.5 $5.7 $11.5 4 55.4 $10.5 0.41 $37.39 Change from: Last year ‐15%‐14%‐21%‐1%‐59% +4%‐27%‐16%‐6% FY 06 ‐16%‐5% +130% +95%‐13% +17%‐51%‐38%+12% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Capital expenditures include direct labor, materials, supplies, and contractual services. 3 Gas comparisons based on recent residential median data: 18 therms/month in summer (April‐October), 54 therms/month in winter (November‐March). Commodity prices switched to market  rate in FY 2013. Prior years were restated to more accurately reflect a monthly utility bill. Does not include 5 percent utility users tax. 4 Reduction of reserves resulted from the implementation of GASB Statement No. 68, as described in the Comprehensive Annual Financial Report period ended June 30, 2014. Gas consumption (in therms)Unplanned service outages Number of leaks found Number of  customer  accounts Residential Commercial  and other Average  residential usage per capita Natural gas savings  achieved annually  through efficiency  programs (% of total sales) Number Total customers  affected Ground leaks Meter leaks FY 06 23,353 11,745,883 19,766,876 188 ‐19 211 119 88 FY 07 23,357 11,759,842 19,581,761 192 ‐18 307 56 85 FY 08 23,502 11,969,151 20,216,975 193 0.11%18 105 239 108 FY 09 23,090 11,003,088 19,579,877 173 0.28%46 766 210 265 FY 10 23,724 11,394,712 19,350,424 177 0.40%58 939 196 355 FY 11 23,816 11,476,609 19,436,897 177 0.55%22 114 124 166 FY 12 23,915 11,522,999 18,460,195 176 0.73%35 111 95 257 FY 13 23,659 10,834,793 18,066,040 163 1.40%65 265 91 279 FY 14 23,592 10,253,776 17,862,866 155 1.34%49 285 102 300 FY 15 23,461 8,537,754 16,522,430 127 0.90%14 195 61 188 Change from: Last year ‐1%‐17%‐8%‐18%‐0.44%‐71%‐32%‐40%‐37% FY 06 0%‐27%‐16%‐32%‐‐26%‐8%‐49% +114% Ch a p t e r  3 Ut i l i t i e s Attachment A 53 WATER Operating  revenues (in millions) Operating expenditures1 (in millions) Capital expenditures2 (in millions) General Fund transfers (in millions) Water Fund  reserves (in millions) Authorized  staffing (FTE) Water purchases (in millions) Average  purchase costs  (per 100 CCF 3) Average monthly  residential bill4 Total water in  CCF sold (in millions) FY 06 $21.6 $24.1 $4.7 $2.4 $19.2 40.8 $6.5 $1.13 $34.00 5.2 FY 07 $26.3 $24.1 $3.9 $2.5 $21.3 44.7 $7.8 $1.32 $36.82 5.5 FY 08 $29.3 $24.9 $3.4 $2.6 $26.4 46.2 $8.4 $1.41 $41.66 5.5 FY 09 $29.5 $28.9 $4.9 $2.7 $26.6 47.7 $8.4 $1.46 $42.97 5.4 FY 10 $28.8 $30.5 $7.1 $0.1 $28.7 46.8 $9.1 $1.70 $43.89 5.0 FY 11 $28.4 $31.8 $7.6 $0.0 $25.5 46.9 $10.7 $1.99 $43.89 5.0 FY 12 $33.8 $41.6 $9.7 $0.0 $23.1 46.4 $14.9 $2.74 $53.62 5.1 FY 13 $40.5 $47.7 $15.3 $0.0 $34.2 49.0 $16.6 $3.03 $62.16 5.1 FY 14 $42.8 $38.4 $9.8 $0.0 $37.1 48.2 $15.7 $3.33 $67.35 5.0 FY 15 $38.6 $34.5 $4.2 $0.0 $27.5 5 51.1 $15.7 $3.77 $67.35 4.4 Change from: Last year ‐10%‐10%‐57%‐‐26% +6% 0% +13%0%‐13% FY 06 +79% +43%‐11%‐+43% +25% +142% +234% +98%‐16% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Capital expenditures include direct labor, materials, supplies, and contractual services. 3 CCF = hundred cubic feet. 4 Water comparisons based on recent residential median data: 9 CCF/month. Prior years were restated to more accurately reflect a monthly utility bill. Does not include 5 percent utility users tax. 5 Reduction of reserves resulted from the implementation of GASB Statement No. 68, as described in the Comprehensive Annual Financial Report period ended June 30, 2014. Water consumption (in CCF1)Unplanned service outages Number of  customer  accounts Residential Commercial and other2 Average  residential  usage per  capita Water savings  achieved through  efficiency programs (% of total sales) Number Total  customers  affected Percent of  miles of water  mains replaced Water quality compliance  with all required CA  Department of Health and  Environmental Protection  Agency testing FY 06 19,645 2,647,758 2,561,145 42 ‐11 160 0%100% FY 07 19,726 2,807,477 2,673,126 46 ‐27 783 1%100% FY 08 19,942 2,746,980 2,779,664 44 0.72%17 374 1%100% FY 09 19,422 2,566,962 2,828,163 40 0.98%19 230 1%100% FY 10 20,134 2,415,467 2,539,818 38 1.35%25 291 2%100% FY 11 20,248 2,442,415 2,550,043 38 0.47%11 92 3%100% FY 12 20,317 2,513,595 2,549,409 38 1.09%10 70 0%100% FY 13 20,043 2,521,930 2,575,499 38 0.53%61 950 2%100% FY 14 20,037 2,496,549 2,549,766 38 0.64%50 942 0%100% FY 15 20,061 2,052,176 2,380,584 31 1.05%17 241 0%100% Change from: Last year 0%‐18%‐7%‐19% 0.41%‐66%‐74%0%0% FY 06 +2%‐22%‐7%‐27%‐+55% +51% 0%0% 1 CCF = hundred cubic feet. 2 Includes commercial, industrial research, and City facilities. Ch a p t e r  3 Ut i l i t i e s Attachment A 54 WASTEWATER COLLECTION Operating  revenues (in millions) Operating  expenditures1 (in millions) Capital expenditures2 (in millions) Wastewater Collection Fund reserves (in millions) Authorized staffing (FTE) Average  monthly  residential  bill3 Number of  customer  accounts Percent  miles of  mains  cleaned/  treated Percent  miles of  sewer lines  replaced Number of  sewage  overflows Percent sewage  spills and line  blockage responses  within 2 hours FY 06 $14.1 $13.2 $2.4 $14.5 23.1 $21.85 21,784 44% 0% 310 99% FY 07 $15.7 $19.1 $7.7 $12.4 25.4 $23.48 21,789 69% 3% 152 99% FY 08 $16.6 $15.7 $3.6 $13.8 28.0 $23.48 21,970 40% 1% 164 99% FY 09 $15.5 $15.0 $2.9 $14.1 25.5 $23.48 22,210 44% 1% 277 100% FY 10 $15.9 $13.4 $2.8 $16.6 26.1 $24.65 22,231 66% 2% 348 100% FY 11 $16.1 $15.5 $2.6 $17.1 28.5 $24.65 22,320 75% 2% 332 100% FY 12 $15.8 $16.8 $1.7 $16.8 29.7 $27.91 22,421 63% 0% 131 96.18% FY 13 $17.6 $17.4 $3.6 $16.4 30.0 $29.31 22,152 65% 2% 129 99.22% FY 14 $17.0 $16.7 $3.9 $16.6 30.2 $29.31 22,105 54% 3% 105 98.09% FY 15 $17.1 $16.0 $1.7 $10.5 4 31.0 $29.31 21,990 61% 0% 96 96.85% Change from: Last year +1%‐4%‐57%‐37% +3% 0%‐1% +7%‐3%‐9%‐1.24% FY 06 +21% +21%‐29%‐28% +34% +34% +1% +17% 0%‐69%‐2.15% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Capital expenditures include direct labor, materials, supplies, and contractual services. 3 Wastewater comparisons are for a residential dwelling unit. Rates are not metered.  4 Reduction of reserves resulted from the implementation of GASB Statement No. 68, as described in the Comprehensive Annual Financial Report period ended June 30, 2014. FIBER OPTICS Operating  revenues (in millions) Operating  expenditures1 (in millions) Capital expenditures2 (in millions) Fiber Optics Fund reserves (in millions) Authorized staffing (FTE) Number of  customer accounts Number of  service  connections Backbone fiber miles FY 06 ‐‐$0.0 ‐4.9 42 139 40.6 FY 07 $2.3 $1.3 $0.0 ‐3.1 49 161 40.6 FY 08 $3.4 $1.1 $0.0 $5.0 0.7 41 173 40.6 FY 09 $3.8 $1.5 $0.0 $6.4 6.0 47 178 40.6 FY 10 $3.6 $1.4 $0.1 $10.2 5.5 47 196 40.6 FY 11 $3.7 $1.9 $0.4 $11.9 7.7 59 189 40.6 FY 12 $4.1 $1.8 $0.6 $14.3 7.4 59 199 40.6 FY 13 $4.7 $1.5 $0.4 $17.0 7.3 72 205 40.6 FY 14 $4.9 $2.0 $0.5 $19.9 7.2 75 230 40.6 FY 15 $5.0 $2.0 $0.4 $21.2 8.4 64 228 42.08 Change from: Last year +4% +1%‐24% +7% +17%‐15%‐1% +4% FY 06 ‐‐0%‐98% +72% +52% +64% +4% 1 Consistent with the City’s operating budgets, capital improvement program (CIP) expenditures are included as operating expenditures for this department. 2 Capital expenditures include direct labor, materials, supplies, and contractual services. Ch a p t e r  3 Ut i l i t i e s Attachment A 55 OFFICES OF COUNCIL‐APPOINTED OFFICERS General Fund Operating Expenditures (in millions)General Fund Authorized Staffing (FTE) City Manager’s  Office1 City Attorney’s  Office City Clerk’s Office City Auditor’s  Office City Manager’s  Office1 City Attorney’s  Office City Clerk’s Office City Auditor’s  Office FY 06 $1.3 $2.6 $1.0 $0.9 8.8 12.3 6.1 4.1 FY 07 $1.7 $2.5 $0.9 $0.9 8.9 11.6 7.3 4.1 FY 08 $2.3 $2.7 $1.3 $0.9 12.9 11.6 8.3 4.3 FY 09 $2.0 $2.5 $1.1 $0.8 11.8 11.6 7.4 4.3 FY 10 $2.3 $2.6 $1.5 $1.0 11.0 11.6 7.2 4.3 FY 11 $2.3 $2.3 $1.2 $1.0 9.9 10.1 7.2 4.8 FY 12 $2.5 $2.8 $1.5 $0.9 11.1 9.0 7.2 4.3 FY 13 $2.5 $2.4 $1.3 $1.0 10.1 9.0 7.2 4.5 FY 14 $2.9 $2.6 $1.1 $1.0 9.6 9.0 6.2 4.5 FY 15 $2.9 $2.6 $1.1 $1.1 10.1 11.0 6.2 4.5 Change from: Last year 0%+1%‐3%+8%+5%+22%0%0% FY 06 +113%+1%+13%+25%+15%‐11%+2%+9% 1Includes figures for the Office of Sustainability, which was established as a separate office in FY 2014 and is no longer classified under the City Manager’s Office for budget purposes.  St r a t e g i c  & Su p p o r t  Se r v i c e s Missions: City Manager: Provides leadership and professional management to the City government in service to City Council policies, priorities and the  community’s civic values. City Attorney: To serve Palo Alto and its policymakers by providing legal representation of the highest quality. City Auditor: To promote an honest, efficient, effective, and fully accountable City government. City Clerk: To provide excellent service to the public, City staff, and the City Council through personal assistance and the use of information technologies; to provide timely and accessible service in response to all inquiries and requests for public information and records; to provide  resources through web pages to enable the public to research public information independently. Administration of elections, records  management, and the legislative process are all key processes handled by the department. Ch a p t e r  3 Attachment A 56 St r a t e g i c  & Su p p o r t  Se r v i c e s City Attorney City Clerk City Auditor Number of  claims  handled Percent of claims  resolved within 45 days of filing  (Target: 90%) Percent of Action Minutes  that are released within  one week of the City Council meeting (Target: 90%) <NEW> Percentage of Public  Records Requests responded to within the required ten days (Target: 100%) <NEW> Number of  major work  products  issued1 Number of  major work  products  issued2 per audit staff Percent of open  audit  recommendations  implemented over  the last five years (Target: 75%) Sales and use tax revenue recoveries2 FY 06 107 ‐‐ ‐52.5 ‐$917,597 FY 07 149 ‐‐ ‐42.0 ‐$78,770 FY 08 160 ‐‐ ‐73.5 ‐$149,810  FY 09 126 ‐‐ ‐3 1.5 40% $84,762  FY 10 144 ‐‐ ‐5 2.5 42% $259,560  FY 11 130 ‐‐ ‐3 1.0 39% $95,625  FY 12 112 92%‐‐5 1.7 49% $160,488  FY 13 99 95%‐‐5 1.4 42% $151,153 FY 14 78 92% 95% 90% 4 1.3 43% $168,916 FY 15 99 93%90%95%4 1.0 42% $116,973 Change from: Last year +27%+1%‐5%+5%0%‐25%‐1%‐31% FY 06 ‐7%‐‐ ‐‐20%‐60%‐‐87% 1Includes audits, the annual Performance Report, and the annual National Citizen Survey™. 2Includes other nonrecurring revenues from transient occupancy tax, alternative fuel tax credit, and/or unclaimed property in fiscal years 2005 through 2007 and fiscal years 2010 through 2013.  Ch a p t e r  3 Attachment A 57 ADMINISTRATIVE SERVICES DEPARTMENT General Fund Procurement Card2 Operating  expenditures (in millions) Authorized  staffing (FTE) Budget  stabilization  reserve (in millions)  Cash and  investments  (in millions) Rate of  return on  investments (Target:  2.10%) Number of  accounts  payable  checks  issued Average days  purchase requisitions  are in queue1 Value of goods  and services  purchased  (in millions) Number of  purchasing  documents  processed Number of  transactions Total value (in millions) Total lease payments  received (in millions) FY 06 $6.6 51.1 $26.3 $376.2 4.21%15,069 ‐$61.3 2,847 10,517 ‐‐ FY 07 $7.0 52.9 $27.5 $402.6 4.35%14,802 ‐$107.5 2,692 10,310 ‐‐ FY 08 $7.3 53.5 $26.1 $375.7 4.45%14,480 ‐$117.2 2,549 11,350 ‐‐ FY 09 $7.0 50.6 $24.7 $353.4 4.42%14,436 ‐$132.0 2,577 12,665 ‐‐ FY 10 $7.9 44.2 $27.4 $462.4 3.96%12,609 ‐$112.5 2,314 12,089 ‐‐ FY 11 $6.3 40.2 $31.4 $471.6 3.34%13,680 ‐$149.8 2,322 13,547 ‐‐ FY 12 $7.0 41.3 $28.1 $502.3 2.59%10,966 ‐$137.0 2,232 15,256 ‐‐ FY 13 $7.0 42.5 $30.4 $527.9 2.46%10,466 38 $152.5 1,945 18,985 ‐$3.4 FY 14 $7.1 41.5 $35.1 $541.2 2.21%10,270 30 $136.6 2,047 17,885 $6.2 $3.4 FY 15 $7.1 42.2 $48.2 $534.6 1.95%10,158 40 $129.3 1,707 17,799 $6.8 $4.0 Change from: Last year +1% +2% +37%‐1% 0%‐1% +33%‐5%‐17% 0% +10% +18% FY 06 +8%‐17% +84% +42%‐2%‐33%‐+111%‐40% +69%‐‐ 1 The estimated average number of days purchase requisitions remain in queue after the initiating department releases them. The Administrative Services Department started tracking this measure in  May 2013. The time to convert purchase requisitions to purchase orders may very significantly depending on procurement requirements and complexity. 2 The department’s goal is to increase procurement card expenditures to $7 million per year to take advantage of the revenue the City receives through rebate.  St r a t e g i c  & Su p p o r t  Se r v i c e s Mission:To provide proactive financial and analytical support to City departments and decision makers, and to safeguard and facilitate the  optimal use of City resources. Ch a p t e r  3 Attachment A 58 St r a t e g i c  & Su p p o r t  Se r v i c e s PEOPLE STRATEGY AND OPERATIONS DEPARTMENT General Fund Workers’ Compensation Operating  expenditures (in millions) Authorized  staffing (FTE) Turnover of employees  within first year1 (Target: 1%) Estimated cost  incurred2 (in thousands) Claims Paid2 (in thousands) Estimated costs  outstanding2 (in thousands) Number of claims  filed with days  away from work3 Days lost to work‐ related illness or  injury4 FY 06 $2.5 15.4 3% $2,858 $2,601 $258 80 ‐ FY 07 $2.6 15.6 7% $2,114 $1,937 $177 76 2,242 FY 08 $2.7 17.2 9% $2,684 $2,460 $224 75 1,561  FY 09 $2.7 16.0 8% $2,628 $2,145 $483 73 1,407  FY 10 $2.7 16.3 6% $2,521 $2,165 $356 71 1,506  FY 11 $2.6 16.3 8% $1,918 $1,402 $516 45 1,372 FY 12 $2.7 16.5 10% $2,843 $1,963 $880 56 1,236  FY 13 $2.9 16.6 8% $3,182 $1,713 $1,469 42 1,815 FY 14 $3.1 16.7 9% $2,088 $1,217 $871 59 1,783 FY 15 $3.3 16.7 16% $1,121 $518 $602 36 1,366 Change from: Last year +4% 0% +7%‐46%‐57%‐31%‐39%‐ FY 06 +29% +9% +13%‐61%‐80%+134%‐55%‐23% 1In FY 2013, the City’s probation period was extended from six months to one year. 2 Estimates of claim costs incurred during each fiscal year, and associated costs paid and outstanding as of June 30, 2015. Costs are expected to increase as claims develop. Prior‐year costs were  updated to reflect current costs as of June 30, 2015. 3 Restated to reflect the number of claims filed during each fiscal year that resulted in days away from work as of June 30, 2015. Numbers may increase as claims develop. 4 Based on calendar days. Federal requirements limit each claim to 180 days. Mission:To recruit, develop, and retain a diverse, well‐qualified and professional workforce that reflects the high standards of the community we  serve, and to lead City departments in positive employee relations, talent management, succession planning, and employee engagement. Ch a p t e r  3 Attachment A The National Citizen SurveyTM January 2016 Office of the City Auditor Harriet Richardson, City Auditor Lisa Wehara, Performance Auditor II Attachment B Page intentionally left blank Attachment B Office of the City Auditor ● 250 Hamilton Avenue, 7th Floor ● Palo Alto, CA 94301 ● 650.329.2667 Copies of the full report are available on the Office of the City Auditor website at: http://www.cityofpaloalto.org/gov/depts/aud/reports/accomplishments/default.asp Office of the City Auditor EXECUTIVE SUMMARY: The National Citizen Survey™ The Honorable City Council Palo Alto, California This report presents the results of the 13th annual National Citizen Survey™ (NCS™) for the City of Palo Alto. We contract with the National Research Center to conduct the statistically valid NCS™ to gather resident opinions across a range of community issues, including the quality of the community and related services, as well as residents’ engagement level within the community. BACKGROUND Beginning in 2014, we increased the number of surveys distributed to City of Palo Alto residents from 1,200 to 3,000, and we distributed the surveys within six geographic areas of the City. The larger sample size allowed us to maintain statistical reliability within each of the six geographic areas, as well as in the north and south areas of the City, and report survey results for these geographic areas (see the maps on report pages 4 and 5 for a breakdown of the north and south and the six geographic areas). The margins of error for the survey results are:  Overall – plus or minus 4 percentage points  North/South – plus or minus 5 percentage points  6 areas – plus or minus 10 percentage points The survey response rate has declined gradually since we conducted the first survey in 2003, from a high of 51 percent in 2004, to a low of 25 percent in this year’s survey. However, increasing the number of surveys mailed from 1,200 to 3,000 has captured responses from more residents, despite the lower response rate. Survey Response Rate: 2006 through 2015 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Response Rate1 48% 51% 43% 42% 38% 36% 37% 36% 37% 27% 29% 27% 25% Number of Responses 557 582 508 495 437 415 424 6242 427 316 337 796 721 1 The response rate is based on the number of surveys mailed minus the number of surveys returned by the post office as undeliverable e.g., the housing unit was vacant. 2 1,800 surveys were mailed in 2010, which resulted in a higher number of respondents despite a slight decline in the response rate. RESULT HIGHLIGHTS Overall Results Residents generally like living in Palo Alto: 88 percent of respondents rated the overall quality of life in Palo Alto as excellent or good, and 80 percent of respondents said it is very or somewhat likely that they would remain in Palo Alto for the next five years. However, this is the first time since we began conducting the survey in Palo Alto that fewer than 90 percent of respondents rated the overall quality of life as excellent or good. The average rating of all the quality of life questions is 81 percent, primarily because only 52 percent of respondents rated Palo Alto as a place to retire as excellent or good. Attachment B Executive Summary: The National Citizen Survey™ ii The average of the quality of life questions was lowest, at 76 percent, for residents living in geographic area 4,1 although 78 percent of those residents said they are very or somewhat likely to remain in Palo Alto for the next five years. The average of the quality of life questions ranged from 81 percent to 84 percent for the other five geographic areas, but the likelihood of those residents remaining in Palo Alto for the next five years ranged from 69 percent to 87 percent. There is only a correlation coefficient2 of 0.13 between the average responses to the quality of life questions and the likelihood of residents remaining in Palo Alto for the next five years. This means that whether residents remain in Palo Alto during the next five years is more likely to be determined other than by factors such as how happy they are with Palo Alto and their neighborhoods as a place to live and raise children. However, because the quality of life questions about Palo Alto as a place to retire rated much lower than the other quality of life questions, residents may be more likely to move out of Palo Alto as they approach retirement. The following tables show the results of key quality of life questions asked in the survey. Overall Quality of Life in Palo Alto - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 88% 91% 91% 94% 92% 94% 93% 91% 94% 92% 1 Area 4 includes the neighborhoods of Ventura, Charleston Meadows, Monroe Park, Palo Alto Orchards, Barron Park, Green Acres, Greater Miranda, and Esther Clark Park. 2 Correlation analysis shows the strength of a linear relationship between pairs of variables, and is measured in terms of a correlation coefficient. A correlation coefficient of +1 indicates a perfect positive correlation, meaning that as variable A increases, variable B will increase similarly; and a correlation coefficient of -1 indicates a perfect negative correlation, meaning that as variable A decreases, variable B will decrease similarly. The relationship weakens as the correlation coefficient moves closer to 0, meaning that it is less likely that there is a linear relationship between the variables. 88%90%85%86%85%91% 81% 90%94% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Attachment B Executive Summary: The National Citizen Survey™ iii Palo Alto as a Place to Live - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 92% 95% 92% 95% 94% 95% 94% 95% 96% 94% Your Neighborhood as a Place to Live - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 90% 92% 91% 90% 90% 91% 90% 91% 91% 91% Palo Alto as a Place to Raise Children - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 87% 93% 90% 92% 93% 93% 91% 94% 92% 92% 92%92%91%92%92%95% 86%92%93% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 90%93%88%91%91%92% 82% 97%92% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 87%87%87%87%90%94% 79% 89%87% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Attachment B Executive Summary: The National Citizen Survey™ iv Palo Alto as a Place to Work - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 87% 86% 89% 88% 89% 87% 87% 90% 90% 84% Palo Alto as a Place to Retire - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 52% 60% 56% 68% 68% 65% 64% 67% 61% 68% Quality of Services Provided by the City of Palo Alto - Percent Rating Excellent or Good 10-year trend: 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 85% 83% 84% 88% 83% 80% 80% 85% 86% 87% 87%86%87%82% 91% 81%87%91%87% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 52%58% 47% 59% 50%46%45% 52%60% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 85%85%86%84%88%83%85%86%86% 0% 20% 40% 60% 80% 100% Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Attachment B Executive Summary: The National Citizen Survey™ v Results by Facet In addition to the general quality of life questions, The NCS™ collects residents’ opinions across eight facets. Residents’ attitudes toward these facets of life in Palo Alto are less favorable than their attitudes toward the overall quality of life: Survey Results by Facet Area Average Percent Rating Excellent or Good Range of Percent Rating Excellent or Good Percent Rating Essential or Very Important Safety 86% 74% to 97% 82% Natural environment 83% 73% to 88% 81% Education and enrichment 82% 49% to 92% 67% Recreation and wellness 78% 53% to 93% 61% Economy 69% 8% to 87% 78% Community engagement 66% 48% to 82% 71% Built environment 63% 8% to 91% 80% Mobility 57% 26% to 83% 82% Most residents were pleased with the areas of safety, natural environment, and education and enrichment, as shown by 82 percent to 86 percent of respondents rating those areas as excellent or good, but the average rating of less than 70 percent for questions related to the economy, community engagement, the built environment, and mobility indicate that residents do not view those facets as favorably. The lowest-rated questions were those related to housing (built environment) and the cost of living in Palo Alto (economy), which also rated low across all of the geographic areas:  Only 8 percent of respondents rated the availability of affordable quality housing as excellent or good, while 80 percent rated it as poor and 12 percent rated it as fair.  Only 20 percent of respondents rated the variety of housing options as excellent or good, while 48 percent rated it as poor and 33 percent rated it as fair.  Only 8 percent of respondents rated the cost of living in Palo Alto as excellent or good, while 64 percent rated it as poor and 29 percent rated it as fair. The mobility facet had the most questions that respondents rated low. Questions that fewer than 50 percent of respondents rated as excellent or good were:  Quality of bus or transit services - 49 percent  Traffic signal timing - 47 percent  Ease of travel by car in Palo Alto - 44 percent  Ease of public parking - 36 percent  Traffic flow on major streets - 31 percent  East of travel by public transportation in Palo Alto - 26 percent Several questions in the community engagement facet also rated low. Residents’ lack of participation in certain activities means that most residents do not provide input on issues that could affect the direction of City policies. For example, fewer than 25 percent of respondents reported that, in the last 12 months, they:  Campaigned or advocated for an issue, cause, or candidate - 24 percent  Attended a local public meeting - 22 percent participation  Watched (online or on television) a local public meeting - 18 percent participation  Contacted Palo Alto elected officials (in-person, phone, email, or web) to express their opinion - 15 percent Attachment B Executive Summary: The National Citizen Survey™ vi Some responses seem to contradict others. For example, only 48 percent of respondents rated the overall direction that Palo Alto is taking as excellent or good, but gave higher ratings to several factors that are related to the direction that Palo Alto is taking. For example, 69 percent of respondents rated economic development as excellent or good, 76 percent rated vibrant downtown/commercial area as excellent or good, and 65 percent rated the value of services for the taxes paid to Palo as excellent or good. Asking more targeted questions about specific issues could provide more insight regarding why residents provided seemingly contradictory responses. Changes From Last Year and Over Time Overall, ratings in the City were generally stable, with 114 areas rated similarly in 2014 and 2015. Results are generally considered similar if the ratings from one year to the next do not differ by more than five percentage points, which is statistically meaningful. Residents rated seven areas more favorably and 15 areas less favorably in 2015 than in 2014: Survey Question 2014 2015 Change from 2014 Public library services (excellent or good) 81% 91% 10% Used Palo Alto public libraries or their services (at least once in last 12 months) 68% 76% 8% Participated in a club (at least once in last 12 months) 27% 34% 7% Attended a City-sponsored event (at least once in last 12 months) 50% 57% 7% The job Palo Alto government does at welcoming citizen involvement (excellent or good) 54% 61% 7% Volunteered your time to some group/activity in Palo Alto (at least once in last 12 months) 40% 46% 6% Carpooled with other adults or children instead of driving alone (at least once in last 12 months) 53% 58% 5% Street cleaning (excellent or good) 80% 75% -5% Palo Alto as a place to raise children (excellent or good) 93% 87% -6% Adult educational opportunities (excellent or good) 89% 83% -6% Traffic signal timing (excellent or good) 53% 47% -6% Overall ease of getting to the places you usually have to visit (excellent or good) 71% 65% -6% Recommend living in Palo Alto to someone who asks (very likely or somewhat likely) 86% 80% -6% Overall customer service by Palo Alto employees (excellent or good) 81% 74% -7% Variety of housing options (excellent or good) 27% 20% -7% Ease of travel by car in Palo Alto (excellent or good) 52% 44% -8% Palo Alto as a place to retire (excellent or good) 60% 52% -8% Openness and acceptance of the community toward people of diverse backgrounds (excellent or good) 76% 68% -8% Bus or transit services (excellent or good) 57% 49% -8% Storm drainage (excellent or good) 80% 71% -9% Availability of affordable quality mental health care (excellent or good) 63% 53% -10% Ease of travel by public transportation in Palo Alto (excellent or good) 36% 26% -10% Although not showing a statistically meaningful change from the prior year, residents’ opinions of several areas have improved or declined over time, which may represent shifts in residents’ perspective. During the past 10 years, 13 areas have had a statistically meaningful change: Attachment B Executive Summary: The National Citizen Survey™ vii Areas That Improved Over Time Percent Rating Excellent or Good 2006 Rating 2015 Rating Change Since 2006 Trend Availability of affordable quality child care/preschool (excellent/good) 35% 49% +14% ↑ Quality of public information services (excellent/good) 72% 82% +10% ↑ Sidewalk maintenance (excellent/good) 53% 62% +9% ↑ Quality of drinking water (excellent/good) 80% 88% +8% ↑ Economic development (excellent/good) 61% 69% +8% ↑ Employment opportunities (excellent/good) 59% 66% +7% ↑ Quality of sewer services (excellent/good) 83% 88% +5% ↑ Remain in Palo Alto for the next five years (very likely/somewhat likely)* 85% 80% -5% ↓ Attended a local public meeting within the last 12 months 27% 22% -5% ↓ Sense of community (excellent/good) 66% 60% -6% ↓ Traffic flow on major streets (excellent/good) 39% 31% -8% ↓ Overall quality of new development in Palo Alto (excellent/good) 62% 49% -13% ↓ Watched (online or television) a local public meeting within the last 12 months 31% 18% -13% ↓ *Data compares 2008 and 2015 because this question was not asked in 2006 or 2007. Comparative Results for Geographic Areas The statistically significant variances in the combined excellent and good responses between the North and South subgroups, as well as for the six area subgroups are shaded in grey in the report. The following table shows the statistically significant variances for the North and South subgroups (variances over 10 percent are shown at the top and bottom of the table). Percent Rating Excellent or Good (if not excellent or good, other rating indicated in parentheses) North South Overall Difference North less South Palo Alto as a place to retire 58% 47% 52% 11% Code enforcement (weeds, abandoned buildings, etc.) 65% 54% 59% 11% Overall quality of new development in Palo Alto 54% 44% 49% 10% Used bus, rail or other public transportation instead of driving (in last 12 months) 58% 48% 53% 10% Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 68% 59% 63% 9% Did NOT observe a code violation (in last 12 months) 71% 63% 67% 8% Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) (essential or very important) 84% 77% 80% 7% Your neighborhood as a place to live 93% 88% 90% 5% The overall quality of life in Palo Alto 90% 85% 88% 5% Availability of affordable quality housing 5% 10% 8% -5% Overall feeling of safety in Palo Alto 88% 93% 91% -5% Public places where people want to spend time 78% 84% 81% -6% Made efforts to make your home more energy efficient (in last 12 months) 70% 78% 74% -8% Neighborliness of residents in Palo Alto 56% 65% 61% -9% Street repair 46% 55% 51% -9% Storm drainage 64% 76% 71% -12% Sidewalk maintenance 55% 68% 62% -13% Attachment B Executive Summary: The National Citizen Survey™ viii The survey does not ask why respondents answered the way they did. Further in-depth questioning, such as through targeted focus groups, could explain why differing opinions exist among the various subgroups. National Benchmark Comparisons When available, benchmark comparisons are shown as the last table for each question. The average rating column shows the City’s rating converted to a 100 point scale. The rank column shows the City’s rank among communities that asked a similar question. The comparison to benchmark column shows “similar” if Palo Alto’s average rating within the standard range of 10 points of the benchmark communities, “higher” or “lower” if Palo Alto’s average rating is greater than the standard range, and “much higher” or “much lower” if Palo Alto’s average rating differs by more than twice the standard range. Palo Alto rated much higher than the benchmark communities in 5 areas, higher in 27 areas, lower in 6 areas, and much lower in 3 areas. Palo Alto’s Ratings Compared to Benchmark Communities Much Higher Overall opportunities for education and enrichment Used bus, rail, or other public transportation instead of driving Employment opportunities Vibrant downtown/commercial areas Walked or biked instead of driving Higher Adult educational opportunities Animal control Availability of preventive health services Carpooled with other adults or children instead of driving alone City parks Did NOT observe a code violation or other hazard in Palo Alto (weeds, abandoned buildings, etc.) Did NOT report a crime to the police Drinking water Ease of travel by bicycle in Palo Alto Ease of walking in Palo Alto Economic development Health and wellness opportunities in Palo Alto K-12 education Made efforts to conserve water Opportunities to attend cultural/arts/music activities Overall appearance of Palo Alto Overall economic health of Palo Alto Overall image or reputation of Palo Alto Palo Alto as a place to work Palo Alto open space Preservation of natural areas such as open space, farmlands and greenbelts Recreation centers or facilities Shopping opportunities Used Palo Alto public libraries or their services Utility billing Visited a neighborhood park or City park Yard waste pick-up Lower Ease of public parking Ease of travel by car in Palo Alto Ease of travel by public transportation in Palo Alto Traffic flow on major streets Participated in religious or spiritual activities in Palo Alto Watched (online or on television) a local public meeting Much Lower Availability of affordable quality housing Cost of living in Palo Alto Variety of housing options CUSTOM QUESTIONS In addition to the standard survey questions, we asked 10 custom questions (14 through 23) regarding communication, where residents go to shop and eat, transportation, and Cubberley Community Center. We also Attachment B Executive Summary: The National Citizen Survey™ ix asked an open-ended question regarding one improvement that the City could make to its parks, arts, or recreation activities and programs to better serve the community. Communication Phone calls are the most preferred method for residents to contact the City regarding maintenance issues or to provide feedback or engage with the City on issues in Palo Alto. If they had to report a maintenance issue, 44 percent of respondents reported that they would be most likely to call the appropriate City department; 21 percent said they would submit a notification electronically on the City’s website, and 19 percent said they would email the appropriate department. Only 3 percent said they would use the Palo Alto 311 phone app to notify the appropriate department (Table 64 on page 32). In the past 12 months, 27 percent of respondents said that they called the City to provide feedback or engage in City issues, and 24 percent said they emailed the City. Despite efforts to provide convenient means of communication through social media, only 11 percent said they used Open City Hall, social media channels such as Facebook and Twitter, or the “Contact the City” link on the City’s website (Table 65 on page 32). Where Residents Go to Shop and Eat A majority of survey respondents shop in their neighborhoods (54 percent) or elsewhere in the City (51 percent) at least one to five times per week. About a third of respondents are eating out in neighborhood restaurants (29 percent) or restaurants elsewhere in the City (28 percent) at least one to five times per week. The City is committed to a diversity of retail and neighborhood services (Tables 66 and 67 on page 33). Transportation Palo Alto residents view walking and biking as the most convenient ways to get around town without a car, with 81 percent of respondents rating biking and 70 percent rating walking as “very convenient” or “somewhat convenient.” Also, 68 percent of respondents rated Uber/Lyft or similar rideshare services as more convenient than conventional transit. Similarly, 56 percent of respondents rated free shuttles as more convenient than the train (46 percent) or bus (39 percent) (Table 71 on page 34). If convenience were not an issue, most Palo Alto residents would prefer or somewhat prefer walking (92 percent of respondents), free shuttles (78 percent), and biking (76 percent) as their mode of travel if they did not have access to a car. Fewer residents would prefer the train (68 percent), conventional buses (53 percent), and rideshare services (52 percent). A key goal of the City’s ongoing planning effort is to make the free shuttles more convenient, which could increase ridership (Table 72 on page 34). Cubberley Community Center We asked residents to rate how much of a priority, if at all, various future uses of the Cubberley Community Center are to them. The City of Palo Alto and the Palo Alto Unified School District are working together on a master plan for the Cubberley Community Center to meet future community and school needs, and the results of this survey question will be considered as they develop that plan. The five priorities receiving the highest percentage of high or medium priority responses were (Table 74 on page 35): Attachment B Executive Summary: The National Citizen Survey™ x Response Category Percent of High and Medium Priority Responses Indoor sports and health programs 75% Outdoor sports 72% Senior wellness, including stroke and cardiovascular programs 69% Rooms available to rent for other activities 65% Education – private schools and special interest classes 61% Suggested Improvements to Parks, Arts, or Recreation Activities and Programs We asked residents to share one improvement to the City of Palo Alto’s parks, arts, or recreation activities and programs that the City could make to better serve the community. The Community Services Department will consider these responses, along with data it has already collected from other community surveys as it develops a long range parks, recreation, trails, and open space master plan. Half of the respondents (361 of 721) provided ideas, which we categorized into 16 topic areas; the five most common suggestions were (Table 75 on page 37): Response Category Number of Responses Bathrooms/Restrooms 36 Park Spaces (Green Space) 35 Park, Recreation, and Art Facilities and Amenities (other than bathrooms/restrooms) 34 Art/Culture Improvements 28 Programs and Classes - Adult/Senior 22 Attachment B 2955 Valmont Road Suite 300 777 North Capitol Street NE Suite 500 Boulder, Colorado 80301 Washington, DC 20002 n-r-c.com • 303-444-7863 icma.org • 800-745-8780 Palo Alto, CA Report of Results 2015 Attachment B The National Citizen Survey™ The National Citizen Survey™ © 2001-2015 National Research Center, Inc. The NCS™ is presented by NRC in collaboration with ICMA. NRC is a charter member of the AAPOR Transparency Initiative, providing clear disclosure of our sound and ethical survey research practices. Contents Detailed Survey Methods .......................................................... 1 National Benchmark Comparisons ............................................. 8 Results Tables ......................................................................... 9 Survey Materials .................................................................... 54 Attachment B The National Citizen Survey™ 1 Detailed Survey Methods The National Citizen Survey™ (The NCS™) is a collaborative effort between National Research Center, Inc. (NRC) and the International City/County Management Association (ICMA). The National Citizen Survey (The NCS™), conducted by National Research Center, Inc., was developed to provide communities an accurate, affordable and easy way to assess and interpret resident opinion about important local topics. Standardization of common questions and survey methods provide the rigor to assure valid results, and each community has enough flexibility to construct a customized version of The NCS. The survey and its administration are standardized to assure high quality research methods and directly comparable results across The NCS communities. Results offer insight into residents’ perspectives about the community as a whole, including local amenities, services, public trust, resident participation and other aspects of the community in order to support budgeting, land use and strategic planning and communication with residents. Resident demographic characteristics permit comparison to the Census and American Community Survey estimates as well as comparison of results for different subgroups of residents. The City of Palo Alto funded this research. Please contact Harriet Richardson, City Auditor, City of Palo Alto, at Harriet.Richardson@CityofPaloAlto.org if you have any questions about the survey. Survey Validity The question of survey validity has two parts: 1) how can a community be confident that the results from those who completed the questionnaire are representative of the results that would have been obtained had the survey been administered to the entire population? and 2) how closely do the perspectives recorded on the survey reflect what residents really believe or do? To answer the first question, the best survey research practices were used for the resources spent to ensure that the results from the survey respondents reflect the opinions of residents in the entire community. These practices include:  Using a mail-out/mail-back methodology, which typically gets a higher response rate than phone for the same dollars spent. A higher response rate lessens the worry that those who did not respond are different than those who did respond.  Selecting households at random within the community to receive the survey to ensure that the households selected to receive the survey are representative of the larger community.  Over-sampling multifamily housing units to improve response from hard-to-reach, lower income or younger apartment dwellers.  Selecting the respondent within the household using an unbiased sampling procedure; in this case, the “birthday method.” The cover letter included an instruction requesting that the respondent in the household be the adult (18 years old or older) who most recently had a birthday, irrespective of year of birth.  Contacting potential respondents three times to encourage response from people who may have different opinions or habits than those who would respond with only a single prompt.  Inviting response in a compelling manner (using appropriate letterhead/logos and a signature of a visible leader) to appeal to recipients’ sense of civic responsibility.  Providing a preaddressed, postage-paid return envelope.  Weighting the results to reflect the demographics of the population. The answer to the second question about how closely the perspectives recorded on the survey reflect what residents really believe or do is more complex. Resident responses to surveys are influenced by a variety of factors. For questions about service quality, residents’ expectations for service quality play a role, as well as the “objective” quality of the service provided, the way the resident perceives the entire community (that is, the context in which the service is provided), the scale on which the resident is asked to record his or her opinion and, of course, the opinion itself that a resident holds about the service. Similarly, a resident’s report of certain Attachment B The National Citizen Survey™ 2 behaviors is colored by what he or she believes is the socially desirable response (e.g., reporting tolerant behaviors toward “oppressed groups,” likelihood of voting for a tax increase for services to poor people, use of alternative modes of travel to work besides the single occupancy vehicle), his or her memory of the actual behavior (if it is not a question speculating about future actions, like a vote), his or her confidence that he or she can be honest without suffering any negative consequences (thus the need for anonymity) as well as the actual behavior itself. How closely survey results come to recording the way a person really feels or behaves often is measured by the coincidence of reported behavior with observed current behavior (e.g., driving habits), reported intentions to behave with observed future behavior (e.g., voting choices) or reported opinions about current community quality with objective characteristics of the community (e.g., feelings of safety correlated with rates of crime). There is a body of scientific literature that has investigated the relationship between reported behaviors and actual behaviors. Well-conducted surveys, by and large, do capture true respondent behaviors or intentions to act with great accuracy. Predictions of voting outcomes tend to be quite accurate using survey research, as do reported behaviors that are not about highly sensitive issues (e.g., family abuse or other illegal or morally sanctioned activities). For self-reports about highly sensitive issues, statistical adjustments can be made to correct for the respondents’ tendency to report what they think the “correct” response should be. Research on the correlation of resident opinion about service quality and “objective” ratings of service quality vary, with some showing stronger relationships than others. NRC’s own research has demonstrated that residents who report the lowest ratings of street repair live in communities with objectively worse street conditions than those who report high ratings of street repair (based on road quality, delay in street repair, number of road repair employees). Similarly, the lowest rated fire services appear to be “objectively” worse than the highest rated fire services (expenditures per capita, response time, “professional” status of firefighters, breadth of services and training provided). Resident opinion commonly reflects objective performance data but is an important measure on its own. NRC principals have written, “If you collect trash three times a day but residents think that your trash haul is lousy, you still have a problem.” Survey Sampling “Sampling” refers to the method by which households were chosen to receive the survey. All households within the City of Palo Alto were eligible to participate in the survey. A list of all households within the zip codes serving Palo Alto was purchased based on updated listings from the United States Postal Service. Since some of the zip codes that serve the City of Palo Alto households may also serve addresses that lie outside of the community, the exact geographic location of each housing unit was compared to community boundaries using the most current municipal boundary file (updated on a quarterly basis) and addresses located outside of the City of Palo Alto boundaries were removed from consideration. Each address identified as being within City boundaries was further identified as being located in North or South Palo Alto, or within one of six areas. To choose the 3,000 survey recipients, a systematic sampling method was applied to the list of households previously screened for geographic location. Systematic sampling is a procedure whereby a complete list of all possible households is culled, selecting every N th one, giving each eligible household a known probability of selection, until the appropriate number of households is selected. Multifamily housing units were over sampled as residents of this type of housing typically respond at lower rates to surveys than do those in single-family housing units. In general, because of the random sampling techniques used, the displayed sampling density will closely mirror the overall housing unit density (which may be different from the population density). While the theory of probability assumes no bias in selection, there may be some minor variations in practice (meaning, an area with only 15 percent of the housing units might be sampled at an actual rate that is slightly above or below that). Figure 1 (page 4) displays a map of the households selected to receive the survey. Attachment B The National Citizen Survey™ 3 An individual within each household was selected using the birthday method. The birthday method selects a person within the household by asking the “person whose birthday has most recently passed” to complete the questionnaire. The underlying assumption in this method is that day of birth has no relationship to the way people respond to surveys. This instruction was contained in the cover letter accompanying the questionnaire. Survey Administration and Response Selected households received three mailings, one week apart, beginning on September 29, 2015. The first mailing was a prenotification postcard announcing the upcoming survey. The next mailing contained a letter from the City Auditor inviting the household to participate, a questionnaire and a postage-paid return envelope. The final mailing contained a reminder letter, another survey and a postage-paid return envelope. The second cover letter asked those who had not completed the survey to do so and those who had already done so to refrain from turning in another survey. Respondents could opt to take the survey online. Completed surveys were collected over the following six weeks. About 3 percent of the 3,000 surveys mailed were returned because the housing unit was vacant or the postal service was unable to deliver the survey as addressed. Of the remaining 2,908 households that received the survey, 721 completed the survey, providing an overall response rate of 25 percent. Of the 721 completed surveys, 114 (16 percent) were completed online. Additionally, responses were tracked by location in Palo Alto (north or south) and by six subareas, as shown in the maps below. Response rates by area ranged from 17 percent to 36 percent. Attachment B The National Citizen Survey™ 4 Figure 1: Location of Survey Recipients – North/South Attachment B The National Citizen Survey™ 5 Figure 2: Location of Survey Recipients – Area Attachment B The National Citizen Survey™ 6 Confidence Intervals It is customary to describe the precision of estimates made from surveys by a “level of confidence” and accompanying “confidence interval” (or margin of error). A traditional level of confidence, and the one used here, is 95 percent. The 95 percent level of confidence can be any size and quantifies the sampling error or imprecision of the survey results because some residents’ opinions are relied on to estimate all residents’ opinions.1 The margin of error or confidence interval for the City of Palo Alto survey is no greater than plus or minus four percentage points around any given percent reported for the entire sample (721 completed surveys). For subgroups of responses, the margin of error increases because the sample size for the subgroup is smaller. For subgroups of approximately 100 respondents, the margin of error is plus or minus 10 percentage points. For the North and South, the margin of error rises to approximately plus or minus five percentage points since the sample sizes for the North were 343 and for the South were 378. Further, for each of the six areas within Palo Alto, the margin of error rises to approximately plus or minus eleven percentage points since sample sizes were 100 for Area 1, 132 for Area 2, 107 for Area 3, 136 for Area 4, 88 for Area 5 and 158 for Area 6. The margin of error for the six areas within Palo Alto is based off the smallest number of returned surveys per area; thus margin of error was calculated using the number of returned surveys from Area 5 (88). Table 1: Survey Response Rates by Area Number mailed Undeliverable Eligible Returned Response rate Overall 3,000 92 2,908 721 25% North 1,488 54 1,434 343 24% South 1,512 38 1,474 378 26% Area 1 293 12 281 100 36% Area 2 519 18 501 132 26% Area 3 380 3 377 107 28% Area 4 596 16 580 136 23% Area 5 537 17 520 88 17% Area 6 675 26 649 158 24% Survey Processing (Data Entry) Upon receipt, completed surveys were assigned a unique identification number. Additionally, each survey was reviewed and “cleaned” as necessary. For example, a question may have asked a respondent to pick two items out of a list of five, but the respondent checked three; in this case, NRC would use protocols to randomly choose two of the three selected items for inclusion in the dataset. All surveys then were entered twice into an electronic dataset; any discrepancies were resolved in comparison to the original survey form. Range checks as well as other forms of quality control were also performed. Survey Data Weighting The demographic characteristics of the survey sample were compared to those found in the 2010 Census and American Community Survey estimates for adults in the City of Palo Alto. The primary objective of weighting survey data is to make the survey sample reflective of the larger population of the community. The characteristics used for weighting were housing tenure (rent or own), housing unit type (attached or detached) and sex and age. The results of the weighting scheme are presented in Table 1. 1 A 95 percent level of confidence indicates that for every 100 random samples of this many residents, 95 of the confidence intervals created will include the “true” population response. This theory is applied in practice to mean that the “true” perspective of the target population lies within the confidence interval created for a single survey. For example, if 75 percent of residents rate a service as “excellent” or “good,” then the 4 percent margin of error (for the 95 percent level of confidence) indicates that the range of likely responses for the entire community is between 71 percent and 79 percent. This source of uncertainty is called sampling error. In addition to sampling error, other sources of error may affect any survey, including the nonresponse of residents with opinions different from survey responders. Though standardized on The NCS, on other surveys, differences in question wording, order, translation and data entry, as examples, can lead to somewhat varying results. Attachment B The National Citizen Survey™ 7 Table 1: Palo Alto, CA 2015 Weighting Table Characteristic Population Norm Unweighted Data Weighted Data Housing Rent home 44% 35% 44% Own home 56% 65% 56% Detached unit 58% 58% 58% Attached unit 42% 42% 42% Race and Ethnicity White 68% 71% 67% Not white 32% 29% 33% Not Hispanic 95% 96% 96% Hispanic 5% 4% 4% Sex and Age Female 52% 55% 51% Male 48% 45% 49% 18-34 years of age 22% 12% 22% 35-54 years of age 41% 31% 41% 55+ years of age 37% 57% 38% Females 18-34 10% 6% 10% Females 35-54 21% 16% 21% Females 55+ 20% 33% 20% Males 18-34 12% 6% 12% Males 35-54 20% 15% 20% Males 55+ 17% 24% 17% Areas North 49% 48% 48% South 51% 52% 51% Area 1 13% 14% 13% Area 2 19% 18% 19% Area 3 13% 15% 13% Area 4 18% 19% 19% Area 5 15% 12% 13% Area 6 21% 22% 22% Survey Data Analysis and Reporting The survey dataset was analyzed using the Statistical Package for the Social Sciences (SPSS). For the most part, the percentages presented in the reports represent the “percent positive.” The percent positive is the combination of the top two most positive response options (i.e., “excellent” and “good,” “very safe” and “somewhat safe,” “essential” and “very important,” etc.), or, in the case of resident behaviors/participation, the percent positive represents the proportion of respondents indicating “yes” or participating in an activity at least once a month. Trends over Time Trend tables display trends over time, comparing the 2015 ratings for the City of Palo Alto to nine previous survey results (going back to 2006; surveying started in 2003). Trend data for Palo Alto represent important comparison data and should be examined for improvements or declines. Deviations from stable trends over time, especially, represent opportunities for understanding how local policies, programs or public information may have affected residents’ opinions. Meaningful differences between survey years have been noted within the following tables as being “higher” or “lower” if the differences are greater than approximately five percentage points2 between the 2014 and 2015 surveys; otherwise, the comparisons between 2014 and 2015 are noted as being “similar.” When comparing 2 While the percentages are reported as rounded whole numbers, meaningful differences are identified based on unrounded percentages with decimals in place. Attachment B The National Citizen Survey™ 8 results over time, small differences (those with less than a 5 percent difference compared to 2014) are more likely to be due to random variation (attributable to chance over real change), while larger differences (those greater than 5 percent compared to 2014) may be due to a real shift in resident perspective. However, it is often wise to continue to monitor results over a longer period of time to rule out random variation due to chance in the sampling process. Sometimes small changes in question wording can explain changes in results as well. Overall, ratings in Palo Alto for 2015 generally remained stable. Of the 136 items for which comparisons were available, 114 items were rated similarly in 2014 and 2015, 15 items showed a decrease in ratings and 7 showed an increase in ratings. Geographic Comparisons The geographic comparison tables on the following pages display differences in opinion of survey respondents by North or South location in Palo Alto and by six areas. Responses in these tables show only the proportion of respondents giving a certain answer; for example, the percent of respondents who rated the quality of life as “excellent” or “good,” or the percent of respondents who attended a public meeting more than once a month. ANOVA and chi-square tests of significance were applied to these comparisons of survey questions. A “p-value” of 0.05 or less indicates that there is less than a 5 percent probability that differences observed between areas are due to chance; or in other words, a greater than 95 percent probability that the differences observed are “real.” Where differences were statistically significant, they have been shaded grey. National Benchmark Comparisons Comparison Data NRC’s database of comparative resident opinion is comprised of resident perspectives gathered in surveys from over 500 communities whose residents evaluated the same kinds of topics on The National Citizen Survey™. The surveys gathered for NRC’s database include data from communities that have conducted The NCS as well as citizen surveys unaffiliated with NRC. The comparison evaluations are from the most recent survey completed in each community; most communities conduct surveys every year or in alternating years. NRC adds the latest results quickly upon survey completion, keeping the benchmark data fresh and relevant, and the comparisons are to jurisdictions that have conducted a survey within the last five years. The communities in the database represent a wide geographic and population range. The City of Palo Alto chose to have comparisons made to the entire database. Interpreting the Results Ratings are compared for standard items in questions 1 through 12 when there are at least five communities in which a similar question was asked. Where comparisons are available, four columns are provided in the table. The first column is Palo Alto’s average rating, converted to a 100-point scale. The 3 New England (CT, ME, MA, NH, RI, VT) Middle Atlantic (NJ, NY, PA) East North Central (IL, IN, MI, OH, WI) West North Central (IA, KS, MN, MO, NE, ND, SD) South Atlantic (DE, FL, GA, MD, NC, SC, VA, WV) East South Central (AL, KY, MS, TN) West South Central (AK, LA, OK, TX) Mountain (AZ, CO, ID, MT, NV, NM, UT, WY) Pacific (AK, CA, HI, OR, WA) Table 3: Benchmark Database Characteristics Region3 Percent New England 3% Middle Atlantic 5% East North Central 15% West North Central 13% South Atlantic 22% East South Central 3% West South Central 7% Mountain 16% Pacific 16% Population Percent Less than 10,000 10% 10,000 to 24,999 22% 25,000 to 49,999 23% 50,000 to 99,999 22% 100,000 or more 23% Attachment B The National Citizen Survey™ 9 second column is the rank assigned to Palo Alto’s rating among communities where a similar question was asked. The third column is the number of communities that asked a similar question. The final column shows the comparison of Palo Alto’s rating to the benchmark. In that final column, Palo Alto’s results are noted as being “higher” than the benchmark, “lower” than the benchmark, or “similar” to the benchmark, meaning that the average rating given by Palo Alto residents is statistically similar to or different (greater or lesser) than the benchmark. More extreme differences are noted as “much higher” or “much lower.” A rating is considered “similar” if it is within the standard range of 10 points; “higher” or “lower” if the difference between Palo Alto’s rating and the benchmark is greater than the standard range; and “much higher” or “much lower” if the difference between Palo Alto’s rating and the benchmark is more than twice the standard range. Where benchmark ratings were not available, “NA” indicates that this information is not applicable. Results Tables The following pages contain results for each question on the survey, the first set of results includes the “don’t know” responses, followed by results excluding the “don’t know” responses (where “don’t know” was an option), trends over time and geographic comparisons. For the questions in the survey respondents could answer “don’t know” the proportion of respondents giving this reply were not included for the comparisons over time and by geography. In other words, these tables display the responses from respondents who had an opinion about a specific item. For the basic frequencies, the percent of respondents giving a particular response is shown followed by the number of respondents (denoted with “N=”); the number of respondents is specific to each item, based on the actual number of responses received for the question or question item and based on the weighted data (weighted responses are rounded to the nearest whole number and may not exactly add up to the total number of responses; for more information on weighting, please see Survey Data Weighting, page 6). Generally, a small portion of respondents select “don’t know” for most survey items and, inevitably, some items have a larger “don’t know” percentage. Comparing responses to a set of items on the same scale can be misleading when the “don’t know” responses have been included. If two items have disparate “don’t know” percentages (2 percent versus 17 percent, for example), any apparent similarities or differences across the remaining response options may disappear once the “don’t know” responses are removed. Tables displaying trend data appear for standard questions (1 through 13; custom question and custom items are not included). Meaningful differences between survey years have been noted within the following tables as being “higher” or “lower” if the differences are greater than approximately five percentage points between the 2014 and 2015 surveys; otherwise, the comparison between 2014 and 2015 are noted as being “similar.” Geographic comparisons are made for questions 1 through 23 (some questions having multiple, nonscaled responses are not included). ANOVA and chi-square tests of significance were applied to these comparisons of survey questions. A “p-value” of 0.05 or less indicates that there is less than a 5 percent probability that differences observed between area are due to chance; or in other words, a greater than 95 percent probability that the differences observed are “real.” Where differences were statistically significant, they have been shaded grey. The shading represents statistical significance for each question individually, which may differ question by question because the number of responses varied, as some residents may have skipped or answered “don’t know.” Attachment B The National Citizen Survey™ 10 Question 1 Table 4: Question 1 - Response Percentages and Number of Respondents including "Don't Know" Responses Please rate each of the following aspects of quality of life in Palo Alto: Excellent Good Fair Poor Don't know Total Palo Alto as a place to live 53% N=377 38% N=274 7% N=51 1% N=8 0% N=2 100% N=713 Your neighborhood as a place to live 52% N=373 37% N=267 8% N=58 2% N=11 0% N=3 100% N=713 Palo Alto as a place to raise children 42% N=296 34% N=241 9% N=65 2% N=13 13% N=95 100% N=711 Palo Alto as a place to work 31% N=217 38% N=270 8% N=58 2% N=16 20% N=142 100% N=703 Palo Alto as a place to visit 29% N=206 40% N=283 19% N=131 6% N=39 6% N=45 100% N=705 Palo Alto as a place to retire 21% N=144 20% N=143 21% N=146 17% N=118 21% N=149 100% N=700 The overall quality of life in Palo Alto 37% N=261 51% N=360 11% N=77 1% N=10 0% N=2 100% N=711 Table 5: Question 1 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate each of the following aspects of quality of life in Palo Alto: Excellent Good Fair Poor Total Palo Alto as a place to live 53% N=377 39% N=274 7% N=51 1% N=8 100% N=711 Your neighborhood as a place to live 53% N=373 38% N=267 8% N=58 2% N=11 100% N=709 Palo Alto as a place to raise children 48% N=296 39% N=241 11% N=65 2% N=13 100% N=616 Palo Alto as a place to work 39% N=217 48% N=270 10% N=58 3% N=16 100% N=561 Palo Alto as a place to visit 31% N=206 43% N=283 20% N=131 6% N=39 100% N=659 Palo Alto as a place to retire 26% N=144 26% N=143 26% N=146 21% N=118 100% N=552 The overall quality of life in Palo Alto 37% N=261 51% N=360 11% N=77 1% N=10 100% N=709 Table 6: Question 1 - Historical Results Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Palo Alto as a place to live 94% 96% 95% 94% 95% 94% 95% 92% 95% 92% Similar Your neighborhood as a place to live 91% 91% 91% 90% 91% 90% 90% 91% 92% 90% Similar Palo Alto as a place to raise children 92% 92% 94% 91% 93% 93% 92% 90% 93% 87% Lower Palo Alto as a place to work 84% 90% 90% 87% 87% 89% 88% 89% 86% 87% Similar Palo Alto as a place to visit NA NA NA NA NA NA NA NA 75% 74% Similar Palo Alto as a place to retire 68% 61% 67% 64% 65% 68% 68% 56% 60% 52% Lower The overall quality of life in Palo Alto 92% 94% 91% 93% 94% 92% 94% 91% 91% 88% Similar Table 7: Question 1 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Palo Alto as a place to live 92% 91% 92% 92% 95% 86% 92% 93% 92% Your neighborhood as a place to live 93% 88% 91% 91% 92% 82% 97% 92% 90% Palo Alto as a place to raise children 87% 87% 87% 90% 94% 79% 89% 87% 87% Palo Alto as a place to work 86% 87% 82% 91% 81% 87% 91% 87% 87% Palo Alto as a place to visit 75% 74% 71% 71% 81% 71% 74% 78% 74% Palo Alto as a place to retire 58% 47% 59% 50% 46% 45% 52% 60% 52% The overall quality of life in Palo Alto 90% 85% 86% 85% 91% 81% 90% 94% 88% Attachment B The National Citizen Survey™ 11 Table 8: Question 1 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Palo Alto as a place to live 81 97 341 Similar Your neighborhood as a place to live 80 41 263 Similar Palo Alto as a place to raise children 78 110 332 Similar Palo Alto as a place to work 74 17 306 Higher Palo Alto as a place to visit 67 43 150 Similar Palo Alto as a place to retire 52 244 315 Similar The overall quality of life in Palo Alto 74 139 398 Similar Question 2 Table 9: Question 2 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don't know Total Overall feeling of safety in Palo Alto 44% N=313 47% N=333 9% N=61 1% N=6 0% N=0 100% N=713 Overall ease of getting to the places you usually have to visit 19% N=132 46% N=327 27% N=189 9% N=61 0% N=2 100% N=710 Quality of overall natural environment in Palo Alto 36% N=260 50% N=357 12% N=88 1% N=8 0% N=0 100% N=713 Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 15% N=106 48% N=338 29% N=208 7% N=53 1% N=7 100% N=712 Health and wellness opportunities in Palo Alto 40% N=283 42% N=300 10% N=71 1% N=8 7% N=50 100% N=713 Overall opportunities for education and enrichment 55% N=396 31% N=221 7% N=47 1% N=6 6% N=43 100% N=714 Overall economic health of Palo Alto 41% N=289 40% N=285 10% N=71 3% N=20 7% N=49 100% N=714 Sense of community 14% N=103 44% N=313 30% N=214 9% N=64 2% N=16 100% N=709 Overall image or reputation of Palo Alto 44% N=313 42% N=299 10% N=68 3% N=19 2% N=11 100% N=711 Table 10: Question 2 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Total Overall feeling of safety in Palo Alto 44% N=313 47% N=333 9% N=61 1% N=6 100% N=713 Overall ease of getting to the places you usually have to visit 19% N=132 46% N=327 27% N=189 9% N=61 100% N=708 Quality of overall natural environment in Palo Alto 36% N=260 50% N=357 12% N=88 1% N=8 100% N=713 Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 15% N=106 48% N=338 29% N=208 7% N=53 100% N=705 Health and wellness opportunities in Palo Alto 43% N=283 45% N=300 11% N=71 1% N=8 100% N=663 Overall opportunities for education and enrichment 59% N=396 33% N=221 7% N=47 1% N=6 100% N=671 Overall economic health of Palo Alto 44% N=289 43% N=285 11% N=71 3% N=20 100% N=665 Sense of community 15% N=103 45% N=313 31% N=214 9% N=64 100% N=694 Overall image or reputation of Palo Alto 45% N=313 43% N=299 10% N=68 3% N=19 100% N=700 Attachment B The National Citizen Survey™ 12 Table 11: Question 2 - Historical Results Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Overall feeling of safety in Palo Alto NA NA NA NA NA NA NA NA 92% 91% Similar Overall ease of getting to the places you usually have to visit NA NA NA NA NA NA NA NA 71% 65% Lower Quality of overall natural environment in Palo Alto NA NA 85% 84% 84% 84% 88% 83% 88% 86% Similar Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) NA NA NA NA NA NA NA NA 67% 63% Similar Health and wellness opportunities in Palo Alto NA NA NA NA NA NA NA NA 88% 88% Similar Overall opportunities for education and enrichment NA NA NA NA NA NA NA NA 96% 92% Similar Overall economic health of Palo Alto NA NA NA NA NA NA NA NA 88% 86% Similar Sense of community 66% 70% 70% 71% 71% 75% 73% 67% 64% 60% Similar Overall image or reputation of Palo Alto 91% 93% 92% 92% 90% 92% 92% 90% 92% 88% Similar Table 12: Question 2 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Overall feeling of safety in Palo Alto 88% 93% 87% 93% 92% 94% 90% 88% 91% Overall ease of getting to the places you usually have to visit 63% 67% 60% 69% 64% 65% 59% 67% 65% Quality of overall natural environment in Palo Alto 88% 85% 88% 87% 86% 82% 87% 89% 86% Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 68% 59% 66% 63% 62% 53% 69% 67% 63% Health and wellness opportunities in Palo Alto 88% 88% 90% 87% 89% 88% 86% 88% 88% Overall opportunities for education and enrichment 91% 93% 86% 95% 97% 89% 91% 93% 92% Overall economic health of Palo Alto 87% 85% 86% 87% 81% 87% 92% 86% 86% Sense of community 58% 61% 58% 65% 66% 56% 61% 57% 60% Overall image or reputation of Palo Alto 87% 88% 89% 89% 87% 87% 80% 90% 88% Table 13: Question 2 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Overall feeling of safety in Palo Alto 78 68 227 Similar Overall ease of getting to the places you usually have to visit 58 111 143 Similar Quality of overall natural environment in Palo Alto 74 62 235 Similar Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 57 70 137 Similar Health and wellness opportunities in Palo Alto 76 14 139 Higher Overall opportunities for education and enrichment 83 3 137 Much higher Overall economic health of Palo Alto 76 8 142 Higher Sense of community 55 164 262 Similar Overall image or reputation of Palo Alto 77 46 297 Higher Attachment B The National Citizen Survey™ 13 Question 3 Table 14: Question 3 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please indicate how likely or unlikely you are to do each of the following: Very likely Somewhat likely Somewhat unlikely Very unlikely Don't know Total Recommend living in Palo Alto to someone who asks 42% N=298 37% N=259 14% N=96 7% N=47 1% N=8 100% N=708 Remain in Palo Alto for the next five years 54% N=383 23% N=160 10% N=68 10% N=72 3% N=25 100% N=708 Table 15: Question 3 - Response Percentages and Number of Respondents without "Don't Know" Responses Please indicate how likely or unlikely you are to do each of the following: Very likely Somewhat likely Somewhat unlikely Very unlikely Total Recommend living in Palo Alto to someone who asks 43% N=298 37% N=259 14% N=96 7% N=47 100% N=700 Remain in Palo Alto for the next five years 56% N=383 23% N=160 10% N=68 10% N=72 100% N=684 Table 16: Question 3 - Historical Results Percent rating positively (e.g., very likely/somewhat likely) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Recommend living in Palo Alto to someone who asks NA NA 91% 90% 90% 91% 92% 89% 86% 80% Lower Remain in Palo Alto for the next five years NA NA 85% 87% 83% 87% 87% 87% 83% 80% Similar Table 17: Question 3 - Geographic Subgroup Results Percent rating "very likely" or "somewhat likely" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Recommend living in Palo Alto to someone who asks 80% 79% 84% 81% 83% 76% 77% 78% 80% Remain in Palo Alto for the next five years 76% 82% 82% 84% 87% 78% 69% 77% 80% Table 18: Question 3 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Recommend living in Palo Alto to someone who asks 80 173 236 Similar Remain in Palo Alto for the next five years 80 171 231 Similar Question 4 Table 19: Question 4 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate how safe or unsafe you feel: Very safe Somewhat safe Neither safe nor unsafe Somewhat unsafe Very unsafe Don't know Total In your neighborhood during the day 81% N=580 16% N=113 2% N=12 1% N=5 0% N=2 0% N=0 100% N=712 In Palo Alto's downtown/commercial areas during the day 61% N=432 30% N=211 6% N=41 1% N=7 1% N=6 2% N=16 100% N=713 In your neighborhood after dark 41% N=293 42% N=295 9% N=63 7% N=47 1% N=4 1% N=8 100% N=709 In Palo Alto's downtown/commercial areas after dark 23% N=163 39% N=277 17% N=119 12% N=82 2% N=15 8% N=56 100% N=713 Attachment B The National Citizen Survey™ 14 Table 20: Question 4 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate how safe or unsafe you feel: Very safe Somewhat safe Neither safe nor unsafe Somewhat unsafe Very unsafe Total In your neighborhood during the day 81% N=580 16% N=113 2% N=12 1% N=5 0% N=2 100% N=712 In Palo Alto's downtown/commercial areas during the day 62% N=432 30% N=211 6% N=41 1% N=7 1% N=6 100% N=697 In your neighborhood after dark 42% N=293 42% N=295 9% N=63 7% N=47 1% N=4 100% N=701 In Palo Alto's downtown/commercial areas after dark 25% N=163 42% N=277 18% N=119 13% N=82 2% N=15 100% N=657 Table 21: Question 4 - Historical Results* Percent rating positively (e.g., very safe/somewhat safe) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 In your neighborhood during the day 94% 98% 95% 95% 96% 98% 96% 97% 97% 97% Similar In Palo Alto's downtown/commercial areas during the day 91% 94% 96% 91% 94% 91% 92% 93% 92% 92% Similar * Trend data are not included for two custom items in this question (Safety in your neighborhood after dark and in Palo Alto’s downtown/commercial areas after dark). Table 22: Question 4 - Geographic Subgroup Results Percent rating "very safe" or "somewhat safe" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 In your neighborhood during the day 98% 97% 99% 97% 98% 96% 100% 97% 97% In Palo Alto's downtown/commercial areas during the day 93% 91% 91% 90% 89% 94% 92% 95% 92% In your neighborhood after dark 81% 86% 85% 88% 84% 84% 87% 76% 84% In Palo Alto's downtown/commercial areas after dark 68% 66% 66% 62% 62% 73% 73% 65% 67% Table 23: Question 4 - Benchmark Comparisons* Average rating Rank Number of communities in comparison Comparison to benchmark In your neighborhood during the day 94 55 303 Similar In Palo Alto's downtown/commercial areas during the day 88 118 257 Similar * Benchmarks were not calculated for two custom items in this question (Safety in your neighborhood after dark and in Palo Alto’s downtown/commercial areas after dark). Question 5 Table 24: Question 5 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don't know Total Traffic flow on major streets 3% N=22 28% N=197 38% N=267 31% N=218 1% N=7 100% N=710 Ease of public parking 6% N=46 29% N=209 40% N=284 22% N=160 2% N=16 100% N=714 Ease of travel by car in Palo Alto 8% N=56 36% N=255 38% N=272 17% N=118 1% N=8 100% N=709 Ease of travel by public transportation in Palo Alto 5% N=37 12% N=87 25% N=176 26% N=182 32% N=225 100% N=707 Ease of travel by bicycle in Palo Alto 26% N=185 39% N=279 15% N=103 5% N=34 15% N=106 100% N=707 Ease of walking in Palo Alto 39% N=278 43% N=305 14% N=99 3% N=20 1% N=5 100% N=708 Availability of paths and walking trails 25% N=181 43% N=309 20% N=144 5% N=36 6% N=42 100% N=711 Air quality 28% N=198 51% N=359 17% N=119 2% N=16 2% N=14 100% N=706 Cleanliness of Palo Alto 33% N=235 51% N=365 13% N=94 2% N=17 0% N=2 100% N=713 Overall appearance of Palo Alto 33% N=235 56% N=398 10% N=69 1% N=8 0% N=3 100% N=714 Public places where people want to spend time 23% N=165 55% N=391 15% N=108 3% N=24 3% N=22 100% N=709 Attachment B The National Citizen Survey™ 15 Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don't know Total Variety of housing options 2% N=17 16% N=111 30% N=213 44% N=311 8% N=58 100% N=709 Availability of affordable quality housing 2% N=11 6% N=39 11% N=81 73% N=519 9% N=62 100% N=712 Fitness opportunities (including exercise classes and paths or trails, etc.) 28% N=197 46% N=330 19% N=133 2% N=17 5% N=36 100% N=714 Recreational opportunities 28% N=195 49% N=347 17% N=124 2% N=15 4% N=27 100% N=709 Availability of affordable quality food 22% N=157 37% N=266 29% N=209 9% N=64 2% N=15 100% N=711 Availability of affordable quality health care 28% N=200 34% N=242 19% N=134 7% N=51 12% N=83 100% N=711 Availability of preventive health services 28% N=196 37% N=259 15% N=108 3% N=23 17% N=124 100% N=710 Availability of affordable quality mental health care 9% N=62 16% N=115 14% N=96 8% N=59 53% N=379 100% N=711 Table 25: Question 5 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Total Traffic flow on major streets 3% N=22 28% N=197 38% N=267 31% N=218 100% N=703 Ease of public parking 7% N=46 30% N=209 41% N=284 23% N=160 100% N=698 Ease of travel by car in Palo Alto 8% N=56 36% N=255 39% N=272 17% N=118 100% N=702 Ease of travel by public transportation in Palo Alto 8% N=37 18% N=87 37% N=176 38% N=182 100% N=482 Ease of travel by bicycle in Palo Alto 31% N=185 46% N=279 17% N=103 6% N=34 100% N=601 Ease of walking in Palo Alto 40% N=278 43% N=305 14% N=99 3% N=20 100% N=703 Availability of paths and walking trails 27% N=181 46% N=309 21% N=144 5% N=36 100% N=670 Air quality 29% N=198 52% N=359 17% N=119 2% N=16 100% N=692 Cleanliness of Palo Alto 33% N=235 51% N=365 13% N=94 2% N=17 100% N=712 Overall appearance of Palo Alto 33% N=235 56% N=398 10% N=69 1% N=8 100% N=710 Public places where people want to spend time 24% N=165 57% N=391 16% N=108 3% N=24 100% N=687 Variety of housing options 3% N=17 17% N=111 33% N=213 48% N=311 100% N=652 Availability of affordable quality housing 2% N=11 6% N=39 12% N=81 80% N=519 100% N=650 Fitness opportunities (including exercise classes and paths or trails, etc.) 29% N=197 49% N=330 20% N=133 3% N=17 100% N=678 Recreational opportunities 29% N=195 51% N=347 18% N=124 2% N=15 100% N=681 Availability of affordable quality food 23% N=157 38% N=266 30% N=209 9% N=64 100% N=696 Availability of affordable quality health care 32% N=200 39% N=242 21% N=134 8% N=51 100% N=628 Availability of preventive health services 33% N=196 44% N=259 18% N=108 4% N=23 100% N=586 Availability of affordable quality mental health care 19% N=62 35% N=115 29% N=96 18% N=59 100% N=332 Table 26: Question 5 - Historical Results Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Traffic flow on major streets 39% 45% 38% 46% 47% 40% 36% 34% 35% 31% Similar Ease of public parking NA NA NA NA NA NA NA NA 38% 36% Similar Ease of travel by car in Palo Alto 60% 65% 60% 65% 66% 62% 51% 55% 52% 44% Lower Ease of travel by public transportation in Palo Alto 60% 55% 52% 63% 62% 64% 71% 65% 36% 26% Lower Ease of travel by bicycle in Palo Alto 78% 84% 78% 79% 81% 77% 81% 78% 78% 77% Similar Ease of walking in Palo Alto 87% 88% 86% 82% 85% 83% 82% 84% 84% 83% Similar Availability of paths and walking trails NA NA 74% 75% 75% 75% 77% 71% 74% 73% Similar Attachment B The National Citizen Survey™ 16 Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Air quality 80% 79% 75% 73% 77% 77% 81% 81% 83% 81% Similar Cleanliness of Palo Alto NA NA 88% 85% 85% 88% 86% 84% 87% 84% Similar Overall appearance of Palo Alto 85% 86% 89% 83% 83% 89% 89% 85% 89% 89% Similar Public places where people want to spend time NA NA NA NA NA NA NA NA 81% 81% Similar Variety of housing options NA NA 34% 39% 37% 37% 29% 26% 27% 20% Lower Availability of affordable quality housing 11% 10% 12% 17% 15% 14% 12% 13% 11% 8% Similar Fitness opportunities (including exercise classes and paths or trails, etc.) NA NA NA NA NA NA NA NA 78% 78% Similar Recreational opportunities 83% 85% 82% 78% 80% 81% 81% 81% 77% 80% Similar Availability of affordable quality food 62% 71% 64% NA NA 66% 68% 67% 65% 61% Similar Availability of affordable quality health care 57% 56% 57% 63% 62% 59% 68% 62% 73% 70% Similar Availability of preventive health services NA NA 70% 67% 67% 72% 76% 73% 82% 78% Similar Availability of affordable quality mental health care NA NA NA NA NA NA NA NA 63% 53% Lower Table 27: Question 5 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Traffic flow on major streets 31% 31% 29% 33% 37% 25% 32% 33% 31% Ease of public parking 36% 37% 34% 35% 40% 35% 48% 32% 36% Ease of travel by car in Palo Alto 45% 44% 46% 42% 50% 40% 49% 43% 44% Ease of travel by public transportation in Palo Alto 26% 25% 14% 23% 32% 22% 24% 36% 26% Ease of travel by bicycle in Palo Alto 77% 78% 82% 82% 74% 78% 72% 75% 77% Ease of walking in Palo Alto 86% 81% 94% 80% 84% 80% 76% 85% 83% Availability of paths and walking trails 76% 70% 80% 67% 75% 71% 75% 75% 73% Air quality 81% 80% 81% 77% 81% 82% 84% 80% 81% Cleanliness of Palo Alto 85% 84% 87% 83% 83% 85% 83% 85% 84% Overall appearance of Palo Alto 90% 89% 91% 90% 89% 87% 88% 90% 89% Public places where people want to spend time 78% 84% 89% 90% 86% 77% 73% 74% 81% Variety of housing options 18% 21% 22% 24% 19% 20% 18% 17% 20% Availability of affordable quality housing 5% 10% 5% 8% 7% 14% 2% 7% 8% Fitness opportunities (including exercise classes and paths or trails, etc.) 77% 78% 89% 74% 82% 79% 72% 73% 78% Recreational opportunities 79% 80% 86% 80% 82% 78% 72% 79% 80% Availability of affordable quality food 59% 62% 57% 59% 67% 62% 59% 60% 61% Availability of affordable quality health care 72% 69% 75% 71% 71% 65% 66% 74% 70% Availability of preventive health services 79% 77% 83% 76% 78% 77% 73% 80% 78% Availability of affordable quality mental health care 56% 51% 59% 58% 44% 48% 44% 59% 53% Table 28: Question 5 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Traffic flow on major streets 34 267 299 Lower Ease of public parking 40 97 119 Lower Ease of travel by car in Palo Alto 45 226 254 Lower Attachment B The National Citizen Survey™ 17 Average rating Rank Number of communities in comparison Comparison to benchmark Ease of travel by public transportation in Palo Alto 32 96 126 Lower Ease of travel by bicycle in Palo Alto 67 19 251 Higher Ease of walking in Palo Alto 73 28 247 Higher Availability of paths and walking trails 65 84 266 Similar Air quality 69 80 211 Similar Cleanliness of Palo Alto 72 73 228 Similar Overall appearance of Palo Alto 74 58 310 Higher Public places where people want to spend time 67 31 130 Similar Variety of housing options 25 233 234 Much lower Availability of affordable quality housing 10 254 255 Much lower Fitness opportunities (including exercise classes and paths or trails, etc.) 68 40 134 Similar Recreational opportunities 69 54 259 Similar Availability of affordable quality food 58 114 192 Similar Availability of affordable quality health care 65 41 216 Similar Availability of preventive health services 69 18 192 Higher Availability of affordable quality mental health care 51 37 119 Similar Question 6 Table 29: Question 6 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don't know Total Availability of affordable quality child care/preschool 8% N=54 17% N=122 17% N=121 9% N=64 49% N=341 100% N=702 K-12 education 41% N=286 25% N=179 5% N=34 1% N=9 28% N=194 100% N=702 Adult educational opportunities 25% N=176 33% N=236 11% N=75 1% N=9 29% N=207 100% N=703 Opportunities to attend cultural/arts/music activities 33% N=235 40% N=285 17% N=118 2% N=17 7% N=51 100% N=706 Opportunities to participate in religious or spiritual events and activities 23% N=162 30% N=212 8% N=57 1% N=9 37% N=261 100% N=702 Employment opportunities 17% N=118 32% N=221 19% N=134 6% N=39 27% N=188 100% N=700 Shopping opportunities 36% N=255 42% N=297 16% N=116 4% N=29 1% N=8 100% N=705 Cost of living in Palo Alto 1% N=7 7% N=46 28% N=198 63% N=440 1% N=7 100% N=698 Overall quality of business and service establishments in Palo Alto 21% N=144 53% N=374 22% N=152 1% N=7 4% N=25 100% N=701 Vibrant downtown/commercial area 27% N=186 46% N=324 19% N=132 4% N=26 4% N=30 100% N=698 Overall quality of new development in Palo Alto 9% N=62 32% N=223 27% N=188 16% N=111 16% N=112 100% N=696 Opportunities to participate in social events and activities 19% N=132 46% N=320 20% N=141 3% N=21 12% N=87 100% N=702 Opportunities to volunteer 23% N=161 36% N=257 14% N=97 1% N=9 26% N=182 100% N=705 Opportunities to participate in community matters 18% N=124 41% N=289 17% N=121 2% N=13 22% N=154 100% N=700 Openness and acceptance of the community toward people of diverse backgrounds 22% N=153 38% N=267 22% N=157 6% N=39 13% N=90 100% N=705 Neighborliness of residents in Palo Alto 15% N=104 42% N=295 29% N=204 8% N=55 5% N=36 100% N=694 Openness and acceptance of the community toward lesbian, gay, bisexual, and transgender people 17% N=120 35% N=244 10% N=73 1% N=9 37% N=261 100% N=706 Opportunities to learn about City services through social media websites such as Twitter and Facebook 14% N=100 28% N=198 12% N=84 2% N=14 44% N=311 100% N=707 Attachment B The National Citizen Survey™ 18 Table 30: Question 6 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Total Availability of affordable quality child care/preschool 15% N=54 34% N=122 34% N=121 18% N=64 100% N=361 K-12 education 56% N=286 35% N=179 7% N=34 2% N=9 100% N=507 Adult educational opportunities 36% N=176 47% N=236 15% N=75 2% N=9 100% N=496 Opportunities to attend cultural/arts/music activities 36% N=235 43% N=285 18% N=118 3% N=17 100% N=655 Opportunities to participate in religious or spiritual events and activities 37% N=162 48% N=212 13% N=57 2% N=9 100% N=441 Employment opportunities 23% N=118 43% N=221 26% N=134 8% N=39 100% N=512 Shopping opportunities 37% N=255 43% N=297 17% N=116 4% N=29 100% N=697 Cost of living in Palo Alto 1% N=7 7% N=46 29% N=198 64% N=440 100% N=691 Overall quality of business and service establishments in Palo Alto 21% N=144 55% N=374 22% N=152 1% N=7 100% N=676 Vibrant downtown/commercial area 28% N=186 49% N=324 20% N=132 4% N=26 100% N=668 Overall quality of new development in Palo Alto 11% N=62 38% N=223 32% N=188 19% N=111 100% N=585 Opportunities to participate in social events and activities 22% N=132 52% N=320 23% N=141 3% N=21 100% N=615 Opportunities to volunteer 31% N=161 49% N=257 18% N=97 2% N=9 100% N=523 Opportunities to participate in community matters 23% N=124 53% N=289 22% N=121 2% N=13 100% N=547 Openness and acceptance of the community toward people of diverse backgrounds 25% N=153 43% N=267 26% N=157 6% N=39 100% N=615 Neighborliness of residents in Palo Alto 16% N=104 45% N=295 31% N=204 8% N=55 100% N=658 Openness and acceptance of the community toward lesbian, gay, bisexual, and transgender people 27% N=120 55% N=244 16% N=73 2% N=9 100% N=446 Opportunities to learn about City services through social media websites such as Twitter and Facebook 25% N=100 50% N=198 21% N=84 4% N=14 100% N=396 Table 31: Question 6 - Historical Results* Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Availability of affordable quality child care/preschool 35% 26% 28% 32% 25% 35% 27% 31% 49% 49% Similar K-12 education NA NA NA NA NA 92% 92% 94% 95% 92% Similar Adult educational opportunities NA NA NA NA NA NA NA NA 89% 83% Lower Opportunities to attend cultural/arts/music activities 85% 81% 79% 74% 74% 73% 77% 69% 81% 79% Similar Opportunities to participate in religious or spiritual events and activities NA NA 82% NA NA NA 84% 75% 86% 85% Similar Employment opportunities 59% 61% 61% 51% 52% 56% 68% 68% 69% 66% Similar Shopping opportunities 80% 79% 71% 70% 70% 71% 69% 73% 82% 79% Similar Cost of living in Palo Alto NA NA NA NA NA NA NA NA 11% 8% Similar Overall quality of business and service establishments in Palo Alto NA NA 77% 73% 75% 74% 79% 71% 79% 77% Similar Vibrant downtown/commercial area NA NA NA NA NA NA NA NA 77% 76% Similar Overall quality of new development in Palo Alto 62% 57% 57% 55% 53% 57% 56% 44% 51% 49% Similar Opportunities to participate in social events and activities NA NA 80% 80% 74% 76% 74% 74% 71% 74% Similar Opportunities to volunteer NA NA 86% 83% 81% 80% 80% 82% 83% 80% Similar Opportunities to participate in community matters NA NA 75% 76% 76% 71% NA NA 75% 76% Similar Openness and acceptance of the community toward people of diverse backgrounds 75% 79% 77% 78% 79% 78% 80% 76% 76% 68% Lower Neighborliness of residents in Palo Alto NA NA NA NA NA NA NA NA 64% 61% Similar * Trend data are not included for two custom items in this question (openness and acceptance of the community toward lesbian, gay, bisexual and transgender people and opportunities to learn about City services through social media websites such as Twitter and Facebook). Attachment B The National Citizen Survey™ 19 Table 32: Question 6 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Availability of affordable quality child care/preschool 45% 51% 44% 57% 49% 44% 33% 53% 49% K-12 education 91% 92% 86% 96% 87% 92% 93% 94% 92% Adult educational opportunities 81% 85% 77% 89% 76% 88% 82% 83% 83% Opportunities to attend cultural/arts/music activities 77% 82% 78% 86% 84% 75% 76% 77% 79% Opportunities to participate in religious or spiritual events and activities 85% 85% 86% 88% 84% 82% 71% 92% 85% Employment opportunities 68% 65% 66% 64% 61% 68% 68% 69% 66% Shopping opportunities 81% 78% 74% 84% 75% 73% 85% 83% 79% Cost of living in Palo Alto 7% 9% 8% 11% 9% 7% 7% 5% 8% Overall quality of business and service establishments in Palo Alto 76% 77% 72% 80% 83% 70% 81% 75% 77% Vibrant downtown/commercial area 76% 77% 75% 77% 81% 74% 75% 77% 76% Overall quality of new development in Palo Alto 54% 44% 41% 41% 48% 44% 56% 60% 49% Opportunities to participate in social events and activities 73% 74% 74% 77% 78% 68% 69% 75% 74% Opportunities to volunteer 80% 80% 77% 84% 82% 72% 83% 82% 80% Opportunities to participate in community matters 74% 77% 70% 79% 79% 73% 77% 75% 76% Openness and acceptance of the community toward people of diverse backgrounds 68% 69% 75% 63% 79% 67% 69% 63% 68% Neighborliness of residents in Palo Alto 56% 65% 61% 63% 72% 60% 49% 57% 61% Openness and acceptance of the community toward lesbian, gay, bisexual, and transgender people 83% 81% 87% 84% 82% 76% 83% 80% 82% Opportunities to learn about City services through social media websites such as Twitter and Facebook 77% 73% 85% 80% 75% 65% 75% 76% 75% Table 33: Question 6 - Benchmark Comparisons* Average rating Rank Number of communities in comparison Comparison to benchmark Availability of affordable quality child care/preschool 49 119 214 Similar K-12 education 82 17 225 Higher Adult educational opportunities 72 6 124 Higher Opportunities to attend cultural/arts/music activities 71 21 252 Higher Opportunities to participate in religious or spiritual events and activities 73 36 172 Similar Employment opportunities 61 4 267 Much higher Shopping opportunities 71 26 253 Higher Cost of living in Palo Alto 15 134 136 Much lower Overall quality of business and service establishments in Palo Alto 66 36 228 Similar Vibrant downtown/commercial area 67 16 127 Much higher Overall quality of new development in Palo Alto 47 182 243 Similar Opportunities to participate in social events and activities 64 40 215 Similar Opportunities to volunteer 70 41 222 Similar Opportunities to participate in community matters 65 33 228 Similar Openness and acceptance of the community toward people of diverse backgrounds 62 50 245 Similar Neighborliness of Palo Alto 56 72 132 Similar * Benchmarks were not calculated for two custom items in this question (openness toward lesbian, gay, bisexual and transgender people and opportunities to learn about City services through social media). Attachment B The National Citizen Survey™ 20 Question 7 Table 34: Question 7 - Response Percentages and Number of Respondents Please indicate whether or not you have done each of the following in the last 12 months. No Yes Total Made efforts to conserve water 5% N=32 95% N=673 100% N=705 Made efforts to make your home more energy efficient 26% N=179 74% N=524 100% N=703 Observed a code violation or other hazard in Palo Alto 67% N=459 33% N=230 100% N=689 Household member was a victim of a crime in Palo Alto 93% N=653 7% N=50 100% N=703 Reported a crime to the police in Palo Alto 87% N=611 13% N=91 100% N=702 Stocked supplies in preparation for an emergency 56% N=392 44% N=311 100% N=703 Campaigned or advocated for an issue, cause or candidate 76% N=533 24% N=167 100% N=700 Contacted the City of Palo Alto (in-person, phone, email or web) for help or information 48% N=338 52% N=362 100% N=700 Contacted Palo Alto elected officials (in-person, phone, email or web) to express your opinion 85% N=595 15% N=109 100% N=704 Table 35: Question 7 - Historical Results Percent rating positively (e.g., yes) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Made efforts to conserve water NA NA NA NA NA NA NA NA 96% 95% Similar Made efforts to make your home more energy efficient NA NA NA NA NA NA NA NA 77% 74% Similar Did NOT observe a code violation or other hazard in Palo Alto NA NA NA NA NA NA NA NA 70% 67% Similar Household member was NOT the victim of a crime in Palo Alto 88% 91% 90% 89% 91% 91% 91% 94% 92% 93% Similar Did NOT report a crime to the police in Palo Alto NA NA NA NA NA NA NA NA 87% 87% Similar Stocked supplies in preparation for an emergency NA NA NA NA NA NA NA NA 46% 44% Similar Campaigned or advocated for an issue, cause or candidate NA NA NA NA NA NA NA NA 27% 24% Similar Contacted the City of Palo Alto (in-person, phone, email or web) for help or information 54% 57% 54% 58% 56% 43% 44% 49% 50% 52% Similar Contacted Palo Alto elected officials (in-person, phone, email or web) to express your opinion NA NA NA NA NA NA NA NA 17% 15% Similar Some questions were reworded in the Historical Results table to reflect the positive rating of “yes.” Table 36: Question 7 - Geographic Subgroup Results Percent "yes" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Made efforts to conserve water 95% 95% 98% 99% 96% 92% 97% 93% 95% Made efforts to make your home more energy efficient 70% 78% 76% 82% 77% 75% 67% 68% 74% Did NOT observe a code violation or other hazard in Palo Alto 71% 63% 70% 58% 66% 65% 76% 69% 67% Household member was NOT the victim of a crime in Palo Alto 91% 94% 94% 95% 97% 93% 89% 91% 93% Did NOT report a crime to the police in Palo Alto 85% 89% 85% 88% 90% 89% 91% 81% 87% Stocked supplies in preparation for an emergency 43% 46% 42% 49% 53% 37% 44% 44% 44% Campaigned or advocated for an issue, cause or candidate 22% 25% 30% 28% 29% 21% 19% 20% 24% Contacted the City of Palo Alto (in-person, phone, email or web) for help or information 54% 50% 66% 53% 42% 51% 44% 54% 52% Contacted Palo Alto elected officials (in-person, phone, email or web) to express your opinion 15% 16% 19% 18% 18% 13% 13% 13% 15% Attachment B The National Citizen Survey™ 21 Table 37: Question 7 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Made efforts to conserve water 95 12 124 Higher Made efforts to make your home more energy efficient 74 90 124 Similar Did NOT observe a code violation or other hazard in Palo Alto 67 20 125 Higher Household member was NOT a victim of a crime 93 41 228 Similar Did NOT report a crime to the police 87 16 133 Higher Stocked supplies in preparation for an emergency 44 28 123 Similar Campaigned or advocated for an issue, cause or candidate 24 36 121 Similar Contacted Palo Alto (in-person, phone, email or web) for help or information 52 74 268 Similar Contacted Palo Alto elected officials (in-person, phone, email or web) to express your opinion 15 77 128 Similar Question 8 Table 38: Question 8 - Response Percentages and Number of Respondents In the last 12 months, about how many times, if at all, have you or other household members done each of the following in Palo Alto? 2 times a week or more 2-4 times a month Once a month or less Not at all Total Used Palo Alto recreation centers or their services 13% N=90 18% N=126 34% N=239 35% N=241 100% N=696 Visited a neighborhood park or City park 29% N=205 33% N=229 32% N=221 6% N=42 100% N=697 Used Palo Alto public libraries or their services 14% N=95 32% N=226 30% N=210 24% N=171 100% N=702 Participated in religious or spiritual activities in Palo Alto 7% N=46 9% N=62 15% N=104 70% N=490 100% N=703 Attended a City-sponsored event 1% N=4 7% N=50 49% N=345 43% N=298 100% N=697 Used bus, rail or other public transportation instead of driving 10% N=67 13% N=92 30% N=210 47% N=331 100% N=700 Carpooled with other adults or children instead of driving alone 18% N=122 20% N=141 21% N=144 42% N=290 100% N=697 Walked or biked instead of driving 50% N=348 20% N=143 17% N=118 13% N=89 100% N=698 Volunteered your time to some group/activity in Palo Alto 12% N=84 14% N=97 20% N=140 54% N=380 100% N=701 Participated in a club 9% N=61 10% N=68 15% N=104 66% N=462 100% N=696 Talked to or visited with your immediate neighbors 34% N=237 32% N=226 23% N=160 11% N=78 100% N=701 Done a favor for a neighbor 14% N=95 22% N=153 41% N=286 24% N=169 100% N=704 Used the City’s website to conduct business or pay bills 3% N=24 10% N=69 38% N=269 49% N=343 100% N=706 Table 39: Question 8 - Historical Results* Percent rating positively (e.g., at least once in the last 12 months) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Used Palo Alto recreation centers or their services 63% 67% 68% 63% 60% 60% 65% 58% 63% 65% Similar Visited a neighborhood park or City park 93% 92% 93% 94% 94% 91% 95% 94% 91% 94% Similar Used Palo Alto public libraries or their services 76% 79% 74% 82% 76% 74% 77% 77% 68% 76% Higher Participated in religious or spiritual activities in Palo Alto NA NA 40% NA NA NA 40% NA 30% 30% Similar Attended a City-sponsored event NA NA NA NA NA NA NA NA 50% 57% Higher Used bus, rail or other public transportation instead of driving NA NA NA NA NA NA NA NA 50% 53% Similar Carpooled with other adults or children instead of driving alone NA NA NA NA NA NA NA NA 53% 58% Higher Attachment B The National Citizen Survey™ 22 Percent rating positively (e.g., at least once in the last 12 months) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Walked or biked instead of driving NA NA NA NA NA NA NA NA 85% 87% Similar Volunteered your time to some group/activity in Palo Alto 53% 52% 51% 56% 51% 45% 54% 50% 40% 46% Higher Participated in a club NA NA 34% 33% 31% 31% 38% 29% 27% 34% Higher Talked to or visited with your immediate neighbors NA NA NA NA NA NA NA NA 91% 89% Similar Done a favor for a neighbor NA NA NA NA NA NA NA NA 81% 76% Similar * Trend data are not included for one custom item in this question (Used the City’s website to conduct business or pay bills). Table 40: Question 8 - Geographic Subgroup Results Percent who had done the activity at least once North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Used Palo Alto recreation centers or their services 63% 68% 78% 75% 71% 61% 41% 65% 65% Visited a neighborhood park or City park 93% 95% 95% 97% 93% 95% 89% 94% 94% Used Palo Alto public libraries or their services 73% 78% 78% 82% 84% 70% 60% 77% 76% Participated in religious or spiritual activities in Palo Alto 29% 31% 22% 28% 32% 34% 28% 34% 30% Attended a City-sponsored event 57% 57% 61% 63% 55% 53% 43% 63% 57% Used bus, rail or other public transportation instead of driving 58% 48% 55% 47% 46% 49% 57% 60% 53% Carpooled with other adults or children instead of driving alone 57% 60% 60% 62% 52% 63% 56% 56% 58% Walked or biked instead of driving 89% 85% 87% 85% 77% 91% 92% 90% 87% Volunteered your time to some group/activity in Palo Alto 43% 48% 56% 51% 50% 44% 36% 39% 46% Participated in a club 34% 34% 44% 31% 44% 31% 33% 27% 34% Talked to or visited with your immediate neighbors 88% 90% 92% 88% 98% 87% 79% 90% 89% Done a favor for a neighbor 75% 77% 87% 75% 84% 73% 60% 77% 76% Used the City’s website to conduct business or pay bills 52% 51% 59% 52% 40% 58% 48% 49% 51% Table 41: Question 8 - Benchmark Comparisons* Average rating Rank Number of communities in comparison Comparison to benchmark Used Palo Alto recreation centers or their services 65 36 200 Similar Visited a neighborhood park or City park 94 13 231 Higher Used Palo Alto public libraries or their services 76 32 201 Higher Participated in religious or spiritual activities in Palo Alto 30 154 170 Lower Attended City-sponsored event 57 45 130 Similar Used bus, rail, or other public transportation instead of driving 53 16 110 Much higher Carpooled with other adults or children instead of driving alone 58 8 129 Higher Walked or biked instead of driving 87 8 133 Much higher Volunteered your time to some group/activity in Palo Alto 46 77 220 Similar Participated in a club 34 57 198 Similar Talked to or visited with your immediate neighbors 89 86 129 Similar Done a favor for a neighbor 76 105 125 Similar * Benchmarks were not calculated for one custom item in this question (Used the City’s website to conduct business or pay bills). Attachment B The National Citizen Survey™ 23 Question 9 Table 42: Question 9 - Response Percentages and Number of Respondents Thinking about local public meetings (of local elected officials like City Council or County Commissioners, advisory boards, town halls, HOA, neighborhood watch, etc.), in the last 12 months, about how many times, if at all, have you or other household members attended or watched a local public meeting? 2 times a week or more 2-4 times a month Once a month or less Not at all Total Attended a local public meeting 0% N=2 3% N=21 19% N=131 78% N=538 100% N=692 Watched (online or on television) a local public meeting 0% N=3 3% N=19 15% N=102 82% N=568 100% N=693 Table 43: Question 9 - Historical Results Percent rating positively (e.g., at least once in the last 12 months) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Attended a local public meeting 27% 26% 26% 28% 27% 27% 25% 28% 22% 22% Similar Watched (online or on television) a local public meeting 31% 26% 26% 28% 28% 27% 21% 24% 16% 18% Similar Table 44: Question 9 - Geographic Subgroup Results Percent who had done the activity at least once North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Attended a local public meeting 22% 22% 26% 19% 31% 19% 19% 22% 22% Watched (online or on television) a local public meeting 17% 19% 20% 15% 24% 20% 16% 15% 18% Table 45: Question 9 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Attended a local public meeting 22 96 220 Similar Watched (online or on television) a local public meeting 18 152 185 Lower Question 10 Table 46: Question 10 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate the quality of each of the following services in Palo Alto: Excellent Good Fair Poor Don't know Total Police services 31% N=216 36% N=250 8% N=55 1% N=10 24% N=164 100% N=694 Fire services 33% N=229 26% N=179 2% N=14 0% N=0 39% N=271 100% N=692 Ambulance or emergency medical services 31% N=218 22% N=153 3% N=18 0% N=1 44% N=304 100% N=693 Crime prevention 19% N=132 30% N=207 11% N=75 3% N=18 37% N=254 100% N=686 Fire prevention and education 16% N=110 27% N=182 6% N=44 1% N=6 50% N=343 100% N=685 Traffic enforcement 13% N=92 35% N=240 23% N=156 9% N=62 20% N=137 100% N=687 Street repair 13% N=88 36% N=248 31% N=218 15% N=105 5% N=35 100% N=693 Street cleaning 26% N=180 45% N=312 21% N=142 4% N=26 4% N=31 100% N=691 Street lighting 20% N=138 50% N=346 22% N=150 7% N=45 2% N=15 100% N=694 Sidewalk maintenance 16% N=110 43% N=300 27% N=188 10% N=66 4% N=30 100% N=693 Traffic signal timing 10% N=68 35% N=245 32% N=224 18% N=124 4% N=30 100% N=692 Bus or transit services 7% N=51 20% N=139 18% N=125 11% N=72 44% N=301 100% N=687 Garbage collection 38% N=266 45% N=313 10% N=68 2% N=15 4% N=30 100% N=692 Attachment B The National Citizen Survey™ 24 Please rate the quality of each of the following services in Palo Alto: Excellent Good Fair Poor Don't know Total Yard waste pick-up 34% N=239 34% N=237 9% N=65 2% N=13 20% N=138 100% N=693 Storm drainage 15% N=106 36% N=250 17% N=115 5% N=31 27% N=188 100% N=689 Drinking water 45% N=314 40% N=276 10% N=71 1% N=7 4% N=25 100% N=692 Sewer services 30% N=208 42% N=290 9% N=62 1% N=8 18% N=124 100% N=692 Utility billing 32% N=223 44% N=301 13% N=91 3% N=23 7% N=49 100% N=687 City parks 45% N=311 45% N=308 6% N=43 1% N=4 4% N=27 100% N=692 Recreation programs or classes 21% N=147 30% N=206 9% N=61 1% N=7 39% N=269 100% N=691 Recreation centers or facilities 22% N=153 35% N=240 8% N=54 2% N=11 33% N=227 100% N=685 Land use, planning and zoning 8% N=56 20% N=134 24% N=168 18% N=120 30% N=207 100% N=685 Code enforcement (weeds, abandoned buildings, etc.) 9% N=59 24% N=165 16% N=110 6% N=44 45% N=305 100% N=684 Animal control 16% N=108 27% N=183 8% N=56 2% N=15 47% N=319 100% N=682 Economic development 15% N=105 30% N=201 15% N=99 6% N=37 35% N=235 100% N=677 Public library services 44% N=304 33% N=225 6% N=42 1% N=7 16% N=112 100% N=690 Public information services 18% N=126 35% N=243 10% N=68 2% N=12 34% N=236 100% N=685 Cable television 8% N=57 20% N=141 16% N=108 8% N=53 48% N=329 100% N=688 Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) 12% N=80 30% N=206 12% N=83 2% N=16 44% N=303 100% N=688 Preservation of natural areas such as open space, farmlands and greenbelts 26% N=181 39% N=267 17% N=117 2% N=14 16% N=108 100% N=687 Palo Alto open space 33% N=227 40% N=278 13% N=87 1% N=10 12% N=84 100% N=686 City-sponsored special events 13% N=87 32% N=220 13% N=90 2% N=13 40% N=269 100% N=680 Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 18% N=127 38% N=260 17% N=117 2% N=16 24% N=167 100% N=686 Neighborhood branch libraries 39% N=263 33% N=226 7% N=49 1% N=9 20% N=137 100% N=683 Your neighborhood park 42% N=288 43% N=296 8% N=54 1% N=7 7% N=45 100% N=690 Variety of library materials 27% N=186 35% N=244 10% N=66 3% N=21 25% N=171 100% N=688 Street tree maintenance 20% N=140 48% N=327 19% N=132 6% N=40 7% N=48 100% N=687 Electric utility 31% N=212 50% N=342 11% N=74 1% N=10 7% N=47 100% N=684 Gas utility 29% N=202 47% N=325 10% N=66 1% N=9 12% N=82 100% N=685 Recycling collection 42% N=285 44% N=304 7% N=46 2% N=12 6% N=39 100% N=686 City's website 14% N=96 37% N=252 17% N=119 6% N=39 26% N=179 100% N=685 Art programs and theatre 22% N=148 33% N=226 12% N=85 1% N=8 32% N=221 100% N=688 Table 47: Question 10 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate the quality of each of the following services in Palo Alto: Excellent Good Fair Poor Total Police services 41% N=216 47% N=250 10% N=55 2% N=10 100% N=530 Fire services 54% N=229 43% N=179 3% N=14 0% N=0 100% N=422 Ambulance or emergency medical services 56% N=218 39% N=153 5% N=18 0% N=1 100% N=389 Crime prevention 31% N=132 48% N=207 17% N=75 4% N=18 100% N=432 Fire prevention and education 32% N=110 53% N=182 13% N=44 2% N=6 100% N=342 Traffic enforcement 17% N=92 44% N=240 28% N=156 11% N=62 100% N=550 Street repair 13% N=88 38% N=248 33% N=218 16% N=105 100% N=657 Street cleaning 27% N=180 47% N=312 22% N=142 4% N=26 100% N=660 Attachment B The National Citizen Survey™ 25 Please rate the quality of each of the following services in Palo Alto: Excellent Good Fair Poor Total Street lighting 20% N=138 51% N=346 22% N=150 7% N=45 100% N=679 Sidewalk maintenance 17% N=110 45% N=300 28% N=188 10% N=66 100% N=663 Traffic signal timing 10% N=68 37% N=245 34% N=224 19% N=124 100% N=661 Bus or transit services 13% N=51 36% N=139 32% N=125 19% N=72 100% N=387 Garbage collection 40% N=266 47% N=313 10% N=68 2% N=15 100% N=662 Yard waste pick-up 43% N=239 43% N=237 12% N=65 2% N=13 100% N=555 Storm drainage 21% N=106 50% N=250 23% N=115 6% N=31 100% N=502 Drinking water 47% N=314 41% N=276 11% N=71 1% N=7 100% N=668 Sewer services 37% N=208 51% N=290 11% N=62 1% N=8 100% N=568 Utility billing 35% N=223 47% N=301 14% N=91 4% N=23 100% N=638 City parks 47% N=311 46% N=308 6% N=43 1% N=4 100% N=666 Recreation programs or classes 35% N=147 49% N=206 14% N=61 2% N=7 100% N=422 Recreation centers or facilities 33% N=153 52% N=240 12% N=54 2% N=11 100% N=458 Land use, planning and zoning 12% N=56 28% N=134 35% N=168 25% N=120 100% N=478 Code enforcement (weeds, abandoned buildings, etc.) 16% N=59 44% N=165 29% N=110 12% N=44 100% N=378 Animal control 30% N=108 50% N=183 15% N=56 4% N=15 100% N=363 Economic development 24% N=105 45% N=201 22% N=99 8% N=37 100% N=442 Public library services 53% N=304 39% N=225 7% N=42 1% N=7 100% N=578 Public information services 28% N=126 54% N=243 15% N=68 3% N=12 100% N=449 Cable television 16% N=57 39% N=141 30% N=108 15% N=53 100% N=360 Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) 21% N=80 53% N=206 21% N=83 4% N=16 100% N=386 Preservation of natural areas such as open space, farmlands and greenbelts 31% N=181 46% N=267 20% N=117 2% N=14 100% N=579 Palo Alto open space 38% N=227 46% N=278 14% N=87 2% N=10 100% N=602 City-sponsored special events 21% N=87 54% N=220 22% N=90 3% N=13 100% N=411 Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 24% N=127 50% N=260 22% N=117 3% N=16 100% N=519 Neighborhood branch libraries 48% N=263 41% N=226 9% N=49 2% N=9 100% N=546 Your neighborhood park 45% N=288 46% N=296 8% N=54 1% N=7 100% N=645 Variety of library materials 36% N=186 47% N=244 13% N=66 4% N=21 100% N=517 Street tree maintenance 22% N=140 51% N=327 21% N=132 6% N=40 100% N=639 Electric utility 33% N=212 54% N=342 12% N=74 2% N=10 100% N=637 Gas utility 34% N=202 54% N=325 11% N=66 1% N=9 100% N=603 Recycling collection 44% N=285 47% N=304 7% N=46 2% N=12 100% N=647 City's website 19% N=96 50% N=252 24% N=119 8% N=39 100% N=506 Art programs and theatre 32% N=148 48% N=226 18% N=85 2% N=8 100% N=468 Attachment B The National Citizen Survey™ 26 Table 48: Question 10 - Historical Results* Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Police services 87% 91% 84% 84% 87% 88% 86% 86% 87% 88% Similar Fire services 95% 98% 96% 95% 93% 92% 96% 93% 95% 97% Similar Ambulance or emergency medical services 94% 94% 95% 91% 94% 93% 96% 93% 97% 95% Similar Crime prevention 77% 83% 74% 73% 79% 81% 74% 75% 80% 79% Similar Fire prevention and education 84% 86% 87% 80% 79% 76% 80% 82% 85% 85% Similar Traffic enforcement 63% 72% 64% 61% 64% 61% 66% 64% 62% 60% Similar Street repair 47% 47% 47% 42% 43% 40% 42% 47% 55% 51% Similar Street cleaning 77% 77% 75% 73% 76% 79% 80% 76% 80% 75% Lower Street lighting 66% 61% 64% 64% 68% 65% 68% 66% 74% 71% Similar Sidewalk maintenance 53% 57% 53% 53% 51% 51% 53% 56% 62% 62% Similar Traffic signal timing 55% 60% 56% 56% 56% 52% 47% 53% 53% 47% Lower Bus or transit services 58% 57% 49% 50% 45% 46% 58% 49% 57% 49% Lower Garbage collection 92% 91% 92% 89% 88% 89% 89% 85% 91% 87% Similar Yard waste pick-up 90% 93% 89% NA NA NA NA NA 90% 86% Similar Storm drainage 61% 59% 70% 73% 74% 74% 75% 69% 80% 71% Lower Drinking water 80% 79% 87% 81% 84% 86% 83% 88% 89% 88% Similar Sewer services 83% 83% 81% 81% 82% 84% 82% 84% 89% 88% Similar Utility billing NA NA NA NA NA NA NA NA 84% 82% Similar City parks 87% 91% 89% 92% 90% 94% 91% 93% 92% 93% Similar Recreation programs or classes 85% 90% 87% 85% 82% 81% 87% 87% 87% 84% Similar Recreation centers or facilities 81% 82% 77% 80% 81% 75% 85% 80% 84% 86% Similar Land use, planning and zoning 50% 49% 47% 47% 49% 45% 51% 36% 43% 40% Similar Code enforcement (weeds, abandoned buildings, etc.) 61% 59% 59% 50% 53% 56% 61% 57% 62% 59% Similar Animal control 78% 79% 78% 78% 76% 72% 78% 76% 80% 80% Similar Economic development 61% 62% 63% 54% 49% 52% 67% 61% 73% 69% Similar Public library services 78% 81% 75% 78% 82% 83% 88% 85% 81% 91% Higher Public information services 72% 73% 76% 68% 67% 67% 74% 73% 79% 82% Similar Cable television NA NA NA NA NA NA NA NA 60% 55% Similar Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) NA NA 71% 62% 59% 64% 73% 77% 70% 74% Similar Preservation of natural areas such as open space, farmlands and greenbelts NA NA 78% 82% 78% 76% 81% 79% 80% 77% Similar Palo Alto open space NA NA NA NA NA NA NA NA 82% 84% Similar City-sponsored special events NA NA NA NA NA NA NA NA 75% 75% Similar Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 79% 79% 73% 79% 77% 76% 81% 79% 81% 74% Lower * Trend data are not included for nine custom items in this question (neighborhood branch libraries, your neighborhood park, variety of library materials, street tree maintenance, electric utility, gas utility, recycling collection, City’s website, and art programs and theatre). Attachment B The National Citizen Survey™ 27 Table 49: Question 10 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Police services 88% 88% 92% 91% 83% 87% 87% 86% 88% Fire services 97% 97% 98% 95% 95% 99% 99% 95% 97% Ambulance or emergency medical services 96% 95% 98% 96% 91% 96% 98% 94% 95% Crime prevention 75% 81% 84% 78% 80% 85% 72% 72% 79% Fire prevention and education 87% 84% 94% 84% 80% 85% 75% 90% 85% Traffic enforcement 61% 60% 61% 62% 69% 54% 61% 60% 60% Street repair 46% 55% 44% 57% 66% 46% 49% 47% 51% Street cleaning 72% 77% 65% 79% 80% 72% 78% 74% 75% Street lighting 70% 72% 71% 76% 72% 67% 74% 69% 71% Sidewalk maintenance 55% 68% 46% 76% 65% 61% 64% 55% 62% Traffic signal timing 46% 49% 44% 49% 62% 40% 49% 46% 47% Bus or transit services 49% 49% 40% 48% 50% 49% 50% 55% 49% Garbage collection 89% 86% 89% 88% 86% 85% 86% 90% 87% Yard waste pick-up 86% 85% 84% 87% 88% 82% 81% 91% 86% Storm drainage 64% 76% 55% 84% 73% 68% 71% 68% 71% Drinking water 87% 90% 87% 91% 94% 87% 88% 85% 88% Sewer services 87% 88% 84% 91% 94% 81% 90% 87% 88% Utility billing 81% 83% 80% 81% 86% 82% 86% 80% 82% City parks 92% 94% 99% 94% 91% 96% 84% 92% 93% Recreation programs or classes 85% 83% 83% 80% 88% 81% 79% 90% 84% Recreation centers or facilities 85% 86% 87% 86% 87% 86% 82% 86% 86% Land use, planning and zoning 39% 41% 34% 43% 49% 33% 33% 45% 40% Code enforcement (weeds, abandoned buildings, etc.) 65% 54% 57% 48% 56% 57% 67% 72% 59% Animal control 83% 78% 84% 78% 71% 84% 77% 85% 80% Economic development 73% 66% 66% 66% 65% 66% 74% 76% 69% Public library services 93% 90% 93% 90% 89% 92% 91% 93% 91% Public information services 82% 82% 85% 85% 82% 80% 72% 86% 82% Cable television 54% 56% 58% 51% 58% 59% 58% 50% 55% Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) 70% 78% 77% 86% 71% 73% 68% 67% 74% Preservation of natural areas such as open space, farmlands and greenbelts 78% 77% 90% 84% 73% 73% 77% 71% 77% Palo Alto open space 84% 84% 90% 86% 84% 82% 78% 83% 84% City-sponsored special events 76% 74% 78% 77% 71% 72% 69% 77% 75% Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 76% 73% 78% 70% 79% 71% 73% 77% 74% Neighborhood branch libraries 90% 89% 97% 92% 91% 85% 78% 91% 90% Your neighborhood park 91% 90% 95% 93% 92% 86% 84% 92% 91% Variety of library materials 84% 82% 84% 87% 83% 76% 80% 87% 83% Street tree maintenance 71% 75% 62% 71% 80% 73% 75% 76% 73% Electric utility 86% 88% 88% 88% 90% 86% 82% 87% 87% Gas utility 87% 88% 87% 89% 89% 85% 87% 88% 88% Attachment B The National Citizen Survey™ 28 Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Recycling collection 91% 91% 92% 93% 97% 85% 84% 93% 91% City's website 69% 69% 70% 67% 72% 69% 71% 66% 69% Art programs and theatre 80% 81% 86% 83% 85% 74% 77% 77% 80% Table 50: Question 10 - Benchmark Comparisons* Average rating Rank Number of communities in comparison Comparison to benchmark Police services 76 93 383 Similar Fire services 84 60 310 Similar Ambulance or emergency medical services 84 46 299 Similar Crime prevention 68 82 307 Similar Fire prevention and education 72 77 244 Similar Traffic enforcement 55 215 327 Similar Street repair 49 172 372 Similar Street cleaning 66 49 276 Similar Street lighting 62 57 271 Similar Sidewalk maintenance 56 88 275 Similar Traffic signal timing 46 133 215 Similar Bus or transit services 48 111 183 Similar Garbage collection 75 99 308 Similar Yard waste pick-up 75 32 227 Higher Storm drainage 62 98 315 Similar Drinking water 78 15 292 Higher Sewer services 74 22 276 Similar Utility billing 71 10 122 Higher City parks 80 35 285 Higher Recreation programs or classes 72 47 298 Similar Recreation centers or facilities 72 46 242 Higher Land use, planning and zoning 42 196 255 Similar Code enforcement (weeds, abandoned buildings, etc.) 54 103 315 Similar Animal control 69 14 295 Higher Economic development 62 28 243 Higher Public library services 81 42 300 Similar Public information services 69 29 247 Similar Cable television 52 70 164 Similar Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) 64 48 240 Similar Preservation of natural areas such as open space, farmlands and greenbelts 69 17 218 Higher Palo Alto open space 73 9 129 Higher City-sponsored special events 64 45 146 Similar Attachment B The National Citizen Survey™ 29 Average rating Rank Number of communities in comparison Comparison to benchmark Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 65 182 321 Similar * Benchmarks were not calculated for nine custom items in this question (neighborhood branch libraries, your neighborhood park, variety of library materials, street tree maintenance, electric utility, gas utility, recycling collection, City’s website, and art programs and theatre). Question 11 Table 51: Question 11 - Response Percentages and Number of Respondents including “Don’t Know” Responses Overall, how would you rate the quality of the services provided by each of the following? Excellent Good Fair Poor Don't know Total The City of Palo Alto 26% N=181 54% N=376 11% N=77 3% N=17 6% N=41 100% N=693 The Federal Government 5% N=36 33% N=227 33% N=231 11% N=73 18% N=125 100% N=693 State Government 6% N=39 33% N=226 34% N=234 9% N=63 19% N=130 100% N=692 Table 52: Question 11 - Response Percentages and Number of Respondents without "Don't Know" Responses Overall, how would you rate the quality of the services provided by each of the following? Excellent Good Fair Poor Total The City of Palo Alto 28% N=181 58% N=376 12% N=77 3% N=17 100% N=652 The Federal Government 6% N=36 40% N=227 41% N=231 13% N=73 100% N=568 State Government 7% N=39 40% N=226 42% N=234 11% N=63 100% N=562 Table 53: Question 11 - Historical Results Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Services provided by Palo Alto 87% 86% 85% 80% 80% 83% 88% 84% 83% 85% Similar Services provided by the Federal Government 33% 33% 33% 41% 43% 41% 50% 37% 48% 46% Similar Services provided by the State Government 38% 44% 34% 23% 27% 26% 41% 33% NA 47% NA Table 54: Question 11 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 The City of Palo Alto 85% 86% 84% 88% 83% 85% 86% 86% 85% The Federal Government 50% 43% 51% 42% 42% 43% 45% 53% 46% State Government 50% 45% 47% 44% 49% 43% 44% 54% 47% Table 55: Question 11 - Benchmark Comparisons* Average rating Rank Number of communities in comparison Comparison to benchmark Services provided by the City of Palo Alto 70 81 386 Similar Services provided by the Federal Government 47 24 206 Similar * Benchmarks were not calculated for one custom item in this question (State government services). Attachment B The National Citizen Survey™ 30 Question 12 Table 56: Question 12 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate the following categories of Palo Alto government performance: Excellent Good Fair Poor Don't know Total The value of services for the taxes paid to Palo Alto 12% N=81 43% N=292 23% N=160 7% N=46 16% N=107 100% N=686 The overall direction that Palo Alto is taking 7% N=46 36% N=245 30% N=205 15% N=105 12% N=82 100% N=683 The job Palo Alto government does at welcoming citizen involvement 10% N=68 32% N=220 19% N=133 7% N=49 31% N=215 100% N=685 Overall confidence in Palo Alto government 9% N=62 36% N=247 30% N=204 10% N=71 15% N=101 100% N=685 Generally acting in the best interest of the community 10% N=70 34% N=235 28% N=188 12% N=81 16% N=110 100% N=684 Being honest 11% N=79 32% N=218 20% N=139 6% N=42 30% N=206 100% N=684 Treating all residents fairly 11% N=74 27% N=188 23% N=159 11% N=78 27% N=186 100% N=686 Table 57: Question 12 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate the following categories of Palo Alto government performance: Excellent Good Fair Poor Total The value of services for the taxes paid to Palo Alto 14% N=81 51% N=292 28% N=160 8% N=46 100% N=579 The overall direction that Palo Alto is taking 8% N=46 41% N=245 34% N=205 17% N=105 100% N=601 The job Palo Alto government does at welcoming citizen involvement 14% N=68 47% N=220 28% N=133 10% N=49 100% N=470 Overall confidence in Palo Alto government 11% N=62 42% N=247 35% N=204 12% N=71 100% N=583 Generally acting in the best interest of the community 12% N=70 41% N=235 33% N=188 14% N=81 100% N=574 Being honest 16% N=79 46% N=218 29% N=139 9% N=42 100% N=478 Treating all residents fairly 15% N=74 38% N=188 32% N=159 16% N=78 100% N=499 Table 58: Question 12 - Historical Results Percent rating positively (e.g., excellent/good) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 The value of services for the taxes paid to Palo Alto 74% 67% 64% 58% 62% 66% 67% 66% 66% 65% Similar The overall direction that Palo Alto is taking 62% 57% 63% 53% 57% 55% 59% 54% 50% 48% Similar The job Palo Alto government does at welcoming citizen involvement 73% 68% 57% 56% 57% 57% 58% 55% 54% 61% Higher Overall confidence in Palo Alto government NA NA NA NA NA NA NA NA 52% 53% Similar Generally acting in the best interest of the community NA NA NA NA NA NA NA NA 54% 53% Similar Being honest NA NA NA NA NA NA NA NA 58% 62% Similar Treating all residents fairly NA NA NA NA NA NA NA NA 57% 53% Similar Table 59: Question 12 - Geographic Subgroup Results Percent rating "excellent" or "good" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 The value of services for the taxes paid to Palo Alto 65% 64% 61% 68% 69% 57% 68% 65% 65% The overall direction that Palo Alto is taking 48% 48% 42% 48% 52% 45% 45% 55% 48% The job Palo Alto government does at welcoming citizen involvement 58% 64% 59% 64% 65% 62% 59% 58% 61% Overall confidence in Palo Alto government 51% 54% 43% 56% 52% 53% 54% 57% 53% Generally acting in the best interest of the community 51% 55% 44% 57% 52% 53% 58% 53% 53% Being honest 60% 64% 62% 68% 59% 62% 69% 56% 62% Treating all residents fairly 50% 55% 50% 58% 52% 52% 52% 50% 53% Attachment B The National Citizen Survey™ 31 Table 60: Question 12 - Benchmark Comparisons Average rating Rank Number of communities in comparison Comparison to benchmark Value of services for the taxes paid to Palo Alto 57 89 347 Similar Overall direction that Palo Alto is taking 46 216 278 Similar Job Palo Alto government does at welcoming citizen involvement 55 74 265 Similar Overall confidence in Palo Alto government 50 69 137 Similar Generally acting in the best interest of the community 50 73 137 Similar Being honest 57 50 133 Similar Treating all residents fairly 51 69 136 Similar Question 13 Table 61: Question 13 - Response Percentages and Number of Respondents Please rate how important, if at all, you think it is for the Palo Alto community to focus on each of the following in the coming two years: Essential Very important Somewhat important Not at all important Total Overall feeling of safety in Palo Alto 48% N=335 34% N=234 14% N=99 4% N=25 100% N=693 Overall ease of getting to the places you usually have to visit 35% N=240 48% N=330 15% N=105 2% N=16 100% N=691 Quality of overall natural environment in Palo Alto 36% N=252 45% N=311 17% N=120 1% N=9 100% N=691 Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 37% N=252 43% N=299 18% N=125 2% N=12 100% N=688 Health and wellness opportunities in Palo Alto 23% N=162 37% N=258 32% N=219 7% N=51 100% N=689 Overall opportunities for education and enrichment 32% N=221 35% N=241 28% N=197 5% N=31 100% N=690 Overall economic health of Palo Alto 37% N=259 40% N=279 18% N=127 4% N=26 100% N=691 Sense of community 29% N=197 42% N=292 26% N=180 3% N=21 100% N=691 * This question did not have a “don’t know” option; therefore, there is not a table for “Response Percentages and Number of Respondents without “Don’t Know” Responses. Table 62: Question 13 - Historical Results Percent rating positively (e.g., essential/very important) 2015 rating compared to 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Overall feeling of safety in Palo Alto NA NA NA NA NA NA NA NA 84% 82% Similar Overall ease of getting to the places you usually have to visit NA NA NA NA NA NA NA NA 82% 82% Similar Quality of overall natural environment in Palo Alto NA NA NA NA NA NA NA NA 81% 81% Similar Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) NA NA NA NA NA NA NA NA 80% 80% Similar Health and wellness opportunities in Palo Alto NA NA NA NA NA NA NA NA 65% 61% Similar Overall opportunities for education and enrichment NA NA NA NA NA NA NA NA 71% 67% Similar Overall economic health of Palo Alto NA NA NA NA NA NA NA NA 80% 78% Similar Sense of community NA NA NA NA NA NA NA NA 72% 71% Similar Attachment B The National Citizen Survey™ 32 Table 63: Question 13 - Geographic Subgroup Results Percent rating "essential" or "very important" North/South Area Overall North South Area 1 Area 2 Area 3 Area 4 Area 5 Area 6 Overall feeling of safety in Palo Alto 81% 83% 81% 84% 87% 81% 77% 83% 82% Overall ease of getting to the places you usually have to visit 80% 84% 80% 88% 86% 81% 81% 79% 82% Quality of overall natural environment in Palo Alto 83% 80% 82% 76% 86% 80% 85% 82% 81% Overall "built environment" of Palo Alto (including overall design, buildings, parks and transportation systems) 84% 77% 85% 74% 86% 75% 79% 84% 80% Health and wellness opportunities in Palo Alto 59% 63% 65% 52% 76% 64% 57% 56% 61% Overall opportunities for education and enrichment 68% 66% 64% 64% 81% 59% 72% 67% 67% Overall economic health of Palo Alto 78% 77% 74% 75% 86% 74% 81% 80% 78% Sense of community 70% 72% 69% 69% 78% 70% 70% 70% 71% Benchmarks were not calculated for question 13 as it is nonevaluative. Question 14 Questions 14 through 24 are custom questions, therefore trend data, geographic subgroup results, and benchmarks were not calculated. Table 64: Question 14 - Response Percentages and Number of Respondents If you had a maintenance issue to report to the City of Palo Alto, what method would you be most likely to use? (Please pick one.) Percent Number Contact the City Manager’s office 3% N=18 Contact a City Council member 0% N=1 E-mail the appropriate city department 19% N=128 Call the appropriate city department 44% N=304 Call the main number for the City 8% N=52 Submit a notification electronically on the City’s website through the “Make a Service Request” link on the City’s website 21% N=144 Use Palo Alto 311 phone app to notify the appropriate city department 3% N=24 Visit City Hall 2% N=14 Total 100% N=685 Question 15 Table 65: Question 15 - Response Percentages and Number of Respondents What method(s), if any, have you used to provide feedback or engage with the City on issues in Palo Alto in the past 12 months? Please check all that apply: Percent Number In-person community meetings 9% N=62 City council meetings 8% N=55 Email 24% N=163 Phone call 27% N=179 Nextdoor (private neighborhood network) 12% N=81 Open City Hall (online civic engagement portal) 2% N=16 Social media channels (Facebook, Twitter) 4% N=29 Use the “Contact the City” link on the City of Palo Alto website 5% N=33 I have not contacted the City about any issues in the last 12 months 52% N=349 Total may exceed 100% as respondents could select more than one option. Attachment B The National Citizen Survey™ 33 Question 16 Table 66: Question 16 - Response Percentages and Number of Respondents How frequently, if at all, do you shop… Once a day or more 1-5 times a week 1-3 times a month Not at all Total In your neighborhood 9% N=63 54% N=369 27% N=186 10% N=71 100% N=689 In other parts of Palo Alto 5% N=31 51% N=350 39% N=265 6% N=39 100% N=685 In neighboring cities 3% N=23 41% N=285 49% N=341 6% N=41 100% N=690 Online 8% N=52 29% N=200 47% N=321 16% N=106 100% N=680 Question 17 Table 67: Question 17 - Response Percentages and Number of Respondents How frequently, if at all, do you eat out for any meal… Once a day or more 1-5 times a week 1-3 times a month Not at all Total In your neighborhood 3% N=21 29% N=200 44% N=305 24% N=163 100% N=689 In other parts of Palo Alto 2% N=10 28% N=195 59% N=406 12% N=80 100% N=691 In neighboring cities 1% N=9 27% N=186 59% N=412 13% N=88 100% N=694 By ordering take-out/delivery 1% N=4 17% N=113 40% N=274 43% N=293 100% N=684 Question 18 Table 68: Question 18 - Response Percentages and Number of Respondents How often, if at all, do you participate in each of the following waste programs when you have these types of waste to dispose of? Never Rarely Sometimes Usually Always Total Residential food scraps collection program 46% N=314 8% N=55 7% N=45 9% N=60 30% N=202 100% N=676 Home composting 56% N=382 10% N=68 8% N=53 7% N=46 19% N=131 100% N=680 Palo Alto's weekly household hazardous waste collection program 39% N=267 22% N=148 22% N=147 6% N=44 11% N=77 100% N=682 Question 19 Table 69: Question 19 - Response Percentages and Number of Respondents including “Don’t Know” Responses Please rate the quality of Palo Alto’s trees and landscaping for: Excellent Good Fair Poor Don't know Total Businesses 21% N=142 45% N=311 17% N=118 3% N=22 13% N=91 100% N=684 Residential homes 27% N=182 51% N=351 17% N=116 2% N=14 3% N=22 100% N=685 Walking and biking 26% N=177 53% N=362 16% N=106 1% N=6 4% N=30 100% N=682 Schools 23% N=156 43% N=292 15% N=100 1% N=9 18% N=122 100% N=679 Streets 23% N=158 54% N=368 17% N=118 2% N=13 4% N=25 100% N=682 Parks 33% N=224 55% N=375 9% N=63 0% N=1 3% N=20 100% N=683 Attachment B The National Citizen Survey™ 34 Table 70: Question 19 - Response Percentages and Number of Respondents without "Don't Know" Responses Please rate the quality of Palo Alto’s trees and landscaping for: Excellent Good Fair Poor Total Businesses 24% N=142 52% N=311 20% N=118 4% N=22 100% N=593 Residential homes 28% N=182 53% N=351 17% N=116 2% N=14 100% N=663 Walking and biking 27% N=177 56% N=362 16% N=106 1% N=6 100% N=651 Schools 28% N=156 52% N=292 18% N=100 2% N=9 100% N=557 Streets 24% N=158 56% N=368 18% N=118 2% N=13 100% N=657 Parks 34% N=224 57% N=375 10% N=63 0% N=1 100% N=663 Question 20 Table 71: Question 20 - Response Percentages and Number of Respondents If you did not have access to a car for your usual daily transportation around town, how convenient (based on time and proximity), would you consider each of the following methods of getting around? Very convenient Somewhat convenient Somewhat inconvenient Very inconvenient Total Walking 33% N=224 37% N=252 18% N=120 11% N=77 100% N=674 Biking 48% N=313 33% N=219 8% N=50 11% N=74 100% N=656 Bus 7% N=47 32% N=206 38% N=250 23% N=147 100% N=650 Train 12% N=76 34% N=224 30% N=196 24% N=158 100% N=653 Free shuttle 17% N=111 39% N=248 32% N=205 12% N=78 100% N=642 Taxi 11% N=67 28% N=177 34% N=216 27% N=167 100% N=627 Uber/Lyft or similar rideshare service 33% N=208 35% N=222 19% N=118 14% N=90 100% N=638 Carpooling 10% N=65 33% N=211 28% N=182 28% N=183 100% N=641 Question 21 Table 72: Question 21 - Response Percentages and Number of Respondents If you did not have access to a car to get around town and convenience (based on time and proximity) was not an issue, what is your preference for each of the following methods of getting around? Prefer a lot Somewhat prefer Do not prefer Total Walking 65% N=434 27% N=181 7% N=50 100% N=665 Biking 55% N=362 21% N=137 24% N=156 100% N=656 Bus 15% N=100 38% N=247 47% N=311 100% N=658 Train 25% N=163 43% N=282 32% N=207 100% N=652 Free shuttle 33% N=218 45% N=291 22% N=145 100% N=655 Taxi 6% N=38 20% N=127 74% N=476 100% N=641 Uber/Lyft or similar rideshare service 21% N=140 31% N=201 48% N=310 100% N=651 Carpooling 18% N=116 34% N=218 49% N=315 100% N=649 Attachment B The National Citizen Survey™ 35 Question 22 Table 73: Question 22 - Response Percentages and Number of Respondents Please rate how important, if at all, it would be to redevelop the Cubberley Community Center for each of the following purposes: Essential Very important Somewhat important Not at all important Total School(s) 24% N=149 28% N=175 31% N=192 18% N=113 100% N=629 Playing fields 19% N=121 32% N=200 33% N=206 16% N=103 100% N=630 Community center 26% N=165 32% N=205 27% N=171 15% N=98 100% N=640 Question 23 Table 74: Question 23 - Response Percentages and Number of Respondents The City of Palo Alto and Palo Alto Unified School District are working together on a master plan for the Cubberley Community Center to meet future community and school needs. Please indicate how much of a priority, if at all, each of the following community programs at Cubberley are to you. High priority Medium priority Not a priority Total Child care 26% N=170 26% N=166 48% N=306 100% N=641 Cubberley Artist Studio Program 13% N=83 38% N=241 49% N=311 100% N=635 Dance studios 16% N=98 40% N=252 45% N=285 100% N=635 Outdoor sports 34% N=214 38% N=239 28% N=179 100% N=632 Indoor sports and health programs 30% N=193 45% N=288 24% N=155 100% N=637 Senior wellness, including stroke and cardiovascular programs 30% N=189 39% N=246 32% N=204 100% N=640 Education – private schools and special interest classes 20% N=126 41% N=260 39% N=251 100% N=636 Rooms available to rent for other activities 19% N=121 46% N=289 35% N=225 100% N=635 Other 26% N=48 10% N=19 64% N=119 100% N=186 For question 23, respondents could also specify an “other” answer than the presented alternatives. Out of a total of 721 completed surveys, 73 respondents wrote in “other” priorities. Respondents’ verbatim responses are in the list below. They are as written or entered on the survey and have not been edited for spelling or grammar.  Added public school space.  Adult education.  Adult school.  Affordable rental & childcare! Jobs.  After school activities for Palo Alto kids.  After school sports.  Any.  Art-watercolor.  Auditorium.  Be wonderful if a lecture services on almost any topic.  Book sales.  Center for disaster care.  Community garden.  Community meeting rooms / organize.  Concert hall.  Cultural events.  Cultural/community events.  Dancing.  Don't have children husband paralyzed left side not applicable.  Don't know.  Exercise [?].  Expand senior programs, perhaps Avenidas can expand in South Palo Alto rather than on Bryant St.  Facilities for homeless (showers).  Foothill college.  Foothill college. Attachment B The National Citizen Survey™ 36  Foothill College.  Fopal book sales.  Fopal sales.  Free of charge drama/dance classes for children.  Friends of library.  Friends of Palo Alto library.  Good dance floor. Theatre.  Hall for performing arts.  Have live here only 1 year don't know.  High school! And grammar school.  High school.  High school.  High school.  Homeless assistance.  Homeless food bank.  Keep ballroom socials in Pavilion.  Keep the existing space for Fopal book sales.  Less start up please.  Library (Fopal space).  Live in north PA.  Low income housing.  Maker space.  Meeting spaces.  Middle school.  N/A.  N/A.  New high school.  None.  Not private school, all public accessed.  Nurse room.  Older teen and young adult activities.  P.A. adult ed classes.  Place for teams to get together in supervised area.  Public high school.  Public school.  Public school.  Public school.  Public school/daycare.  Public schools.  School if needed.  School or community services.  School.  Senior activities.  Teen activities & special ed.  Teen center.  Theater activities.  Theatre, large dance floor.  Wildlife rescue services. Question 24. Please share one improvement to the City of Palo Alto’s parks, arts, or recreation activities and programs that the City could make to better serve the community. In question 24, respondents were asked to record their opinions about improvements to parks, recreation or arts activities or programming in the above question. The verbatim responses were categorized by topic area and those topics are reported in Table 75, with the number and percent of responses given in each category. Some comments from residents covered more than a single topic. We separated the copies and put them under their relevant categories and also listed the verbatim comment at the end of this section so that. Results from the open-ended question are best understood by reviewing the frequencies that summarize responses as well as the actual verbatim responses themselves. A total of 721 surveys were completed by Palo Alto residents; of these 361 respondents wrote in responses for the open-ended question. Attachment B The National Citizen Survey™ 37 Table 75: Question 24 – Open-ended Responses Response Category Number of Responses Percentage of Responses Parking/Transportation 17 5% Park Spaces (Green Space) 35 10% Park, Recreation, and Art Facilities and Amenities (other than bathrooms/restrooms) 34 9% Bathrooms/Restrooms 36 10% Off-leash Dog Area 19 5% Programs and Classes - General 16 4% Programs and Classes - Adult/Senior 22 6% Programs and Classes - Youth 11 3% Information/Registration 18 5% Art/Culture Improvements 28 8% Bike/Walking Path Improvements 20 5% Maintenance/Cleanliness 10 3% Pool Access/Swimming 11 3% Nothing/Don't Know 20 5% Other - Related to Community Services Department 29 8% Other - Not Community Services Department 42 11% Parking/Transportation  Any activity with less regular outside traffic.  Avenidas and parking garage across the street.  Better parking.  Better public transportation for Palo Alto west of El Camino real to Downtown and Cubberley.  Bus or shuttle access.  Electric car charging at parks.  Free transportation.  Improve parking/traffic.  Increase parking availability  More parking as well as more EV charging stations  More parking at Mitchell Park  More parking available.  More parking.  More shuttle bus with more stops.  Parking, parking, parking! Seniors have great difficulties parking near Avenidas(senior center). Limits ability to attend classes at Avenidas.  Provide a publicized program of bus transportation with stops near to homes to get seniors to activities & programs.  Transportation to parks for senior for senior living communities like Moldaw. Attachment B The National Citizen Survey™ 38 Park Spaces (Green Space)  Don't limit Foothills park to PA residents only; it's wasteful.  Limit use of P.A. parks to P.A citizens only.  Open Foothills park to non-residents.  Priority for residents, Rinconada park can be over run with east Palo Alto residents on warm weather weekends.  More open space.  Access to Baylands.  Availability to all neighborhoods.  It would be great if every neighborhood had a park within easy walking distance.  More parks to accommodate recent population growth.  Make parks more convenient.  Eliminate the new trees planted at Cubberley fields.  Keep Palo Alto green-parks, open space interested in outdoor clean-up/beautification efforts.  Keep trees that are in danger watered in parks until drought eases.  Keep up with dead and dying street trees  More and larger trees.  More trees in heritage park so there's more continuous field space.  More trees in Mitchell park.  More trees, more green.  Park.  Parks could use more trees to provides shade.  Parks.  Parks.  Plant more trees on long streets.  Provide shade for children @ Scott park shade sails? Swing area is roasting!  Prune trees in community garden at Eleanor Park.  Shade in the bridge playgrounds.  Take better care of city trees.  Use of only drought tolerant and native species of tree/plants.  Finish El Camino Park.  Build another soccer turf park like Mayfield but with adequate parking.  More sports fields.  Accelerated renovations/improvements to Palo Alto Baylands Park.  Ensure the intense economic boom does not damage air quality & the health of our existing open space, parks & outdoor quality of life.  More shade.  Water the trees at parks. Attachment B The National Citizen Survey™ 39 Park, Recreation, and Art Facilities and Amenities (other than bathrooms/restrooms)  New play equipment.  ADA access improvements.  Provide access/facility for reach program.  Are those community center facilities anywhere other than Cubberley? (Which is almost in mountain views- not near center Palo Alto).  Add more picnic areas with modern grills.  BBQ grills.  Food trucks in the parks.  More picnic areas.  Parks - Semi-permanent camping facility options at Foothills Park (like permanent 'tents', etc.  Place benches facing each other so people could visit & exchange & enjoy their community.  Space to grill.  Working drinking fountains.  Basketball courts Downtown.  Batting cages for Baylands athletic center.  Finish the golf course. Delay is an expensive scandal!  Fix up old par course stations.  Gym facilities for city residents  Improve the Rinconada tennis courts.  Lighted fields.  More gyms are better.  More lighted fields for night use.  Repair tennis courts at Howell park.  Tennis courts at Greer park.  Tennis courts nets, surface repairs.  Track.  Better lighting at night.  Better lighting.  Lighting at neighborhood parks to enable evening use (eg Ventura).  Upgrade & update the Foothill park visitor center exhibits. They are very old & musty. This should be a place for vibrant & engaging environmental education/ stimulation.  Update the children's playground areas in parks where this has not been done recently.  Upgrade playground areas/surfaces at Rinconada Park.  More spaces to reserve.  We need a new theater like mountain view's.  May be for the arts & recreation needs more space. Regarding parks more chairs. Attachment B The National Citizen Survey™ 40 Bathrooms/Restrooms  Add a restroom to parks with none except for small parks like we.  Add bathroom facilities in bigger parks.  All parks should have restrooms.  Bathroom at Johnson park.  Bathroom availability.  Bathrooms & community rooms at parks.  Bathrooms & trash collection & pick up at every park. Plus Downtown.  Bathrooms (restrooms) in every park!  Bathrooms at all parks.  Bathrooms in city parks.  Bathrooms in neighborhood parks.  Bathrooms in some of the parks where there currently are none.  Bathrooms.  Bathrooms.  Clean secure bathrooms.  Cleaner bathrooms/drinking water.  Cleaner restrooms.  Having restrooms available at the park; example: Eleanor Pardee it's difficult to enjoy the park for any extended period with no access to restrooms. Also very inconvenient for soccer practices/games etc; the fact that no restrooms are available excludes using the local park for BBQ'S, picnics, gatherings with family/friends.  Make sure they all have nice & clean restrooms available.  Map of public restrooms.  More bathrooms at parks.  More bathrooms.  Please clean public bathrooms more often.  Restroom at all parks.  Restroom facilities.  Restrooms at all parks.  Restrooms in Eleanor park.  Restrooms.  Restrooms.  Restrooms.  Restrooms.  Restrooms.  Restrooms.  Safe, clean, accessible restroom. More playing fields. Attachment B The National Citizen Survey™ 41  Toilet facility at Bol park.  Upgrade locker rooms at Rinconada pool. Off-leash Dog Area  Better dog runs in parks.  Create dog and non-dog parks.  Dog free parks.  Dog park.  Dog parks.  Enforce dog on leash in neighborhood parks!  Enforce leash laws please. (And I love dogs and often walk one).  Enforce off-leash dog laws in the parks.  Install additional dog run areas.  Larger off leash dog park.  More dog parks.  More off leash dog park.  More off leash dog parks (A Hoover, not like Greer, which is too small.)  More off leash dog runs/areas.  Need a bigger dog park.  Off leash dog park.  Require dogs online/leash.  Set a place for the dogs when they go to the parks.  Give the community a place to walk (i.e. get some exercise) with their dogs-preferably off leash. Programs and Classes - General  Closer activities/more convenient to Terman & Gunn.  More class hours, all the classes are during weekday which do not work for families with both parents working full time.  More weekend classes.  Offer programs west of Alma.  Free exercise classes.  Gymnastics.  Health/cardio/blood pressure/stroke athletes exercise longevity.  Increase wellness classes.  More dance classes - Hip Hop / Zumba after work / evening.  More free yoga.  More health and wellness classes & activities.  More organized activities. Attachment B The National Citizen Survey™ 42  More recreational activities for the community.  Park, recreation activities.  Programs for the impaired to be included.  Add an improve class! Programs and Classes – Adult/Senior  Additional adult recreation classes.  Broader offer for adult education,  Drop an outdoor senior exercise program.  Elder conveniences.  Evening fitness and art classes for adults.  Fitness/exercise classes for working adults.  Literacy/programs or ESL programs for adults.  Many of us are getting older. More programs to help residents as they don't would be great: (a) Retirement planning. (b)Emphasis on open spaces; quality of outdoors.  More adult acting programs.  More adult body weight lifting bars and equipment.  More art classes for adults.  More available for adult without children. We are not all families and so much leaves us out.  More evening/weekend classes for working adults.  More opportunities for adult (not necessarily seniors) to take dance (ballet, ballroom, Bollywood) classes.  More recreational activities for the senior citizens.  More senior programs.  Senior activities in the evening.  Senior activities.  Senior programs in SW Palo Alto (possibly at Gunn?).  Senior wellness programs.  Exercise classes for working people (after 6PM).  Social events for singles. Programs and Classes - Youth  A center where youths can meet.  Accommodate people with developmental disabilities.  More dance for children up to 18.  Children's theater plays that are not musicals.  Improvement in recreation activities for teens.  Make children's programs more accessible for families where both parents work. Attachment B The National Citizen Survey™ 43  More after-school activities right at the school.  More classes for small children (under 5's).  More school field trips to our parks, so our children may be more apt to use them.  More special education classes for autism.  Teen center/support services for mental health. Information/Registration  Better advertising.  Better notifications as to what events are impending.  Better publicity of events/activities.  Better publicity of the activities. I rarely ever hear about programs/activities.  Better publicity.  Communicate better (insert in utility bills?).  Communication about programs available.  Easier on-line access.  Easier reservation of picnic areas for residents.  Get more info out there about are the activities.  Give at least 3 wks notice for publicity of events. More information! I don't know what's available.  More outreach, I don't even know the options.  More vocal about availability.  Online booking for book the Outdoor Recreation Programs Palo Alto resident reservation of picnic space made easier.  Sign up is difficult online- glitchy.  The city website does not seem to be organized to easily access current events. Like if I wanted to see what was happening at the library or art center today, it would be hard to find.  The recreation centers could be more well publicized.  Weekend soccer field reservation: I don't understand why AYSO (kids soccer organisation) is often kicked out by other groups at the last minute. The reservation system should be fair to all. Art/Culture Improvements  Actually be responsive to community opinion when choosing public art (recent new works are horrible).  An event that brings all the community together rich and poor.  Art & reading.  Arts.  Classes in film- making.  Create gathering places activated by art.  Eliminate amplified music at street fairs & the like.  Ensure that there are spaces for public music and dance performances. Attachment B The National Citizen Survey™ 44  Festivals like in Europe not like we've had here.  Frequent festivals or performances in different parks of the city.  It would be nice if Theatreworks had a stable facility and didn't need to alternate between Lucy Stern and Mountain View.  Less expensive art and other classes.  More arts classes.  More affordable art classes.  Make the Children's Theater totaling self-supporting.  More dance!- Do more during national dance week. Set up a stage or stages outside and invite Bay areas artists to perform. Pay for bigger name like- ODC Janice Garrett Robert Moses kin. May be coordinate w/ Stanford lively arts.  More fairs.  More games of local musical artists-it is all boring and "safe".  More music in the parks.  More musical program- on a Sun.  More street music.  Museum.  Sound system in Lucy Stern theatre.  Start a public mural program.  The people who research and decide on city funded art could be more sensitive and knowledgeable. The "color of PA" was waste of money. Lytton plaza needed a fountain but it could have been a more beautiful one. The "rrun" sculpture on Alma weighs on the spirit of commuters. Palo Alto can do better in public art.  Theater in the parks.  Theatre.  Update Lucie Stern theater. Bike/Walking Path Improvements  Add bike racks.  Better bike lane coverage.  Bike path no cars.  Brick walkways around Lucie Stern center need to be recover. The bricks to the parking lot are uneven & dangerous!  Create pedestrian only zone on university avenue with park/fountains/cafes redirect all car & bicycle traffic off university.  Fix Baylands boardwalk.  I spent last summer in Dublin, they have closed many of streets to traffic and turned them into walking/biking streets only. It's a welcome change to everyone.  Make sidewalks less hazardous & tree root bumps produce fall & injuries.  More bike lanes clearly marked.  More bike path.  More bike paths. Attachment B The National Citizen Survey™ 45  More bike ways.  More bike/walking trails.  More safe biking paths.  More walking paths.  Promote appropriate increased use of biking outdoor (non sports) activities at Foothills & Byxbee Parks.  Repave bike paths and side streets.  Restaurants are taking over sidewalks no room to walk safely!  Sidewalks.  Soft surface running, walking, and hiking trails in easily accessible places. Maintenance/Cleanliness  Better care for Boulware park enforce decency on homeless must meet commonly [?] in behavior.  Better cleaning and pick-up.  Entrance to Cubberley, especially left turn is very difficult & dangerous.  Keep parks clean and well maintained.  Maintain & enhance natural areas in parks.  Maintain buildings.  Make sure sprinklers are checked often. Have reported issues, and had to call multiple times to get it fixed.  Regular attention to empty garbage cans or way for residents to help keep can empty.  They're not bad, but could be cleaner.  Upkeep of field, ground and building maintenance. Pool Access/Swimming  Access to pools.  Better times for open swim & reduction in prices.  Build an indoor swimming facility.  Indoor swimming pool.  Less crowded swimming pools.  More pool space for aquatic programs.  More public swimming pools.  Open Rinconada wading pool year- round or open an indoor public pool.  Use of school pools during summer.  Water play areas. Rinconada pool is not enough access-would be great to have a free, easy to play in water area.  Year round pool (indoor). Attachment B The National Citizen Survey™ 46 Nothing/Don’t Know  Can't think of anything.  City does an excellent job cannot think of any improvements in this area.Hanging banners over embarcadero looks "tacky" and is dangerous to do.  Dont know.  Don't know.  Don't know.  Don't know.  Don't know.  Don't know.  I don't know.  I have recently moved (2 1/2 months ago) to Palo Alto and do not know where Cubberley community center is.  keep what the city is doing it works fine for me.  N/A.  N/A.  N/A.  No idea physically unable to participate.  No opinion.  Not involved enough to comment.  Not sure.  Too new to the area to respond.  We are new here, all we see here is lots of nice activities and wonderful parks. Still exploring to know more to come up with something that needs improvement. Other – Related to Community Services Department  Police browsing for safety.  Safe places for kids to be kids, inside and outside.  Safety.  Add food bank for homeless.  Longer hours.  Affordable long term recreation availability.  Celebrating patriotic days.  Eliminate the zoo as zoos are passe and the PA zoo an abomination.  Encourage/support neighborhood gatherings to foster community.  Finally the park from Stanford shopping look like it might open again. What a long wait?  Have a park where children are NOT allowed.  I like Palo Alto's parks, art & recreation very much. What I don't like is all the ugly, big, new office buildings. Their approval has ruined Palo Alto. Attachment B The National Citizen Survey™ 47  Let Deep Peninsula Dog Training Club use a local park for lessons, and Let West Bay Opera use the Lucie Stern Theater for free. I am not affiliated with them!  Lower their priority.  More entry-level youth employment.  More funding for high quality staff to educate the community and maintain parks and buildings in a sustainable way.  More indoor meeting spaces open on weekends and weeknights.  Night sky watching at Foothill Park.  Opening of top of land fill which has recently been covered & burrowing wild life cannot be allowed there because of the cap as dog off leash area. With trash cans.  Our [?] designs for library- Cal Ave-start protected the land scape of park- potable water for trees. Recreation [?] need to allow a park to be a serene place!  Outdoor area quiet; safe for seniors; bikes skate boards, etc.; benches; flowers; singing birds (not crows).  Pare back programs to save money!  Put the electrical wires underground in Barrow park. This was done in north Palo Alto but not in south Palo Alto.  Remove the homeless people.  Rinconada park.  Sponsor city wide 5k/10k walk run.  Stop using water on the parks/other govt properties.  Use a drought resistant grass, less watering.  Variety/availability/affordability/accessibility. Other – Not Community Services Department  Less traffic!!!  Downtown parking is a huge problem. Too many city-sponsored "activities" that often close off Downtown P.A.-Affects parking, walking & life as near by residents. Too congested.  Deal with vehicle dwellers.  Affordable child care/preschool rent is unacceptably high for poor quality housing. We pay over $4k/mo for a 1 bath home w/o air or dishwasher. Please consider tenants rights. Renters are human too.  Improve traffic.  Add more open days to college terrace library (left out of recent additions).  Create a parking garage (free) in Downtown P.A.  Eliminate parking on University Ave. Just through traffic and drive to parking places.  Better inventory at libraries.  Extend library hours-college terrace branch please!  Longer hours at libraries.  Longer library hours.  Trim the city trees that/to protect the property owners!! Fix the damage to drive ways/cement areas as a result of those trees. Attachment B The National Citizen Survey™ 48  Better streets lighting. Neighborhood.  More street lighting's.  (1) Have some more landscaping workshops/talks to give people ideas about water wise parking strips & front yards, (2) Not really about parks/arts, but I wish there were better transportation options for from Palo Alto homes & airport in SJ & SF, such as more shuttle routes through town to connect with cal train at cal ave & university.  Add one more high school.  Affordable housing!! I work for a nonprofit & my rent increased 25% this year. I am going to lose my job and Palo Alto will lose the nonprofit.  Affordable housing!!!  Better organized.  Better selection of library books.  Cable service/internet services.  City desperately needs more medium density housing so transportation works- like condos by California avenue station and senior housing that was rejected in measure d.  Do something to mitigate airplane noise.  Get rid of dishonest realtors & developers.  Get together for business opportunities.  Help homeless relocate away from Downtown.  I don't give a crap, just give me cheaper housing.  Keep noise level down early in the day.  Kinder, gentler support staff & more flexible rules. i.e. new water meter installed, broke the pvc pipe at threads, made us pay because it was on our side of meter, shocking, they were rude, had lawyers call us. Dishonest & they knew it, disgusting.  Less improvement in arts recreation park especially less arts. Give money to police, fireman, emt.  Library book return from car.  More housing.  Palo alto needs more affordable housing and more socioeconomic diversity!  Please limit condo/commercial development of El Camino. I am frustrated that existing business are all being ripped at all around my building. It will be to congested.  Prohibit dogs on school grounds.  Re-examine Palo Alto's original plan, and ban new housing.  Reduce airplane noise.  Regulation activities.  Rental is too high!!!  Tunnel the train tracks.  Universal Wi-Fi. Attachment B The National Citizen Survey™ 49 The following are responses that were originally submitted as a single response but were separated into their respective categories above:  1) Less traffic!!! 2) More open space.  1) Parking, parking, parking! Seniors have great difficulties parking near Avenidas(senior center). Limits ability to attend classes at Avenidas. 2) Downtown parking is a huge problem. Too many city-sponsored "activities" that often close off Downtown P.A.-Affects parking, walking & life as near by residents. Too congested.  1) Working drinking fountains 2) exercise classes for working people (after 6PM).  1) More art classes for adults; 2) more dance for children up to 18.  1) New play equipment, 2) ADA access improvements, 3) more shade, 4) more affordable art classes.  1) Give at least 3 wks notice for publicity of events 2) we need a new theater like mountain view's.  1) Online booking for book the Outdoor Recreation Programs 2) add food bank for homeless.  1) Eliminate the zoo as zoos are passe and the PA zoo an abomination and 2) make the Children's Theater totaling self-supporting. Demographic Questions Table 76: Question D1 - Response Percentages and Number of Respondents How often, if at all, do you do each of the following, considering all of the times you could? Never Rarely Sometimes Usually Always Total Recycle at home 2% N=13 2% N=16 2% N=17 15% N=101 79% N=548 100% N=695 Purchase goods or services from a business located in Palo Alto 1% N=6 4% N=26 32% N=221 46% N=320 18% N=123 100% N=696 Eat at least 5 portions of fruits and vegetables a day 2% N=17 9% N=65 26% N=181 38% N=263 24% N=170 100% N=697 Participate in moderate or vigorous physical activity 2% N=12 8% N=56 27% N=188 38% N=266 25% N=170 100% N=693 Read or watch local news (via television, paper, computer, etc.) 4% N=28 15% N=107 23% N=158 30% N=211 28% N=197 100% N=701 Vote in local elections 14% N=99 5% N=34 9% N=61 22% N=155 50% N=349 100% N=699 Table 77: Question D2 - Response Percentages and Number of Respondents Would you say that in general your health is: Percent Number Excellent 32% N=220 Very good 40% N=278 Good 24% N=167 Fair 3% N=22 Poor 1% N=8 Total 100% N=695 Table 78: Question D3 - Response Percentages and Number of Respondents What impact, if any, do you think the economy will have on your family income in the next 6 months? Do you think the impact will be: Percent Number Very positive 6% N=40 Somewhat positive 26% N=177 Neutral 56% N=383 Somewhat negative 10% N=69 Very negative 3% N=20 Total 100% N=688 Attachment B The National Citizen Survey™ 50 Table 79: Question D4 - Response Percentages and Number of Respondents What is your employment status? Percent Number Working full time for pay 51% N=353 Working part time for pay 13% N=87 Unemployed, looking for paid work 4% N=28 Unemployed, not looking for paid work 5% N=37 Fully retired 24% N=164 College student, unemployed 4% N=26 Total 100% N=695 Table 80: Question D5 - Response Percentages and Number of Respondents Do you work inside the boundaries of Palo Alto? Percent Number Yes, outside the home 22% N=146 Yes, from home 14% N=93 No 64% N=423 Total 100% N=662 Table 81: Question D6 - Response Percentages and Number of Respondents How many years have you lived in Palo Alto? Percent Number Less than 2 years 18% N=124 2 to 5 years 17% N=119 6 to 10 years 15% N=105 11 to 20 years 16% N=114 More than 20 years 34% N=237 Total 100% N=699 Table 82: Question D7 - Response Percentages and Number of Respondents Which best describes the building you live in? Percent Number One family house detached from any other houses 58% N=403 Building with two or more homes (duplex, townhome, apartment or condominium) 38% N=267 Mobile home 0% N=2 Other 4% N=25 Total 100% N=697 Table 83 Question D8 - Response Percentages and Number of Respondents Is this house, apartment or mobile home... Percent Number Rented 44% N=304 Owned 56% N=385 Total 100% N=689 Attachment B The National Citizen Survey™ 51 Table 84: Question D9 - Response Percentages and Number of Respondents About how much is your monthly housing cost for the place you live (including rent, mortgage payment, property tax, property insurance and homeowners' association (HOA) fees)? Percent Number Less than $1,000 per month 11% N=73 $1,000 to $1,499 per month 9% N=59 $1,500 to $1,999 per month 10% N=68 $2,000 to $2,499 per month 12% N=82 $2,500 to $2,999 per month 8% N=56 $3,000 to $3,499 per month 9% N=61 $3,500 to 3,999 per month 8% N=52 $4,000 to $4,499 per month 8% N=55 $4,500 to $4,999 per month 5% N=36 $5,000 or more per month 20% N=132 Total 100% N=675 Table 85: Question D10 - Response Percentages and Number of Respondents Do any children 17 or under live in your household? Percent Number No 63% N=435 Yes 37% N=260 Total 100% N=695 Table 86: Question D11 - Response Percentages and Number of Respondents Are you or any other members of your household aged 65 or older? Percent Number No 70% N=485 Yes 30% N=210 Total 100% N=695 Table 87: Question D12 - Response Percentages and Number of Respondents How much do you anticipate your household's total income before taxes will be for the current year? (Please include in your total income money from all sources for all persons living in your household.) Percent Number Less than $25,000 6% N=40 $25,000 to $49,999 5% N=36 $50,000 to $99,999 18% N=116 $100,000 to $149,999 17% N=111 $150,000 to $199,999 11% N=72 $200,000 to $249,999 12% N=77 $250,000 to $299,999 7% N=48 $300,000 or more 25% N=162 Total 100% N=662 Attachment B The National Citizen Survey™ 52 Table 88: Question D13 - Response Percentages and Number of Respondents Are you Spanish, Hispanic or Latino? Percent Number No, not Spanish, Hispanic or Latino 96% N=658 Yes, I consider myself to be Spanish, Hispanic or Latino 4% N=30 Total 100% N=688 Table 89: Question D14 - Response Percentages and Number of Respondents What is your race? (Mark one or more races to indicate what race(s) you consider yourself to be.) Percent Number American Indian or Alaskan Native 0% N=2 Asian, Asian Indian or Pacific Islander 28% N=193 Black or African American 1% N=7 White 70% N=479 Other 4% N=26 Total may exceed 100% as respondents could select more than one option. Table 90: Question D15 - Response Percentages and Number of Respondents In which category is your age? Percent Number 18 to 24 years 5% N=31 25 to 34 years 17% N=118 35 to 44 years 16% N=110 45 to 54 years 25% N=171 55 to 64 years 12% N=79 65 to 74 years 12% N=81 75 years or older 14% N=100 Total 100% N=690 Table 91: Question D16 - Response Percentages and Number of Respondents What is your sex? Percent Number Female 51% N=352 Male 49% N=336 Total 100% N=688 Table 92 Question D17 - Response Percentages and Number of Respondents Do you consider a cell phone or landline your primary telephone number? Percent Number Cell 60% N=414 Land line 22% N=150 Both 19% N=128 Total 100% N=692 Attachment B The National Citizen Survey™ 53 Table 93: Question D18 - Response Percentages and Number of Respondents without "Don't Know" Responses Do you consider yourself to be one or more of the following? (Check all that apply.) Percent Number Heterosexual 96% N=549 Lesbian 1% N=3 Gay 2% N=11 Bisexual 3% N=15 Transgender 1% N=3 Total may exceed 100% as respondents could select more than one option. Attachment B The National Citizen Survey™ 54 Survey Materials Attachment B Presorted First Class Mail US Postage PAID Boulder, CO Permit NO.94 55 Attachment B The City of Palo Alto 2015 Citizen Survey Page 1 of 6 Please complete this questionnaire if you are the adult (age 18 or older) in the household who most recently had a birthday. The adult’s year of birth does not matter. Please select the response (by circling the number or checking the box) that most closely represents your opinion for each question. Your responses are anonymous and will be reported in group form only. 1.Please rate each of the following aspects of quality of life in Palo Alto: Excellent Good Fair Poor Don’t know Palo Alto as a place to live ....................................................................... 1 2 3 4 5 Your neighborhood as a place to live ....................................................... 1 2 3 4 5 Palo Alto as a place to raise children ........................................................ 1 2 3 4 5 Palo Alto as a place to work ..................................................................... 1 2 3 4 5 Palo Alto as a place to visit ...................................................................... 1 2 3 4 5 Palo Alto as a place to retire ..................................................................... 1 2 3 4 5 The overall quality of life in Palo Alto ...................................................... 1 2 3 4 5 2.Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don’t know Overall feeling of safety in Palo Alto ........................................................ 1 2 3 4 5 Overall ease of getting to the places you usually have to visit .................. 1 2 3 4 5 Quality of overall natural environment in Palo Alto ................................. 1 2 3 4 5 Overall “built environment” of Palo Alto (including overall design, buildings, parks and transportation systems) ......................................... 1 2 3 4 5 Health and wellness opportunities in Palo Alto ........................................ 1 2 3 4 5 Overall opportunities for education and enrichment ................................ 1 2 3 4 5 Overall economic health of Palo Alto ...................................................... 1 2 3 4 5 Sense of community ................................................................................. 1 2 3 4 5 Overall image or reputation of Palo Alto .................................................. 1 2 3 4 5 3.Please indicate how likely or unlikely you are to do each of the following: Very Somewhat Somewhat Very Don’t likely likely unlikely unlikely know Recommend living in Palo Alto to someone who asks ................... 1 2 3 4 5 Remain in Palo Alto for the next five years ..................................... 1 2 3 4 5 4.Please rate how safe or unsafe you feel:Very Somewhat Neither safe Somewhat Very Don’t safe safe nor unsafe unsafe unsafe know In your neighborhood during the day ..................................... 1 2 3 4 5 6 In Palo Alto’s downtown/commercial areas during the day .... 1 2 3 4 5 6 In your neighborhood after dark ............................................. 1 2 3 4 5 6 In Palo Alto’s downtown/commercial areas after dark ............ 1 2 3 4 5 6 5. Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don’t know Traffic flow on major streets ..................................................................... 1 2 3 4 5 Ease of public parking .............................................................................. 1 2 3 4 5 Ease of travel by car in Palo Alto .............................................................. 1 2 3 4 5 Ease of travel by public transportation in Palo Alto ................................... 1 2 3 4 5 Ease of travel by bicycle in Palo Alto ........................................................ 1 2 3 4 5 Ease of walking in Palo Alto ..................................................................... 1 2 3 4 5 Availability of paths and walking trails ..................................................... 1 2 3 4 5 Air quality ................................................................................................ 1 2 3 4 5 Cleanliness of Palo Alto ........................................................................... 1 2 3 4 5 Overall appearance of Palo Alto .............................................................. 1 2 3 4 5 Public places where people want to spend time ....................................... 1 2 3 4 5 Variety of housing options ....................................................................... 1 2 3 4 5 Availability of affordable quality housing ................................................. 1 2 3 4 5 Fitness opportunities (including exercise classes and paths or trails, etc.) ............................................................................................. 1 2 3 4 5 Recreational opportunities ....................................................................... 1 2 3 4 5 Availability of affordable quality food ...................................................... 1 2 3 4 5 Availability of affordable quality health care ............................................ 1 2 3 4 5 Availability of preventive health services ................................................. 1 2 3 4 5 Availability of affordable quality mental health care ................................. 1 2 3 4 5 56 Attachment B Th e N a t i o n a l Ci t i z e n S u r v e y ™ • © 2 0 0 1 -20 1 5 Na t i o n a l Re s e a r c h C e n t e r , I n c . Page 2 of 6 6. Please rate each of the following characteristics as they relate to Palo Alto as a whole: Excellent Good Fair Poor Don’t know Availability of affordable quality child care/preschool ................................ 1 2 3 4 5 K-12 education .......................................................................................... 1 2 3 4 5 Adult educational opportunities ................................................................. 1 2 3 4 5 Opportunities to attend cultural/arts/music activities .................................. 1 2 3 4 5 Opportunities to participate in religious or spiritual events and activities ... 1 2 3 4 5 Employment opportunities ......................................................................... 1 2 3 4 5 Shopping opportunities .............................................................................. 1 2 3 4 5 Cost of living in Palo Alto .......................................................................... 1 2 3 4 5 Overall quality of business and service establishments in Palo Alto............ 1 2 3 4 5 Vibrant downtown/commercial areas ......................................................... 1 2 3 4 5 Overall quality of new development in Palo Alto ....................................... 1 2 3 4 5 Opportunities to participate in social events and activities ......................... 1 2 3 4 5 Opportunities to volunteer ......................................................................... 1 2 3 4 5 Opportunities to participate in community matters..................................... 1 2 3 4 5 Openness and acceptance of the community toward people of diverse backgrounds ............................................................................... 1 2 3 4 5 Neighborliness of residents in Palo Alto ..................................................... 1 2 3 4 5 Openness and acceptance of the community toward lesbian, gay, bisexual, and transgender people ........................................................... 1 2 3 4 5 Opportunities to learn about City services through social media websites such as Twitter and Facebook ................................................... 1 2 3 4 5 7. Please indicate whether or not you have done each of the following in the last 12 months. No Yes Made efforts to conserve water ................................................................................................................. 1 2 Made efforts to make your home more energy efficient ............................................................................. 1 2 Observed a code violation or other hazard in Palo Alto (weeds, abandoned buildings, etc.) ..................... 1 2 Household member was a victim of a crime in Palo Alto .......................................................................... 1 2 Reported a crime to the police in Palo Alto ............................................................................................... 1 2 Stocked supplies in preparation for an emergency..................................................................................... 1 2 Campaigned or advocated for an issue, cause or candidate ....................................................................... 1 2 Contacted the City of Palo Alto (in-person, phone, email or web) for help or information ......................... 1 2 Contacted Palo Alto elected officials (in-person, phone, email or web) to express your opinion ................ 1 2 8. In the last 12 months, about how many times, if at all, have you or other household members done each of the following in Palo Alto?2 times a 2-4 times Once a month Not week or more a month or less at all Used Palo Alto recreation centers or their services .................................................. 1 2 3 4 Visited a neighborhood park or City park ................................................................ 1 2 3 4 Used Palo Alto public libraries or their services ...................................................... 1 2 3 4 Participated in religious or spiritual activities in Palo Alto ....................................... 1 2 3 4 Attended a City-sponsored event ............................................................................. 1 2 3 4 Used bus, rail or other public transportation instead of driving................................ 1 2 3 4 Carpooled with other adults or children instead of driving alone ............................ 1 2 3 4 Walked or biked instead of driving ......................................................................... 1 2 3 4 Volunteered your time to some group/activity in Palo Alto ...................................... 1 2 3 4 Participated in a club .............................................................................................. 1 2 3 4 Talked to or visited with your immediate neighbors ................................................ 1 2 3 4 Done a favor for a neighbor .................................................................................... 1 2 3 4 Used the City’s website to conduct business or pay bills ......................................... 1 2 3 4 9.Thinking about local public meetings (of local elected officials like City Council or County Commissioners, advisory boards, town halls, HOA, neighborhood watch, etc.), in the last 12 months, about how many times, if at all, have you or other household members attended or watched a local public meeting?2 times a 2-4 times Once a month Not week or more a month or less at all Attended a local public meeting ............................................................................. 1 2 3 4 Watched (online or on television) a local public meeting ........................................ 1 2 3 4 57 Attachment B The City of Palo Alto 2015 Citizen Survey Page 3 of 6 10. Please rate the quality of each of the following services in Palo Alto: Excellent Good Fair Poor Don’t know Police services ......................................................................................... 1 2 3 4 5 Fire services ............................................................................................. 1 2 3 4 5 Ambulance or emergency medical services .............................................. 1 2 3 4 5 Crime prevention ..................................................................................... 1 2 3 4 5 Fire prevention and education ................................................................. 1 2 3 4 5 Traffic enforcement .................................................................................. 1 2 3 4 5 Street repair ............................................................................................. 1 2 3 4 5 Street cleaning ......................................................................................... 1 2 3 4 5 Street lighting ........................................................................................... 1 2 3 4 5 Sidewalk maintenance ............................................................................. 1 2 3 4 5 Traffic signal timing ................................................................................. 1 2 3 4 5 Bus or transit services ............................................................................... 1 2 3 4 5 Garbage collection ................................................................................... 1 2 3 4 5 Yard waste pick-up .................................................................................. 1 2 3 4 5 Storm drainage ......................................................................................... 1 2 3 4 5 Drinking water ......................................................................................... 1 2 3 4 5 Sewer services ......................................................................................... 1 2 3 4 5 Utility billing............................................................................................ 1 2 3 4 5 City parks ................................................................................................. 1 2 3 4 5 Recreation programs or classes ................................................................ 1 2 3 4 5 Recreation centers or facilities .................................................................. 1 2 3 4 5 Land use, planning and zoning ................................................................ 1 2 3 4 5 Code enforcement (weeds, abandoned buildings, etc.) ............................ 1 2 3 4 5 Animal control ......................................................................................... 1 2 3 4 5 Economic development ........................................................................... 1 2 3 4 5 Public library services .............................................................................. 1 2 3 4 5 Public information services ...................................................................... 1 2 3 4 5 Cable television ....................................................................................... 1 2 3 4 5 Emergency preparedness (services that prepare the community for natural disasters or other emergency situations) .................................... 1 2 3 4 5 Preservation of natural areas such as open space, farmlands and greenbelts ...................................................................................... 1 2 3 4 5 Palo Alto open space ............................................................................... 1 2 3 4 5 City-sponsored special events .................................................................. 1 2 3 4 5 Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) .................................................................. 1 2 3 4 5 Neighborhood branch libraries ................................................................ 1 2 3 4 5 Your neighborhood park .......................................................................... 1 2 3 4 5 Variety of library materials ....................................................................... 1 2 3 4 5 Street tree maintenance ............................................................................ 1 2 3 4 5 Electric utility ........................................................................................... 1 2 3 4 5 Gas utility ................................................................................................ 1 2 3 4 5 Recycling collection ................................................................................. 1 2 3 4 5 City’s website........................................................................................... 1 2 3 4 5 Art programs and theatre .......................................................................... 1 2 3 4 5 11. Overall, how would you rate the quality of the services provided by each of the following? Excellent Good Fair Poor Don’t know The City of Palo Alto ................................................................................ 1 2 3 4 5 The Federal Government ......................................................................... 1 2 3 4 5 State Government .................................................................................... 1 2 3 4 5 58 Attachment B Th e N a t i o n a l Ci t i z e n S u r v e y ™ • © 2 0 0 1 -20 1 5 Na t i o n a l Re s e a r c h C e n t e r , I n c . Page 4 of 6 12. Please rate the following categories of Palo Alto government performance: Excellent Good Fair Poor Don’t know The value of services for the taxes paid to Palo Alto ................................. 1 2 3 4 5 The overall direction that Palo Alto is taking ............................................ 1 2 3 4 5 The job Palo Alto government does at welcoming citizen involvement .... 1 2 3 4 5 Overall confidence in Palo Alto government ............................................ 1 2 3 4 5 Generally acting in the best interest of the community ............................. 1 2 3 4 5 Being honest ............................................................................................ 1 2 3 4 5 Treating all residents fairly ....................................................................... 1 2 3 4 5 13.Please rate how important, if at all, you think it is for the Palo Alto community to focus on each of the following in the coming two years:Very Somewhat Not at all Essential important important important Overall feeling of safety in Palo Alto ....................................................................... 1 2 3 4 Overall ease of getting to the places you usually have to visit ................................. 1 2 3 4 Quality of overall natural environment in Palo Alto ................................................ 1 2 3 4 Overall “built environment” of Palo Alto (including overall design, buildings, parks and transportation systems) ....................................................... 1 2 3 4 Health and wellness opportunities in Palo Alto ....................................................... 1 2 3 4 Overall opportunities for education and enrichment ............................................... 1 2 3 4 Overall economic health of Palo Alto ..................................................................... 1 2 3 4 Sense of community ................................................................................................ 1 2 3 4 14.If you had a maintenance issue to report to the City of Palo Alto, what method would you be most likely to use? (Please pick one.)  Contact the City Manager’s office  Submit a notification electronically on the City’s website through the  Contact a City Council member “Make a Service Request” link on the City’s website  E-mail the appropriate city department  Use Palo Alto 311 phone app to notify the appropriate city department  Call the appropriate city department  Visit City Hall  Call the main number for the City 15.What method(s), if any, have you used to provide feedback or engage with the City on issues in Palo Alto in the past 12 months? Please check all that apply:  In-person community meetings  Open City Hall (online civic engagement portal)  City council meetings  Social media channels (Facebook, Twitter)  Email  Use the “Contact the City” link on the City of Palo Alto website  Phone call  I have not contacted the City about any issues in the last 12  Nextdoor (private neighborhood network)months 16.How frequently, if at all, do you shop…Once a 1-5 times 1-3 times Not day or more a week a month at all In your neighborhood ........................................................................................ 1 2 3 4 In other parts of Palo Alto .................................................................................. 1 2 3 4 In neighboring cities .......................................................................................... 1 2 3 4 Online ............................................................................................................... 1 2 3 4 17.How frequently, if at all, do you eat out for any meal…Once a 1-5 times 1-3 times Not day or more a week a month at all In your neighborhood ........................................................................................ 1 2 3 4 In other parts of Palo Alto .................................................................................. 1 2 3 4 In neighboring cities .......................................................................................... 1 2 3 4 By ordering take-out/delivery ............................................................................. 1 2 3 4 18.How often, if at all, do you participate in each of the following waste programs when you have these types of waste to dispose of? Never Rarely Sometimes Usually Always Residential food scraps collection program .............................................. 1 2 3 4 5 Home composting ................................................................................... 1 2 3 4 5 Palo Alto’s weekly household hazardous waste collection program ......... 1 2 3 4 5 59 Attachment B The City of Palo Alto 2015 Citizen Survey Page 5 of 6 19.Please rate the quality of Palo Alto’s trees and landscaping for: Excellent Good Fair Poor Don’t know Businesses................................................................................................ 1 2 3 4 5 Residential homes .................................................................................... 1 2 3 4 5 Walking and biking .................................................................................. 1 2 3 4 5 Schools .................................................................................................... 1 2 3 4 5 Streets ...................................................................................................... 1 2 3 4 5 Parks ........................................................................................................ 1 2 3 4 5 20.If you did not have access to a car for your usual daily transportation around town, how convenient (based on time and proximity), would you consider each of the following methods of getting around? Very Somewhat Somewhat Very convenient convenient inconvenient inconvenient Walking ............................................................................................................. 1 2 3 4 Biking ................................................................................................................ 1 2 3 4 Bus .................................................................................................................... 1 2 3 4 Train .................................................................................................................. 1 2 3 4 Free shuttle ........................................................................................................ 1 2 3 4 Taxi ................................................................................................................... 1 2 3 4 Uber/Lyft or similar rideshare service ................................................................. 1 2 3 4 Carpooling ......................................................................................................... 1 2 3 4 21.If you did not have access to a car to get around town and convenience (based on time and proximity) was not an issue, what is your preference for each of the following methods of getting around? Prefer Somewhat Do not a lot prefer prefer Walking ................................................................................................................................. 1 2 3 Biking .................................................................................................................................... 1 2 3 Bus ........................................................................................................................................ 1 2 3 Train ...................................................................................................................................... 1 2 3 Free shuttle ............................................................................................................................ 1 2 3 Taxi ....................................................................................................................................... 1 2 3 Uber/Lyft or similar rideshare service ..................................................................................... 1 2 3 Carpooling ............................................................................................................................. 1 2 3 22.Please rate how important, if at all, it would be to redevelop the Cubberley Community Center for each of the following purposes: Very Somewhat Not at all Essential important important important School(s) ............................................................................................................ 1 2 3 4 Playing fields ..................................................................................................... 1 2 3 4 Community center ............................................................................................. 1 2 3 4 23.The City of Palo Alto and Palo Alto Unified School District are working together on a master plan for the Cubberley Community Center to meet future community and school needs. Please indicate how much of a priority, if at all, each of the following community programs at Cubberley are to you. High Medium Not a Priority priority priority Child care ................................................................................................................................. 1 2 3 Cubberley Artist Studio Program ............................................................................................... 1 2 3 Dance studios ........................................................................................................................... 1 2 3 Outdoor sports .......................................................................................................................... 1 2 3 Indoor sports and health programs ............................................................................................ 1 2 3 Senior wellness, including stroke and cardiovascular programs ................................................. 1 2 3 Education – private schools and special interest classes ............................................................ 1 2 3 Rooms available to rent for other activities ................................................................................ 1 2 3 Other (please specify) __________________________ ............................................................... 1 2 3 24. Please share one improvement to the City of Palo Alto’s parks, arts, or recreation activities and programs that the City could make to better serve the community. 60 Attachment B Th e N a t i o n a l Ci t i z e n S u r v e y ™ • © 2 0 0 1 -20 1 5 Na t i o n a l Re s e a r c h C e n t e r , I n c . Page 6 of 6 Our last questions are about you and your household. Again, all of your responses to this survey are completely anonymous and will be reported in group form only. D1. How often, if at all, do you do each of the following, considering all of the times you could? Never Rarely Sometimes Usually Always Recycle at home .............................................................................................. 1 2 3 4 5 Purchase goods or services from a business located in Palo Alto ....................... 1 2 3 4 5 Eat at least 5 portions of fruits and vegetables a day .......................................... 1 2 3 4 5 Participate in moderate or vigorous physical activity ......................................... 1 2 3 4 5 Read or watch local news (via television, paper, computer, etc.) ....................... 1 2 3 4 5 Vote in local elections...................................................................................... 1 2 3 4 5 D2. Would you say that in general your health is:  Excellent  Very good  Good  Fair  Poor D3. What impact, if any, do you think the economy will have on your family income in the next 6 months? Do you think the impact will be:  Very positive  Somewhat positive  Neutral  Somewhat negative  Very negative D4. What is your employment status?  Working full time for pay  Working part time for pay  Unemployed, looking for paid work  Unemployed, not looking for paid work  Fully retired  College student, unemployed D5. Do you work inside the boundaries of Palo Alto?  Yes, outside the home  Yes, from home  No D6. How many years have you lived in Palo Alto?  Less than 2 years  11-20 years  2-5 years  More than 20 years  6-10 years D7. Which best describes the building you live in?  One family house detached from any other houses  Building with two or more homes (duplex, townhome, apartment or condominium)  Mobile home  Other D8. Is this house, apartment or mobile home...  Rented  Owned D9. About how much is your monthly housing cost for the place you live (including rent, mortgage payment, property tax, property insurance and homeowners’ association (HOA) fees)?  Less than $1,000 per month  $3,000 to $3,499 per month  $1,000 to $1,499 per month  $3,500 to $3,999 per month  $1,500 to $1,999 per month  $4,000 to $4,499 per month  $2,000 to $2,499 per month  $4,500 to $4,999 per month  $2,500 to $2,999 per month  $5,000 or more per month D10. Do any children 17 or under live in your household?  No  Yes D11. Are you or any other members of your household aged 65 or older?  No  Yes D12. How much do you anticipate your household’s total income before taxes will be for the current year? (Please include in your total income money from all sources for all persons living in your household.)  Less than $25,000  $150,000 to $199,999  $25,000 to $49,999  $200,000 to $249,999  $50,000 to $99,999  $250,000 to $299,999  $100,000 to $149,999  $300,000 or more Please respond to both questions D13 and D14: D13. Are you Spanish, Hispanic or Latino?  No, not Spanish, Hispanic or Latino  Yes, I consider myself to be Spanish, Hispanic or Latino D14. What is your race? (Mark one or more races to indicate what race you consider yourself to be.)  American Indian or Alaskan Native  Asian, Asian Indian or Pacific Islander  Black or African American  White  Other D15. In which category is your age?  18-24 years  55-64 years  25-34 years  65-74 years  35-44 years  75 years or older  45-54 years D16. What is your sex?  Female  Male D17. Do you consider a cell phone or land line your primary telephone number?  Cell  Land line  Both D18. Do you consider yourself to be one or more of the following? (Check all that apply.)  Heterosexual  Lesbian  Gay  Bisexual  Transgender Thank you for completing this survey. Please return the completed survey in the postage-paid envelope to: National Research Center, Inc., PO Box 549, Belle Mead, NJ 08502 61 Attachment B October 2015 Dear City of Palo Alto Resident: Please help us shape the future of Palo Alto! You have been randomly selected to participate in the 2015 Palo Alto Citizen Survey. Please take a few minutes to fill out the enclosed survey. Your participation in this survey is very important – especially since your household is one of only a small number of households being surveyed. The survey results are compiled each year into a report that is carefully reviewed by City Council members, City management and staff, and the Office of the City Auditor. Your input influences the City’s priorities and the services provided to Palo Alto residents. A few things to remember: Your responses are completely anonymous. In order to hear from a diverse group of residents, the adult 18 years or older in your household who most recently had a birthday should complete this survey. You may return the survey by mail in the enclosed postage-paid envelope, or you can complete the survey online at: www.n-r-c.com/survey/paloalto.htm If you have any questions about the survey please call (650) 329-2667. Thank you for your time and participation! Sincerely, Harriet Richardson City Auditor 62 Attachment B October 2015 Dear City of Palo Alto Resident: Here’s a second chance if you haven’t already responded to the 2015 Palo Alto Citizen Survey! (If you completed it and sent it back, we thank you for your time and ask you to recycle this survey. Please do not respond twice.) Please help us shape the future of Palo Alto! You have been randomly selected to participate in the 2015 Palo Alto Citizen Survey. Please take a few minutes to fill out the enclosed survey. Your participation in this survey is very important – especially since your household is one of only a small number of households being surveyed. The survey results are compiled each year into a report that is carefully reviewed by City Council members, City management and staff, and the Office of the City Auditor. Your input influences the City’s priorities and the services provided to Palo Alto residents. A few things to remember: Your responses are completely anonymous. In order to hear from a diverse group of residents, the adult 18 years or older in your household who most recently had a birthday should complete this survey. You may return the survey by mail in the enclosed postage-paid envelope, or you can complete the survey online at: www.n-r-c.com/survey/paloalto.htm If you have any questions about the survey please call (650) 329-2667. Thank you for your time and participation! Sincerely, Harriet Richardson City Auditor 63 Attachment B The National Citizen Survey™ 64 Communities included in national comparisons The communities included in Palo Alto’s comparisons are listed on the following pages along with their population according to the 2010 Census. Adams County, CO ................................................. 441,603 Airway Heights city, WA .............................................. 6,114 Albany city, OR......................................................... 50,158 Albemarle County, VA ............................................... 98,970 Albert Lea city, MN ................................................... 18,016 Algonquin village, IL ................................................. 30,046 Aliso Viejo city, CA .................................................... 47,823 Altoona city, IA......................................................... 14,541 American Canyon city, CA ......................................... 19,454 Ames city, IA ............................................................ 58,965 Andover CDP, MA ....................................................... 8,762 Ankeny city, IA ......................................................... 45,582 Ann Arbor city, MI .................................................. 113,934 Annapolis city, MD .................................................... 38,394 Apache Junction city, AZ ........................................... 35,840 Apple Valley town, CA ............................................... 69,135 Arapahoe County, CO ............................................. 572,003 Arkansas City city, AR ....................................................366 Arlington city, TX .................................................... 365,438 Arlington County, VA .............................................. 207,627 Arvada city, CO ...................................................... 106,433 Asheville city, NC ...................................................... 83,393 Ashland city, OR ....................................................... 20,078 Ashland town, VA ....................................................... 7,225 Aspen city, CO............................................................ 6,658 Auburn city, AL ......................................................... 53,380 Auburn city, WA ....................................................... 70,180 Augusta CCD, GA.................................................... 134,777 Aurora city, CO ....................................................... 325,078 Austin city, TX ........................................................ 790,390 Bainbridge Island city, WA ........................................ 23,025 Baltimore city, MD .................................................. 620,961 Bartonville town, TX ................................................... 1,469 Battle Creek city, MI ................................................. 52,347 Bay City city, MI ....................................................... 34,932 Baytown city, TX ...................................................... 71,802 Bedford city, TX........................................................ 46,979 Bedford town, MA ..................................................... 13,320 Bellevue city, WA .................................................... 122,363 Bellingham city, WA .................................................. 80,885 Beltrami County, MN ................................................. 44,442 Benbrook city, TX ..................................................... 21,234 Bend city, OR ........................................................... 76,639 Benicia city, CA ........................................................ 26,997 Bettendorf city, IA .................................................... 33,217 Billings city, MT ...................................................... 104,170 Blaine city, MN ......................................................... 57,186 Bloomfield Hills city, MI ............................................... 3,869 Bloomington city, MN ................................................ 82,893 Blue Springs city, MO ................................................ 52,575 Boise City city, ID ................................................... 205,671 Boone County, KY................................................... 118,811 Boulder city, CO ....................................................... 97,385 Bowling Green city, KY .............................................. 58,067 Brentwood city, MO .................................................... 8,055 Brentwood city, TN ................................................... 37,060 Brighton city, CO ...................................................... 33,352 Bristol city, TN .......................................................... 26,702 Broken Arrow city, OK............................................... 98,850 Brookfield city, WI .................................................... 37,920 Brookline CDP, MA ................................................... 58,732 Broomfield city, CO .................................................. 55,889 Brownsburg town, IN ............................................... 21,285 Bryan city, TX .......................................................... 76,201 Burien city, WA ........................................................ 33,313 Burleson city, TX ...................................................... 36,690 Cabarrus County, NC ............................................... 178,011 Cambridge city, MA ................................................. 105,162 Canton city, SD .......................................................... 3,057 Cape Coral city, FL .................................................. 154,305 Cape Girardeau city, MO ........................................... 37,941 Carlisle borough, PA ................................................. 18,682 Carlsbad city, CA ..................................................... 105,328 Carroll city, IA .......................................................... 10,103 Cartersville city, GA .................................................. 19,731 Cary town, NC ........................................................ 135,234 Casa Grande city, AZ ................................................ 48,571 Casper city, WY ....................................................... 55,316 Castine town, ME ....................................................... 1,366 Castle Pines North city, CO ....................................... 10,360 Castle Rock town, CO ............................................... 48,231 Centennial city, CO.................................................. 100,377 Centralia city, IL....................................................... 13,032 Chambersburg borough, PA ...................................... 20,268 Chandler city, AZ .................................................... 236,123 Chanhassen city, MN ................................................ 22,952 Chapel Hill town, NC ................................................ 57,233 Charlotte city, NC .................................................... 731,424 Charlotte County, FL ............................................... 159,978 Charlottesville city, VA .............................................. 43,475 Chattanooga city, TN............................................... 167,674 Chesterfield County, VA ........................................... 316,236 Chippewa Falls city, WI ............................................ 13,661 Citrus Heights city, CA .............................................. 83,301 Clackamas County, OR ............................................ 375,992 Clarendon Hills village, IL ........................................... 8,427 Clayton city, MO....................................................... 15,939 Clearwater city, FL .................................................. 107,685 Cleveland Heights city, OH........................................ 46,121 Clive city, IA ............................................................ 15,447 Clovis city, CA .......................................................... 95,631 College Park city, MD ............................................... 30,413 College Station city, TX............................................. 93,857 Colleyville city, TX .................................................... 22,807 Collinsville city, IL .................................................... 25,579 Columbia city, MO ................................................... 108,500 Columbia city, SC .................................................... 129,272 Columbia Falls city, MT ............................................... 4,688 Columbus city, WI ...................................................... 4,991 Commerce City city, CO ............................................ 45,913 Concord city, CA ..................................................... 122,067 Concord town, MA.................................................... 17,668 Cookeville city, TN ................................................... 30,435 Coon Rapids city, MN ............................................... 61,476 Copperas Cove city, TX............................................. 32,032 Coronado city, CA .................................................... 18,912 Corvallis city, OR ...................................................... 54,462 Creve Coeur city, MO ............................................... 17,833 Cross Roads town, TX ................................................ 1,563 Crystal Lake city, IL .................................................. 40,743 Attachment B The National Citizen Survey™ 65 Dacono city, CO ......................................................... 4,152 Dade City city, FL ....................................................... 6,437 Dakota County, MN................................................. 398,552 Dallas city, OR .......................................................... 14,583 Dallas city, TX ..................................................... 1,197,816 Danville city, KY ....................................................... 16,218 Dardenne Prairie city, MO ......................................... 11,494 Davenport city, IA .................................................... 99,685 Davidson town, NC ................................................... 10,944 Dayton city, OH ...................................................... 141,527 Decatur city, GA ....................................................... 19,335 Del Mar city, CA.......................................................... 4,161 Delray Beach city, FL ................................................ 60,522 Denison city, TX ....................................................... 22,682 Denton city, TX ...................................................... 113,383 Denver city, CO ...................................................... 600,158 Derby city, KS .......................................................... 22,158 Des Peres city, MO ..................................................... 8,373 Destin city, FL .......................................................... 12,305 Dorchester County, MD ............................................. 32,618 Dothan city, AL......................................................... 65,496 Douglas County, CO................................................ 285,465 Dover city, NH .......................................................... 29,987 Dublin city, CA.......................................................... 46,036 Duluth city, MN ........................................................ 86,265 Duncanville city, TX .................................................. 38,524 Durham city, NC ..................................................... 228,330 Eagle town, CO .......................................................... 6,508 East Baton Rouge Parish, LA ................................... 440,171 East Grand Forks city, MN ........................................... 8,601 East Lansing city, MI................................................. 48,579 Eau Claire city, WI .................................................... 65,883 Eden Prairie city, MN ................................................ 60,797 Edgerton city, KS ........................................................ 1,671 Edgewater city, CO ..................................................... 5,170 Edina city, MN .......................................................... 47,941 Edmond city, OK....................................................... 81,405 Edmonds city, WA .................................................... 39,709 El Cerrito city, CA ..................................................... 23,549 El Dorado County, CA ............................................. 181,058 El Paso city, TX ...................................................... 649,121 Elk Grove city, CA ................................................... 153,015 Elk River city, MN ..................................................... 22,974 Elko New Market city, MN ........................................... 4,110 Elmhurst city, IL ....................................................... 44,121 Encinitas city, CA ...................................................... 59,518 Englewood city, CO................................................... 30,255 Erie town, CO ........................................................... 18,135 Escambia County, FL .............................................. 297,619 Estes Park town, CO ................................................... 5,858 Fairview town, TX ....................................................... 7,248 Farmington Hills city, MI ........................................... 79,740 Fayetteville city, NC ................................................ 200,564 Fishers town, IN ....................................................... 76,794 Flower Mound town, TX ............................................ 64,669 Forest Grove city, OR ................................................ 21,083 Fort Collins city, CO ................................................ 143,986 Fort Smith city, AR.................................................... 86,209 Fort Worth city, TX ................................................. 741,206 Fountain Hills town, AZ ............................................. 22,489 Franklin city, TN ....................................................... 62,487 Fredericksburg city, VA ............................................. 24,286 Fremont city, CA ..................................................... 214,089 Friendswood city, TX ................................................ 35,805 Fruita city, CO .......................................................... 12,646 Gahanna city, OH ..................................................... 33,248 Gaithersburg city, MD ............................................... 59,933 Galveston city, TX .................................................... 47,743 Gardner city, KS ....................................................... 19,123 Geneva city, NY ....................................................... 13,261 Georgetown city, TX ................................................. 47,400 Gilbert town, AZ ...................................................... 208,453 Gillette city, WY ....................................................... 29,087 Glendora city, CA ..................................................... 50,073 Glenview village, IL .................................................. 44,692 Globe city, AZ ............................................................ 7,532 Golden Valley city, MN .............................................. 20,371 Goodyear city, AZ .................................................... 65,275 Grafton village, WI ................................................... 11,459 Grand Blanc city, MI ................................................... 8,276 Grand Island city, NE ............................................... 48,520 Grass Valley city, CA................................................. 12,860 Greeley city, CO ....................................................... 92,889 Green Valley CDP, AZ ............................................... 21,391 Greenville city, NC .................................................... 84,554 Greenwich town, CT ................................................. 61,171 Greenwood Village city, CO ....................................... 13,925 Greer city, SC .......................................................... 25,515 Guilford County, NC ................................................ 488,406 Gunnison County, CO ............................................... 15,324 Gurnee village, IL ..................................................... 31,295 Hailey city, ID ............................................................ 7,960 Haines Borough, AK ................................................... 2,508 Hallandale Beach city, FL .......................................... 37,113 Hamilton city, OH ..................................................... 62,477 Hanover County, VA ................................................. 99,863 Harrisonburg city, VA ............................................... 48,914 Harrisonville city, MO ............................................... 10,019 Hayward city, CA .................................................... 144,186 Henderson city, NV ................................................. 257,729 Herndon town, VA .................................................... 23,292 High Point city, NC .................................................. 104,371 Highland Park city, IL ............................................... 29,763 Highlands Ranch CDP, CO ........................................ 96,713 Hillsborough town, NC ................................................ 6,087 Holland city, MI........................................................ 33,051 Honolulu County, HI ................................................ 953,207 Hooksett town, NH ................................................... 13,451 Hopkins city, MN ...................................................... 17,591 Hopkinton town, MA ................................................. 14,925 Hoquiam city, WA ...................................................... 8,726 Horry County, SC .................................................... 269,291 Hudson city, OH ....................................................... 22,262 Hudson town, CO ....................................................... 2,356 Hudsonville city, MI .................................................... 7,116 Huntersville town, NC ............................................... 46,773 Hurst city, TX........................................................... 37,337 Hutchinson city, MN ................................................. 14,178 Hutto city, TX .......................................................... 14,698 Hyattsville city, MD .................................................. 17,557 Independence city, MO............................................ 116,830 Indian Trail town, NC ............................................... 33,518 Indianola city, IA...................................................... 14,782 Iowa City city, IA ..................................................... 67,862 Issaquah city, WA .................................................... 30,434 Jackson County, MI ................................................. 160,248 James City County, VA ............................................. 67,009 Jefferson City city, MO.............................................. 43,079 Jefferson County, CO .............................................. 534,543 Jefferson County, NY ............................................... 116,229 Jerome city, ID ........................................................ 10,890 Johnson City city, TN................................................ 63,152 Johnston city, IA ...................................................... 17,278 Jupiter town, FL ....................................................... 55,156 Attachment B The National Citizen Survey™ 66 Kalamazoo city, MI ................................................... 74,262 Kansas City city, KS ................................................ 145,786 Kansas City city, MO ............................................... 459,787 Keizer city, OR.......................................................... 36,478 Kenmore city, WA ..................................................... 20,460 Kennedale city, TX ...................................................... 6,763 Kennett Square borough, PA ....................................... 6,072 Kettering city, OH ..................................................... 56,163 Key West city, FL ...................................................... 24,649 King County, WA ................................................. 1,931,249 Kirkland city, WA ...................................................... 48,787 Kirkwood city, MO .................................................... 27,540 Knoxville city, IA ......................................................... 7,313 La Mesa city, CA ....................................................... 57,065 La Plata town, MD ...................................................... 8,753 La Porte city, TX ....................................................... 33,800 La Vista city, NE ....................................................... 15,758 Lafayette city, CO ..................................................... 24,453 Laguna Beach city, CA .............................................. 22,723 Laguna Hills city, CA ................................................. 30,344 Laguna Niguel city, CA .............................................. 62,979 Lake Oswego city, OR ............................................... 36,619 Lake Stevens city, WA............................................... 28,069 Lake Worth city, FL ................................................... 34,910 Lake Zurich village, IL ............................................... 19,631 Lakeville city, MN...................................................... 55,954 Lakewood city, CO .................................................. 142,980 Lane County, OR .................................................... 351,715 Larimer County, CO ................................................ 299,630 Las Cruces city, NM .................................................. 97,618 Las Vegas city, NV .................................................. 583,756 Lawrence city, KS ..................................................... 87,643 League City city, TX .................................................. 83,560 Lee's Summit city, MO .............................................. 91,364 Lehi city, UT ............................................................. 47,407 Lenexa city, KS ......................................................... 48,190 Lewis County, NY ..................................................... 27,087 Lewisville city, TX ..................................................... 95,290 Libertyville village, IL ................................................ 20,315 Lincoln city, NE....................................................... 258,379 Lindsborg city, KS ....................................................... 3,458 Littleton city, CO....................................................... 41,737 Livermore city, CA .................................................... 80,968 Lombard village, IL ................................................... 43,165 Lone Tree city, CO .................................................... 10,218 Long Grove village, IL ................................................. 8,043 Longmont city, CO .................................................... 86,270 Longview city, TX ..................................................... 80,455 Los Alamos County, NM ............................................ 17,950 Louisville city, CO ..................................................... 18,376 Lynchburg city, VA.................................................... 75,568 Lynnwood city, WA ................................................... 35,836 Macomb County, MI................................................ 840,978 Madison city, WI..................................................... 233,209 Manhattan Beach city, CA ......................................... 35,135 Mankato city, MN...................................................... 39,309 Maple Grove city, MN ................................................ 61,567 Maple Valley city, WA ............................................... 22,684 Maricopa County, AZ............................................ 3,817,117 Martinez city, CA ...................................................... 35,824 Maryland Heights city, MO ........................................ 27,472 Matthews town, NC .................................................. 27,198 McAllen city, TX ...................................................... 129,877 McDonough city, GA ................................................. 22,084 McKinney city, TX ................................................... 131,117 McMinnville city, OR .................................................. 32,187 Medford city, OR ...................................................... 74,907 Menlo Park city, CA .................................................. 32,026 Mercer Island city, WA ............................................. 22,699 Meridian charter township, MI .................................. 39,688 Meridian city, ID ...................................................... 75,092 Merriam city, KS....................................................... 11,003 Mesa County, CO .................................................... 146,723 Miami Beach city, FL ................................................ 87,779 Miami city, FL ......................................................... 399,457 Middleton city, WI .................................................... 17,442 Midland city, MI ....................................................... 41,863 Milford city, DE .......................................................... 9,559 Milton city, GA ......................................................... 32,661 Minneapolis city, MN ............................................... 382,578 Mission Viejo city, CA ............................................... 93,305 Modesto city, CA ..................................................... 201,165 Monterey city, CA ..................................................... 27,810 Montgomery County, VA ........................................... 94,392 Monticello city, UT...................................................... 1,972 Monument town, CO .................................................. 5,530 Mooresville town, NC ................................................ 32,711 Morristown city, TN .................................................. 29,137 Morrisville town, NC ................................................. 18,576 Moscow city, ID ....................................................... 23,800 Mountain Village town, CO .......................................... 1,320 Mountlake Terrace city, WA ...................................... 19,909 Muscatine city, IA .................................................... 22,886 Naperville city, IL .................................................... 141,853 Needham CDP, MA ................................................... 28,886 New Braunfels city, TX ............................................. 57,740 New Brighton city, MN .............................................. 21,456 New Hanover County, NC ........................................ 202,667 New Orleans city, LA ............................................... 343,829 New Smyrna Beach city, FL ...................................... 22,464 Newberg city, OR ..................................................... 22,068 Newport Beach city, CA ............................................ 85,186 Newport News city, VA ............................................ 180,719 Newton city, IA ........................................................ 15,254 Noblesville city, IN ................................................... 51,969 Nogales city, AZ ....................................................... 20,837 Norfolk city, VA ....................................................... 242,803 North Richland Hills city, TX ...................................... 63,343 Northglenn city, CO .................................................. 35,789 Novato city, CA ........................................................ 51,904 Novi city, MI ............................................................ 55,224 O'Fallon city, IL ........................................................ 28,281 O'Fallon city, MO ...................................................... 79,329 Oak Park village, IL .................................................. 51,878 Oakland city, CA ..................................................... 390,724 Oakland Park city, FL................................................ 41,363 Oakley city, CA ........................................................ 35,432 Ogdensburg city, NY ................................................ 11,128 Oklahoma City city, OK ............................................ 579,999 Olathe city, KS ........................................................ 125,872 Old Town city, ME ...................................................... 7,840 Olmsted County, MN ............................................... 144,248 Olympia city, WA ..................................................... 46,478 Orland Park village, IL .............................................. 56,767 Oshkosh city, WI ...................................................... 66,083 Oshtemo charter township, MI .................................. 21,705 Otsego County, MI ................................................... 24,164 Overland Park city, KS ............................................. 173,372 Oviedo city, FL ......................................................... 33,342 Paducah city, KY ...................................................... 25,024 Palm Coast city, FL ................................................... 75,180 Papillion city, NE ...................................................... 18,894 Park City city, UT ....................................................... 7,558 Parker town, CO ...................................................... 45,297 Attachment B The National Citizen Survey™ 67 Parkland city, FL ....................................................... 23,962 Pasadena city, CA ................................................... 137,122 Pasco city, WA ......................................................... 59,781 Pasco County, FL .................................................... 464,697 Pearland city, TX ...................................................... 91,252 Peoria city, AZ ........................................................ 154,065 Peoria city, IL ......................................................... 115,007 Peoria County, IL .................................................... 186,494 Petoskey city, MI ........................................................ 5,670 Pflugerville city, TX ................................................... 46,936 Phoenix city, AZ .................................................. 1,445,632 Pinal County, AZ ..................................................... 375,770 Pinehurst village, NC ................................................. 13,124 Piqua city, OH .......................................................... 20,522 Pitkin County, CO ..................................................... 17,148 Plano city, TX ......................................................... 259,841 Platte City city, MO ..................................................... 4,691 Plymouth city, MN .................................................... 70,576 Pocatello city, ID ...................................................... 54,255 Polk County, IA ...................................................... 430,640 Pompano Beach city, FL ............................................ 99,845 Port Huron city, MI ................................................... 30,184 Port Orange city, FL .................................................. 56,048 Portland city, OR .................................................... 583,776 Post Falls city, ID...................................................... 27,574 Prince William County, VA ....................................... 402,002 Prior Lake city, MN ................................................... 22,796 Provo city, UT ........................................................ 112,488 Pueblo city, CO ....................................................... 106,595 Purcellville town, VA ................................................... 7,727 Queen Creek town, AZ .............................................. 26,361 Radnor township, PA ................................................ 31,531 Ramsey city, MN....................................................... 23,668 Rapid City city, SD .................................................... 67,956 Raymore city, MO ..................................................... 19,206 Redmond city, WA .................................................... 54,144 Rehoboth Beach city, DE ............................................. 1,327 Reno city, NV ......................................................... 225,221 Reston CDP, VA ........................................................ 58,404 Richmond city, CA .................................................. 103,701 Richmond Heights city, MO ......................................... 8,603 Rifle city, CO .............................................................. 9,172 Rio Rancho city, NM.................................................. 87,521 River Falls city, WI .................................................... 15,000 Riverdale city, UT ....................................................... 8,426 Riverside city, CA.................................................... 303,871 Riverside city, MO ....................................................... 2,937 Rochester Hills city, MI ............................................. 70,995 Rock Hill city, SC ...................................................... 66,154 Rockford city, IL ..................................................... 152,871 Rockville city, MD ..................................................... 61,209 Rogers city, MN .......................................................... 8,597 Rolla city, MO ........................................................... 19,559 Roselle village, IL ..................................................... 22,763 Rosemount city, MN.................................................. 21,874 Roseville city, MN ..................................................... 33,660 Roswell city, GA........................................................ 88,346 Round Rock city, TX ................................................. 99,887 Royal Oak city, MI .................................................... 57,236 Saco city, ME ........................................................... 18,482 Sahuarita town, AZ ................................................... 25,259 Sammamish city, WA ................................................ 45,780 San Anselmo town, CA .............................................. 12,336 San Antonio city, TX ............................................ 1,327,407 San Carlos city, CA ................................................... 28,406 San Diego city, CA ............................................... 1,307,402 San Francisco city, CA ............................................. 805,235 San Jose city, CA .................................................... 945,942 San Juan County, NM .............................................. 130,044 San Marcos city, CA.................................................. 83,781 San Marcos city, TX .................................................. 44,894 San Rafael city, CA ................................................... 57,713 Sandy Springs city, GA ............................................. 93,853 Sanford city, FL ........................................................ 53,570 Sangamon County, IL .............................................. 197,465 Santa Clarita city, CA ............................................... 176,320 Santa Fe County, NM............................................... 144,170 Santa Monica city, CA ............................................... 89,736 Sarasota County, FL ................................................ 379,448 Savage city, MN ....................................................... 26,911 Scarborough CDP, ME ................................................ 4,403 Schaumburg village, IL ............................................. 74,227 Scott County, MN .................................................... 129,928 Scottsdale city, AZ .................................................. 217,385 Seaside city, CA ....................................................... 33,025 SeaTac city, WA ....................................................... 26,909 Sevierville city, TN.................................................... 14,807 Shawnee city, KS ..................................................... 62,209 Sheboygan city, WI .................................................. 49,288 Shoreview city, MN .................................................. 25,043 Shorewood city, MN ................................................... 7,307 Shorewood village, IL ............................................... 15,615 Shorewood village, WI.............................................. 13,162 Sioux Center city, IA .................................................. 7,048 Sioux Falls city, SD .................................................. 153,888 Skokie village, IL ...................................................... 64,784 Snellville city, GA ..................................................... 18,242 Snowmass Village town, CO ........................................ 2,826 South Kingstown town, RI ........................................ 30,639 South Lake Tahoe city, CA ........................................ 21,403 South Portland city, ME ............................................ 25,002 Southborough town, MA ............................................. 9,767 Southlake city, TX .................................................... 26,575 Sparks city, NV ........................................................ 90,264 Spokane Valley city, WA ........................................... 89,755 Spring Hill city, KS ...................................................... 5,437 Springboro city, OH .................................................. 17,409 Springfield city, MO ................................................. 159,498 Springfield city, OR .................................................. 59,403 Springville city, UT ................................................... 29,466 St. Charles city, IL .................................................... 32,974 St. Cloud city, FL ...................................................... 35,183 St. Cloud city, MN .................................................... 65,842 St. Joseph city, MO .................................................. 76,780 St. Louis County, MN ............................................... 200,226 St. Louis Park city, MN.............................................. 45,250 Stallings town, NC .................................................... 13,831 State College borough, PA ........................................ 42,034 Steamboat Springs city, CO ...................................... 12,088 Sterling Heights city, MI .......................................... 129,699 Sugar Grove village, IL ............................................... 8,997 Sugar Land city, TX .................................................. 78,817 Summit city, NJ........................................................ 21,457 Summit County, UT .................................................. 36,324 Sunnyvale city, CA .................................................. 140,081 Surprise city, AZ...................................................... 117,517 Suwanee city, GA ..................................................... 15,355 Tacoma city, WA ..................................................... 198,397 Takoma Park city, MD .............................................. 16,715 Tamarac city, FL ...................................................... 60,427 Temecula city, CA ................................................... 100,097 Tempe city, AZ ....................................................... 161,719 Temple city, TX ........................................................ 66,102 The Woodlands CDP, TX ........................................... 93,847 Attachment B The National Citizen Survey™ 68 Thornton city, CO ................................................... 118,772 Thousand Oaks city, CA .......................................... 126,683 Tigard city, OR ......................................................... 48,035 Tracy city, CA ........................................................... 82,922 Tualatin city, OR ....................................................... 26,054 Tulsa city, OK ......................................................... 391,906 Twin Falls city, ID ..................................................... 44,125 Tyler city, TX ............................................................ 96,900 Umatilla city, OR......................................................... 6,906 Upper Arlington city, OH ........................................... 33,771 Urbandale city, IA ..................................................... 39,463 Vail town, CO ............................................................. 5,305 Vancouver city, WA ................................................ 161,791 Vestavia Hills city, AL ................................................ 34,033 Victoria city, MN ......................................................... 7,345 Virginia Beach city, VA ............................................ 437,994 Wake Forest town, NC .............................................. 30,117 Walnut Creek city, CA ............................................... 64,173 Washington County, MN.......................................... 238,136 Washington town, NH ................................................. 1,123 Washoe County, NV ................................................ 421,407 Watauga city, TX ...................................................... 23,497 Wauwatosa city, WI .................................................. 46,396 Waverly city, IA .......................................................... 9,874 Weddington town, NC ................................................. 9,459 Wentzville city, MO ................................................... 29,070 West Carrollton city, OH ............................................ 13,143 West Chester borough, PA ........................................ 18,461 West Des Moines city, IA .......................................... 56,609 West Richland city, WA............................................. 11,811 Western Springs village, IL ....................................... 12,975 Westerville city, OH .................................................. 36,120 Westlake town, TX ........................................................ 992 Westminster city, CO ............................................... 106,114 Weston town, MA ..................................................... 11,261 Wheat Ridge city, CO ............................................... 30,166 White House city, TN................................................ 10,255 Wichita city, KS ....................................................... 382,368 Williamsburg city, VA................................................ 14,068 Wilmington city, NC................................................. 106,476 Wilsonville city, OR................................................... 19,509 Winchester city, VA .................................................. 26,203 Windsor town, CO .................................................... 18,644 Windsor town, CT .................................................... 29,044 Winnetka village, IL.................................................. 12,187 Winston-Salem city, NC ........................................... 229,617 Winter Garden city, FL .............................................. 34,568 Woodbury city, MN................................................... 61,961 Woodland city, CA .................................................... 55,468 Woodland city, WA ..................................................... 5,509 Wrentham town, MA ................................................ 10,955 Yakima city, WA ....................................................... 91,067 York County, VA....................................................... 65,464 Yorktown town, IN ..................................................... 9,405 Attachment B Table of Contents Page 1 City Organization and Information Page 2 Progress in Fiscal Year 2015 Page 3 Fiscal Year 2015 Revenues and Expenditures Page 4 What's Next? City’s Economic Outlook and Moving Forward Demographics Information FY 2013 FY 2014 Population* 65,498 66,029 Average travel time to work* 22.0 minutes 22.1 minutes Median household income* $118,396 $122,366 Median price of single family home $1,992,500 $1,880,250 Number of authorized City staff 1,129 1,147 FY 2015 66,968 22.3 minutes $151,370 $2,465,000 1,153 City Organization and Information Incorporated in 1894, the City of Palo Alto covers 26 square miles and is located in the heart of Silicon Valley. Palo Alto has about 67,000 residents and the daytime population is estimated at more than 128,000. Stanford University, adjacent to Palo Alto and one of the top-rated institutions of higher education in the nation, has produced much of the talent that founded successful high-tech companies in Palo Alto and Silicon Valley. The total daytime population for Palo Alto and Stanford is about 154,000. The City of Palo Alto provides a full range of municipal services, in addition to owning and operating its own utility system, including electricity, gas, water, wastewater treatment, refuse, storm drain, and fiber optics. The City also offers expanded service delivery, including fire protection service for Palo Alto and Stanford. The Regional Water Quality Control Plant serves the cities of Palo Alto, Mountain View, Los Altos, Los Altos Hills, Stanford, and East Palo Alto. Animal Services provides animal control services to the cities of Palo Alto, Los Altos, and Los Altos Hills, and residents from neighboring cities often use the animal spay and neuter services. City residents elect nine members to the City Council to serve staggered four-year terms. Each January, Council members elect a Mayor and Vice-Mayor. The City of Palo Alto operates under a Council-manager form of government. 1 * Figures reflect American Community Survey data The City of Palo Alto’s Values Quality Superior delivery of services Courtesy Providing service with respect and concern Efficiency Productive, effective use of resources Integrity Straightforward, honest, and fair relations Innovation Excellence in creative thought and implementation Additional information is available at the Office of the City Auditor’s website, http://www.cityofpaloalto.org/gov/depts/aud/default.asp The City of   Palo Alto, California  A Report to Our CiƟzens    Attachment C Progress in Fiscal Year 2015 Themes for 2015 Differing from prior years’ performance reports, the themes allow users to understand the performance of cross-departmental programs or initiatives, while continuing to present information by individual departments. ► Stewardship: Financial Responsibility Neighborhood Preservation Environmental Sustainability ► Public Service: Public Safety Services Utility Services Internal City Services ► Community: Community Involvement and Enrichment Safety, Health, and Well-Being Density and Development Mobility Key Measures Additional information is available at the City of Palo Alto’s website, http://www.cityofpaloalto.org/gov/depts/aud/default.asp All percent ratings as “excellent/good” FY 2013 FY 2014 FY 2015 Ranking compared to other surveyed jurisdictions GENERAL COMMUNITY CHARACTERISTICS Palo Alto as a place to live 92% 95% 92% Similar Overall quality of life in Palo Alto 91% 91% 88% Similar Overall image or reputation of Palo Alto 90% 92% 88% Higher Overall appearance of Palo Alto 85% 89% 89% Higher STEWARDSHIP General Fund Operating Expenditures Per Capita (in millions) $2,400 $2,412 $2,492 Overall natural environment in Palo Alto 83% 88% 86% Similar Your neighborhood as a place to live 91% 92% 90% Similar PUBLIC SERVICE Overall confidence in Palo Alto government n/a 52% 53% Similar Overall customer service by Palo Alto employees (police, receptionists, planners, etc.) 79% 81% 74% Similar Police services 86% 87% 88% Similar Fire services 93% 95% 97% Similar COMMUNITY Overall feeling of safety in Palo Alto as “very/somewhat safe” n/a 92% 91% Similar Overall ease of getting to the places you usually have to visit n/a 71% 65% Similar Overall “built environment” of Palo Alto (including overall design, buildings, parks, and transportation systems) n/a 67% 63% Similar Openness and acceptance of the community toward people of diverse backgrounds 76% 76% 68% Lower Preservation of natural areas such as open space, farmlands, and greenbelts 79% 80% 77% Higher Opportunity to participate in community matters n/a 75% 76% Similar Opportunities to volunteer 82% 83% 80% Similar Cost of living in Palo Alto n/a 11% 8% Much lower Palo Alto as a place to visit n/a 75% 74% Similar The value of services for taxes paid to Palo Alto 66% 66% 65% Similar Services provided by Palo Alto 84% 83% 85% Similar Generally acting in the best interest of the community n/a 54% 53% Similar Economic development 61% 73% 69% Higher 2 How We Have Progressed Attachment C The City’s Finances Revenues and Expenditures Primary Sources of General Fund Revenues Primary General Fund Expenditures Additional information is available at the City of Palo Alto’s website, http://www.cityofpaloalto.org/gov/depts/aud/default.asp Revenues by Source FY 2014 Actual Revenues FY 2015 Actual Revenues Property Tax $30.6 million $34.1 million Sales Tax $29.4 million $29.7 million Charges for Services $24.0 million $25.9 million Transient Occupancy Tax $12.2 million $16.7 million Rental Income $14.2 million $14.9 million Utility Users Tax $11.0 million $10.9 million Documentary Transfer Tax $7.8 million $10.4 million All Other Revenues $5.5 million $7.8 Million Permits and Licenses $7.0 million $7.1 million Total Revenues: $141.7 million $157.5 million 3 Source: FY 2015 Comprehensive Annual Financial Report (CAFR) Source: FY 2015 Comprehensive Annual Financial Report (CAFR) Expenditures by Source FY 2014 Actual Expenditures FY 2015 Actual Expenditures Public Safety $61.7 million $61.2 million Community Services $22.5 million $23.0 million Public Works $11.5 million $11.4 million Development Services n/a* $11.1 million Library $7.3 million $8.0 million Planning and Community Environment $13.2 million $7.4 million All Others $7.3 million $7.4 million Nondepartmental $8.0 million $5.6 million Administrative Services $3.0 million $3.7 million Total Expenditures: $134.5 million $138.8 million * In prior years, the expenditure for Development Services was included in other department figures, primarily Planning and Community Environment. Attachment C What’s Next? City’s Budget and Accomplishments Palo Alto is truly a special place - a community with a rich history of entrepreneurship, with some of the world’s smartest and most creative people. With an unparalleled quality of life, there is no better place than Palo Alto to live, work, raise a family, grow a business or visit. Palo Alto continues to be a driving force in the global economy, a leader in sustainability, and the innovations developed here change the world. City Council 2015 Priorities The City Council held its annual retreat in Jan. 2015 to discuss and adopt its priorities. Each year, the Council sets its priorities giving the community a clear definition of what the City is trying to accomplish. For 2015, the Council adopted four priorities that will receive significant attention throughout the year. The 2015 Council Priorities are: The Built Environment: Multi-modal transportation, parking and livability Infrastructure Strategy and Implementation Healthy City, Healthy Community Completion of the Comprehensive Plan update with increased focus from Council City of Palo Alto Budget The City of Palo Alto exists to promote and sustain a superior quality of life in Palo Alto. In partnership with our community, our goal is to deliver cost-effective services in a personal, responsive and innovative manner. In June 2015, the City Council adopted the Budget for Fiscal Year 2016 (July 1, 2015 through June 30, 2016) in the amount of $563.6 million, which includes ongoing funding for the City’s public safety, library, parks and recreation, utility, and internal support department functions as well as improvements to our roads, facilities, and utility infrastructure. Despite the growing economy and increased tax revenues, the City continues to prudently enhance service levels while remaining cognizant of the City’s long-term fiscal sustainability. To enhance the quality of life for residents, City’s budget included increased Library opening hours for the newly renovated and expanded facilities, added funding for special events, and added staff to respond quicker to code enforcement cases. Further, we added staff to support initiatives in response to the City’s parking and transportation issues such as the Residential Preferential Parking program, Downtown and California Avenue parking studies, and commute programs through a Transportation Management Authority. In addition, the City will continue the rehabilitation of streets and sidewalks and make improvements to the existing utility infrastructure. Furthermore, the City’s Utility continues to provide excellent services in the delivery of electricity, gas, and water as well as wastewater treatment and garbage and recycling collection services at competitive rates. The Office of the City Auditor is responsible for independently evaluating the City’s programs, services, and departments. For 14 years our office has issued the City’s annual Performance Report (formerly Service Efforts and Accomplishments) to supplement the City’s financial reports and statements. If you are interested in viewing the City’s complete annual performance report, please visit: http://www.cityofpaloalto.org/gov/depts/aud/reports/accomplishments.asp About Citizen Centric Reporting The Association of Government Accountants (AGA) developed guidance on producing Citizen Centric Reporting as a method to demonstrate accountability to residents and answer the question, “Are we better off today than we were last year?” Additional details can be found at the AGA website: www.agacgfm.org (under Tools & Resources) 4 From the City Manager Attachment C City of Palo Alto (ID # 6416) City Council Staff Report Report Type: Informational Report Meeting Date: 1/25/2016 City of Palo Alto Page 1 Summary Title: Update on Second Transmission Line Title: Update on Progress Towards Building a Second Electric Transmission Interconnection Between the City, Stanford National Accelerator Laboratory and Stanford University From: City Manager Lead Department: Utilities Executive Summary The purpose of this report is to update Council on progress towards a new 60kV electric transmission line between the City of Palo Alto (City), the Department of Energy (DOE), SLAC National Accelerator Laboratory (SLAC), and Stanford University (Stanford). The proposed 60kV transmission line (the Project) would provide an interconnection between two existing transmission corridors - the 230 kilovolt (kV) line in the west serving SLAC and the 115kV line in the east serving the City. The new 60kV line would provide SLAC, Stanford and the City transmission service reliability improvements and potential cost savings. Since four parties are involved in this Project (City, DOE, SLAC and Stanford), detailed feasibility studies have been conducted and reviewed by all participants to analyze the Project’s reliability and cost implications, which the City and Stanford have jointly funded. The DOE and SLAC are particularly concerned with any incremental power quality issues that may result from a more integrated system and they have identified a number of betterments they require to their existing system before they will participate, the funding for which remains to be resolved. Stanford remains a critical party to enable this Project to move forward and the parties’ current focus is on possible business models to allow Stanford to access the new line over Palo Alto’s distribution system. At this stage, none of the parties have committed to actual construction and funding of the Project. Council will have full opportunity for review and approval prior to any commitment for construction and funding. Background The City of Palo Alto’s electric distribution system is connected to Pacific Gas and Electric Company’s (PG&E) transmission grid via three 115 kV transmission lines. Although three lines would normally provide redundancy and back-up power delivery to the City, all three lines run in a common corridor on the bay side of the City, a corridor that is in close proximity to the Palo City of Palo Alto Page 2 Alto Airport. The common corridor and proximity to an airport means that the City’s power supply is susceptible to single events that can affect all three lines, as happened in February of 2010 when a small aircraft hit the power lines resulting in a city-wide power outage for over 10 hours. To minimize these possibilities, it is in the City’s interest to find a physically diverse connection for power supply to the City. Staff has been investigating options for an alternative connection to the transmission grid for numerous years. Following the February 2010 plane crash and subsequent city-wide outage, Council included the goal to evaluate alternative electric transmission line sources in its priorities for 2011 (Staff Report No. 1497, March 21, 2011). Further in March 2011, Council adopted a guideline and implementation plan item to evaluate interconnection options to the City to increase service reliability and lower delivery costs. Council adopted this guideline and implementation plan as part of the City’s updated Long-term Electric Acquisition Plan (LEAP) (Resolution 9152, Staff Report No. 1317). The relevant portion of the applicable LEAP Strategy #8 is as follows: 8. Transmission and Reliability – Pursue the reliability of supply at fair and reasonable transmission and delivery costs by: c. Evaluating interconnection options to the City to increase service reliability and lower delivery costs. Staff has provided updates on the evaluation of interconnection options in the Utilities Quarterly reports to the Utilities Advisory Commission (UAC) since Council’s approval of LEAP. Over the past three years, staff concluded that the optimal interconnection option is a connection between the City’s Quarry electric substation and the SLAC substation. This Project has the added advantage of also providing redundant back-up service to SLAC, providing Stanford an alternative connection and reducing transmission costs for the City’s electric ratepayers. Implementing the Project will require a multiparty effort including Stanford--the land owner and potential Project participant, and SLAC and DOE--Project participants and the owners of the transmission assets to which the new transmission line would connect. This effort has required several feasibility studies, as each participant has explored the reliability and cost implications of the Project. Utilities Department appropriated funds (the “Feasibility Study Funds”) from the Electric Fund – Capital Improvement Program (CIP) EL-06001 - 230 kV Electric Intertie and its consulting budgets to conduct these evaluations. Summary of Feasibility Studies Load Flow Study – Although no new electric customer loads would be added to the regional electric grid as a result of the Project, the City and Stanford commissioned an updated Load Flow Study to determine potential Project impacts on PG&E’s system. The Load Flow Study analyzed various normal and fault condition scenarios. The results of the study showed that the proposed Project would be able to deliver power while improving regional power reliability and quality. City of Palo Alto Page 3 230 kV Overhead Line Assessment – Stanford commissioned a study of the existing DOE-owned 230 kV transmission line to determine if it has capacity to carry additional load. This study evaluated the maximum load (temperature) at which the line could operate in compliance with California Public Utilities Commission’s General Order 95 (overhead electric line rules regarding ground and structure clearance) and identified spans that could require additional work to meet current GO 95 criteria if the Project proceeds. Routing Study – Stanford commissioned a Routing Study which analyzed various route options for a potential underground 60kV line between SLAC and the City’s Quarry substation, with a focus on route alternatives that best meet environmental and engineering constraints. Transient Analysis – The City commissioned this study to determine whether the combined system would be as reliable and stable as the current system. The study concluded that the Project would create a reduction in voltage fluctuations overall, with generally positive impacts on the magnitude of voltage depressions. SLAC Studies – SLAC commissioned their own transient and steady state analyses for an independent review of the impacts to their power quality and reliability. Their studies indicated that while the Project would mitigate SLAC’s exposure to some PG&E faults there was an additional exposure to faults on the City’s 60kV system. Although the City’s occurrence of faults is extremely low--2 or 3 events in the past 10 years -- and notwithstanding the reduction in magnitude of the PG&E fault impact, SLAC has determined that they need mitigation measures in place at a cost of between $5M-$23M, depending on the level of correction they want from both their existing exposure and their perceived risk from connecting to the City’s system. SLAC’s steady state analysis concluded the Project would not add much value to the backup service provided to SLAC, but SLAC is still interested in having a fully redundant system designed into and funded through the Project. Next Steps Although the studies to date indicate that the proposed interconnection is feasible, would strengthen the local transmission system, could be designed and operated to maintain and improve power quality, and could provide for the participants’ current and forecasted electric load, much work remains to move the Project forward. In particular: (a) The successful completion of the Project will require additional joint evaluation of various issues, including, but not limited to, the method by which the City can provide electric transmission service to Stanford; land use and environmental analysis under the California Environmental Quality Act (CEQA); siting issues and easement acquisition; and possibly the negotiation of separate agreements with other parties such as PG&E, the Western Area Power Administration (WAPA), and the United States DOE. City of Palo Alto Page 4 (b) Preliminary design of the proposed Project could entail substantial expenditure of funds by both the City and Stanford. (c) The completion of the Project may be infeasible if the City, Stanford, SLAC and DOE cannot resolve contractual issues and execute and deliver mutually acceptable agreements pertaining to this Project. Project Timeline A project of this magnitude will take between three to four years to complete once an agreement is in place amongst the parties. An estimated duration of each task follows:  Project scope and environmental review would take from six months to one year.  Design contracting and the actual design would take approximately one year.  Construction contracting, construction, and project commissioning would take between one year and one and a half years. Alternatives There is an alternative to the SLAC 230kV connection that will provide redundant transmission service to the City. The alternative is a PG&E project that would connect the Adobe Creek Substation near San Antonio Road with PG&E’s Ames Substation in Mountain View. Although the PG&E alternative would provide the redundant service and come at minimal cost to the City, it does not provide the same level of local system benefits or offer the opportunity for the City to avoid any transmission access charges. This alternative has been proposed by PG&E to the California Independent System Operator and is currently on hold pending the results of the City’s negotiations on the SLAC project. Resource Impact The City has borne expenditures related to transmission-level interconnection studies beginning in 2005. More recently the load flow study was updated and the three new studies were conducted, as described above, to be used as the basis for the study and analysis summary for SLAC and the DOE. The City’s portion of the load flow study update and three new studies is $123,000. This includes:  $85,000 for the City’s share of the overhead line assessment and routing study to be reimbursed to Stanford under a cost sharing agreement executed in December 2013. The total cost of these two studies was $217, 000, with $132,000 paid by Stanford.  $27,000 for the City’s share of the updated load flow analysis paid to Flynn Resources Consultants, Inc. under its existing consulting agreement with the City. The total cost of the load flow analysis was split 50/50 with Stanford; and  $11,000 for the City’s share of the transient analysis, paid to Flynn Resources Consultants, Inc. under its existing consulting agreement with the City. This Project is also consuming 0.25 FTE in Utilities Engineering who is responsible for managing the meetings with the various parties and consultants. Staff will be recommending the contracting of additional resources to offset the staff time dedicated to this Project. City of Palo Alto Page 5 Additional estimated costs if the City, Stanford and SLAC agree to proceed with the next steps of project evaluation will include:  $40,000 for PG&E to perform a study assessing the impacts of the interconnection to its system, which would include laying the groundwork for additional electrical protection requirements required as a result of the proposed Project; and  $5-7 million for the detailed evaluation, negotiations and contract drafting, and preliminary design described above in “Next Steps”. In the event the City, Stanford and SLAC/DOE proceed with the Project, the total construction cost is estimated at $50-90 million. Completing the required land use, legal and environmental analysis and regulatory approvals will also impact that estimate. The City’s share of the costs for the next phase of studies and construction has yet to be determined. The allocation of these costs will be addressed in the terms of agreements yet to be executed between the parties. Staff will include estimates of the City’s share of the cost of the next phase of evaluation and design for approval in Fiscal Years (FYs) 2017 and 2018 operating and CIP budgets for the Electric Fund. Appropriation of these funds will only occur if and when agreements are signed between the City, Stanford and SLAC/DOE to proceed with the next phase. Staff will continue to report on the Project’s status to the UAC and Council in the Utilities Quarterly reports. City of Palo Alto (ID # 6486) City Council Staff Report Report Type: Informational Report Meeting Date: 1/25/2016 Summary Title: Plan Bay Area 2040 Update Title: Update on Plan Bay Area 2040 - 2016 Scenario Planning and Timeline From: City Manager Lead Department: Planning and Community Environment Recommendation This information item is to provide the City Council with an update on the planning effort being undertaken by the ABAG and MTC to update the regional plan known as Plan Bay Area. No action is required. Executive Summary As initiated by the Association of Bay Area Governments (ABAG) and the Metropolitan Transportation Commission (MTC) in 2013, Plan Bay Area 2040 is an integrated, long range transportation and housing/land use strategy that is intended to preserve the character of the ay ! rea’s communities while planning for the transportation needs of the region. ABAG is currently reaching out to member municipalities regarding the ongoing update to the plan, and will be conducting public workshops in the spring. This information item summaries those efforts and follow-up activities. (See the presentation included as Attachment A.) Background Plan Bay Area was created as a result of SB 375 (Steinberg), a 2008 law aimed at reducing greenhouse gas emissions from passenger vehicles by aligning land use and transportation investments on a regional basis. On March 22, 2013, the Association of Bay Area Governments (ABAG) and the Metropolitan Transportation Commission (MTC) released a draft of Plan Bay Area, and a Draft Environmental Impact Report (DEIR) for the document was released on April 2, 2013. On May 13, 2013, the City Council approved two letters (Attachments B and C) that reflected the ity of Palo !l to’s continued objections to the Plan Bay Area effort, particularly the singular and overstated population, housing and economic projections. These letters were drafted to allow the City to 1) be “on the record” of concern and opposition to some of these issues, in the event litigation or other challenges are subsequently raised, and 2) counter arguments by other stakeholders City of Palo Alto Page 1 who may argue for even increased allocations to cities like Palo Alto, such as the potential DEIR alternatives. A Final EIR was prepared and Plan Bay Area was adopted by ABAG and MTC in the summer of 2013. SB 375 requires the regional agencies to update Plan Bay Area on a regular schedule and the first update is now underway. This update is considered “minor” for a number of reasons, and will not involve development of new Regional Housing Needs Allocations (RHNAs) for local jurisdictions. City staff responded to requests for information over the last year, and will be scheduling a study session or an action item to receive the ity ouncil’s input in the spring. Discussion ABAG will be reaching out to member communities throughout 2016 to get their input on a number of aspects of Plan Bay Area. These include:  Assessment of Transportation Projects to be included in the Plan (early 2016)  Public workshops to developed alternative land use distributions and transportation strategies (April 2016)  Public workshops to discuss the use of performance measures (April 2016) The ity’s first opportunity to participate in these milestones will be the workshops for the land use and transportation strategies in April and City staff will schedule a City Council study session or action item to receive the ouncil’s input around the same time. ABAG Scenarios ABAG is currently developing three land use and transportation scenarios as part of the overall stragety under Plan Bay Area. The scenarios are expected to 1. Analyze and evaluate three planning scenarios designed to achieve Plan Bay Area 2040 goals 2. Inform the selection of a preferred scenario; and, 3. Be used in the Plan Bay Area Draft Environmental Impact Report (EIR) !cc ording to !!G, “Once refined, these scenario concept narratives will be released in early 2016, and then evaluated to understand the effects of different combinations of land use and transportation strategies on our shared goals and targets. A series of evening public workshops will be held in the spring of 2016 around the region. Public comments will be sought to inform the selection of a preferred scenario, which is slated to be approved by the ABAG Executive Board and MTC in June 2016.” Once staff has received the narratives and data, they will be presented back to Council for discussion in March 2016. Per previous responses on the DEIR in 2013, staff will continue to monitor any data that is generated by ABAG that does not match historical growth patterns, development capacity, and/or are inconsistent with other projections. City of Palo Alto Page 2 Timeline Staff expects to review the aforementioned scenarios, and accompanying data, in January of 2016. Once that review is complete, staff will return to the Council to discuss findings and next steps. Resource Impact The ongoing update to the Plan Bay Area regional plan will not directly affect Palo Alto because it does not include development of a new Regional Housing Needs Allocation (RHNA), although it will inform !!G’s population and employment projections for the region, as well as prioritization of regional transportation investments. Attachments:  Attachment A: City Council Approved Letter on Comments on Final Draft Plan Bay Area dated May 13, 2013 (PDF)  Attachment B: City Council Approved Letter on Comments on the Plan Bay Area Draft EIR, dated May 13, 2013 (PDF)  Attachment C: Plan Bay Area Presentation by MTC and ABAG (PPTX) City of Palo Alto Page 3 ATTACHMENT A CityofPaloAlto Office of the Mayor and City Council May 13, 2013 Mr. Mark Luce, President Association of Bay Area Governments Joseph P. Bort Metro Center P.O, Box 2050 Oakland, CA 94607-4756 Re: City of Palo Alto Comments on Final Draft Plan Bay Area Dear Mr, Luce: The City of Palo Alto has reviewed the proposed Final Draft Plan Bay Area (Plan) and the associated Draft Environmental Impact Report (DEIR). The City has previously reviewed and commented on the Preferred Scenario tentatively adopted by the agencies in May of 2012, and on prior alternative scenarios. This letter provides the City of Palo Alto's (City) comments regarding the Plan, while a separate letter will be provided outlining comments on the DEIR. In summary, the City's concerns are as follows:  The regional forecasts of jobs and housing being considered as part of the Plan overstate future growth in the Bay Area and are inconsistent with the most recent Department of Finance projections. ABAG should recognize the distinct possibility that actual growth rates in the Bay Area over the next 30 years may be lower and should evaluate a range of growth potential and phase job and housing allocations and implementation accordingly.  Palo Alto's allocation of jobs and housing units under the Plan is excessive by reference to its historical growth trends and development capacity; these allocations should more accurately consider policy constraints, market feasibility, and the high infrastructure costs and local fiscal impacts of such intensive redevelopment.  The land use changes contemplated in the SCS Alternative Scenarios have a proportionately small contribution to achieving AB32/SB375 GHG reduction targets and there are very limited differences shown between the scenarios considered; the substantial effort and investment needed to effect these land use changes should be re- directed to more cost-effective regional and local GHG reduction measures. P.O. Box 10250 Palo Alto, CA 94303 650.329.2477 650.328.3631 fax Page 2 of 6  The City of Palo Alto has been a national leader in implementing policies and programs that reduce greenhouse gas (GHG) emissions and the effectiveness of these efforts should be considered as a part of the SCS and achieving regional GHG emission reduction targets. The following items elaborate on the summary points listed above. 1. The Regional Forecast of jobs and housing overstate future growth in the Bay Area and are inconsistent with the most recent Department of Finance forecasts. The regional forecast of jobs and housing for the region substantially overstates growth for the overall Plan period (through 2040), implying greater RHNA (Regional Housing Needs Assessment) housing allocations for cities through that period. Significantly, the overall regional allocation continues to ignore the updated demographic forecasts of the State’s Department of Finance (DOF). Whereas the Plan Bay Area estimates an increase of 2.1 million population from 2010-2040, DOF projects only a 1.3 million increase, approximately 40% less. This creates an unrealistic scenario for long-term planning, potentially creating unreasonable and unachievable housing mandates and infrastructure needs. Although the SCS process does allow for adjustment of long-term growth projections on a periodic basis, the City encourages ABAG to regain public confidence of its numbers by working with the Department of Finance to reduce the 2010-2040 projections to reflect the adaptations already made by the Department of Finance to the changing State of California demographics. Furthermore, current and future projections should be adjusted so they are more consistent with historical growth patterns and/or a range of projections should be adopted that reflect meaningful planning scenarios in response to market changes over time. The ity suggests that the agencies should adopt “low,” “high,” and “most likely” forecasts for planning. An analysis of the inadequacy of the current long-range projections, authored by Palo Alto Councilmember Greg Schmid, was submitted to ABAG during the Preferred Scenario evaluation process and is attached to this letter. A more recent analysis prepared by Councilmember Schmid, specifically focused on the Plan Bay Area Final Draft, is also attached. a. Jobs. Regarding the ABAG jobs forecast, a comparison with the last 20 years is noteworthy. Average job increases between 1990 and 2010 approximated 10,000 net new jobs annually. Excluding the three years that included the Great Recession where substantial jobs losses occurred (i.e. 2008-2010), the Bay Region added jobs at an average annual rate of 25,200 between 1990 and 2007. The ABAG jobs forecast used for the Plan assumes that the Region will add an average of over 33,000 jobs annually from 2010 to 2040, a 32% increase over the pre-recession trend line. The method used to arrive at the jobs forecast assumes a "shift- share" of a national jobs growth forecast that itself is subject to question. As a part of revisions to the regional jobs forecast, ABAG should consider a more fundamental economic assessment that identifies the key industries in the Bay Area that will drive job growth and also the distinct possibility that future jobs and housing may be closer to recent historical growth trends. Page 3 of 6 b. Housing. Regarding the ABAG housing forecast used for the Plan, an additional 660,000 households are shown added to the Bay Area between 2010 and 2040 - an annual average growth of 22,000 households. Until very recently, the Bay Area, like much of the United States, was mired in a weak housing market characterized by very limited new development, low pricing, slow sales of existing homes, tight credit, and an oversupply of homes resulting from a historically high number of foreclosed and distressed properties. These conditions are improving, but it may be several more years until the existing inventory is reduced and substantial improvement in the job market and related increases in household income occurs. In any event, the Bay Area will need to be in "catch-up" mode, meaning even higher additional households per year must be realized to meet the SCS forecast growth rates, once more normal housing market conditions emerge. Moreover, ABAG's regional housing forecast is based on a “shift-share” model of a national employment forecast prepared by the U.S. Department of Labor Statistics. The forecast also presumes that international in- migration (primarily of Asian and Hispanic peoples) would continue and comprise approximately 80 percent of all population growth nationwide, well in excess of migration trends documented by others. c. Housing Affordability. In addition to questions regarding job growth (the ultimate cause of housing demand) there are a number of other questions regarding ABAG's housing forecast including those related to affordability. A presentation made by Karen Chapple of UC Berkeley at the ABAG's January Regional Advisory Working Group (RAWG) suggested that given likely wages paid by the new jobs expected, over 70 percent of all new households formed in the 2010 to 2040 period will be "moderate" income or below. In many Bay Area locations, especially the inner Bay Area urbanized areas that are the focus of growth under the SCS Alternative Scenarios, such "affordable" housing units must be subsidized in one fashion or another, either as "inclusionary" units burdened upon the market rate units constructed or by public subsidies such as (now eliminated) redevelopment agency funding and federal tax credits. Given the loss of redevelopment powers and funding and recent court cases affecting inclusionary programs (Palmer, Patterson) there is no assurance that adequate housing subsidy funding will be available. Accordingly, given all of these concerns, the City strongly recommends that the jobs and housing forecasts for the Preferred Scenario be reduced to more accurately reflect the most recent Department of Finance projections and historical trends. Developing a more realistic jobs and housing forecast would reduce the implied need to intensify land uses, reduce projected GHG emissions by lowering energy consumption, congestion and single occupancy vehicle trips, and require less costly transit and highway infrastructure investments. The SCS effort is to be revisited and updated every four years, so that there would be future opportunities to re- evaluate whether a higher forecast is appropriate and adjustments would be needed. 2. Palo Alto's allocation of jobs and housing units under the proposed Plan is highly unrealistic and excessive relative to historical growth trends and development capacity. Page 4 of 6 Santa Clara County dominates all other Bay Area counties in the allocation of ABAG's regional forecast of jobs and housing, absorbing 33 percent of the regional job forecast and 36 percent of the regional housing forecast. Palo Alto is allocated 29,650 new jobs and 7,870 new households through 2040. These allocations have been made without regard to existing development capacity in Palo Alto (use of remaining vacant land and redevelopment of existing developed areas), the likely match between new household affordability and local housing prices, or a range of other potential local costs for achieving the required high density development. a. Jobs. The City presently contains approximately 89,370 jobs, according to ABAG. During the past decade (2000 to 2010), Palo Alto experienced a 14 percent decline in employment reflecting the combined effect of the "dot-com" bust and the Great Recession. While economic conditions are improving, there have been structural changes in technology industries that have driven growth in the Silicon Valley over the past 50 years that portend only modest growth. The proposed Plan, however, assumes that Palo Alto's job growth by 2040 will increase over the 2010 estimate by 33 percent. b. Housing. The housing projections in the Alternative Scenarios represent a 30 percent increase in housing units from 2010-2040, up to approximately 262 new units per year. The City has in the past 40 years (1970-2010) produced an average of 148 units per year. To increase that annual output by more than 50% in a relatively built-out city is again entirely unrealistic and using such an assumption as the basis for growth scenarios and transportation investments will likely result in failure of the planning effort. c. Constraints. The City of Palo Alto is highly built out, and the existing limited number of vacant sites and redevelopment opportunity sites severely limit how the households and jobs allocated to Palo Alto in the SCS Alternative Scenarios could be accommodated, The proposed Plan clearly does not appear to consider the many constraints to new development in Palo Alto, including limited school capacity and funding for infrastructure. Accordingly, the City requests that the allocations of jobs and housing units in Palo Alto should be lowered substantially to more accurately consider policy constraints, market feasibility, and infrastructure and local fiscal impacts of such intensive redevelopment. 3. The land use changes contemplated in the proposed Plan contribute a proportionately small contribution to achieving AB32/SB375 GHG reduction targets. The AB32/SB375 target for California is a reduction to 85 million equivalent metric tons per year by 2050, an 80 percent reduction from current levels. To return to 1990 levels of 427 million tons, an 80 million ton reduction of projected 2020 levels is required. Of this 80 million ton reduction, approximately 96 percent is proposed to be achieved from improved fuel standards, energy efficiency, industrial measures, and other methods needed to curb emissions from the construction, manufacturing, and agricultural sectors. Only four percent, however, or 3.2 million tons, would be achieved by altering land use patterns. Page 5 of 6 a. Regional Transportation Pricing and Policies: The MTC analysis of various transportation pricing and policy changes (e.g., telecommuting, electric vehicle strategies, parking pricing) may account for at least a 6.5% further reduction in GIG emissions, considerably more significant than the differences between the land use patterns in the Plan Alternatives in the EIR. b. Cost Effectiveness. Given the numerous challenges associated with fundamental changes in the way that Bay Area land use patterns would otherwise evolve, including wholesale changes to land use regulations, presuming changes in market characteristics and preferences of homebuyers, and the need for substantial public investments and subsidies, we question the feasibility and cost-effectiveness of the proposed Plan. Regarding cost-effectiveness, the comparable costs (mostly borne by local jurisdictions) of implementing the Plan or the various alternatives may be far higher than other alternatives for achieving comparable GHG emission reductions. Accordingly, the City of Palo Alto recommends that a performance-based approach, involving establishing GHG reduction targets for the local jurisdictions along with a menu of options for achieving these targets (including feasible and realistic alterations in land use policy) should become the basis of the proposed Plan Bay Area. 4. The City of Palo Alto has been a national leader in implementing policies and programs that reduce GHG emissions. Over the past decade, the City of Palo Alto has adopted a range of policies, programs and projects to reduce GHG emissions, focused upon improving energy efficiency, enhancing multimodal transportation alternatives to the single-occupant vehicle, and creating walkable, mixed-use districts. Implementing these policies, programs, and investments, the City has become a national leader in reducing GHG emissions. Examples of key City sustainability programs include an aggressive Climate Action Plan, the provision of clean energy to Palo Alto customers via the City owned and operated electric utility, various utility programs to reduce emissions, leadership in Green Building and sustainable design, affordable housing programs, higher density land uses near transit, and numerous “complete streets” oriented policies and projects. In particular, the City’s limate Protection Plan, adopted by the ity ouncil in December 2007, includes goals for the reduction of CO2 from a 2005 baseline level as a result of changes in City operations and from CO2 reduction efforts within the community. • GHG reductions for City operations have been reduced by 53% below 2005 levels, as compared to a goal of a 20% reduction in emissions by 2012. • GHG reductions for the City and the community have been reduced by 22% below 2005 levels, as compared to a goal of a 20% reduction by 2020. Page 6 of 6 Accordingly, the City of Palo Alto requests that ABAG consider the effectiveness of these local GHG emission reduction efforts, incorporate them as a part of the Plan and related regional GHG reduction targets, and provide "credits" to those jurisdictions that have demonstrated implementation of meaningful GHG reduction measures. Conclusion In conclusion, the City of Palo Alto suggests that the proposed Plan Bay Area for the Sustainability Communities Strategy should include:  A range of forecasted growth, outlining “low,” “high”, and “most likely” scenarios and transportation networks for each, to be updated every four years.  A focus on GHG emission reductions, with the flexibility for each city and county to provide for a reasonable minimum amount of housing plus options for other commitments to GHG emission reductions;  Realistic housing forecasts limited to each upcoming 8-year RHNA cycle, with review every four years to update projections; and  Longer range projections that are not allocated to cities and counties, but are used to provide context for regional transportation investments. Thank you again for the opportunity to comment on the Final Draft Plan Bay Area. If you have questions or need additional information, please contact Curtis Williams, the ity’s Director of Planning and Community Environment, at (650) 329-2321 or curtis.williams@cityofpaloalto.org. Sincerely, H. Gregory Scharff Mayor City of Palo Alto Attachments: Exhibit 1: November 15, 2011 Memorandum: “alifornia Demographic Forecasts: Why are the Numbers Overestimated”, prepared by ity of Palo !l to ouncilmember Greg Schmid Exhibit 2: May 6, 2013 Memorandum: “Demographic Forecasts for Plan ay !r ea: Why aren’t they More Helpful”, prepared by ity of Palo !lt o ouncilmember Greg Schmid cc: Adrienne J. Tissier, Chair, Metropolitan Transportation Commission Ezra Rapport, Association of Bay Area Governments Miriam Chion, Association of Bay Area Governments Ken Kirkey, Metropolitan Transportation Commission Palo Alto City Council ATTACHMENT B CityofPaloAlto Office of the Mayor and City Council May 13, 2013 Mr. Mark Luce, President Association of Bay Area Governments Joseph P. Bort Metro Center P.O, Box 2050 Oakland, CA 94607-4756 Re: City of Palo Alto Comments on Plan Bay Area Draft Environmental Impact Report Dear Mr. Luce: Thank you for providing an opportunity to review the Draft Environmental Impact Report (DEIR) for the Final Draft Plan Bay Area. The City of Palo Alto has reviewed the Draft and has several concerns about the basic assumptions, the inadequacy of the alternatives, and the lack of analysis of local impacts and associated mitigation measures. 1. The Key Assumptions include an overstated forecast of future population, jobs, and housing. One of the stated Key EIR Assumptions is that: “The total amount of growth projected for the ay !re a through 2040 is based on !!G’s Plan ay !re a Forecast of Jobs, Population and Housing0this amount of growth is assumed in the proposed Plan, which identifies a land use pattern to accommodate the projected growth/” The City of Palo Alto believes that the regional forecast of jobs and housing for the region substantially overstates growth for the overall Plan period (through 2040). Most significantly, the overall regional allocation continues to ignore the updated demographic forecasts of the State’s Department of Finance (DOF), with population estimates in excess of 40% more (ABAG: 2.1 million v. DOF: 1.3 million) than the 2012 DOF projections. This creates an unrealistic scenario for long-term planning, potentially creating unreasonable and unachievable housing mandates and infrastructure needs and overstating impacts, including greenhouse gas reduction. A range of projections should be evaluated that reflect meaningful planning scenarios in response to market changes over time. The City suggests that the agencies should adopt “low,” “high,” and “most likely” forecasts for planning and impact P.O. Box 10250 Palo Alto, CA 94303 650.329.2477 650.328.3631 fax Page 2 of 4 analysis. An analysis of the inadequacy of the current long-range projections, authored by Palo Alto Councilmember Greg Schmid, was submitted to ABAG during the Preferred Scenario evaluation process and is attached to this letter. A more recent analysis by Councilmember Schmid, specific to Plan Bay Area, is also attached. 2. Alternatives are inadequate in that no alternatives consider demographic forecasts less than the overstated projections and no alternatives provide for alternative approaches to greenhouse gas (GHG) reduction. The alternatives proposed include the No Project Alternative, and three alternatives that result in either greater population, housing and jobs projections or a somewhat different distribution of the future development. Again, no alternatives are proposed that would evaluate lower and more realistic growth projections for the region. The California Environmental Quality Act (CEQA) requires evaluation of alternatives that would lessen environmental impacts, but none of those evaluated would have that effect. Another means of lessening impacts could include allowing flexibility or mandates for cities to take measures to reduce greenhouse gas (GHG) emissions through local energy conservation, building design or transportation measures. An alternative should be developed to provide for and evaluate local GHG reduction measures. The City suggested these type of “hybrid” alternatives in our July 11, 2012 response to the Notice of Preparation (attached). 3. The Alternatives proposed (other than the No Project Alternative) all would result in greater environmental impacts on the City of Palo Alto, in that the allocation of new housing and employment would increase above that proposed in the Final Draft Plan . The alternatives proposed include the No Project Alternative and three alternatives that result in either greater population, housing and jobs projections or a somewhat different distribution of the future development. Alternative 3 (Transit Priority Focus) would increase impacts on the City and similar cities near transit, even though those areas are often already heavily built out and congested already. Alternative 4 (Enhanced Network of Communities) would assume increased population and housing forecasts and would further exacerbate unrealistic demands and impacts on cities like Palo Alto. Alternative 5 (Environment, Equity and Jobs) is not only more impactful on Palo Alto, but is a highly infeasible option, relying on social engineering functions that will not be supported by the jobs and housing markets and will likely be counterproductive to the regional effort. 4. Lack of analysis of local impacts and potential for mitigation. The DEIR identifies many impacts at a regional level, and implies that there are significant unavoidable impacts in some impact categories, such as traffic congestion and land use character and compatibility. However, mitigation for many of these measures is assumed to be the responsibility of the “implementing agency,” assumed to be the local jurisdiction/ The ity questions the use of “Statements of Overriding onsiderations” by a regional agency when the Page 3 of 4 impacts are most heavily felt on local agencies. Mitigation should be offered by the regional and state agencies for many such impacts, and again alternatives should be considered with a lesser growth assumption to minimize those impacts on local agencies. Conclusion In conclusion, the City of Palo Alto suggests that the Draft EIR be modified to:  Include alternatives that assume lesser growth projections than proposed, at least midway between the Department of Finance projections and !!G’s -  Include an alternative that provides for flexibility for cities to reduce greenhouse gas (GHG) emissions at a local level, reducing the reliance on the land use-transportation connection;  Reject all proposed alternatives to the Plan as infeasible; and  Provide regional or state-funded mitigation for potential “significant unavoidable” impacts to local agencies. The ity also takes exception to the EIR’s characterization of alternatives 4 and 5 as “Enhanced Network of ommunities” and “Environment, Equity and Jobs/” These terms are clearly stylized to sound positive while they are actually alternatives developed by active interest groups, including the building industry (Alternative 4) and social/environmental advocacy groups (Alternative 5). The inclusion of these titles for the alternatives creates a highly biased appearance to the Alternatives analysis, if not the document as a whole. Thank you again for the opportunity to comment on the Draft EIR. If you have questions or need additional information, please contact urtis Williams, the ity’s Director of Planning and Community Environment, at (650) 329-2321 or curtis.williams@cityofpaloalto.org. Sincerely, H. Gregory Scharff Mayor City of Palo Alto Attachments: Exhibit 1. “Demographic Forecasting in alifornia,” prepared by Councilmember Greg Schmid; November 15, 2011 Exhibit 2. “Demographic Forecasts for Plan ay !re a. Why !re n’t They More Helpful?” prepared by Councilmember Greg Schmid, May 6, 2013 Exhibit 3: July 11, 2012 City of Palo Alto Response to Notice of Preparation Page 4 of 4 cc: Adrienne J. Tissier, Chair, Metropolitan Transportation Commission Ezra Rapport, Association of Bay Area Governments Miriam Chion, Association of Bay Area Governments Ken Kirkey, Metropolitan Transportation Commission Palo Alto City Council City of Palo Alto (ID # 6463) City Council Staff Report Report Type: Informational Report Meeting Date: 1/25/2016 City of Palo Alto Page 1 Council Priority: Environmental Sustainability Summary Title: Annual Report on Renewable and Carbon Neutral Electricity Supplies Title: Annual Review of the City’s Renewable Procurement Plan, Renewable Portfolio Standard Compliance, and Carbon Neutral Electric Supplies From: City Manager Lead Department: Utilities Request This is an informational report and requires no Council action. Executive Summary Palo Alto’s City Council established a goal to provide at least 33% of the City’s electricity needs from renewable energy resources by 2015, a goal that exceeds the interim annual procurement requirements under California’s Renewable Portfolio Standard (RPS) mandate of 50% by 2030. The City has also adopted a Carbon Neutral Plan, which led to the achievement of a carbon neutral electric supply portfolio starting in 2013. In December 2011, the Council also formally adopted an RPS Procurement Plan and Enforcement Program that recognizes certain elements of the state’s RPS law applicable to publicly owned utilities. The RPS Enforcement Program requires the Utilities Director to conduct an annual review of the Electric Utility’s compliance with the procurement targets set forth in the City’s RPS Procurement Plan. This staff report satisfies the reporting requirements of the City’s RPS Enforcement Program, and also includes an update on the City’s renewable energy goals set forth in its Long-term Electric Acquisition Plan (LEAP). The City is currently on track to meet its objectives under the RPS Procurement Plan and the Carbon Neutral Plan, and will meet the LEAP RPS objective for 2015 so long as unbundled renewable energy certificates (RECs) are counted toward this goal. However, with additional contracted renewable energy supplies coming on line in 2016, the City’s RPS is expected to be over 42% in 2016 and 57% by 2017 with no use of RECs. City of Palo Alto Page 2 Background The City currently has three procurement targets related to renewable and carbon neutral electricity contained in three different plans:  LEAP Renewable Energy Goal (33% by 2015): The City’s first renewable energy goal is contained in LEAP: procuring renewable electricity supplies equal to at least 33% of retail sales starting in 2015, with no more than a 0.5 cents per kilowatt-hour (¢/kWh) impact on rates. LEAP was last updated in April 2012 (Staff Report 2710, Resolution 9241) to clarify that the 33% goal is a minimum and renewable energy supplies beyond the 33% level should be pursued as long as the aggregate rate impact does not exceed the 0.5 cent per kilowatt-hour (¢/kWh) limit.  RPS Procurement Plan (33% by 2020): The second goal is contained in the RPS Procurement Plan that the City was required to adopt under Section 399.30(a) of California’s Public Utilities Code. This was adopted in December 2011 (Staff Report 2225, Resolutions 9214 and 9215) and updated in November 2013 (Staff Report 4168, Resolution 9381). The RPS Procurement Plan and Enforcement Program complement each other: the Procurement Plan sets forth procurement targets, while the Enforcement Program specifies the reporting and monitoring that is required of the Utilities Director while working to achieve those targets. The procurement requirements in the City’s RPS Procurement Plan are that the City achieve renewable supplies equal to 33% of retail sales by 2020, which is in line with the state’s RPS mandate but less ambitious than the City’s LEAP goals (33% by 2015). The RPS Procurement Plan also contains interim targets for three separate periods (2011- 2013, 2014-2016, and 2017-2020), which are not part of the City’s LEAP goal. The reason the City adopted the less ambitious state-mandated levels for the official compliance plan is because the City would face penalties for failing to meet the state targets, but the City’s achievement of its more ambitions LEAP targets is not subject to state enforcement procedures.  Carbon Neutral Plan (100% Carbon Neutral Electricity by 2013): The Carbon Neutral Plan was adopted in March 2013 (Resolution 9322, Staff Report 3550), and requires that the City procure a carbon neutral electric supply portfolio starting in calendar year (CY) 2013. In the long term, this goal is expected to be achieved primarily through purchases made under the City’s long-term renewable power purchase agreements (PPAs) and output from its hydroelectric resources. But until the contracted long-term renewable resources are all constructed and operating (and in dry hydro years when hydroelectric resources are lower than expected), carbon neutrality may be achieved through the purchase of RECs to offset fossil fuel-based market power purchases. City of Palo Alto Page 3 Discussion LEAP Renewable Energy Goals Due to delays in the development of the first two of the City’s long-term solar PPAs, staff estimates that renewable electricity supplies from its long-term PPAs will fall slightly short of meeting the LEAP RPS goal of at least 33% of retail sales by 2015. (Current estimates project renewable electricity supplies from long-term resources equaling 28.2% of retail sales for 2015.) However, the LEAP Renewable Energy Goal includes all supplies deemed “eligible” under the state’s RPS eligibility criteria, not just generation from long-term resources. Therefore, the City will far exceed LEAP’s 33% RPS target in 2015 if the RPS-eligible RECs that are procured under the Carbon Neutral Plan are counted. In CY 2016, when three more solar resources under long-term PPAs are expected to come on line, staff projects that renewable electricity supplies will equal 40.1% of retail sales. Further, in CY 2017, renewable supplies are projected to be 57.5% of retail sales (55.5% of total supply). Table 1 shows the renewable resources currently under contract, the status of the projects, their annual output in Gigawatt-hours (GWh), and the rate impact of each resource that was calculated at the time it was added to the electric supply portfolio. Table 1: Summary of Contracted Renewable Electricity Resources Resource Delivery Begins Annual Generation (GWh) Rate Impact (¢/kWh) Small Hydro Before 2000 10.0 0 High Winds Dec. 2004 48.2 0.013 Shiloh I Wind Jun. 2006 64.5 (0.043) Santa Cruz Landfill Gas (LFG) Feb. 2006 9.9 0.003 Ox Mountain LFG Apr. 2009 43.9 (0.039) Keller Canyon LFG Aug. 2009 14.9 (0.020) Johnson Canyon LFG May 2013 10.4 0.061 San Joaquin LFG Apr. 2014 30.3 0.133 Kettleman Solar Jul. 2015 53.5 0.094 Hayworth Solar Dec. 2015 63.7 0.024 Total Operating Resources 349.3 0.225 Elevation Solar C Jul. 2016 100.8 (0.041) W. Antelope Blue Sky Ranch B Solar Jul. 2016 50.4 (0.002) Frontier Solar Jul. 2016 52.5 0.010 Palo Alto CLEAN Program @ 3 MW Cap TBD 5.1 0.027 Total Non-Operating Resources 208.8 (0.006) Total Committed Resources 558.0 0.219 RPS Procurement Plan Compliance Annually, the Utilities Director reviews the City of Palo Alto Utilities’ (CPAU’s) RPS Procurement Plan to determine compliance with the state’s RPS Program. Under the state’s RPS Program, the City of Palo Alto Page 4 California Energy Commission (CEC) developed portfolio balancing requirements, which dictate what percentage of renewable procurement must come from resources interconnected to a California Balancing Area (as opposed to an out-of-state transmission grid balancing area). These requirements also determine the eligibility criteria for renewable resource products as determined by their eligible Portfolio Content Categories1, found in the CEC Enforcement Procedure RPS (CA Code of Regulations, Title 20, Section 3203). The CEC Enforcement Procedures apply to publicly-owned utilities (POUs), such as CPAU. In accordance with the state’s RPS Program requirements, CPAU’s RPS Procurement Plan develops a renewable electric supply portfolio that balances environmental goals with system reliability while maintaining stable and low retail electric rates. The state’s RPS program requires retail electricity suppliers like CPAU to procure progressively larger amounts of renewable electricity supplies across three separate Compliance Periods, as outlined below. 1. Compliance Period 1 (2011 – 2013) For Compliance Period 1 (2011-2013) retail electricity providers were required to procure renewable electricity supplies equaling 20% of total retail sales, which CPAU did. In this period, CPAU supplied 21.4% of the City’s retail electricity sales volumes from renewable energy sources. The procurement results for Compliance Period 1 are displayed in Table 2 below: Table 2: Compliance Period 1 Procurement Results Year Retail Sales (MWh) Procurement Target (MWh)* Actual Procurement (MWh) % of Retail Sales 2011 949,517 189,903 207,974 21.9% 2012 935,021 187,004 200,621 21.5% 2013 953,235 190,647 199,145 20.9% TOTAL 2,837,773 567,555 607,740 21.4% * Annual procurement targets are “soft” targets. The RPS Procurement Plan requires that the target be met for the compliance period as a whole, not in each year of the compliance period. All of the renewable energy procured in Compliance Period 1 came from resources whose contracts were executed before June 1, 2010. The RPS Procurement Plan considers these contracts “grandfathered,” and since all of the renewable energy procurement for Compliance Period 1 was from these types of contracts, there was no need to meet the Portfolio Balancing Requirements included in Section B.4 of the RPS Procurement Plan. 1 RPS Portfolio Content Categories are defined as follows: Category 1 is energy and RECs delivered to a California Balancing Authority (CBA) without substituting electricity from another source, Category 2 is energy and RECs that cannot be delivered to a CBA without substituting electricity from another source, and Category 3 is unbundled RECs. City of Palo Alto Page 5 2. Compliance Period 2 (2014 – 2016) In Compliance Period 2, renewable procurement must equal or exceed the sum of the three annual RPS procurement targets described by the following equations: 2014 RPS Target = 20% × (Retail Sales in 2014) 2015 RPS Target = 20% × (Retail Sales in 2015) 2016 RPS Target = 25% × (Retail Sales in 2016) As shown in Table 3 below, CPAU is projected to easily exceed this mandated procurement level as well. Renewable electricity procurement is projected to equal 31% of retail sales for Compliance Period 2. Table 3: Compliance Period 2 Procurement Target Year Retail Sales (MWh) Procurement Target (MWh)* Actual/Projected Procurement (MWh) % of Retail Sales 2014 953,386 190,677 210,250 22.1% 2015 967,261 193,452 273,887 28.3% 2016 985,766 246,442 421,501 42.8% TOTAL 2,906,413 630,571 905,638 31.2% * Annual procurement targets are “soft” targets. The RPS Procurement Plan requires that the target be met for the compliance period as a whole, not in each year of the compliance period. Also in Compliance Period 2, the RPS Portfolio Balancing Requirements will apply to the procurement levels described above. The specific requirements are: (1) CPAU must procure at least 65% of its renewable supplies from Portfolio Content Category 1, and (2) no more than 15% from Portfolio Content Category 3 (unbundled RECs). Staff projects that CPAU will easily meet the Compliance Period 2 overall procurement requirement and the RPS Portfolio Balancing Requirement with existing renewable energy supplies, combined with the output from the five solar projects coming online before 2017, as shown in Table 1. 3. Compliance Period 3 (2017 – 2020) For Compliance Period 3, CPAU is required to supply at least 27% of its retail sales volume from renewable resources in 2017, with that level increasing by 2% each year until reaching 33% in 2020, as described by the following equations: 2017 RPS Target = 27% × (Retail Sales in 2017) 2018 RPS Target = 29% × (Retail Sales in 2018) 2019 RPS Target = 31% × (Retail Sales in 2019) 2020 RPS Target = 33% × (Retail Sales in 2020) With all five of the City’s solar contracts expected to come online by the end of 2016, as, shown in Table 1, CPAU is expected to easily comply with the Compliance Period 3 overall City of Palo Alto Page 6 procurement requirement, as well as the Portfolio Balancing Requirement that at least 75% of the renewable electricity supplies come from Portfolio Content Category 1 and no more than 10% come from Portfolio Content Category 3. Staff projects that renewable electricity supplies will satisfy 57% of retail sales for Compliance Period 3, and that all of these supplies will come from either Portfolio Content Category 1 or “grandfathered” resources. As required by the CEC RPS Enforcement Procedures and Section D of the City’s Procurement Plan, staff reported all of the above information to the CEC in May 2015 (Attachment A). Carbon Neutral Plan With the purchase of unbundled RECs in June 2015 to offset the CY 2014 market power purchases, CPAU achieved its goal, set forth in the Carbon Neutral Plan, of an electric supply portfolio with zero net greenhouse (GHG) emissions for the second year in a row. Along with the purchase of RECs, carbon neutrality was achieved in CY 2014 through existing hydro and renewable generation (landfill gas and wind). As in CY 2013, the amount of carbon neutral generation was lower than expected due to the ongoing severe drought limiting hydroelectric output. This resulted in a higher volume of purchases of market power and the offsetting RECs. The carbon content of CPAU’s electric supply portfolio for CY 2014 is undergoing a formal verification process at this time. Third-party verification is not a state requirement, but is good practice to maintain public confidence in the City’s claims of carbon neutrality. For CY 2015 staff projects that roughly 51% of the City’s electric supply resources will be from carbon-free generating sources, with the remainder being procured through market purchases. In early 2016, staff will establish the actual carbon content of the 2015 supply portfolio, and will procure RECs to offset the remainder of the portfolio’s emissions, in accordance with the City’s adopted emissions calculation protocol (Staff Report 3194). Assuming that the projects listed in Table 1 that are still being developed come online in 2016 and the ongoing drought finally comes to an end, by 2017 CPAU’s entire electric supply portfolio is expected to be sourced from carbon neutral resources under the City’s long-term contracts (see Figure 1 below). City of Palo Alto Page 7 Figure 1: CPAU Carbon Neutral Supply Resources Next Steps In October 2015, Governor Brown signed Senate Bill 350 (SB 350), the "Clean Energy and Pollution Reduction Act of 2015" which establishes targets to increase retail sales of renewable electricity to 50% by 2030. Specifically, SB 350 establishes an RPS target of 50% by December 31, 2030, and thereafter, including interim targets of 40% by the end of the 2021 to 2024 compliance period, 45% by the end of the 2025 to 2027 compliance period, and 50% by the end of the 2028 to 2030 compliance period. CPAU will need to update its RPS Procurement Plan and Enforcement Program to be consistent with the new state requirements. Policy Implications This report implements the City’s RPS Enforcement Program, which require an annual review of the Electric Utility’s compliance with the CPAU RPS Procurement Plan to ensure that CPAU is making reasonable progress toward meeting the December 31, 2016 compliance obligation of 25% of retail sales with eligible renewable resources, consistent with the CPAU RPS Procurement Plan. City of Palo Alto Page 8 Environmental Review This report does not meet the definition of a “project” pursuant to Public Resources Code Section 21065, thus California Environmental Quality Act review is not required. Attachments:  Attachment A: City of Palo Alto Report to CEC on RPS Compliance for Calendar Year 2014 (PDF) STATE OF CALIFORNIA Compliance Report Form for Local Publicly Owned Electric Utilities CEC-RPS-POU (Revised 05/2015) CALIFORNIA ENERGY COMMISSION CEC-RPS-POU May 2015 Annual RPS Report: Accounting To be completed annually. Input Required Actual Data Forecasted Data Actual Annual RPS Procurement and Percentages (MWh)2014 2015 2016 Annual Retail Sales 953,386.000 967,261.000 985,766.000 Annual RPS Procurement Retired 210,250.000 273,887.000 421,501.000 Soft Targets 20.00%20.00%25.00% Procurement Target (MWh)2014 2015 2016 Procurement Target Category 0 RECs Retired 210,250.000 222,086.000 222,542.000 Category 1 RECs Retired 0.000 51,801.000 198,959.000 Pre-June 1, 2010 Category 1 RECs Retired1 0.000 0.000 0.000 Category 2 RECs Retired 0.000 0.000 0.000 Pre-June 1, 2010 Category 2 RECs Retired2 0.000 0.000 0.000 Category 3 RECs Retired 0.000 0.000 0.000 Pre-June 1, 2010 Category 3 RECs Retired3 0.000 0.000 0.000 Total RECs Retired (Compliance Period) 630,570.900 905,638.0000 Compliance Period 2 Compliance Period 2 Forecasted ATTACHMENT A STATE OF CALIFORNIA Compliance Report Form for Local Publicly Owned Electric Utilities CEC-RPS-POU (Revised 05/2015) C A L IF O R N IA E N E R G Y C O M M IS S IO N CEC-RPS-POU May 2015 RPS Compliance Period Report: Accounting To be completed at the end of each compliance period. Input Required Actual Data Annual RPS Procurement and Percentages (MWh)2014 2015 2016 Annual Retail Sales 953,386.000 967,261.000 985,766.000 Annual RPS Procurement Retired 210,250.000 273,887.000 421,501.000 Soft Targets 20.00%20.00%25.00% Procurement Target (MWh)2014 2015 2016 Procurement Target Category 0 RECs Retired 210,250.000 222,086.000 222,542.000 Category 1 RECs Retired 0.000 51,801.000 198,959.000 Pre-June 1, 2010 Category 1 RECs Retired 0.000 0.000 0.000 Category 2 RECs Retired 0.000 0.000 0.000 Pre-June 1, 2010 Category 2 RECs Retired 0.000 0.000 0.000 Category 3 RECs Retired 0.000 0.000 0.000 Pre-June 1, 2010 Category 3 RECs Retired 0.000 0.000 0.000 Historic Carryover (HCO) Applied1 Total RECs Retired Including HCO Total RECs Retired for the Compliance Period 905,638.000 905,638.000 Compliance Period 2 Compliance Period 2 Actual 0.000 630,570.900 STATE OF CALIFORNIA Compliance Report Form for Local Publicly Owned Electric Utilities CEC-RPS-POU (Revised 05/2015) C A L IF O R N IA E N E R G Y C O M M IS S IO N CEC-RPS-POU May 2015 Portfolio Balance Requirements (MWh)Total Retired Applied to Target2 Potential Excess Category 0 RECs Retired 654,878.000 654,867.000 11.000 Historic Carryover Applied 0.000 0.000 n/a Category 1 RECs Retired 250,760.000 250,760.000 0.000 Pre-June 1, 2010 Category 1 RECs Retired 0.000 0.000 0.000 Category 2 RECs Retired 0.000 0.000 0.000 Pre-June 1, 2010 Category 2 RECs Retired 0.000 0.000 0.000 Category 3 RECs Retired 0.000 0.000 n/a Pre-June 1, 2010 Category 3 RECs Retired 0.000 0.000 n/a Total RECs applied to the Target Category 1 Balance Requirement Category 3 Balance Limitation Disallowed Category 3 RECs Additional Procurement (MWh)Starting Balance Applied to Current Compliance Period Accumulated in Current Compliance Period Remaining Balance Total Excess Procurement 0.000 0.000 11.000 11.000 Excess Category 0 RECs 0.000 0.000 0.000 0.000 Excess Category 1 RECs 0.000 0.000 0.000 0.000 Excess Pre-June 1, 2010 Cat. 1 RECs 0.000 0.000 0.000 0.000 Excess Category 2 RECs 0.000 0.000 0.000 0.000 Excess Pre-June 1, 2010 Cat. 2 RECs 0.000 0.000 0.000 0.000 Total Historic Carryover6 368,756.957 0.000 n/a 368,756.957 0.000 Compliance Period 2 905,627.000 0.000 0.000 STATE OF CALIFORNIA Compliance Report Form for Local Publicly Owned Electric Utilities CEC-RPS-POU (Revised 05/2015) C A L IF O R N IA E N E R G Y C O M M IS S IO N CEC-RPS-POU May 2015 RPS Procurement Enforcement (MWh)2014 2015 2016 Deficit of RECs Necessary to Meet Target Deficit of RECs Necessary to Meet PCC 1 Portfolio Balance Requirement Total RECS retired, less disallowed PCC 3 905,638.000 Cost Limitations No Procurement Target 630,570.900 Delay of Timely Compliance No Potential Excess 11.000 Reduction of PCC 1 No Short-Term RECs8 0.000 Excess RECs Eligible 11.000 Excess Category 0 RECs 0.000 Excess Category 1 RECs 0.000 Excess Pre-June 1, 2010 Category 1 RECs 0.000 Excess Category 2 RECs 0.000 Excess Pre-June 1, 2010 Category 2 RECs 0.000 Other Optional Compliance Measures Applied Yes/NoExcess Procurement Calculation (MWh)7 Compliance Period 2 0.000 0.000 Compliance Period 2