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HomeMy WebLinkAbout2026-02-02 City Council Agenda PacketCITY COUNCIL Regular Meeting Monday, February 02, 2026 Council Chambers & Hybrid 5:30 PM   Palo Alto City Council meetings will be held as “hybrid” meetings with the option to attend by teleconference or in person. Information on how the public may observe and participate in the meeting is located at the end of the agenda. The meeting will be broadcast on Cable TV Channel 26, live on YouTube https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen Media Center https://midpenmedia.org. VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/362027238) Meeting ID: 362 027 238 Phone:1(669)900-6833   PUBLIC COMMENTS General Public Comment for items not on the agenda will be accepted in person for up to three minutes or an amount of time determined by the Chair. General public comment will be heard for 30 minutes. Additional public comments, if any, will be heard at the end of the agenda. Public comments for agendized items will be accepted both in person and via Zoom for up to three minutes or an amount of time determined by the Chair. Requests to speak will be taken until 5 minutes after the staff’s presentation or as determined by the Chair. Written public comments can be submitted in advance to city.council@PaloAlto.gov and will be provided to the Council and available for inspection on the City’s website. Please clearly indicate which agenda item you are referencing in your subject line. Multiple individuals who wish to speak on the same item may designate a spokesperson. Spokespersons must be representing five or more verified individuals who are present either in person or via zoom. Spokespeople will be allowed up to 10 minutes, at the discretion of the presiding officer. Speaking time may be reduced if the presiding officer reduces the speaking time for individual speakers. PowerPoints, videos, or other media to be presented during public comment are accepted only by email to city.clerk@PaloAlto.gov at least 24 hours prior to the meeting. Once received, the Clerk will have them shared at public comment for the specified item. To uphold strong cybersecurity management practices, USB’s or other physical electronic storage devices are not accepted. Signs and symbolic materials less than 2 feet by 3 feet are permitted provided that: (1) sticks, posts, poles or similar/other type of handle objects are strictly prohibited; (2) the items do not create a facility, fire, or safety hazard; and (3) persons with such items remain seated when displaying them and must not raise the items above shoulder level, obstruct the view or passage of other attendees, or otherwise disturb the business of the meeting. TIME ESTIMATES 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.  1 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. CALL TO ORDER   SPECIAL ORDERS OF THE DAY (5:30 - 5:40 PM)   1.Proclamation Honoring Christopher Fujimoto for 25 Years of Service to the City of Palo Alto CLOSED SESSION (5:40 - 6:10 PM)   2.CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION Subject: Sami Gerges vs Yolanda Franco Clausen, City of Palo Alto, Santa Clara County Superior Court Case No. 25CV473428 Authority: Government Code Section 54956.9(d)(1)   AGENDA CHANGES, ADDITIONS AND DELETIONS   PUBLIC COMMENT (6:10 - 6:40 PM) Members of the public may speak in-person ONLY to any item NOT on the agenda. 1-3 minutes depending on number of speakers. Public Comment is limited to 30 minutes. Additional public comments, if any, will be heard at the end of the agenda. COUNCIL MEMBER QUESTIONS, COMMENTS, ANNOUNCEMENTS (6:40 - 6:55 PM) Members of the public may not speak to the item(s).   STUDY SESSION (6:55 - 7:55 PM)   3.44 and 88 Encina Avenue [25PLN-00308]. Request for Council Prescreening to Rezone the Subject Properties from Community Commercial (CC) to Planned Community/Planned Home Zoning (PC/PHZ) and to Allow Construction of 158 Units and 315 Parking Spaces in Two Seven-Story Structures. The Formal Application Will be Subject to California Environmental Quality Act (CEQA) Review. Zoning District: CC (Community Commercial).   CONSENT CALENDAR (7:55 - 8:00 PM) Items will be voted in one motion unless removed from the calendar by three Council Members.    2 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. 4.Approval of Minutes from January 12, January 15, and January 20, 2026 Meetings 5.Approve and Authorize the City Manager to Execute an MOU Between the City of Palo Alto and the County of Santa Clara to Support the City's Psychiatric Emergency Response Team (PERT) Program for a Term of Five Years and a Not-To-Exceed Amount of $1.4 Million and Approval of a Budget Amendment in the General Fund and Stanford University Medical Center Fund; CEQA status - not a project. 6.SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot Tub/Sauna Establishments) of Title 4 (Business Licenses and Regulations) (FIRST READING: January 12, 2025, PASSED 7- 0) CITY MANAGER COMMENTS (8:00 - 8:15 PM)   BREAK (15 MINUTES) ACTION ITEMS (Item 7: 8:30 - 9:30 PM, Item 8: 9:30 - 11:00 PM) Include: Report of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Report of Officials, Unfinished Business and Council Matters.   7.Approval of FY 2026 Architectural Review Board, Historic Resources Board, Planning and Transportation Commission, and Utilities Advisory Commission Work Plans; CEQA status– not a project 8.Review the 2024 Greenhouse Gas Inventory and S/CAP Key Performance Indicators Annual Progress Report, and Approve the 2026-2027 S/CAP Work Plan and Receive Six S/CAP Studies Recommended by the Climate Action and Sustainability Committee; CEQA Status: Review GHG Inventory and Key Performance Indicators: Not a Project; Potential Environmental Impacts of the S/CAP Work Plan were Studied in the June 5, 2023 S/CAP Addendum to the 2017-2031 Comprehensive Plan EIR; this Project is also Exempt Pursuant to CEQA Guidelines Section 15183 Supplemental Report added ADJOURNMENT INFORMATION REPORTS Information reports are provided for informational purposes only to the Council and the public but are not listed for action or discussion during this meeting’s agenda.   A.Monthly Investment Report - December 2025 (Unaudited)  3 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. B.Informational Report on Calendar Year 2024 Annual Update for the Cap-and-Trade Program OTHER INFORMATION Standing Committee Meetings this week Finance Committee February 3, 2026 CANCELED Public Comment Letters Schedule of Meetings   SUPPLEMENTAL / AMENDED AGENDA ITEMS   8.Review the 2024 Greenhouse Gas Inventory and S/CAP Key Performance Indicators Annual Progress Report, and Approve the 2026-2027 S/CAP Work Plan and Receive Six S/CAP Studies Recommended by the Climate Action and Sustainability Committee; CEQA Status: Review GHG Inventory and Key Performance Indicators: Not a Project; Potential Environmental Impacts of the S/CAP Work Plan were Studied in the June 5, 2023 S/CAP Addendum to the 2017-2031 Comprehensive Plan EIR; this Project is also Exempt Pursuant to CEQA Guidelines Section 15183 Supplemental Report added      4 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. PUBLIC COMMENT INSTRUCTIONS Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1.Written public comments may be submitted by email to city.council@PaloAlto.gov. 2.For in person public comments please complete a speaker request card located on the table at the entrance to the Council Chambers and deliver it to the Clerk prior to discussion of the item. 3.Spoken public comments for agendized items using a computer or smart phone will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom-based meeting. Please read the following instructions carefully. ◦You may download the Zoom client or connect to the meeting in- browser. If using your browser, make sure you are using a current, up-to-date browser: Chrome 30 , Firefox 27 , Microsoft Edge 12 , Safari 7 . Certain functionality may be disabled in older browsers including Internet Explorer. Or download the Zoom application onto your smart phone from the Apple App Store or Google Play Store and enter in the Meeting ID below. ◦You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. ◦When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. ◦When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments. 4.Spoken public comments for agendized items using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. CLICK HERE TO JOIN Meeting ID: 362-027-238 Phone: 1-669-900-6833 Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329-2550 (voice) or by emailing ada@PaloAlto.gov. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service.  5 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. California Government Code §84308, commonly referred to as the "Levine Act," prohibits an elected official of a local government agency from participating in a proceeding involving a license, permit, or other entitlement for use if the official received a campaign contribution exceeding $500 from a party or participant, including their agents, to the proceeding within the last 12 months. A “license, permit, or other entitlement for use” includes most land use and planning approvals and the approval of contracts that are not subject to lowest responsible bid procedures and have a value over $50,000. A “party” is a person who files an application for, or is the subject of, a proceeding involving a license, permit, or other entitlement for use. A “participant” is a person who actively supports or opposes a particular decision in a proceeding involving a license, permit, or other entitlement for use, and has a financial interest in the decision. The Levine Act incorporates the definition of “financial interest” in the Political Reform Act, which encompasses interests in business entities, real property, sources of income, sources of gifts, and personal finances that may be affected by the Council’s actions. If you qualify as a “party” or “participant” to a proceeding, and you have made a campaign contribution to a Council Member exceeding $500 made within the last 12 months, you must disclose the campaign contribution before making your comments.  6 February 02, 2026 Materials submitted after distribution of the agenda packet are available for public inspection at www.paloalto.gov/agendas. City Council Staff Report From: City Manager Report Type: SPECIAL ORDERS OF THE DAY Lead Department: Public Works Meeting Date: February 2, 2026 Report #:2512-5766 TITLE Proclamation Honoring Christopher Fujimoto for 25 Years of Service to the City of Palo Alto ATTACHMENTS Attachment A: Retirement Proclamation of Appreciation for Christopher (Chris) Fujimoto APPROVED BY: Brad Eggleston, Director Public Works/City Engineer Item 1 Item 1 Staff Report Item 1: Staff Report Pg. 1 Packet Pg. 7 of 228  EXPRESSING APPRECIATION TO CHRISTOPHER (CHRIS) FUJIMOTO UPON HIS RETIREMENT WHEREAS, Chris Fujimoto joined the City of Palo Alto in July 2000 as a Code Enforcement Officer with the City of Palo Alto Planning Department, and then joined Public Works Department Environmental Services – Watershed Protection in June 2005 as an Industrial Waste Investigator; and WHEREAS, Chris inspected construction sites, green stormwater infrastructure, commercial and industrial businesses, municipal facilities, construction dewatering, and other locations to ensure the City of Palo Alto Stormwater Ordinance and regional stormwater permit requirements were followed to protect local creeks and the San Francisco Bay from stormwater runoff pollutants; and WHEREAS, Chris responded to illicit discharges to reduce the extent of harm to local creeks and watersheds and coordinated with the City of Palo Alto Fire Department, Public Works Public Services Division, and others for cleanup, enforcement, and resolution; and WHEREAS, Chris actively participated in Santa Clara Valley Water District’s Creek Connections Action Group and led creek cleanups during his tenure with Watershed Protection to improve the health of the watershed and engage the public in environmental protection; and WHEREAS, Chris established trash booms on Matadero and Adobe creeks in coordination with the Santa Clara Valley Water District and led trash boom cleanouts to prevent trash from flowing downstream to the Palo Alto Baylands and San Francisco Bay; and WHEREAS, Chris represented the City of Palo Alto at regional meetings and during daily public service with expertise and professionalism; and WHEREAS, Chris was certified by ReScape and trained in green stormwater infrastructure maintenance practices, bringing expertise to green stormwater infrastructure design and maintenance and best practices for landscaping maintenance; and WHEREAS, Chris completed 25 years of dedicated service to both the City of Palo Alto’s Code Enforcement Team and the Watershed Protection Stormwater Program. NOW, THEREFORE, I, Vicki Veenker, Mayor of the City of Palo Alto, on behalf of the entire City Council, do hereby recognize Chris Fujimoto for his years of dedicated service. PRESENTED: February 2, 2026 APPROVED: ______________________ Mayor Vicki Veenker ______________________ ______________________ Vice Mayor Greer Stone Councilmember Pat Burt ______________________ ______________________ Councilmember Ed Lauing Councilmember George Lu ______________________ ______________________ Councilmember Julie Lythcott-Haims Councilmember Keith Reckdahl ATTEST: ______________________ City Clerk APPROVED AS TO FORM: ______________________ ______________________ City Manager City Attorney Proclamation Item 1 Attachment A - Retirement Proclamation of Appreciation for Christopher (Chris) Fujimoto        Item 1: Staff Report Pg. 2  Packet Pg. 8 of 228  City Council Staff Report From: City Manager Report Type: STUDY SESSION Lead Department: Planning and Development Services Meeting Date: February 2, 2026 Report #:2512-5619 TITLE 44 and 88 Encina Avenue [25PLN-00308]. Request for Council Prescreening to Rezone the Subject Properties from Community Commercial (CC) to Planned Community/Planned Home Zoning (PC/PHZ) and to Allow Construction of 158 Units and 315 Parking Spaces in Two Seven- Story Structures. The Formal Application Will be Subject to California Environmental Quality Act (CEQA) Review. Zoning District: CC (Community Commercial). RECOMMENDATION Staff recommends Council conduct a prescreening and provide informal comments regarding the applicant’s request to rezone 44 and 88 Encina Avenue from Community Commercial to Planned Community/Planned Home Zoning (PHZ).1 Comments provided during the prescreening process are not binding on the City or the applicant. EXECUTIVE SUMMARY This prescreening is a request by the applicant to rezone the subject properties, which are currently zoned Community Commercial to “Planned Home Zoning (PHZ)”. The project site consists of nine parcels that currently serve as surface parking lots for Town & Country Village Shopping Center with approximately 150 parking spaces. The project proposes to construct two non-contiguous structures at 44 and 88 Encina Avenue crossing nine individual parcels. The buildings would include three levels of parking for Town & Country Village as well as the proposed residential use and four levels of residential rental units with 158 units in total. This prescreening application responds to the City Council’s expressed interest in learning from home builders what it takes to create more housing opportunities in Palo Alto. To be eligible for the Planned Community (PC) zoning process, a PHZ application must meet two initial qualifying 1 Referred to in this report as "Planned Home Zoning" to emphasize the focus on housing as the benefit to the community. Palo Alto Municipal Code (PAMC) Section 18.38, which outlines the requirement and process for Planned Community (PC) Zoning, remains the underlying code supporting application of this policy. Item 3 Item 3 Staff Report Item 3: Staff Report Pg. 1 Packet Pg. 9 of 228  criteria established by the City Council: 1) provide 20% of the total units as affordable housing selected from a prescribed menu of options, and 2) provide housing units that meet or exceed the demand generated by any net new jobs. In this case, no new jobs are proposed, as this project is exclusively residential. The project would still be required to meet the 20% affordable requirement. BACKGROUND 3 Proposed Building 1 would have a lot coverage of approximately 28,852 square feet (93% 3 Units indicated as “urban” on the project plans are counted as one-bedroom units Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 2  Packet Pg. 10 of 228  of the site) and proposed Building 2 would have a lot coverage of approximately 29,246 square feet (71%). ANALYSIS Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 3  Packet Pg. 11 of 228  and dental offices may also locate in this designation. In some locations, residential and mixed-use projects may also locate in this category. Non-residential FARs range from 0.35 to 2.0. Consistent with the Comprehensive Plan’s encouragement of housing near transit centers, higher density multi-family housing may be allowed in specific locations.” The proposed project includes multi-family residential development within close proximity to the University Avenue Caltrain station, which is consistent with this land use designation. The project is also consistent with Policy L2.4, which encourages housing near “retail, employment, and transit, in a way that connects to and enhances existing neighborhoods.” The site is located near retail, the Palo Alto Caltrain station (.5 miles), and VTA bus lines in addition to being close to Stanford University and the Stanford University Medical Center, and Downtown Palo Alto. Although located on a separate parcel, the project is also located within the boundaries of the area defined as Town & Country Village. There are several policies that apply to this area, including: Program L-2.4.4 - Assess non-residential development potential in the Community Commercial, Service Commercial and Downtown Commercial Districts (CC, CS and CD) and the Neighborhood Commercial District (CN), and convert non-retail commercial FAR to residential FAR, where appropriate. Conversion to residential capacity should not be considered in Town and Country Village. Policy L-4.12 - Recognize and preserve Town and Country Village as an attractive retail center serving Palo Altans and residents of the wider region. Future development at this site should preserve its existing amenities, pedestrian scale and architectural character while also improving safe access for bicyclists and pedestrians and increasing the amount of bicycle parking. Policy L-4.13 - In Town and Country Village, encourage a vibrant retail environment and urban greening. Policy L-4.14 - In Town and Country Village, encourage improvement of pedestrian, bicycle and auto circulation and landscaping improvements, including maintenance of existing oak trees and planting additional trees. These policy statements seek to preserve existing amenities and commercial floor area but the concept to convert a portion of the surface parking lot to housing does not appear inconsistent with these Comprehensive Plan polices, especially as the parking would be replaced. Specifically, the proposal does not reduce commercial floor area or otherwise impede the vitality of the Town & Country Village. The placement of new residential structures at the subject location would temporarily disrupt the availability of parking spaces and requires consideration of drive aisle re-alignment. However, this also holds true if the parcels were developed with commercial uses as well. Moreover, adding housing to this location may actually prove beneficial to the Town & Country Village as it introduces new residents that Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 4  Packet Pg. 12 of 228  could shop at the center and enjoy many of the other restaurants and retail stores within the immediate proximity. Housing Element Increases in floor area (2.86:1 for Building 1 and 2.41:1 for Building 2 where a total of 0.5:1 total FAR and 0.15:0 residential FAR is allowed). Increase in height (85 feet where 35 feet is allowed). An allowance for a 100% residential project where only mixed-use is allowed. No rear setback where a 10 foot setback is required. Reduce 0- to 5-foot side yard where 10-foot side yard is required adjacent a residential zone district (the PC approved at 70 Encina Avenue). Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 5  Packet Pg. 13 of 228  submittal of a formal application. Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 6  Packet Pg. 14 of 228  of the two apartment buildings and 150 commercial spaces for patrons of the Town & Country Village shopping center. This does not meet the Code required minimum off-street parking spaces. As shown in Attachment B, PAMC Section 18.52 requires one parking space for both studio and one-bedroom units and two parking spaces for units that are two-bedrooms or larger (with at least one covered space). Based on the proposed units, the PAMC would require a total of 218 parking spaces for the proposed residential use; however, only 165 are proposed. Senate Bill 79 Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 7  Packet Pg. 15 of 228  POLICY IMPLICATIONS Prescreenings are intended to solicit early feedback on proposed projects and, like all study sessions, cannot result in any formal action. Therefore, informal comments from Councilmembers would not impart policy. That said, there is interest among other home builders and property owners to learn of the Council’s initial reaction to the subject request, which may influence the filing of future prescreening requests. Following the prescreening review, the applicant will consider Council’s comments and determine how they want to proceed. Any formal application to rezone the property to a PHZ would be subject to hearings before the Planning and Transportation Commission (PTC), Architectural Review Board (ARB), and City Council. The recommendation in this report does not have any significant fiscal or budgetary impacts since it is tied to the prescreening review; however, should the project proceed it will yield development impact fees and will likely generate additional tax revenues through property taxes and sales taxes. The Palo Alto Municipal Code requires notice of this public hearing be published in a local paper and mailed to owners and occupants of property within 600 feet of the subject property at least ten days in advance. Notice of a public hearing for this project was published in the Daily Post on January 23, 2026, which is 10 days in advance of the meeting. Postcard mailing occurred on January 22, 2026, which is 11 days in advance of the meeting. As of the writing of this report no project-related public written comments were received. The prescreening is a preliminary review process in which Councilmembers may provide comment, but no formal action will be taken. Therefore, no review under the California Environmental Quality Act (CEQA) is required at this time. A full review in accordance with CEQA would be initiated with the formal filing of a development application. Attachment A: Location Map Attachment B: Zoning Comparison Analysis Attachment C: Project Plans : Jonathan Lait, Planning and Development Services Director Item 3 Item 3 Staff Report        Item 3: Staff Report Pg. 8  Packet Pg. 16 of 228  30 Bldg 3 Bldg 1 Bldg 2 Bldg 4 ing P Bldg 5 _Building 50.0' 121.2' 50.0' 121.2' 121.2' 51.8' 121.2' 207.3' 259.5' 121.2' 56.0' 121.2' 56.0' 100.0' 121.2' 100.0' 121.2' 50.0' 121.2' 50.0' 121.2' 535.5' 938.0' 1019.5' 105.0 100.0' 100.0' 105.0' 100.0' 105.0' 100.0' 105.0' 200.0' 50.0' 105.0' 50.0' 105.0' 50.0' 105.0' 50.0' 105.0' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 50.0' 121.2' 121.2' 121.2' 50.0' 50.0' 148.2' 149.1' 121.2' 121.2' 100.0' 100.0' 121.2' 121.2' 182.3' 200.0' 121.1'14.3' 72.6' 137.4' 84.5' 112.3' 39.0' 48.0'43.5' 112.3' 82.2' 224.6' 212.7' 72.0' 33 98 Bldg 1 Bldg 2 Bldg 3 Bldg 4 Bldg 5 855 917 901 75 63 29 841 44 955 904 909 81 87 51 903 905 907 921 925 70 67 ALMA STREET CHA EL CAMINO REAL EL CAMINO REA ERO ROAD URBAN LANE ENCINA AVENUE ENCINA AVENUE LANE -4782CS RT-5PC-4389 CS CC PAMF PARKING STRUCTURE This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend Assessment Parcel Project Site 0' 124' Location map CITY OF PALO ALTO I NC O R P O R A TE D CALI FORNIA P a l o A l t o T h e C i t y o f APRI L 1 6 189 4 The City of Palo Alto assumes no responsibility for any errors ©1989 to 2016 City of Palo Alto chodgki, 2026-01-15 13:47:24 (\\cc-maps\Encompass\Admin\Personal\Planning.mdb) Item 3 Attachment A - Location Map        Item 3: Staff Report Pg. 9  Packet Pg. 17 of 228  1 0 2 8 7 ATTACHMENT B 44 and 88 Encina Avenue, 25PLN-00308 Table 1: COMPARISON WITH CHAPTER 18.16 (CC DISTRICT) Mixed-use and Residential Development Standards Note: 100% Residential not typically allowed in CC District Bold indicates exceedance of base zone district development standards Regulation Required Existing Proposed Minimum Site Area, Width, and Depth No Requirement Building 1 Parcel – 31,025 sf area, 256 ft wide, 121 ft deep Building 2 Parcel – 41,191 sf area, 374 ft wide, 121 ft deep No change Minimum Front Yard (Encina Ave) No Requirement Vacant/parking lot Building 1 – 0 feet Building 2 – 0 feet Rear Yard 10 feet 0 feet Side Yard None Building 1 – 0 feet (western PL) Building 2: 0 feet (western PL), Side Yard Minimum yard for lot lines abutting or opposite residential districts or residential PC districts 10 feet Building 1 – 9 feet, 7 inches (eastern PL) Building 2: 5 feet (eastern PL) Build-to-lines (1)50% of frontage built to setback on Encina Ave. Complies Max. Site Coverage 50% Lot 1 - 15,512.5 sf Lot 2 – 20,595.5 sf Building 1 – 93%, 28,852 sf Building 2 – 71%, 29,246 sf Max. Building Height 35 feet Building 1 – 85 feet, 7 stories Building 2 – 85 feet, 7 stories Item 3 Attachment B - Zoning Comparison Analysis        Item 3: Staff Report Pg. 10  Packet Pg. 18 of 228  1 0 2 8 7 Maximum Floor Area Ratio (FAR) See note (e) 0.15 to 1 for residential Building 1 - 28,852 sf, 2.86: 1 Building 2 – 29,246 sf, 2.41: 1 Daylight Plane for lot lines abutting one or more residential zone districts other than an RM-40 or PC Zone Not applicable Landscape Open Space 30%Additional information needed Useable Open Space 150 sf per unit (Private and/or Common) 24,389 sf – Approximately 154 sf per unit (e) CC District Shopping Center Floor Area Ratio Regulations (1) The maximum floor area ratio for the Town and Country Village Shopping Center shall be .35 to 1; and office uses at said shopping center shall be limited to 15% of the floor area of the shopping center existing as of August 1, 1989. Hotel use shall not be included as part of the .35 to 1 maximum floor area ratio, but shall not exceed an additional .25 to 1 floor area ratio, for a maximum site floor area ratio of .60 to 1. (2) The maximum floor area ratio for mixed use development for the Town and Country Village Shopping Center shall be limited to .50 to 1; provided that no more than .35 to 1 floor area shall be nonresidential, consistent with part (1) above, and not more than .15 to 1 floor area shall be residential. (3) Stanford Shopping Center shall not be permitted to add more than 80,000 square feet of floor area to the total amount of floor area of the shopping center existing as of June 14, 1996, 1,332,362 square feet, for a total square footage not to exceed 1,412,362. Any hotel or mixed use development for the Stanford Shopping Center shall only be included if approved as part of a Development Agreement for the site. Table 2: CONFORMANCE WITH CHAPTER 18.52 (Off-Street Parking and Loading) for Residential Type Required Existing Proposed Vehicle Parking 1 per Studio unit 1 per 1-bedroom unit 2 per 2-bedroom or larger unit At least one space per unit must be covered Tandem parking allowed for any unit requiring two spaces (one tandem space per unit, associated directly with another parking space for the same unit, up to a maximum of 25% of total required spaces for any project with more than four (4) units) 218 residential stalls required Approximately 263 parking spaces 315 parking stalls provided (165 residential and 150 commercial) Item 3 Attachment B - Zoning Comparison Analysis        Item 3: Staff Report Pg. 11  Packet Pg. 19 of 228  1 0 2 8 7 Bicycle Parking 1 long term space per unit 1 guest space per 10 units Bike Room provided on ground floor at Building 2. Additional details needed from applicant regarding bicycle parking counts. Loading Space None required Loading area shown on ground floor at Building 2. Item 3 Attachment B - Zoning Comparison Analysis        Item 3: Staff Report Pg. 12  Packet Pg. 20 of 228  If you need assistance reviewing the above documents, please contact the Project Planner or call the Planner-on-Duty at 650-617-3117 or email planner@paloalto.gov Project Plans In order to reduce paper consumption, a limited number of hard copy project plans are provided to Council members for their review. The same plans are available to the public, at all hours of the day, via the following online resources. Directions to review Project plans and environmental documents online: 1. Go to: bit.ly/PApendingprojects 2. Scroll down to find “44 Encina Avenue” and click the address link 3. On this project-specific webpage you will find a link to the project plans and other important information Direct Link to Project Webpage: 44 Encina Avenue – City of Palo Alto, CA Item 3 Attachment C - Project Plans        Item 3: Staff Report Pg. 13  Packet Pg. 21 of 228  City Council Staff Report Report Type: CONSENT CALENDAR Lead Department: City Clerk Meeting Date: February 2, 2026 Report #:2601-5830 TITLE Approval of Minutes from January 12, January 15, and January 20, 2026 Meetings RECOMMENDATION Staff recommends that the City Council review and approve the minutes. ATTACHMENTS Attachment A: January 12, 2026 Draft Action Minutes Attachment B: January 15, 2026 Draft Action Minutes Attachment C: January 20, 2026 Draft Action Minutes APPROVED BY: Mahealani Ah Yun, City Clerk Item 4 Item 4 Staff Report Item 4: Staff Report Pg. 1 Packet Pg. 22 of 228  CITY COUNCIL/PUBLIC IMPROVEMENT CORPORATION DRAFT ACTION MINUTES Page 1 of 5 Special Meeting January 12, 2026 The City Council of the City of Palo Alto met on this date in the Council Chambers and by virtual teleconference at 5:30 P.M. Present In Person: Burt, Lauing, Lu, Lythcott-Haims, Reckdahl, Stone, Veenker Present Remotely: Absent: Closed Session 1. Subject: Initiation of litigation in one case Authority: Potential Exposure to Litigation Under Government Code Section 54956.9(d) (4) Number of potential cases: 1, as Plaintiff MOTION: Councilmember Lauing moved, seconded by Councilmember Lu to go into Closed Session. MOTION PASSED: 7-0 Council went into Closed Session at 5:32 P.M. Council returned from Closed Session at 6:20 P.M. Mayor Veenker announced that the City Council authorized the City Attorney to initiate litigation in one case. Agenda Changes, Additions and Deletions Public Comment Item 4 Attachment A - January 12, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 2  Packet Pg. 23 of 228  DRAFT ACTION MINUTES Page 2 of 5 Sp. City Council Meeting Draft Action Minutes: 01/12/2026 Council Member Questions, Comments and Announcements Study Session 2. Review and Discuss 2025 Q4 Council Priorities & Objectives and format of the 2026 City Council Annual Retreat. CEQA Status – Not a project. NO ACTION Consent Calendar Councilmember Lythcott-Haims registered a no vote on Agenda Item Number 10 and 11. MOTION: Councilmember Reckdahl moved, seconded by Councilmember Lauing to approve Agenda Item Numbers 3-12. MOTION PASSED ITEMS 3-9, 12: 7-0 MOTION PASSED ITEMS 10, 11: 6-1, Lythcott-Haims no 3. Approval of Minutes from December 8, December 10, and December 15, 2025 Meetings 4. Adoption of Memorandum of Agreement with Service Employees International Union Hourly Unit effective upon adoption through December 31, 2027; and Adoption of Compensation Plan for Unrepresented Limited Hourly Employee effective upon adoption through June 30, 2028; CEQA Status - Not a project 5. Approval of Professional Services Contract Number C26195486 with Baron Contracting in an Amount Not-to-Exceed $514,528 for Gas Leak Survey Services for a Period of Three Years. CEQA Status – Exempt Under CEQA Guidelines Sections 15301(c) and 15308 (Existing Facilities). 6. Approval of a Contract with the Media Center for Cable Casting Services of Public Meetings for a Term of Three Years and a Not to Exceed Amount of $540,000 with Two One-Year Options to Extend for a Potential Not to Exceed amount of $900,000 over a five-year term, for cablecasting, production, and streaming services; CEQA Status – Not a Project. 7. Approve the City Manager or Designee to Execute Purchase Order C26196045 with Insight Public Sector, Utilizing a County of Riverside Cooperative Contract ITARC-00930, to Procure Microsoft Enterprise Software Licensing, Cloud Services, and Server/Data Item 4 Attachment A - January 12, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 3  Packet Pg. 24 of 228  DRAFT ACTION MINUTES Page 3 of 5 Sp. City Council Meeting Draft Action Minutes: 01/12/2026 Center Licensing for a 3-Year Term with a maximum Total Not-To-Exceed Amount of $2,506,936, inclusive of a Contingency in the Amount of $50,000 Annually. 8. FIRST READING: Adoption of an ordinance to Amend Chapters 4.54 and 4.56 of the Palo Alto Municipal Code to Amend the Regulation of Massage Establishments and Hot Tub/Sauna Establishments as Recommended by the Policy & Services Committee; and Adoption of a Resolution to Amend the Administrative Penalty Schedule to Amend Related Penalties; CEQA status - not a project. 9. SECOND READING: Ordinance of the Council of the City of Palo Alto Renewing the Military Equipment Use Policy in Compliance with Govt. Code Section 7070 et seq. (2025-2026) (FIRST READING: December 8, 2025; PASSED 7-0) 10. SECOND READING: Ordinance of the Council of the City of Palo Alto Prohibiting Parking of Detached Trailers and Other Non-Motorized Vehicles on Public Streets (FIRST READING: December 8, 2025; PASSED 6-1, Lythcott-Haims no) 11. SECOND READING: Ordinance of the Council of the City of Palo Alto Prohibiting Rental of Vehicles for Human Habitation (FIRST READING: December 8, 2025; PASSED 6-1, Lythcott-Haims no) 12. SECOND READING: Interim Ordinance of the Council of the City of Palo Alto Temporarily Extending Interim Ordinance 5645, Amending Various Chapters of Title 16 (Building Regulations) and Title 18 (Zoning) and Title 21 (Subdivisions and Other Divisions of Land) of the Palo Alto Municipal Code to Implement Recent State Housing Laws (FIRST READING: December 8, 2025, PASSED 7-0) City Manager Comments Ed Shikada, City Manager Action Items 13. Study and Assessment of Palo Alto Turf Systems and Direct Staff to Proceed with El Camino Park Synthetic Turf Replacement and Natural Grass Pilot; CEQA Status – Categorically and Statutorily Exempt MOTION: Councilmember Lu moved, seconded by Councilmember Lythcott-Haims to: 1. Proceed with replacing the existing synthetic turf at El Camino Park with improved synthetic turf using organic infill and to implement risk management measures, Item 4 Attachment A - January 12, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 4  Packet Pg. 25 of 228  DRAFT ACTION MINUTES Page 4 of 5 Sp. City Council Meeting Draft Action Minutes: 01/12/2026 including stormwater filtration, enhanced maintenance practices, and related mitigation measures; and MOTION PASSED: 6-1, Stone no MOTION SPLIT FOR THE PURPOSE OF VOTING MOTION: Councilmember Lu moved, seconded by Councilmember Lythcott-Haims to: 3. Pursue a natural grass pilot project to enhance playability and durability; and 4. Continue to explore opportunities to transition from synthetic turf at Cubberley. MOTION PASSED: 7-0 Recess City Council Meeting and Convene Public Improvement Corporation Meeting All Board Members of the Public Improvement Corporation are present in-person. 14. Approval of Fiscal Year 2025 Palo Alto Public Improvement Corporation's Annual Financial Report. CEQA Status - Not a Project MOTION: Board Member Lauing moved, seconded by Board Member Reckdahl to approve the Fiscal Year (FY) 2025 Annual Financial Report for the Palo Alto Public Improvement Corporation. MOTION PASSED: 7-0 Reconvene City Council Meeting 15. Review and Approval of Suggested Changes to the City Council Procedures and Protocols Handbook as Recommended by the Policy and Services Committee. CEQA Status – Not a project. Agenda Item Number 15 not heard and deferred to a date uncertain. Adjournment: The meeting was adjourned at 10:08 P.M. Item 4 Attachment A - January 12, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 5  Packet Pg. 26 of 228  DRAFT ACTION MINUTES Page 5 of 5 Sp. City Council Meeting Draft Action Minutes: 01/12/2026 ATTEST: APPROVED: ____________________ ____________________ City Clerk Mayor NOTE: Action minutes are prepared in accordance with Palo Alto Municipal Code (PAMC) 2.04.160(a) and (b). Summary minutes (sense) are prepared in accordance with PAMC Section 2.04.160(c). Beginning in January 2018, in accordance with Ordinance No. 5423, the City Council found action minutes and the video/audio recordings of Council proceedings to be the official records of both Council and committee proceedings. These recordings are available on the City’s website. Item 4 Attachment A - January 12, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 6  Packet Pg. 27 of 228  CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 2 Special Meeting January 15, 2026 The City Council of the City of Palo Alto met on this date in the Council Chambers and by virtual teleconference at 5:41 P.M. Present In Person: Burt, Lu, Lythcott-Haims, Reckdahl, Veenker Councilmember Lu arrived at 5:49 P.M. Councilmember Lythcott-Haims departed during closed session. Present Remotely: Absent: Lauing, Stone Call to Order Closed Session 1. Public Employee Appointment Title: City Attorney Authority: Gov. Code Section 54957(b) 2. Conference with Labor Negotiators Authority: Gov. Code section 54957.6; Agency representative: Sandra Blanch and Nicholas Raisch, Teri Black, Teri Black & Co. Unrepresented Employee: City Attorney MOTION: Councilmember Reckdahl moved, seconded by Councilmember Burt to go into Closed Session. MOTION PASSED: 4-0-3 (Lauing, Lu, Stone absent) Council went into Closed Session at 5:47 P.M. Council returned from Closed Session at 7:00 P.M. Mayor Veenker announced no reportable action. Item 4 Attachment B - January 15, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 7  Packet Pg. 28 of 228  DRAFT ACTION MINUTES Page 2 of 2 Sp. City Council Meeting Draft Action Minutes: 01/15/2026 Agenda Changes, Additions and Deletions Adjournment: The meeting was adjourned at 7:01 P.M. ATTEST: APPROVED: ____________________ ____________________ City Clerk Mayor NOTE: Action minutes are prepared in accordance with Palo Alto Municipal Code (PAMC) 2.04.160(a) and (b). Summary minutes (sense) are prepared in accordance with PAMC Section 2.04.160(c). Beginning in January 2018, in accordance with Ordinance No. 5423, the City Council found action minutes and the video/audio recordings of Council proceedings to be the official records of both Council and committee proceedings. These recordings are available on the City’s website. Item 4 Attachment B - January 15, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 8  Packet Pg. 29 of 228  CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 4 Special Meeting January 20, 2026 The City Council of the City of Palo Alto met on this date in the Council Chambers and by virtual teleconference at 5:30 P.M. Present In Person: Burt, Lauing, Lu, Lythcott-Haims, Reckdahl, Stone, Veenker Present Remotely: Absent: Special Orders of the Day 1. Proclamation honoring Aaron (Bunk) Miller for 34 Years of Service to the Palo Alto Regional Water Quality Control Plant and its partner agencies. NO ACTION Agenda Changes, Additions and Deletions Public Comment Council Member Questions, Comments and Announcements Study Session 2. Presentation of the 2025 Annual Community Survey Results. CEQA Status -- Not a project. NO ACTION Item 4 Attachment C - January 20, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 9  Packet Pg. 30 of 228  DRAFT ACTION MINUTES Page 2 of 4 Sp. City Council Meeting Draft Action Minutes: 01/20/2026 Consent Calendar Councilmember Lythcott-Haims registered a no vote on Agenda Item Number 10. MOTION: Vice Mayor Stone moved, seconded by Councilmember Reckdahl to approve Agenda Item Numbers 3-10. MOTION PASSED ITEMS 3-9: 7-0 MOTION PASSED ITEM 10: 6-1, Lythcott-Haims 3. Approval of Minutes from January 5, 2026 Meeting 4. Accept CalPERS Pension Annual Valuation Report as of June 30, 2024; CEQA Status – Not a project. 5. Approval of the Advisory Report: Contract Solicitation & Authority Levels and Subsequent Management Response as recommended by the Policy & Services Committee. CEQA Status – Not a Project. 6. Approval of the City of Palo Alto’s Updated 2026 Water, Gas, and Wastewater Utility Standards (Design and Construction); CEQA Status- Not a Project. 7. Adopt a Resolution to Allow Consumption of Alcohol under PAMC section 9.04.010 on Certain Days and Times through May 31, 2026, on California Avenue. 8. Approve Recommended Changes that will Align Increased General Liability Insurance Costs in the General Liability Fund to be Included in the Mid-Year Budget Report as Recommended by the Finance Committee. CEQA Status—Not a project. 9. Approval of Contract Amendment Number 3 to Contract C23183770 with Townsend Public Affairs, Inc. in the amount of $186,000 to Revise the Not-to-Exceed Total to $744,000 and to Extend the Term for an Additional Year of Service (the third of four one-year options to renew) for State and Federal Legislative Advocacy and Grant Consulting and Compliance Services; CEQA Status - Not a Project 10. SECOND READING: Ordinance of the Council of the City of Palo Alto Repealing and Replacing Section 18.40.250 (Lighting) of Chapter 18.40 (General Standards and Exceptions) and Amending Chapters 18.10, 18.12, 18.28 and Section 18.40.230 of Title 18 (Zoning) of the Palo Alto Municipal Code to Adopt New Outdoor Lighting Regulations (REINTRODUCED FIRST READING: December 8, 2025; PASSED:6-1, Lythcott-Haims, no) Item 4 Attachment C - January 20, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 10  Packet Pg. 31 of 228  DRAFT ACTION MINUTES Page 3 of 4 Sp. City Council Meeting Draft Action Minutes: 01/20/2026 City Manager Comments Ed Shikada, City Manager Action Items 11. Policy and Services Committee Recommendation to Adopt the 2026 State and Federal State Legislative Guidelines and 2026 Utility Policy Guidelines, and Receive an Update on State and Federal Legislative Advocacy; CEQA Status – Not a Project MOTION: Mayor Veenker moved, seconded by Councilmember Reckdahl to: 1. Adopt the 2026 State and Federal Legislative Guidelines and 2026 Utility Policy Guidelines and receive an update on State and Federal Legislative Advocacy and add the following amendments to the Housing Section of Guidelines: a. Clarify and streamline the process for developing affordable housing on city- owned land b. Advocate for additional state and federal funding in support of affordable housing c. Advocacy for reevaluations to the RHNA requirements for mid-cycle mandates on cities d. Support changes to the legislative guidelines that align with Council’s recommended reforms to SB79, if any. 2. Direct staff to next year review and revise, as appropriate, the Utilities Legislative Guidelines and the Climate and Environment Section Guidelines to be consistent with each other and mutually supportive. MOTION PASSED: 7-0 PORTION OF MOTION REMOVED WITH THE CONSENT OF THE MAKER AND SECONDER MOTION SPLIT FOR THE PURPOSE OF VOTING MOTION: Mayor Veenker moved, seconded by Councilmember Reckdahl to: 3. Adopt a support position for SB63 advocacy (Connect Bay Area Transit Committee) and follow up accordingly. MOTION PASSED/FAILED: X-X Item 4 Attachment C - January 20, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 11  Packet Pg. 32 of 228  DRAFT ACTION MINUTES Page 4 of 4 Sp. City Council Meeting Draft Action Minutes: 01/20/2026 12. Review the FY 2027-FY 2036 Long Range Financial Forecast (LRFF) and FY 2027 Budget Development Guidelines using the LRFF as the Baseline for Developing the FY 2027 Budget as Recommended by the Finance Committee, CEQA Status – Not a Project MOTION: Councilmember Lauing moved, seconded by Councilmember Reckdahl to accept the Long Range Financial Forecast (LRFF) for Fiscal Year 2027-2036 (Attachment A) and the FY 2027 annual Budget Development Guidelines (Attachment B) and direct staff to use this forecast as the baseline for developing the FY 2027 budget. MOTION PASSED: 7-0 Adjournment: The meeting was adjourned at 10:42 P.M. ATTEST: APPROVED: ____________________ ____________________ City Clerk Mayor NOTE: Action minutes are prepared in accordance with Palo Alto Municipal Code (PAMC) 2.04.160(a) and (b). Summary minutes (sense) are prepared in accordance with PAMC Section 2.04.160(c). Beginning in January 2018, in accordance with Ordinance No. 5423, the City Council found action minutes and the video/audio recordings of Council proceedings to be the official records of both Council and committee proceedings. These recordings are available on the City’s website. Item 4 Attachment C - January 20, 2026 Draft Action Minutes        Item 4: Staff Report Pg. 12  Packet Pg. 33 of 228  City Council Staff Report From: City Manager Report Type: CONSENT CALENDAR Lead Department: Police Meeting Date: February 2, 2026 Report #:2512-5757 TITLE Approve and Authorize the City Manager to Execute an MOU Between the City of Palo Alto and the County of Santa Clara to Support the City's Psychiatric Emergency Response Team (PERT) Program for a Term of Five Years and a Not-To-Exceed Amount of $1.4 Million and Approval of a Budget Amendment in the General Fund and Stanford University Medical Center Fund; CEQA status - not a project. RECOMMENDATION Staff recommends that the City Council: 1. Approve and Authorize the City Manager to Execute an MOU Between the City of Palo Alto and the County of Santa Clara to Support the City's Psychiatric Emergency Response Team (PERT) Program for a Term of Five Years and a Not-To-Exceed Amount of $1.4 million (Attachment A); and 2. Amend the Fiscal Year 2026 Budget Appropriation for the General Fund (requires a 2/3 vote) by: a. Increasing the transfer from the Stanford University Medical Center (SUMC) Development Fund by $135,500; and b. Increasing the expenditure appropriation for the Police Department by $135,500. 3. Amend the Fiscal Year 2026 Budget Appropriation for the Stanford University Medical Center Fund (requires 2/3 vote) by: a. Increasing transfer to the General Fund by $135,500; and b. Decreasing fund balance in the Stanford University Medical Center Fund, Community Health and Safety by $135,500. EXECUTIVE SUMMARY The Psychiatric Emergency Response Team (PERT) consists of one police officer employed by the Palo Alto Police Department (PAPD) paired full-time with one clinician employed by the Santa Clara County Behavioral Health Services Department (BHSD). The PERT unit Item 5 Item 5 Staff Report Item 5: Staff Report Pg. 1 Packet Pg. 34 of 228  responds to calls of people experiencing mental health crisis. The City and County successfully deployed a pilot PERT program in November 2021 and Council converted the program to ongoing in FY 2023. The County notified the City in late 2025 that their funding to hire clinicians assigned to PERT units no longer existed. BHSD now has a clinician if the City provides funding. This MOU (Attachment A) would provide funding to County to staff one clinician for PAPD for five years. The City’s cost will not exceed $1.4 million through December 31, 2030, subject to the annual availability and appropriation of funds. BACKGROUND 1 . 2 to fund the PERT officer moving forward. The County would still fund and supply the clinician; however, BHSD efforts to hire a new clinician for Palo Alto continued but were ultimately unsuccessful. 1 Policy and Services Committee, March 9, 2021; Agenda Item #1; SR # 12051 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/reports/city-manager-reports- cmrs/year-archive/2021/id-12051.pdf 2 City of Palo Alto FY2023 Adopted Operating Budget, June 2022; page 345 https://www.paloalto.gov/files/assets/public/v/1/administrative-services/city-budgets/fy-2023-city- budget/adopted-fy23/operating-budget_final-4.pdf Item 5 Item 5 Staff Report        Item 5: Staff Report Pg. 2  Packet Pg. 35 of 228  In late 2025, County notified the City that they can no longer fund a PERT clinician for Palo Alto, but they could supply one if Palo Alto provided the funding. ANALYSIS 5, the Department still believes it would be most ideal for the community to have PERT coverage seven days a week (approximately 48% of the weekly shift cycle). If resources become available in the future, the Department intends to return to Council to seek to add a second PERT unit. FISCAL/RESOURCE IMPACT 5 Policy & Services Committee, May 9, 2023; Agenda Item #1; SR # 2303-1142 https://cityofpaloalto.primegov.com/viewer/preview?id=1889&type=0 Item 5 Item 5 Staff Report        Item 5: Staff Report Pg. 3  Packet Pg. 36 of 228  For the remainder of FY2026, the Department is requesting use of the Stanford University Medical Center (SUMC) development fund set-aside for public safety, specifically, mental health public safety as noted in the FY2026 Adopted Operating budget (which had a fund balance of $1.2 million as of last reporting7). As outlined in the FY 2026 Adopted Budget, the PERT Police Officer assigned to this team is also funded from this SUMC resource. Upon exhaustion of the remaining one-time SUMC funding of $1.2 million, an alternative source will need to be identified prior to the completion of this contract. STAKEHOLDER ENGAGEMENT ENVIRONMENTAL REVIEW ATTACHMENTS APPROVED BY: 7 City of Palo Alto FY2026 Adopted Operating Budget, June 2025; page 151 https://www.paloalto.gov/files/assets/public/v/1/administrative-services/city-budgets/fy-2026-city- budget/adopted/fy-2026-adopted-operating-budget_final.pdf Item 5 Item 5 Staff Report        Item 5: Staff Report Pg. 4  Packet Pg. 37 of 228  Page 1 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT) JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 WHEREAS, the mission of the City of Palo Alto (hereinafter “CITY”) is to provide quality public services, facilities and opportunities that create, sustain, and enhance a safe, livable, and vibrant community for its diverse residents, businesses, and visitors. The CITY’s Palo Alto Police Department (hereinafter “PAPD”) is a progressive and professional organization dedicated to maintaining community partnerships which promote a high quality of life for the City’s diverse population; and WHEREAS, the mission of the County of Santa Clara (hereinafter “COUNTY”) is to plan for the needs of a dynamic community, provide quality services, and promote a healthy, safe, and prosperous community for all; and WHEREAS, COUNTY and CITY seek to collaborate to increase public safety and reduce recidivism among high-risk individuals experiencing a mental health crisis, including individuals with mental illnesses and co-occurring mental illness and substance abuse through the Psychiatric Emergency Response Team Justice and Mental Health Collaboration Program (or “PERT Program”); and WHEREAS, the partners listed above have agreed to enter into a collaborative agreement in which CITY and COUNTY Behavioral Health Services Department (hereinafter “BHSD”) will be partners on this collaborative effort to combine the unique resources, skills, experience, and training of personnel from two different professions (law enforcement and mental health services) to provide the best possible response to situations involving persons with mental illness; and WHEREAS, the partners herein desire to enter into a Memorandum of Understanding (hereinafter "MOU") setting forth the roles, responsibilities, and services to be provided by the PERT Program; and WHEREAS, the agencies recognize the need for cross-system collaboration to improve responses and outcomes for individuals experiencing a mental health crisis, including individuals with mental illnesses and substance abuse who come into contact with the justice system; and WHEREAS, the partners recognize the need to increase public safety and to provide rapid intervention to an individual experiencing a mental health crisis by de-escalating the situation and helping to stabilize the individuals in the least restrictive way possible, and then striving to get that individual the help they need; and WHEREAS, the partners are committed to providing services to those in need in a nondiscriminatory manner such that no individual is turned away based on their ethnicity, gender, gender identity, sexual orientation, origin, religious or political beliefs, age, insurance status, mental health status, disability, and/or creed; NOW, THEREFORE, it is hereby agreed by and between the partners as follows: Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 5  Packet Pg. 38 of 228  Page 2 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 ARTICLE 1 TERM; EXTENSIONS; TERMINATION 1.1 Term of Agreement. The initial term of this MOU is from January 1, 2026, through December 31, 2030. 1.2 Termination without Cause. Any Party may terminate this MOU without cause by providing sixty (60) day written notice. ARTICLE 2 SCOPE OF SERVICES 2.1 The COUNTY shall provide the following for the PERT Program: a. Participate in proactive responses for high-risk individuals experiencing a mental health crisis in conjunction with the PAPD PERT officer(s); b. Develop and modify protocols for PERT Program response and information sharing policies and procedures, as necessary; c. Identify one (1) full time BHSD clinician (hereinafter “BHSD PERT Clinician), who must be licensed to provide mental health services by appropriate State of California licensing authorities and must participate in a CITY background investigation and fingerprinting, prior to beginning work with the CITY. d. Assign the identified BHSD PERT Clinician to work with the PAPD PERT officer(s) to perform the following tasks: 1) Conduct mental health evaluations, assessments, and crisis screening, for individuals with serious mental illnesses including individuals who are frequent users of emergency psychiatrist services, dual diagnosed individuals and individuals who are mentally ill; 2) Assist in determining the appropriate disposition supporting individuals’ needs and safety; 3) Consult with PAPD PERT officer(s) regarding disposition of individuals and law enforcement issues; 4) Maintain knowledge of the criteria for psychiatric disorders according to the current Diagnostic and Statistical Manual (DSM) of Mental Disorders; 5) Maintain knowledge of current legal and ethical issues as they relate to mental illness; 6) Maintain licensing as required; 7) Ensure requirements for detention and transportation pursuant to Welfare and Institutions Code (WIC) Section 5150 are met; 8) Provide documentation to the PERT officer(s) supporting the decision to detain and transport a subject pursuant to WIC Section 5150; 9) Assist in coordination of transportation to mental health service centers, or facilities when such support and services would be beneficial (regardless of whether a 72-hour evaluation hold is issued), and there is cooperation from the subject; 10) Maintain a law enforcement security clearance; Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 6  Packet Pg. 39 of 228  Page 3 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 11) Conduct presentations to inform the community about the mission and focus of the PERT Program; 12) Provide mental health training and expertise to other PAPD Department staff; 13) Contribute toward providing metrics related to the PERT Program; 14) Provide mental health services for law enforcement activities that are related only to the PERT mission and focus; and 15) Abide by and follow all CITY policies while performing services under this MOU. e. Collaborate with the CITY in determining what training, if any, is necessary for the BHSD PERT Clinician during the duration of the MOU; and f. Work with PAPD to identify available trainings to officers to assist with appropriately responding to incidents involving individuals with mental illness and substance abuse. Any identified training courses must be certified by Peace Officer Standards Training (POST) to ensure a consistent level of quality. 2.2 The CITY shall provide the following for the PERT Program: a. Develop a detailed policy, procedure, process, and plan on implementing a specialized police mental health PERT Program; b. Expand training for law enforcement to identify and respond to individuals with mental illness and provide cross-training of criminal justice and mental health personnel; c. Establish a dedicated PAPD officer(s) to work with the BHSD PERT Clinician; d. Participate in the process of identifying the BHSD PERT Clinician to work with PAPD; e. Assume primary responsibility for site control when responding to a crisis; f. Assume role of the primary responder when engaged with BHSD PERT Clinician; g. Issue basic tools to BHSD PERT Clinician to perform their duties and provide access to certain CITY facilities. h. Determine whether phone consultation or on-site consultation is needed from the BHSD PERT Clinician; i. Coordinate training exercises with the BHSD PERT Clinician to ensure proper collaboration when needed during a crisis; j. Collaborate with the BHSD PERT Clinician by participating in trainings and meetings to ensure proper understanding of roles and responsibilities during crisis situations; k. Facilitate transportation for individuals to the appropriate receiving facility when a WIC 5150 hold has been placed by the BHSD PERT clinician in response to a call for service to PAPD; l. Agree to provide a review on the overall effectiveness of the BHSD PERT clinician deployments; Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 7  Packet Pg. 40 of 228  Page 4 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 m. Agree to provide information to BHSD PERT clinician regarding individuals who are involved in a crisis incident, when such information provides critical value to the safe resolution of those incidents; n. Have an officer on scene with the PERT Clinician to assess and provide safety and security. o. Offer referrals or other assistance through the officer and PERT Clinician as the situation warrants, and if needed, assist the individual to the appropriate setting (either voluntarily or involuntarily); p. Collaborate with the COUNTY in determining what training, if any, is necessary for the BHSD PERT Clinician during the duration of the MOU; q. Modify and enhance policies, procedures, and protocols for the PERT Program and information sharing process, as necessary; and r. The CITY shall work in conjunction with the PERT Clinician, to draft and submit a Monthly Program Narrative Report to County no later than seven (7) days after the end of each month. The Quarterly Narrative Report shall include a summary of the PERT Program’s performance goals, milestones achieved, and any issues/concerns encountered during the reporting period. ARTICLE 3 RELATIONSHIP OF PARTIES AND FINANCIAL REQUIREMENTS 3.1 Relationship of Parties. The COUNTY acknowledges and agrees that the work/services provided by the BHSD PERT Clinician under this MOU are performed as an independent contractor relative to the CITY. The BHSD PERT Clinician is part of the COUNTY workforce and will remain as employee of the COUNTY while providing services under this MOU. 3.2 Funding/Financial Responsibilities. Unless amended by the Board of Supervisors and the City of Palo Alto, the annual contribution of the COUNTY and CITY for Program expenses shall be as follows. a. The COUNTY shall provide the following funding/financial responsibilities: 1) The COUNTY shall pay, upfront, all personnel costs of the PERT Program (i.e., the fully weighted costs of salary, benefits, and any training for the BHSD PERT Clinician) in accordance with the COUNTY’s memorandum of understanding with the applicable bargaining unit. 2) The COUNTY shall procure and supply the BHSD PERT Clinician with a laptop and cellphone. The initial and on-going costs for such equipment, maintenance and/or replacement shall be incurred by the COUNTY. The COUNTY shall retain ownership of the property at the conclusion of the MOU term. 3) The COUNTY shall invoice the CITY for the previous month to pay for staff time, benefits, and any training as applicable. 4) The COUNTY is not obligated to provide services for which no reimbursement will be made when the CITY’s maximum financial obligation has been fully exhausted. Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 8  Packet Pg. 41 of 228  Page 5 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 b. The CITY shall provide the following funding/financial responsibilities: 1) The CITY will reimburse the COUNTY for all personnel costs of the PERT Program (i.e., the fully weighted costs of salary, benefits, and any training for the BHSD PERT Clinician, where, for FY26, the full cost for one full-time position is approximately $224k salary and $47k benefits) in accordance with the COUNTY’s memorandum of understanding with the applicable bargaining unit. 2) The CITY shall provide the BHSD PERT Clinician with \a fitted protective vest at its sole expense. 3) The CITY shall pay for related expenses such as registration, meal per diem, and lodging for any required attendance by the BHSD PERT Clinician to any conference, workshop, or training program(s) as agreed upon by the Parties pursuant to Section 2.1.e and Section 2.2.p above and section 3.2.c below. c. Both the COUNTY and CITY shall collaboratively determine what training, if any, is necessary during the duration of the MOU. 3.3 Staffing. The CITY shall be involved with the process of identifying one (1) COUNTY PERT Clinician who must be licensed to provide mental health services by appropriate State of California licensing authorities. a. If the identified COUNTY PERT Clinician has previously completed a previous City’s background investigation and fingerprinting requirements, the COUNTY PERT Clinician shall be allowed to work in full capacity as the identified COUNTY PERT Clinician for the new City pending their ability to complete and pass the newly assigned CITY’s background investigation and fingerprinting requirements. The CITY shall notify COUNTY when the CITY’s background investigation and fingerprinting requirements are complete for the COUNTY PERT Clinician. b. The CITY shall issue the COUNTY PERT Clinician basic tools to perform their duties and provide access to certain CITY facilities. c. The COUNTY PERT Clinician shall follow all CITY policies while performing services under this MOU. ARTICLE 4 MISCELLANEOUS PROVISIONS 4.1 Collaboration. Both the CITY and the COUNTY have jointly developed this MOU. The CITY and the COUNTY are committed to working together to achieve the stated project goals through monthly meetings designed to monitor and evaluate the project. The CITY and the COUNTY shall meet informally and as often as needed. 4.2 Record Retention. The CITY and COUNTY shall maintain all documents and records which demonstrate performance under this MOU for a minimum period of three (3) years, from the date of termination or completion of this MOU. Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 9  Packet Pg. 42 of 228  Page 6 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 4.3 Compliance with Non-Discrimination and Equal Opportunity Laws: The CITY and COUNTY shall comply with all applicable Laws concerning nondiscrimination and equal opportunity in employment and contracting, including but not limited to the following: Santa Clara County’s policies for contractors on nondiscrimination and equal opportunity; Title VII of the Civil Rights Act of 1964 as amended; Americans with Disabilities Act of 1990; the Age Discrimination in Employment Act of 1967; the Rehabilitation Act of 1973 (Sections 503 and 504); the Equal Pay Act of 1963; California Fair Employment and Housing Act (Gov. Code § 12900 et seq.); California Labor Code sections 1101, 1102, and 1197.5; and the Genetic Information Nondiscrimination Act of 2008. CITY and COUNTY shall not discriminate in the provision of services provided under this contract because of age, race, color, national origin, ancestry, religion, sex, gender identity, gender expression, sexual orientation, mental disability, physical disability, medical condition, political beliefs, organizational affiliations, or marital status. 4.4 California Public Records Act. The Parties are public agencies subject to the disclosure requirements of the California Public Records Act (“CPRA”). In the event either Party receives a CPRA request for records related to the PERT program the Parties shall collaborate to comply with the CPRA and to prevent disclosure of exempt records, such as medical or mental health records. 4.5 Records and Confidentiality. Records created by the BHSD PERT Clinician, even while operating in collaboration with CITY, shall be considered COUNTY records, free from the control and direction of any other party to this MOU. Such records will be subject to all federal, state, and local laws and regulations regarding the protection of client/patient privacy and confidentiality. Both Parties agree that all BHSD PERT Clinicians are COUNTY employees and shall follow the privacy requirements of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The BHSD shall train all BHSD PERT Clinicians on federal, state, and local policies and procedures with respect to the confidentiality, use and/or disclosure of protected health information of clients as necessary and appropriate for the BHSD PERT Clinicians to perform their functions. The BHSD shall provide BHSD PERT Clinicians with the appropriate Health System(s) policies and procedures, which are subject to change from time to time. The BHSD reserves the right to take appropriate action for violation of its policies; such action may include immediate termination of any BHSD PERT Clinician who violates Federal, State, or local law and policy. 4.6 Contract Execution. Unless otherwise prohibited by law or County policy, the parties agree that an electronic copy of a signed contract, or an electronically signed contract, has the same force and legal effect as a contract executed with an original ink signature. The term “electronic copy of a signed contract” refers to a transmission by facsimile, electronic mail, or other electronic means of a copy of an original signed contract in a portable document format. The term “electronically signed contract” means a contract that is executed by applying an electronic signature using technology approved by the County. This MOA may be executed in counterparts, and when each party has signed and delivered at least one such counterpart, each one shall be deemed an original. 4.7 Indemnification and Insurance a. Indemnification. In lieu of and notwithstanding the pro rata risk allocation, which might otherwise be imposed between the Parties pursuant to Government Code Section 895.6, the Parties agree that all losses or liabilities incurred by Party shall not Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 10  Packet Pg. 43 of 228  Page 7 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 be shared pro rata but, instead, COUNTY and CITY agree that, pursuant to Government Code Section 895.4, each of the Parties hereto shall fully indemnify and hold each of the other Parties, their officers, board members, employees, and agents, harmless from any claim, expense or cost, damage or liability imposed for injury (as defined in Government Code Section 810.8) occurring by reason of the negligent acts or omissions or willful misconduct of the indemnifying party, its officers, employees or agents, under or in connection with or arising out of any work, authority or jurisdiction delegated to such party under this MOU. No party, nor any officer, board member or agent thereof shall be responsible for any damage or liability occurring by reason of the negligent acts or omissions or willful misconduct of the other Parties hereto, their officers, board members, employees, or agents, under or in connection with or arising out of any work authority or jurisdiction delegated to such other Parties under this MOU. b. Insurance. Without limiting the indemnification of either party to this Agreement, each party shall maintain or cause to be maintained throughout the term of the Agreement the following insurance coverage: (i) a policy of commercial general liability with limits of liability not less than one million dollars ($1,000,000) per occurrence and two million dollars ($2,000,000) annual aggregate; (ii) a policy of automobile liability with limits of liability not less than one million dollars ($1,000,000) per occurrence and two million dollars ($2,000,000) annual aggregate (iii) a policy of workers’ compensation providing statutory coverage; and (iv) such other insurance or self-insurance as shall be necessary to insure it against any claim or claims for damages arising under the Agreement. Insurance afforded by a commercial general liability policy shall be endorsed to provide coverage to the other party of the Agreement as an additional insured. Each party to this Agreement shall provide a Certificate of Insurance certifying that coverage as required herein has been obtained. The requirements of this section may be satisfied by the provision of similar coverage through a self-insurance program. 4.8 Notices. All notices required under the terms of this MOU will be in writing and must be transmitted by electronic mail or deposited in the United States Mail, certified mail, return receipt requested, addressed to the parties as set forth below: COUNTY OF SANTA CLARA: CITY OF PALO ALTO: Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 11  Packet Pg. 44 of 228  Page 8 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 4.9 Miscellaneous provisions. a. No Agency. It is understood that each of the Parties operate independently from one another and cannot enter into agreements or contracts as agents of the other. It is expressly understood and agreed that none of the Parties are in any way or for any purpose an agent of each other related to this MOA. b. No Assignment. No party to this MOA can assign any portion of this MOA without the other Parties’ prior written consent, unless otherwise stated herein. c. Entire Agreement. This MOA contains the entire agreement of the Parties with respect to the matters contained herein, and each party acknowledges there were no other oral agreements, representations, warranties, or statements of fact made prior to or at the time of the signing of this Agreement. d. Severability. If any term or provision of this MOA is declared invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall remain in full force and effect. e. Waiver. Waiver by any Party of any portion of this MOA shall not constitute a waiver of the same or any other portion hereof. // // // // // // // Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 12  Packet Pg. 45 of 228  Page 9 of 9 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PALO ALTO AND THE COUNTY OF SANTA CLARA REGARDING THE PSYCHIATRIC EMERGENCY RESPONSE TEAM (PERT)JUSTICE AND MENTAL HEALTH COLLABORATION PROGRAM FOR FISCAL YEARS 2026 THROUGH 2030 By signing below, each agency approves the conditions set forth in this MOU as well as the submitted application and proposed project budget. “COUNTY” County of Santa Clara “CITY” City of Palo Alto, a Municipal Corporation and Charter City APPROVED AS TO FORM AND LEGALITY APPROVED AS TO FORM APPROVED: Item 5 Attachment A - MOA Between County of Santa Clara and City of Palo Alto for PERT Clinician, 2026 through 2030        Item 5: Staff Report Pg. 13  Packet Pg. 46 of 228  City Council Staff Report Report Type: CONSENT CALENDAR Lead Department: City Clerk Meeting Date: February 2, 2026 Report #:2601-5828 TITLE SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot Tub/Sauna Establishments) of Title 4 (Business Licenses and Regulations) (FIRST READING: January 12, 2025, PASSED 7-0) BACKGROUND The City Council heard this item on January 12, 2026 for a first reading and approved it on a 7-0 vote. No changes were made to the ordinance, and it is now before the City Council for a second reading. ATTACHMENTS Attachment A: Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot Tub/Sauna Establishments) of Title 4 (Business Licenses and Regulations) APPROVED BY: Mahealani Ah Yun, City Clerk Item 6 Item 6 Staff Report Item 6: Staff Report Pg. 1 Packet Pg. 47 of 228  NOT YET APPROVED 1 149_20251222_ts24 Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot Tub/Sauna Establishments) of Title 4 (Business Licenses and Regulations) The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and Declarations. The City Council finds and declares as follows: A. Massage establishments are primarily regulated in the Palo Alto Municipal Code at PAMC Chapter 4.54. The last major update to this chapter was in 2012. Chapter 4.54 is currently enforced primarily by the Palo Alto Police Department. B. Massage is also regulated in state law under the Massage Therapy Act, codified in the Business and Professions Code section 4600 et seq. The State Legislature enacted the Act in 2008. The Act was substantially amended in 2014 under AB 1147, and has been amended again in 2025 under AB 1504. C. Through this ordinance, the City desires to amend Chapter 4.54 in order to respond to the changes to the Act and codify existing practices. Foremost, this ordinance will result in the City no longer licensing individual massage technicians; instead, technicians must be certified by the California Massage Therapy Council (“CAMTC”). The CAMTC is the state- recognized body in charge of such certification and enacts statewide standards for training and certification. The CAMTC also approves massage schools in an effort to uphold training standards and prevent bad actors from opening degree mills. This update also ensures that local regulations stay current with industry standards and public health requirements, enhancing safety and professionalism. These updates also help address new trends, prevent illicit activities, and clarify licensing procedures for businesses. D. This ordinance also amends Chapter 4.56 (Hot Tub/Sauna Establishments) to remove existing permitting requirements. These establishments are already regulated by the County’s Department of Environmental Health. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 2  Packet Pg. 48 of 228  NOT YET APPROVED 2 149_20251222_ts24 SECTION 2. Chapter 4.54 (Massage Establishments) of the Palo Alto Municipal Code is hereby amended and restated in its entirety to read as follows: 4.54.010 Purpose and intent. In enacting this chapter, the City Council recognizes that massage therapy is a professional pursuit which can offer the public valuable health and therapeutic services, but that unless properly regulated, the practice of massage therapy and the operation of massage businesses may be associated with unlawful activity and pose a threat to the quality of life in the local community. It is the purpose and intent of this chapter to provide for the orderly regulation of offices and establishments providing massage therapy services, and to prevent and discourage the misuse of massage therapy as a front for human trafficking, prostitution, and related activities in violation of state law, all in the interests of the public health, safety, and welfare, by providing certain minimum building, sanitation, and operation standards for such businesses, and by requiring certain minimum qualifications for the operators and practitioners of such businesses. It is the further intent of this chapter to streamline local massage therapy permitting procedures, while still facilitating and advancing the ethical practice of massage therapy, by relying upon the uniform statewide regulations enacted by the Legislature in 2008 as Business and Professions Code Sections 4600 et seq., known as the Massage Therapy Act, as subsequently amended, and by restricting the commercial practice of massage in the city to those persons duly certified to practice by the California Massage Therapy Council formed pursuant to those statutes. 4.54.020 Definitions. For the purpose of this chapter, unless the context clearly requires a different meaning, the words, terms, and phrases set forth in this section shall have the meanings that are given them in this section: "Authorized massage professional" means a massage professional who is identified in a permit issued pursuant to this chapter as a person employed or retained by a massage establishment to practice massage. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 3  Packet Pg. 49 of 228  NOT YET APPROVED 3 149_20251222_ts24 "California massage therapy council" or "CAMTC" means the massage therapy organization formed pursuant to Business and Professions Code Section 4600 et seq. "CAMTC-certified massage professional" means any individual currently certified by the California Massage Therapy Council as a massage therapist or massage practitioner pursuant to Business and Professions Code Section 4600 et seq. "Compensation" means the payment, loan, advance, donation, contribution, deposit, exchange, or gift of money or anything of value. "Department" means the Chief of the Palo Alto Police Department or designee charged with the administration of this chapter. "Inspector" means the person or persons designated by the city to conduct any inspections required or permitted under this chapter. "Massage," "massage therapy," and/or "bodywork" for purposes of this chapter mean the skillful application of touch, including but not limited to, pressure, stroking, kneading, compression on or movement of the external surfaces of the body by a practitioner to produce increased awareness, relaxation, pain relief, injury rehabilitation, or neuromuscular reeducation. "Massage establishment" means any business that offers massage therapy, baths or health treatments including, but not limited to, aromatherapy, vapor, shower, electric tub, sponge, hot towels, mineral fermentation, sauna, steam or any other type of bath, involving massages or baths in exchange for compensation. Home-based massage businesses and businesses that provide mobile massage services are also considered to be massage establishments. For purposes of this chapter, the term "massage establishment" may be applied to include establishments which offer or advertise themselves as providing "relaxation" or "tanning" Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 4  Packet Pg. 50 of 228  NOT YET APPROVED 4 149_20251222_ts24 where the essential nature of the interaction between the employee and the customer involves "massage" as defined herein. The terms, names or phrases listed on business license or fictitious name application forms are not necessarily conclusive as to the nature of the business. "Owner" or "massage establishment owner" means any of the following persons: (1) The sole proprietor of a sole proprietorship operating a massage establishment. (2) Any general partner of a general or limited partnership that owns a massage establishment. (3) Any person who has a ten percent or greater ownership interest in a corporation that owns a massage establishment. (4) Any person who is a member of a limited liability company that owns a massage establishment. (5) All owners of any other type of business association that owns a massage establishment. "Operator" or "massage establishment operator" means any person who is an owner or manager of a massage establishment. "Mobile massage service" means the engaging in or carrying on of massage therapy for compensation at locations other than a massage establishment at a fixed location. "Patron" means an individual on the premises of a massage establishment for the purpose of receiving massage therapy. "Person" means any individual, firm, association, partnership, corporation, joint venture, limited liability company, or combination of individuals. "Reception and waiting area" means an area immediately inside the main entry door of the massage establishment dedicated to the reception and waiting of patrons or visitors of the massage establishment and which is not a massage therapy room or otherwise used for the provision of massage therapy services. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 5  Packet Pg. 51 of 228  NOT YET APPROVED 5 149_20251222_ts24 “School of massage” means any school or institution of learning that is recognized as an approved school pursuant to Business and Professions Code Division 2, Chapter 10.5 (known as the Massage Therapy Act), as may be amended. "Sole proprietorship" means a massage establishment where the owner owns one hundred percent of the business and has one or no other employees or independent contractors. "Visitor" means any individual not retained or employed by the massage establishment and not receiving or waiting to receive massage therapy services, but excluding law enforcement personnel or governmental officials performing governmental business. 4.54.030 Business registration required. The requirements of this chapter are in addition to any business registration and business tax requirements imposed pursuant to PAMC Chapters 4.60 and 2.37, respectively of this code. 4.54.040 Other permits and authorizations required. The requirements of this chapter are in addition to any permits or authorizations that may be required under other applicable laws including but not limited to the city's building, fire, zoning, and health regulations. 4.54.050 Exemptions. This chapter shall not apply to the following classes of individuals while engaged in the performance of the duties of their respective professions: (a) Physicians, surgeons, chiropractors, osteopaths, podiatrists, physical therapists, nurses, acupuncturists or any other person licensed to practice any healing art under the provisions of Division 2 (commencing with Section 500) of the Business and Professions Code when engaging in such practice within the scope of his or her license. This subsection (a) shall apply only to a person who meets the qualifications above and shall Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 6  Packet Pg. 52 of 228  NOT YET APPROVED 6 149_20251222_ts24 not extend to any other person, including by virtue of being a tenant, independent contractor, employee, or co-worker of the exempted person. (b) Trainers of any amateur, semi-professional, or professional athlete or athletic team, so long as such persons do not practice massage therapy as their primary occupation at any location where they provide such services in the city. (c) Barbers, estheticians, and cosmetologists who are duly licensed under the laws of the State of California, while engaging in practices within the scope of their licenses. This subsection (c) shall apply only to a person who meets the qualifications above and shall not extend to any other person, including by virtue of being a tenant, independent contractor, employee, or co-worker of the exempted person. (d) Individuals administering massages or health treatments involving massage to persons participating in single occurrence athletic, recreational, or educational events such as road races, track meets, triathlons, educational events, or conferences, provided that the event is open to the public or to a significant segment of the public such as employees of sponsoring or participating corporations, and the massage services are provided at the site of the event during, immediately preceding, or immediately following the event. (e) Individuals administering massages or health treatments involving massage to persons at a state-licensed “general acute care hospital” or other “health facilities” as defined by California Health and Safety Code section 1250 when employed or contracted at the direction of the hospital or health facility. (f) Somatic practitioners who use no physical touch of any kind at any time in their practice. (g) Enrolled students of a school of massage when they are performing massage within the city as part of a formal supervised internship or training program operated by the school, without compensation other than school credit, on the premises of a massage establishment duly authorized to operate pursuant to the terms of this chapter; and provided that the operator of the massage establishment has first notified the Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 7  Packet Pg. 53 of 228  NOT YET APPROVED 7 149_20251222_ts24 Department in writing of the name, residence address, and school of the students and the dates of the trainings. 4.54.060 CAMTC certification required. It is unlawful for any individual to practice massage therapy for compensation within the city unless that individual is a CAMTC-certified massage professional. 4.54.070 Reserved. 4.54.080 Massage establishment permit required—Prohibited conduct. (a) It is unlawful for any person to operate a massage establishment within the city without first obtaining a massage establishment permit from the Department. (b) It is unlawful for a massage establishment operator to employ or retain any person to practice massage therapy for compensation, or to allow any person to perform massage therapy for compensation on the premises of a massage establishment, unless that person is a CAMTC-certified massage professional and unless that person is identified as an authorized massage professional on the permit issued pursuant to this chapter. For purposes of this chapter, a massage establishment operator "employs or retains" a person to practice massage therapy for compensation when: (1) That person is a directly paid employee of the massage establishment; or (2) That person's association with a massage establishment is that of an independent contractor who receives compensation for massage therapy provided to patrons of the massage establishment; or (3) That person receives a referral of patrons from the massage establishment and, at any time before or after the referral, arranges in any way for compensation to flow to the massage establishment operator. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 8  Packet Pg. 54 of 228  NOT YET APPROVED 8 149_20251222_ts24 (c) It is unlawful for a massage establishment to operate under any name or conduct business under any designation not specified in the massage establishment permit issued pursuant to this chapter. (d) It is unlawful for a massage establishment to continue to operate following the sale or transfer of any interest in the massage establishment to a person who was not identified as an owner in the massage establishment permit application. 4.54.090 Permit application. The owners of the massage establishment shall file an application for a permit on a form provided by the Department. The application shall be accompanied by the fee established by the city's fee schedule. The application shall include the following information: (a) The name, address, and telephone number of the massage establishment. (b) The name, residence address and telephone number, and business address and telephone number of each owner of the massage establishment. (c) The form of business under which the applicant will be conducting the massage `establishment, i.e., corporation, general or limited partnership, limited liability company, or other form. If the applicant is a corporation, the name of the corporation shall be set forth exactly as shown in its articles of incorporation, together with the names and residence addresses of each of its officers, directors, and each shareholder holding more than ten percent of the stock of the corporation. If the applicant is a general or limited partnership, the application shall set forth the name and residence address of each of the partners, including limited partners. If one or more of the partners is a corporation, the provisions of this section pertaining to a corporate applicant shall apply. If the applicant is a limited liability company, the application shall set forth the name and residence address of each of the members. If one or more of the members is a partnership, limited liability company, or corporation, the provisions of this section pertaining to a partnership, limited liability company, or corporate applicant shall apply, as applicable. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 9  Packet Pg. 55 of 228  NOT YET APPROVED 9 149_20251222_ts24 (d) The name, address, and telephone number of the owner of the real property upon, in, or from which the certified massage establishment is to be operated. In the event the applicant is not the legal owner of the property, the application shall be accompanied by a copy of any written lease between the applicant and the property owner authorizing use of the premises for a massage establishment, or, alternatively, if there is no written lease, then a written, notarized acknowledgment from the property owner that the property owner has been advised that a massage establishment will be operated by the applicant upon, in, or from the property owner's property. (e) If the massage establishment will be located on a property in a residential or commercial condominium or other common interest development, the applicant shall submit a notarized statement from the homeowner's association or condominium owner's association acknowledging that the association has been advised that a massage establishment will be operated by the applicant and that such use of the property is allowed by the property's covenants, codes, and restrictions. This requirement is in addition to any applicable zoning code requirements or regulations. (f) A description of the proposed massage establishment, including the type of treatments to be administered. (g) The name of each individual who the massage establishment employs or retains to perform massage therapy for compensation, whether on or off the massage establishment premises. (h) The name of each individual who is regularly employed or retained by the massage establishment to perform services on the premises other than massage therapy, and the nature of their services. (i) For each individual who the massage establishment does or will employ or retain to perform massage therapy for compensation, whether on or off the massage establishment premises, a copy of that individual's current certification from the CAMTC as a certified massage practitioner or certified massage therapist, and a copy of his or her current CAMTC-issued identification card. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 10  Packet Pg. 56 of 228  NOT YET APPROVED 10 149_20251222_ts24 (j) For each owner of the massage establishment who is a CAMTC-certified massage professional, a copy of his or her current certification from the CAMTC as a certified massage practitioner or as a certified massage therapist and a copy of his or her current CAMTC-issued identification card. (k) For each owner of the massage establishment who is not a CAMTC-certified massage professional, the following information: (1) Whether any owner of the massage establishment has within the five years immediately preceding the date of application been convicted of any felony in any state. (2) Whether any owner of the massage establishment is currently required to register under the provisions of Section 290 of the California Penal Code. (3) The business, occupation, and employment history of each owner of the massage establishment for five years preceding the date of application, and the inclusive dates of same. (4) One set of fingerprints, and any required fee for such fingerprinting shall be paid by the applicant. (l) Whether any certificate, license or permit has ever been issued to the applicant by any jurisdiction under the provisions of any ordinance or statute governing massage or somatic practice, and as to any such certificate, license or permit, the name and address of the issuing authority, the effective dates of such certificate, license or permit, whether such certificate, license or permit was ever suspended, revoked, withdrawn, or denied; and copies of any documentary materials relating to such suspension, revocation, withdrawal, or denial. (m) Such other information as may be required by the permit authority to determine compliance with any other eligibility requirements for issuance of the permit as specified by federal, state, or local law. (n) A statement that within the last five years the applicant has not failed to comply with a final court order or administrative action of an investigatory agency finding a violation of Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 11  Packet Pg. 57 of 228  NOT YET APPROVED 11 149_20251222_ts24 applicable federal, state and local wage and hour laws, including, but not limited to, the Federal Fair Labor Standards Act, the California Labor Code, and any local minimum wage ordinance or prevailing wage requirements. For purposes of this subsection, a final court order or administrative action is one as to which there is no pending appeal and the time for filing an appeal has passed. 4.54.100 Permit issuance. (a) The Department shall issue a massage establishment permit if the applicant meets the requirements of this chapter and no grounds for denial exist under Section 4.54.110. The Department may impose conditions on the permit consistent with this chapter and applicable law. (b) Notice to Property Owner. If the applicant is not the record owner of the property where the massage establishment is located, the Department may send a written notice to the property owner advising of the issuance of the permit and of the regulations applicable to the massage establishment. The Department may also provide the property owner with copies of any other notices or communications with the applicant sent at any time before or after issuance of the permit. (c) Term. A massage establishment permit issued pursuant to the terms of this chapter shall be valid for a term of one year from the date of issuance, and, unless suspended or revoked, must be renewed by the massage establishment operator annually so long as the massage establishment is operating within the city. (d) Insurance. Insurance coverage is a condition of receiving a permit and proof of such coverage is required. Unless specified otherwise by Department regulation, proof of liability insurance, or the equivalent, for not less than one hundred thousand dollars ($100,000) per massage therapist licensed, or to be licensed, at the massage establishment up to a maximum of one million dollars ($1,000,000) shall be required by the time of permit issuance. This requirement can be satisfied by insurance provided in the name of a massage therapist or the massage establishment. Coverage must be Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 12  Packet Pg. 58 of 228  NOT YET APPROVED 12 149_20251222_ts24 maintained for the entirety of the permit period. The Department may establish regulations governing insurance requirements that do not conflict with this section. 4.54.110 Permit denial. The Department may deny an application for a massage establishment permit on any of the following grounds: (a) The massage establishment, as proposed by the applicant, would not comply with the requirements of this chapter. (b) The massage establishment, as proposed by the applicant, would not comply with any applicable law, including, but not limited to the city's building, fire, zoning, and health regulations or regulations under the CAMTC. (c) The applicant has knowingly made any false, misleading or fraudulent statement of material fact in the application for a massage establishment permit. (d) Any owner of the massage establishment, within five years immediately preceding the date of filing of the application, has been convicted in a court of competent jurisdiction of any offense that relates directly to the operation of a massage establishment whether as a massage establishment owner or operator or as a person practicing massage for compensation, or as an employee of either; or has at any time been convicted in a court of competent jurisdiction of any felony the commission of which occurred on the premises of a massage establishment. (e) Any owner of the massage establishment is currently required to register under the provisions of Section 290 of the California Penal Code. (f) Any owner of the massage establishment, within five years of the date of application, has been convicted in a court of competent jurisdiction of any violation of Sections 266, 266a, 266e, 266f, 266g, 266h, 266i, 266j, 315, 316, 318, 647(b) of the California Penal Code, or conspiracy or attempt to commit any such offense, or any offense in a jurisdiction outside of the State of California that is the equivalent of any of the aforesaid offenses. (g) Any owner of the massage establishment has been subjected to a permanent injunction against the conducting or maintaining of a nuisance pursuant to Sections 11225 through Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 13  Packet Pg. 59 of 228  NOT YET APPROVED 13 149_20251222_ts24 11235 of the California Penal Code, or any similar provision of law in a jurisdiction outside the State of California. (h) Any owner of the massage establishment, within five years of the date of application, and as established by clear and convincing evidence, has engaged in acts prohibited under California Penal Code Sections 266, 266a, 266e, 266f, 266g, 266h, 266i, 266j, 315, 316, 318, 647(b). (i) Any owner of the massage establishment is an individual who has not attained the age of eighteen years. (j) Any owner of the massage establishment, within five years immediately preceding the date of filing of the application, has had a certificate, permit or license to practice massage for compensation or to own and/or operate a massage establishment revoked or denied in any jurisdiction, including CAMTC. (k) Any owner of the massage establishment currently owns or operates a massage establishment in the city of Palo Alto that is not in good standing due to the existence of uncorrected violations or unpaid fines or fees. (l) Within the last five years, the applicant has failed to comply with a final court order or administrative action of an investigatory agency finding a violation of applicable federal, state and local wage and hour laws, including, but not limited to, the Federal Fair Labor Standards Act, the California Labor Code, and any local minimum wage ordinance or prevailing wage requirements. For purposes of this subsection, a final court order or administrative action is one as to which there is no pending appeal and the time for filing an appeal has passed. 4.54.120 Notice of denial—Appeal. (a) If an application for a massage establishment permit is denied, the Department shall give written notice to the applicant specifying the grounds for denial. (b) The applicant may appeal the decision to deny a massage establishment permit by filing a written notice of appeal with the Department within fifteen days after deposit of the decision in the mail, specifying in detail the grounds for such appeal. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 14  Packet Pg. 60 of 228  NOT YET APPROVED 14 149_20251222_ts24 (c) The City Clerk shall set a time and place for the hearing on the appeal not less than thirty days after the date the appeal was received by the Department, and shall give written notice by mail to the applicant of the date, time, and place for the hearing. The hearing may be conducted virtually or by phone at the discretion of the City. The hearing shall be conducted in accordance with Section 4.54.180. (d) After the hearing on the appeal, the City’s hearing officer may refer the matter back to the Department for a new investigation and decision, may affirm the decision of the Department, or may direct the Department to issue the license. The decision of the hearing officer or designee upon such appeal shall be final and shall be subject to judicial review according to the provisions and time limits set forth in Code of Civil Procedure Section 1094.6. 4.54.130 Amendments to permit required upon change of information. (a) Within 14 days of a change of the information provided in the application for a certified massage establishment on file with the City, the operator shall file an application to amend the permit to reflect such change. An application to amend a massage establishment permit shall be made by submitting an application on a form provided by the Department. The application shall be accompanied by the fee established by the city's fee schedule. (b) The application shall not be approved unless the Department determines that the terms of the amended permit comply with all requirements of this chapter and all other local, state, and federal laws, and the massage establishment has no outstanding violations or unpaid citations or fees. Inspection of the massage establishment may be required prior to approval of the amendment. (c) An amendment shall not be used to change the location or owners of a massage establishment. Instead, a new permit application is required. (d) A denial of an application to amend a massage establishment permit may be appealed in the same manner as a denial of an application for a permit under Section 4.54.120. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 15  Packet Pg. 61 of 228  NOT YET APPROVED 15 149_20251222_ts24 4.54.140 Requirements for all massage establishment facilities and operations. (a) Operational Requirements. Except as otherwise specifically provided in this chapter, the following operational requirements shall be applicable to all massage establishments located within the city: (1) No massage establishment shall be kept open for business between the hours of ten p.m. of one day and eight a.m. of the following day. A massage begun any time before ten p.m. must nevertheless terminate at ten p.m. This restriction does not apply to the use of hot tubs at a massage establishment that also has hot tubs in compliance with PAMC Chapter 4.56, but must follow any other applicable law or condition of permit as to hours of operation. (A) After ten years of continuous operation, a massage establishment may be exempted from the hours restrictions of this section by the Department upon a written request which details the factual reasons supporting good cause for the exemption. The Department, in determining what constitutes good cause for this exemption from the hours restrictions, shall consider and weight the following factors: (i) ongoing compliance with this Chapter including updated review of permit requirements; (ii) the impact which the massage establishment has had on the health, safety, and welfare of the local community, including, but not limited to, parking and traffic congestion; and (iii) the massage establishment's compliance or noncompliance with all federal, state, and local laws, including, but not limited to, this municipal code. If, upon review of those factors, the Department determines that good cause does exist for the requested exemption, the Department may then exempt the massage establishment from the hours restrictions of this section. However, in no event shall any massage end later than midnight or begin earlier than six a.m. If the Department denies an application for an exemption under this subsection (A), the massage establishment may appeal under the process in PAMC section 4.54.120. The Department may revoke an exemption issued under this subsection (A) for the Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 16  Packet Pg. 62 of 228  NOT YET APPROVED 16 149_20251222_ts24 reasons stated in PAMC section 4.54.170 and such revocation is subject to hearing under PAMC section 4.54.180. (2) The hours of operation of the massage establishment shall be displayed in a conspicuous public place in the reception and waiting area and in any front window clearly visible from outside of the massage establishment. (3) Patrons and visitors shall be permitted in the massage establishment only during the hours of operation. (4) During the hours of operation, patrons shall be permitted in massage therapy rooms only if at least one duly authorized certified massage professional is present on the premises of the massage establishment. Patrons shall not be permitted in any employee break room on the premises. (5) During the hours of operation, visitors shall not be permitted in massage therapy rooms except as follows: (A) The parents or guardian of a patron who is a minor child may be present in the massage therapy room with that minor child; (B) The minor child of a patron may be present in the massage therapy room with the patron when necessary for the supervision of the child; or (C) The conservator, aid, or other caretaker of a patron who is elderly or disabled may be present in the massage therapy room with that elderly or disabled person. (6) During the hours of operation, except as otherwise provided herein, no visitors shall be permitted in massage therapy rooms, break rooms, dressing rooms, showers, or any other room or part of the massage establishment premises other than the reception and waiting area or toilet rooms. (7) Except for a patron who is inside a massage therapy room for the purpose of receiving a massage, no patrons or visitors shall be permitted in or on the massage establishment premises at any time who are less than fully clothed in outer garments of nontransparent material, or who display or expose themselves in underclothing or similar intimate apparel. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 17  Packet Pg. 63 of 228  NOT YET APPROVED 17 149_20251222_ts24 (8) A list of massage services available and the cost of such services shall be posted in an open and conspicuous public place on the premises. The massage services shall be described in English and may also be described in such other languages as may be convenient. No massage establishment operator shall permit, and no person employed or retained by the massage establishment shall offer to perform any massage services or request or demand fees other than those posted. (9) The massage establishment shall keep on the premises a complete and current roster of all owners, operators, and managing employees of the massage establishment and all massage professionals and other persons employed or retained by the massage establishment. The roster shall include the name, residence address, and phone number of each individual. The roster shall be available for inspection by city officials charged with the enforcement of this chapter. (b) Physical Facility and Building and Fire Code Requirements. Except as otherwise specifically provided in this chapter, the following physical facility and building code requirements shall be applicable to all massage establishments located within the city: (1) Main entry door and reception and waiting area required. One or more main entry door shall be provided for patron entry to the massage establishment, which shall open to an interior patron reception and waiting area immediately. All patrons and any persons other than individuals employed or retained by the massage establishment shall be required to enter and exit through the main entry door(s). Unless the massage establishment is a sole proprietorship or a home occupation with one or no other employees, the main entry door shall be unlocked at all times during business hours. (2) No massage establishment located in a building or structure with exterior windows fronting a public street, highway, walkway, or parking area shall block visibility into the interior reception and waiting area through the use of curtains, Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 18  Packet Pg. 64 of 228  NOT YET APPROVED 18 149_20251222_ts24 closed blinds, tints, or any other material that obstructs, blurs, or unreasonably darkens the view into the premises. (3) All interior doors, including massage therapy rooms or cubicles (but excluding individual dressing rooms, showers, and toilet rooms, storage/equipment rooms, offices for staff only, and rooms for hot tubs at massage establishments that are also a hot tub/sauna establishment in compliance with PAMC Chapter 4.56) shall be incapable of being locked and shall not be blocked to prevent opening. Draw drapes, curtain enclosures, or accordion-pleated closures in lieu of doors are acceptable on all inner massage therapy rooms or cubicles. (4) Minimum lighting equivalent to at least one forty-watt light shall be provided in each massage therapy room or cubicle. (5) A massage table or professional massage chair specifically designed for seated massage shall be used for all massage therapy, with the exception of "Thai," "Shiatsu," and similar forms of massage therapy, which may be provided on a padded mat on the floor, provided the patron is fully attired in loose clothing, pajamas, scrubs, or similar style of garment. Massage tables shall have a minimum height of eighteen inches. (6) Beds, floor mattresses, and waterbeds are not permitted on the premises of the massage establishment, and no massage establishment shall be used for residential or sleeping purposes, which may be shown by circumstantial evidence such as the presence of bedding, pillows, sleeping bags, suitcases, clothing, toiletries or other personal belongings, cooking appliances, utensils or food in excess of a business establishment's normal requirements. A massage establishment that is also a hot tub/sauna establishment in compliance with PAMC Chapter 4.56 may have beds or floor mattresses only in rooms used for hot tubs and shall not be used for massage or residential purposes. (7) All locker facilities that are provided for the use of patrons shall be fully secured for the protection of the patrons' valuables, and each patron shall be given control of the key or other means of access. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 19  Packet Pg. 65 of 228  NOT YET APPROVED 19 149_20251222_ts24 (8) The massage establishment shall comply with all applicable state and local building and fire codes as adopted in Title 16 of this code. (9) Any signage referring to the massage establishment located on or adjacent to the building housing the massage establishment must match the business name that is listed on the massage establishment permit. A massage establishment shall not have signage that refers to another business name. (c) Health and Safety Requirements. Except as otherwise specifically provided in this chapter, the following health and safety requirements shall be applicable to all massage establishments located within the city: (1) The massage establishment shall at all times be equipped with an adequate supply of clean sanitary towels, coverings, and linens. Massage table or chair shall be covered with a fresh, clean sheet or other clean covering appropriate to the equipment for each patron, just before the client arrives. After a towel, covering, or linen has been used once, it shall be deposited in a closed receptacle and not used again until properly laundered and sanitized. Towels, coverings, and linens shall be laundered either by regular commercial laundering, or by a noncommercial laundering process that includes immersion in water at least one hundred forty degrees Fahrenheit for not less than fifteen minutes during the washing or rinsing operation. Clean towels, coverings, and linens shall be stored in closed, clean cabinets when not in use. A certified massage professional engaged in the practice of mobile massage shall carry a sufficient quantity of clean and sanitary towels, sheets, and linens to comply with the requirements. (2) All massage therapy rooms or cubicles, wet and dry heat rooms, toilet rooms, shower compartments, hot tubs, and pools shall be thoroughly cleaned and disinfected as needed, and at least once each business day when the premises has been or will be open and such facilities in use. All bathtubs shall be thoroughly cleaned and disinfected after each use. (3) All liquids, creams, or other preparations used on or made available to patrons shall be kept in clean and closed containers. Powders may be kept in clean Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 20  Packet Pg. 66 of 228  NOT YET APPROVED 20 149_20251222_ts24 shakers. All bottles and containers shall be distinctly and correctly labeled to disclose their contents. When only a portion of a liquid, cream, or other preparation is to be used on or made available to a patron, it shall be removed from the container in such a way as not to contaminate the remaining portion. (4) No invasive procedures shall be performed on any patron. Invasive procedures include, but are not limited to: (A) Application of electricity that contracts the muscle; (B) Penetration of the skin by metal needles; (C) Abrasion of the skin below the nonliving, epidermal layers; (D) Removal of skin by means of any razor-edged instrument or other device or tool; (E) Use of any needle-like instrument for the purpose of extracting skin blemishes; and (F) Other similar procedures. (5) All bathrobes, bathing suits, and/or other garments that are provided for the use of patrons shall be either fully disposable and not used by more than one patron, or shall be laundered after each use pursuant to subsection (c)(1) of this section. (6) All combs, brushes, and/or other personal items of grooming or hygiene that are provided for the use of patrons shall be either fully disposable and not used by more than one patron, or shall be fully disinfected after each use. (7) All massage establishments must provide patrons with slip-resistant sandals or flip-flops to wear while in the shower compartment. All footwear such as sandals or flip-flops that are provided for the use of patrons either shall be fully disposable and not used by more than one patron, or shall be fully disinfected after each use. (8) Patrons' genitals and female patrons' breasts must be fully draped at all times while any individual employed or retained by the massage establishment is in the massage room or cubicle with the patron. No massage shall be provided to a Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 21  Packet Pg. 67 of 228  NOT YET APPROVED 21 149_20251222_ts24 patron that results in intentional contact, or occasional and repetitive contact, with the genitals or anal region of a patron. (9) No alcoholic beverages shall be sold, served, or furnished to any patron; nor shall any alcoholic beverages be kept or possessed on the premises of a massage establishment. A massage establishment that is also a hot tub/sauna establishment in compliance with PAMC Ch. 4.56 is not subject to this limitation for non-massage areas of the establishment, but must adhere to all other applicable laws, including any applicable zoning code provisions and California Department of Alcohol Beverage Control requirements. (d) Attire and Physical Hygiene Requirements. The following attire and physical hygiene requirements shall be applicable to all employees and any other persons who work permanently or temporarily on the premises of a massage establishment within the city, including, but not limited to, all persons who are employed or retained to practice massage for the massage establishment: (1) No person shall dress in: (A) Attire that is transparent, see-through, or substantially exposes the person's undergarments; (B) Swim attire, unless providing a water-based massage modality approved by the CAMTC; (C) A manner that exposes the person's chest, breasts, buttocks, or genitals; (2) No massage establishment operator, employee, or visitor shall, while on the premises of a massage establishment or while performing any mobile massage service, and while in the presence of any patron, customer, employee or visitor, expose his or her chest, breast, buttocks, or genitals. (3) All persons shall thoroughly wash their hands with soap and water or any equally effective cleansing agent immediately before providing massage to a patron. No massage shall be provided upon a surface of the skin or scalp of a patron where such skin is inflamed, broken (e.g., abraded or cut), or where a skin infection or eruption is present. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 22  Packet Pg. 68 of 228  NOT YET APPROVED 22 149_20251222_ts24 (e) Display of Permit and Certifications. (1) The massage establishment permit shall be displayed in an open and conspicuous place on the premises visible from the main entry door and/or reception and waiting area of the massage establishment. (2) Each person employed or retained by a massage establishment to perform massage in or on the premises or through a mobile massage service shall display on his or her person the valid current photograph-bearing identification card issued to that employee by the CAMTC. A copy of each such identification card and the person's original CAMTC certificate shall also be displayed in an open and conspicuous place visible from the main entry door and/or reception and waiting area of the massage establishment. The home address of any employee need not be displayed. If a massage establishment has more than 25 massage therapists and can demonstrate to the Department it is not reasonably practical to display a copy of each identification card and original CAMTC certificate as required above, then the massage establishment may request from the Department an alternative method of displaying copies of identification cards and CAMTC certificates. Such alternatives may only be approved in writing and shall comply with any applicable state law requirements. (f) Display of Human Trafficking Notices. The massage establishment shall comply with the requirements in California Civil Code Section 52.6 related to the posting of information for victims of human trafficking. (g) Home Occupation and Mobile-Only Businesses—Exemptions. (1) Where a certified massage establishment is a home occupation, and the operator has complied with the provisions of Section 18.42.010 of this code pertaining to home occupations, the provisions of subsections (a)(2), (b)(1)—(3), and (b)(6) of this section shall not apply, and the portions of the residence subject to the requirements of subsections (b) and (c) of this section shall be only those portions that are used at any time by the patron of the massage establishment. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 23  Packet Pg. 69 of 228  NOT YET APPROVED 23 149_20251222_ts24 (2) For massage establishments that provide mobile-only services and have no fixed location for performing massage, provisions of this section related to businesses with fixed locations shall not apply. Specifically, the provisions of subsections (a)(2)—(9), (b)(1)—(4), (b)(6)—(8), (c)(2) and (7), (e)(1), and (f) of this section shall not apply to mobile-only establishments. 4.54.150 Massage establishment inspections. (a) As a condition of the massage establishment permit, investigating officials of the Department shall have the right to enter any massage establishment, other than an establishment providing mobile only services, during regular business hours, to make reasonable inspection to ascertain whether there is compliance with the provisions of this chapter. For home occupations, reasonable inspection shall be limited to the portions of the residence open to patrons. (b) The massage establishment operator shall take immediate action to correct each violation noted by the inspector. A reinspection will be performed to ensure that each violation noted by the inspector has been corrected. 4.54.160 Reserved. 4.54.170 Revocation or suspension. All massage establishment operators shall be deemed to know and understand the requirements and prohibitions of this chapter. Any massage establishment permit issued pursuant to this chapter may be suspended or revoked by the Department after a hearing, where the Department finds that any of the following have occurred on even a single occasion: (a) The permittee or any person employed or retained by the massage establishment has violated any provision of this chapter. (b) The permittee or any person employed or retained by the massage establishment has been convicted in a court of competent jurisdiction of having violated, or has engaged in conduct constituting a violation of, any of the following: California Penal Code Sections 266, 266a, 266e, 266f, 266g, 266h, 266i, 266j, 315, 316, 318, 647(b), or conspiracy or Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 24  Packet Pg. 70 of 228  NOT YET APPROVED 24 149_20251222_ts24 attempt to commit any such offense, or any offense in a jurisdiction outside of the State of California that is the equivalent of any of the aforesaid offenses. (c) The permittee or any person employed or retained by the massage establishment is required to register under Section 290 of the California Penal Code. (d) The permittee has been subject to a permanent injunction against the conducting or maintaining of a nuisance pursuant to this code, or Sections 11225 through 11235 of the California Penal Code, or any similar provision of law in any jurisdiction outside the State of California. (e) The permittee or any person employed or retained by the massage establishment has engaged in fraud or misrepresentation or has knowingly made a misstatement of material fact while working in or for the massage establishment as it pertains to the massage establishment. (f) The permittee has continued to operate the massage establishment after the massage establishment permit has been suspended. (g) Massage has been performed on the premises of the massage establishment, with or without the permittee's actual knowledge, by any person who is not a duly authorized CAMTC-certified massage professional. (h) A person who is not a duly authorized CAMTC-certified massage professional has provided mobile massage services through or on behalf of the massage establishment. (i) There have been one or more acts prohibited under California Penal Code Sections 266, 266a, 266e, 266f, 266g, 266h, 266i, 266j, 315, 316, 318, or 647(b), taking place on the premises of the massage establishment, whether or not any criminal prosecution has been pursued or conviction obtained for such acts, and whether or not they occurred with or without the actual knowledge of the permittee. (j) The permittee or any person employed or retained by the massage establishment or any other person on the premises of the massage establishment has engaged in conduct or committed acts that a reasonable person in the patron's position would understand as an offer to perform on or engage in with the patron acts that are sexual in nature or that involve touching of the patron's genitals, or anal region. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 25  Packet Pg. 71 of 228  NOT YET APPROVED 25 149_20251222_ts24 (k) The permittee or any person employed or retained by the massage establishment has engaged in sexually suggestive advertising related to massage services available at the massage establishment, including, but not limited to displaying photographs of individuals clothed in swim attire, or attire that is transparent, see-through or substantially exposes the individual's undergarments, breasts, buttocks, or genitals, describing massage services as "erotic," "sensual" or similarly sexual in nature, listing advertisements in any media (including online) intended for adults only, or describing the appearance or age of massage providers. (l) If the applicant has failed to comply with a final court order or administrative action of an investigatory agency finding a violation of applicable federal, state and local wage and hour laws, including, but not limited to, the Federal Fair Labor Standards Act, the California Labor Code, and any local minimum wage ordinance or prevailing wage requirements. For purposes of this subsection, a final court order or administrative action is one as to which there is no pending appeal and the time for filing an appeal has passed. In addition, any disciplinary action taken by CAMTC shall be considered in determining grounds for revocation, suspension or nonrenewal. 4.54.180 Hearing for revocation or suspension. (a) The Department shall give written notice of a hearing for the revocation or suspension of any permit granted pursuant to this chapter to the permittee. The notice shall set forth the time and place of the hearing, the ground or grounds upon which the hearing is based, the pertinent code sections, and a brief statement of the factual issues in support thereof. The notice shall be mailed, postage prepaid, addressed to the permittee at the last known address of the permittee, or it shall be delivered to the permittee personally, at least ten days prior to the hearing date. (b) Within ten days of the hearing the Department shall render its decision in writing, stating its findings and the action taken, if any. The decision letter shall be mailed, postage prepaid, addressed to the permittee at the last known address of the permittee, or it shall be delivered to the permittee personally. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 26  Packet Pg. 72 of 228  NOT YET APPROVED 26 149_20251222_ts24 (c) Within ten days from the deposit of the decision letter in the mail or its receipt by the permittee, whichever occurs first, the permittee may appeal the decision in writing to the city manager or designee, setting forth with particularity the ground or grounds for the appeal. (d) The hearing officer shall give written notice of the hearing on the appeal not less than ten days from the date the appeal was received by the city. The hearing shall be conducted in accordance with Section 4.54.190. (e) After the hearing on the appeal, the hearing officer or designee may refer the matter back to the Department for a new investigation and decision, may affirm the decision of the Department, may dismiss the disciplinary action, or may revoke or suspend the permit. The decision of the hearing officer upon such appeal shall be final and shall be subject to judicial review according to the provisions and time limits set forth in Code of Civil Procedure Section 1094.6. (f) The notices provided to the massage establishment pursuant to this section may also be sent to the owner of the premises where the massage establishment is located. However, failure to provide notice to the property owner shall not invalidate any actions taken by the city. 4.54.190 Hearing rules. The following rules shall apply to any hearing required by this chapter. All parties involved shall have the right to offer testimonial, documentary, and tangible evidence bearing on the issues, to be represented by counsel, and to confront and cross-examine witnesses. Any relevant evidence may be admitted if it is the sort of evidence upon which reasonable persons are accustomed to rely in the conduct of serious affairs. Any hearing under this chapter may be continued for a reasonable time for the convenience of a party or witness. 4.54.200 Violations a public nuisance—Penalties, nuisance abatement, and other remedies. Any massage establishment operated, conducted, or maintained contrary to the provisions of this chapter shall be, and the same is hereby declared to be, unlawful and a public nuisance, and Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 27  Packet Pg. 73 of 228  NOT YET APPROVED 27 149_20251222_ts24 the city attorney may, in addition to or in lieu of prosecuting a criminal action hereunder, commence an action or actions, proceeding or proceedings, for the abatement, removal and enjoinment thereof, in the manner provided by law. Such remedies shall be in addition to any other judicial and administrative penalties and remedies available to the city under this code or under state law. (a) For the purpose of enforcing the requirements of this chapter, all owners and operators of the massage establishment shall be jointly and severally responsible for the conduct of all massage establishment employees, agents, independent contractors, or other representatives while such persons are on the premises of the massage establishment or providing mobile massage services on behalf of the massage establishment. (b) In addition to any other remedy available to the city under applicable law, a massage establishment permit may be suspended or revoked as provided in Sections 4.54.170 and 4.54.180. Upon issuance of a final order by the Department or Hearing Officer to revoke the massage permit, the massage establishment shall immediately cease operation, and, if so ordered by the hearing officer, no other massage establishment shall be permitted to operate at that location by any person for a period of not less than five years ("the moratorium period"). If the operator is not also the legal owner of the real property on which the massage establishment is situated, notice of such revocation and the five-year prohibition shall be provided by the permit authority to the owner of record of the property as shown on the latest county assessment roll. (c) In addition to any other remedy available to the city under applicable law, a massage establishment permit may not be renewed or amended unless and until all due and unpaid citations issued pursuant to this chapter are paid in full, and all outstanding violations have been corrected. (d) Notwithstanding any other provision of this chapter, where a Notice of Revocation or Suspension has been issued to the operator of a massage establishment pursuant to Section 4.54.180 of this chapter, the Department shall not process or grant an application for a massage establishment permit for a new massage establishment at the Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 28  Packet Pg. 74 of 228  NOT YET APPROVED 28 149_20251222_ts24 same premises unless and until such Notice of Revocation or Suspension is dismissed; or a final determination is made pursuant to that section that the current operator's massage establishment permit is not or should not be revoked; or any moratorium period imposed pursuant to this chapter has expired. 4.54.200 Administrative Citations and Penalties (a) Violations. Upon a finding by the City that a business has violated any provision of this chapter, the City may issue an administrative citation and/or compliance order resulting in administrative fines pursuant to PAMC Chapters 1.12 and 1.16. (b) Separate Violations. Each violation of any provision of this chapter shall constitute a separate violation. Each client to whom massage is provided or offered in violation of this chapter shall also constitute a separate violation. Each day upon which a massage business remains open for business in violation of this chapter shall also constitute a separate violation. (c) Outstanding Fines. All outstanding penalties resulting from administrative citations and/or compliance orders must be paid prior to the issuance or renewal of any registration. (d) Appeals. Appeals of administrative citations and compliance orders may be made pursuant to the appeal procedures in PAMC Chapters 1.12 and 1.16, respectively. SECTION 3. Chapter 4.56 (Hot Tub/Sauna Establishments) of the Palo Alto Municipal Code is hereby amended and restated in its entirety to read as follows: 4.56.010 Purpose and intent. It is the purpose and intent of this chapter to provide for the orderly regulation of hot tub/sauna establishments and hot tub/sauna establishment employees, as defined in this chapter in the interests of the public health, safety and welfare by providing certain minimum building, sanitation and health standards for hot tub/sauna establishments and by providing certain minimum standards and regulations regarding the conduct and activities of the owners and employees of hot tub/sauna establishments.Reserved. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 29  Packet Pg. 75 of 228  NOT YET APPROVED 29 149_20251222_ts24 4.56.020 Definitions. For the purpose of this chapter, unless the context clearly requires a different meaning, the words, terms, and phrases set forth in this section shall have the meanings given them in this section: (a) "Hot tub/sauna establishment" means any establishment having a fixed place of business where any person, as defined in this section, for compensation, engages in, conducts, carries on or permits to be engaged in, conducted or carried on any of the following as the principal functions; provided, that any establishment wherein any employee provides any services defined as massage or adult entertainment by Sections 4.54.020 or 4.55.020 shall be licensed pursuant to the provisions of Chapters 4.54 or 4.55, respectively. (1) Where Russian, Turkish, Finnish, Swedish, hot air, vapor, electric cabinet, steam, mineral, sweat, salt, Japanese, sauna, fomentation, alcohol or baths of any kind whatsoever are furnished or made available; and/or (2) Where the public has access, on a rental basis, to private rooms or suites located within the establishment, in which are located or provided hot tubs, jacuzzis, saunas, showers, similar and/or related facilities, or any combination thereof. The term "hot tub/sauna establishment" does not include licensed hospitals, nursing homes, sanitaria, or individuals holding a valid certificate to practice the healing arts under the laws of the state of California, or individuals working under the direction of any such certificated persons. The term "hot tub/sauna establishment" does not include any type of a privately owned and operated health spa, gymnasium or exercise facility where the primary purpose of the establishment is the offering of exercise or physical fitness equipment and facilities to prospective patrons; even though such establishment may have, on its premises, facilities for hot baths, and/or hot tubs, jacuzzis, saunas and related facilities for the incidental use of patrons. (b) "Hot tub/sauna establishment employee" means every owner, partner, manager, supervisor, employee or any other person, whether paid or not, who renders personal services of any type in the operation of a hot tub/sauna establishment. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 30  Packet Pg. 76 of 228  NOT YET APPROVED 30 149_20251222_ts24 (c) "License" means the license to operate a hot/tub sauna establishment as required by this chapter. (d) "Permit" means the permit to engage in the activities of a hot tub/sauna establishment employee as required by this chapter. (e) "Person" means any individual, partnership, firm, association. joint venture, corporation. or combination of individuals. Whenever, in this chapter, the singular form of any of the terms defined in this section is used, the same includes the plural form of such term. 4.56.030 Hot tub/sauna establishment County license required. It is unlawful for any person to engage in, conduct or carry on, in or upon any premises within the city the operation of a hot tub//sauna establishment without the any applicable valid license(s) or permit(s) required by and obtained from the chief of police as required by this chapter. A. hot tub/sauna establishment license the County of Santa Clara. shall be issued to any person who has complied with the requirements of Sections 4.56.050 and 4.56.110, and all applicable provisions of the code; unless grounds for denial of such license are found to exist. In addition to those set forth in Section 4.04.140, grounds for denial shall include: (a) The applicant made a material misstatement in the application for a license; (b) The applicant has, within five years immediately preceding the date of the filing of the application, been convicted in a court of competent jurisdiction of an offense involving conduct which requires registration under California Penal Code Section 290, or any violations of Sections 311 through 311.7, 313.1, 314, 315, 316, 318, or 647(a), 647(b), 647(d), or 647(h) of the California Penal Code, or of any offense involving theft of property or violence; (c) That the operation of a hot tub/sauna establishment, as proposed by the applicant, if permitted, would not comply with all applicable laws including, but not limited to, all city ordinances and regulations; (d) That the operation of the proposed hot tub/sauna establishment is likely to be injurious to the health, safety and welfare of the people of the city; Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 31  Packet Pg. 77 of 228  NOT YET APPROVED 31 149_20251222_ts24 (e) That the applicant is lacking in the background and qualifications to conduct a bona fide hot tub/sauna establishment; or (f) That the applicant has violated any provision of this chapter, or of any similar ordinance, law, rule or regulation of another public agency which regulates the operation of hot tub/sauna or related establishments. 4.56.040 Hot tub/sauna establishment license application fee. Any application for a license to operate a hot tub/sauna establishment shall be accompanied by a nonrefundable fee as set forth in the municipal fee schedule. The application fee shall be used to defray, in part, the costs of investigation and report, and is not made in lieu of any other fees or taxes required under this code. A license to operate a hot tub/sauna establishment shall be renewed annually. The renewal fee shall be as set forth in the municipal fee schedule. Reserved. 4.56.050 Application for hot tub/sauna establishment license. Any application for a license to operate a hot tub/sauna establishment shall be made with the chief of police. Within thirty working days following receipt of a completed application, the chief of police shall either issue the permit or mail a written statement of his reasons for denial thereof. The application shall set forth the exact nature of the hot tub/sauna operations or activities to be conducted, the proposed place of business and facilities therefor, and the name and address of each applicant. In addition to the requirements of Chapter 4.04 and this section, any applicant shall furnish the following information: (a) The previous address of applicant, if any, for a period of three years immediately prior to the date of the application and the dates of residence at each; (b) Written proof that the applicant is at least eighteen years of age; (c) Applicant's height, weight, color of eyes and hair; Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 32  Packet Pg. 78 of 228  NOT YET APPROVED 32 149_20251222_ts24 (d) The applicant shall allow the police department official processing the application to take photographs and fingerprints of the applicant; (e) Business, occupation or employment history of the applicant for the three years immediately preceding the date of the application; (f) If the applicant is a corporation, the name of the corporation shall be set forth exactly as shown in its articles of incorporation, together with the names and residence addresses of each of its officers, directors, and each stockholder holding more than five percent of the stock of the corporation. If the applicant is a partnership, the application shall set forth the name and residence address of each of the partners, including limited partners. If one or more of the partners is a corporation, the provisions of this section pertaining to a corporate applicant shall apply; (g) The names and residence addresses of all persons currently employed or intended to be employed in the hot tub/sauna establishment, regardless of the nature of the employment, other than any person licensed pursuant to Section 4.56.060, along with the proposed or actual nature of the work performed or to be performed, and recent passport-size photographs, suitable to the police department official processing the application, of each such employee. All such employees shall be requested to obtain the permit specified in Section 4.56.060. Any applicant or licensee shall notify the city in writing of the names, addresses, and nature of the work, of any new or proposed employees, and supply the photographs described in this subsection upon determining to employ such person. No such person shall commence such employment until a permit has been obtained as specified in Section 4.56.060. "Employee" means "hot tub/sauna establishment employee" as defined herein. It shall be unlawful for any licensee to employ any hot tub/sauna establishment employee who does not possess a valid permit provided for in Section 4.56.020. Any licensee shall notify the chief of police in writing of the termination of employment of any employee, whether terminated by the licensee or employee, within five days of such termination; (h) Such other information as may be deemed necessary by the chief of police. Reserved. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 33  Packet Pg. 79 of 228  NOT YET APPROVED 33 149_20251222_ts24 4.56.060 Hot tub/sauna establishment employee permit required. It is unlawful for any person to act as a hot tub/sauna establishment employee unless such person holds a valid permit issued by the chief of police. A hot tub/sauna establishment employee permit shall be issued to any person who has fulfilled the requirements of Section 4.56.080, and all other applicable provisions of this code; unless grounds for denial of such permit are found to exist. In addition to those set forth in Section 4.04.140, grounds for denial shall include: (a) The applicant made a material misstatement in the application for the permit; (b) The applicant, within five years immediately preceding the date of the filing of the application, has been convicted in a court of competent jurisdiction of any offense involving conduct which requires registration under California Penal Code Section 290, or any violation of Sections 311 through 311.7, 313.1, 314, 315, 316, 318 or 647(a), 647(b), 647(d), or 647(h) of the California Penal Code or of any offense involving theft of property; (c) The issuance of the permit is likely to be injurious to the health, safety, welfare, and interest of the people of the city; (d) The applicant has previously violated any provision of this chapter, or of any similar ordinance, law, rule or regulation of another public agency which regulates the operation of hot tub/sauna establishments or hot tub/sauna establishment employees; (e) The applicant is under eighteen years of age. Reserved. 4.56.070 Hot tub/sauna establishment employee application fee. Any application for a permit to act as hot tub/sauna establishment employee shall be accompanied by a nonrefundable fee as set forth in the municipal fee schedule. A hot tub/sauna establishment employee permit shall be renewed annually. The renewal fee shall be as set forth in the municipal fee schedule. Any person who applies for a license to operate a hot tub/sauna establishment and who desires to act as a hot tub/sauna establishment employee within said establishment shall not be required to pay the fee required by the municipal fee schedule, but shall be required to furnish the information set forth in Section 4.56.080. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 34  Packet Pg. 80 of 228  NOT YET APPROVED 34 149_20251222_ts24 Reserved. 4.56.080 Application for hot tub/sauna establishment employee permit. Any application for a permit to act as a hot tub/sauna establishment employee shall be made with the chief of police. Within thirty working days following receipt of a completed application, the chief of police shall either issue the permit, or mail a written statement of his reason for denial thereof. The chief of police may require the applicant to allow fingerprints to be taken. In addition to the requirements of Chapter 4.04, the applicant shall furnish the following information: (a) Name, residence address and telephone number; (b) Social security number and driver's license number if any; (c) Applicant's weight, height, color of hair and eyes; (d) The applicant shall furnish a recent photograph of applicant to the police department official who processes the application; (e) Written evidence that the applicant is at least eighteen years of age; (f) Business, occupation or employment of the applicant for the three years immediately preceding the date of application; (g) The name and address of the establishment where the applicant is to be employed, and the name of the owner or operator of the same. Any hot tub/sauna establishment employee granted a permit pursuant to this section must report any change in hot tub/sauna establishment employment within five days of said change; (h) Whether such person has ever been convicted of any crime mentioned in Section 4.56.060. If any person has been so convicted, a statement must be made giving the place and court in which said conviction was had, the specific charge or charges under which the conviction was obtained, and the sentence imposed as a result of such conviction; (i) Such other information as may be deemed necessary by the chief of police. Reserved. 4.56.090 Appeal. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 35  Packet Pg. 81 of 228  NOT YET APPROVED 35 149_20251222_ts24 In the event a permit or license application has been denied, the applicant shall proceed pursuant to the appeal and hearing provision of Chapter 4.04. Reserved. 4.56.100 Hot tub/sauna establishment and operations requirements. All hot tub/sauna establishments shall comply with the following facilities and operations requirements and each of the requirements listed in this section shall be conditions of any hot tub/sauna establishment license which is issued pursuant to the requirements of this chapter: (a) Hot tub/sauna establishments shall comply with all applicable provisions of this code and with all applicable health and sanitation laws, rules and regulations of the county of Santa Clara and state of California. (b) Toilet and lavatory facilities shall be provided for employees and patrons of a hot tub/sauna establishment in a number and type not less than the minimum number and type specified in the applicable code section for such type of use. (c) A manager or other supervisory representative of the licensee shall be and remain on the premises of the licensed hot tub/sauna establishment at all times during the operating hours of the establishment. The licensee shall furnish the chief of police with a list of all persons authorized by licensee to act as manager or representative of the licensee. Any change in said list shall be reported to the chief of police immediately. (d) All suites and rooms within hot tub/sauna establishments, for the use of patrons, shall be provided with clean laundered sheets, towels and linens in sufficient quantities which shall be laundered between consecutive uses thereof and stored in an approved sanitary manner. The same sheets, towels and linens shall not be used in excess of one rental period. No sheets, towels or linens shall be laundered or dried in any hot tub/sauna establishment unless such establishment is provided with approved laundry facilities comparable to commercial laundering facilities, for such laundering and drying. Approved receptacles shall be provided for the storage of soiled sheets, linens, and towels. Heavy white paper may be substituted for sheets; provided that such paper is used once for each person and then discarded into a sanitary receptacle. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 36  Packet Pg. 82 of 228  NOT YET APPROVED 36 149_20251222_ts24 (e) All walls, ceilings, floors, pools, showers, bathtubs, hot tubs, jacuzzis, saunas, steam rooms, and all other physical facilities within the establishment must be in good repair and maintained in a clean and sanitary condition. Wet and dry heat rooms, steam or vapor rooms, or steam or vapor cabinets, shower compartments, bathrooms, toilet rooms, saunas, jacuzzis, hot tubs, and individual suites shall be thoroughly cleaned and disinfected each day the business is in operation. Bathtubs (not including hot tubs) shall be cleaned and thoroughly disinfected after each use. Not more than one hot tub or similar water-holding device shall be operated from the same heating or filtering device or any similar mechanism unless each such hot tub or other similar device is capable of being emptied and refilled independent of any other hot tub. (f) The walls in all rooms where water or steam baths are given shall have a washable, mold- resistant surface. (g) All lavatories or wash basins shall be provided with hot and cold running water, soap and single-service towels in wall-mounted dispensers. (h) Cabinets or other covered space shall be provided for the storage of clean linen. (i) To protect patrons from potential health and sanitary hazards, all hot tub/sauna establishment employees shall be clean and shall perform all services on the premises in full, clean outer garments. (j) Security deposit facilities capable of being locked by the patron or a waterproof security bag that may be carried by the patron shall be available for the protection of the valuables of the patron. (k) Each service or facility offered, the price thereof, and the minimum length of time such service shall be performed shall be posted in a conspicuous public location within the hot tub/sauna establishment. If the hot tub/sauna establishment contains within it one or more individual rooms or suites, the hourly rental rate for such individual rooms or suites shall also be posted in a conspicuous public location, along with the minimum and maximum periods of time such individual rooms or suites can be rented. All letters and numbers shall be capitals, and not less than one-half inch in height. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 37  Packet Pg. 83 of 228  NOT YET APPROVED 37 149_20251222_ts24 (l) No mirrors of any type shall be placed at any location within or inside the hot tub/sauna establishment unless the approval of the chief of police has first been obtained; provided, however, that if the hot tub/sauna establishment is comprised of one or more individual rooms or suites, a small mirror, not more than three square feet in size, may be placed on the interior of such room or suite on the door leading from such individual room or suite into any interior hallway within such establishment, or such other comparable location not visible from the exterior of such individual room or suite when the door thereto is open as may be approved by the chief of police. (m) If the hot tub/sauna establishment is comprised of one or more individual rooms or suites which are rented to patrons, the interior of any such individual room or suite shall not be visible from any point outside the room or suite when the door leading from such individual room or suite into any interior hallway is closed. (n) No alcoholic beverages of any type shall be permitted to be brought into or consumed within or upon the premises or property of any hot tub/sauna establishment. (o) No nudity shall be permitted or allowed to occur in any interior hallways of the establishment, or in any other open patron area or areas located within the hot tub/sauna establishment. Nudity shall only be permitted or allowed within the confines of an individual room or suite located within the establishment and then only by the patrons who have rented such room or suite. (p) No individual under the age of eighteen years shall be allowed to enter into or to remain upon or within the premises of any hot tub/sauna establishment unless such individual is accompanied by his or her parent or guardian. (q) All hot tub/sauna establishment employees, while on duty: (1) Shall remain fully clothed at all times; (2) Shall not remain inside any of the individual rooms or suites with any patrons of the establishment while the doors leading to the hallways from such rooms or suites are closed. Said doors shall remain closed at all times during which the individual room or suite is occupied and utilized by any patron; Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 38  Packet Pg. 84 of 228  NOT YET APPROVED 38 149_20251222_ts24 (3) Shall not perform, for compensation or otherwise, any type of personal services for the patrons of the establishment, which personal services consist of the touching of any part of the body of a patron with any part of the employee's body, or any implement utilized by an employee. (r) (1) Hot tub/sauna establishments shall close and remain closed from eleven p.m. to nine a.m. (2) After one year of operation, a hot tub/sauna establishment may be exempted from the hours restrictions of this section by the chief of police upon a written request which details the factual reasons supporting good cause for the exemption. The chief of police, in determining what constitutes good cause for this exemption from the hours restrictions, shall consider and weight the following factors: (A) The criteria outlined in Section 4.04.140 of Chapter 4.04; (B) The criteria outlined in Section 4.56.030 of this chapter; (C) The impact which the hot tub/sauna establishment has had on the health, safety, and welfare of the local community, including, but not limited to, parking and traffic congestion; (D) The hot tub/sauna establishment's compliance or noncompliance with all federal, state, and local laws, including, but not limited to, this municipal code. If, upon review of these factors, the chief of police determines that good cause does exist for the requested exemption, the chief may then exempt the particular hot tub/sauna establishment from the hours restrictions of this section. However, in no event shall any hot tub/sauna establishment close later than two a.m. nor open earlier than six a.m. (3) The exemption from the hours restrictions of this section shall be subject to review and renewal annually at the same time as the renewal of the underlying license and the same factual showing shall be made as that required for the initial exemption. The chief shall not grant an hours exemption unless said establishment has maintained the criteria specified in Section 4.56.100(r)(2). (s) No hot tub/sauna establishment shall be allowed in the following locations: (1) Within two hundred fifty feet of the exterior property limits of any public or private elementary school, junior high school or high school; Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 39  Packet Pg. 85 of 228  NOT YET APPROVED 39 149_20251222_ts24 (2) Within two hundred fifty feet of the exterior limits of any district where residential use is the principal permitted use, including all R and RM districts, O-S districts, and any P-C or P-F districts where the principal use permitted or maintained is residential; or (3) Within twelve hundred feet of the exterior property limits of any other premises lawfully occupied by a hot tub/sauna establishment or by any establishment subject to the provisions of Chapters 4.54 or 4.55, or any cardroom licensed pursuant to Chapter 4.52. Notwithstanding the provisions of this subdivision, subject to all other provisions of this chapter, a hot tub/sauna establishment license may be issued for an establishment located within twelve hundred feet of another hot tub/sauna establishment, an establishment subject to the provisions of Chapters 4.54 or 4.55, or any cardroom licensed pursuant to Chapter 4.52 if the applicant has obtained, and has in effect, a valid conditional use permit pursuant to Chapter 18.76 (Permits and Approvals). Application for a license under this chapter shall be made and processed prior to an application for a use permit. In the event it is determined that a license under this chapter would be issued for the provisions of this subdivision, the application for a use permit shall then be processed. A license under this chapter shall not be issued until completion of the use permit application process. In the case of such an application, the time limit for action on a hot tub/sauna establishment license application contained in Section 4.56.050 shall be automatically extended as necessary to follow processing of the use permit application. For the purpose of determining compliance with standard (3), as to, between and with respect to establishments lawfully in operation on the effective date of this section, priority between such existing establishments shall be assigned in accordance with the dates upon which said establishments commenced such lawful operations. In the event any dispute arises regarding said dates, the applicant shall have the obligation to establish the date on which he commenced lawful operation. Any hot tub/sauna establishment lawfully in operation on the effective date of this section shall, within sixty days of said date apply to the chief of police for a determination as to compliance with the provisions of this section. Said application shall be in such form as prescribed by the chief of police. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 40  Packet Pg. 86 of 228  NOT YET APPROVED 40 149_20251222_ts24 Any hot tub/sauna establishment legally existing on the effective date of this subsection and which is not in compliance with the provisions of this subsection shall comply with said provisions within three years of the effective date of this subsection; provided, however, that any such establishment which intends to in any way transfer ownership or alter or change the nature of any such hot tub/sauna establishment on or after the effective date of this subsection shall comply with the provisions of this subsection prior to such transfer, alteration or change. Any such use which at the expiration of said period is not in compliance with the provisions of this subsection shall at that time discontinue and abate its operation. Any hot tub/sauna establishment lawfully in operation upon the effective date of this subsection failing to comply with the provisions of this subsection shall be issued a limited-term license containing a statement on its face reciting such noncompliance and the date by which compliance must be accomplished, and that said license shall not be renewed beyond said date. All distances referred to in this subsection shall be measured between the closest points on the exterior property lines or area boundaries of the parcels or areas involved, except that when a hot tub/sauna establishment subject to the provisions of this section occupies one unit of a multi-unit structure located on a single parcel, distances shall be measured from the exterior boundaries of the unit so occupied. Reserved. 4.56.110 Inspection by officials. Any and all investigating officials of the city shall have the right to enter hot tub/sauna establishments from time to time during regular business hours to make reasonable inspections to observe and enforce compliance with building, fire, electrical, plumbing or other health safety regulations. A warrant shall be obtained whenever required by law. 4.56.120 Business name. No person licensed to operate a hot tub/sauna establishment shall operate under any name or conduct business under any designation not specified in the a County license(s). Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 41  Packet Pg. 87 of 228  NOT YET APPROVED 41 149_20251222_ts24 4.56.130 Business location change. Upon a change of location of a hot tub/sauna establishment, an application to the chief of police shall be made in the same form as an original application, and such application shall be granted, provided all applicable provisions of this code are complied with as in the case of an original application, and a change of location fee as set forth in the municipal fee schedule to defray, in part, the costs of investigation and report has been paid to the city. Reserved. 4.56.140 Sale or transfer of hot tub/sauna establishment interest. A sale or transfer of any interest in a hot tub/sauna establishment, which interest would be reported as required in this chapter upon application for a hot tub/sauna establishment license, shall be reported to the chief of police within ten days of such sale or transfer. The chief of police shall investigate any person receiving any interest in a hot tub/sauna establishment as a result of such sale or transfer, and if such person satisfies the requirements relating to hot tub/sauna establishment license applicants, the existing license shall be endorsed to include such person. A fee as set forth in the municipal fee schedule shall be paid to the city for the investigation by the chief of police necessitated by each such sale or transfer. Reserved. 4.56.150 Display of permits, licenses. The owner or operator of a hot tub/sauna establishment shall display the hot tub/sauna establishment license and the permit of each and every hot tub/sauna establishment employee employed in the establishment in an open and conspicuous place on the premises. Passport- size photographs of the licensee and permittees shall be affixed to the respective license and permits on display pursuant to this section. Home addresses of hot tub/sauna establishment employees need not be displayed. Reserved. 4.56.160 Grounds for denial, probation, and disciplinary action. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 42  Packet Pg. 88 of 228  NOT YET APPROVED 42 149_20251222_ts24 In addition to any provisions contained in this chapter, the provisions of Section 4.04.140 shall apply to licenses and permits required under this chapter. Any circumstances constituting grounds for denial shall also constitute grounds for revocation, suspension or disciplinary action. Reserved. 4.56.170 Hearing. Any licensee or permittee whose license or permit has been suspended or revoked shall proceed pursuant to the appeal and hearing provisions of Chapter 4.04. Reserved. 4.56.180 Application to existing establishments and employees. All operators of existing hot tub/sauna establishments, and all hot tub/sauna establishment employees in the city upon the effective date of this chapter shall comply with all application and other requirements within thirty days following the effective date of this chapter. Reserved. 4.56.190 Application of other code provisions. Chapter 4.04 shall apply to the subject matter of this chapter in all respects, including those not specifically mentioned in this chapter. Reserved. 4.56.200 Employment of persons under the age of eighteen years prohibited. No licensee shall employ, hire or retain the services of any individual who is under the age of eighteen years old. No licensee shall knowingly employ, hire or retain the services of, or continue to employ or retain, any individual who has been convicted of any of the offenses set forth in subsection (b) of Section 4.56.060, or who has failed to obtain the permit required by Section 4.56.060. Reserved. Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 43  Packet Pg. 89 of 228  NOT YET APPROVED 43 149_20251222_ts24 SECTION 4. If any section, subsection, clause or phrase of this Ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining portion or sections of the Ordinance. The Council hereby declares that it should have adopted the Ordinance and each section, subsection, sentence, clause or phrase thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid. SECTION 5. 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. SECTION 6. This ordinance shall be effective 31 days after adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ Assistant City Attorney City Manager ____________________________ Chief of Police Item 6 Attachment A - Ordinance of the Council of the City of Palo Alto Amending Chapter 4.54 (“Massage Establishments”) and Chapter 4.56 (Hot TubSauna Establishments) of Title 4 (Business Licenses and Regulations)        Item 6: Staff Report Pg. 44  Packet Pg. 90 of 228  City Council Staff Report Report Type: ACTION ITEMS Lead Department: City Clerk Meeting Date: February 2, 2026 Report #:2512-5593 TITLE Approval of FY 2026 Architectural Review Board, Historic Resources Board, Planning and Transportation Commission, and Utilities Advisory Commission Work Plans; CEQA status– not a project RECOMMENDATION The Architectural Review Board, Historic Resources Board, Planning and Transportation Commission, and Utilities Advisory Commission recommend approval of their respective Fiscal Year 2026 Work Plans. BACKGROUND This item was originally scheduled on the Consent Calendar of the September 29, 2025 City Council Meeting and was pulled for further discussion as an Action Item. On November 30, 2020, the City Council adopted the Boards, Commissions and Committees (BCC) Handbook1, which implemented an annual review and approval of BCC work plans. Each BCC is required to prepare an annual work plan for Council’s review and approval. The annual report should include the results of the prior year’s work plan and should consist of up to three priorities. When applicable, the City Council would like to see metrics of community involvement and participation in meetings and activities included in the work plan. Council may refer additional items to the BCC in response to new developments. If the BCC would like to add an issue for review after an annual work plan has been approved, a prompt request by the BCC Chair to the City Council is required and the item will then be addressed by the City Council as a whole. 1 Boards, Commissions, Committees Handbook: https://www.paloalto.gov/files/assets/public/v/4/city-clerk/board- and-commission-handbook.pdf Item 7 Item 7 Staff Report Item 7: Staff Report Pg. 1 Packet Pg. 91 of 228  At its December 2, 2024 meeting3, the City Council approved dividing BCC recruitments and work plan approvals into fall and spring cycles. Per the adopted schedule, work plans for the Architectural Review Board, Historic Resources Board, Planning and Transportation Commission, and Utilities Advisory Commission are before the City Council for consideration. City Council will consider work plans for the remaining BCCs (Human Relations Commission, Public Art Commission, Parks and Recreation Commission, and Storm Water Management Oversight Committee) in the spring. FISCAL/RESOURCE IMPACT Projects included in commission work plans ultimately require staff time and other City resources to complete. When possible, staff provide input to the commissions during work plan development to ensure the impact on staff time and resources is reasonable given staff workload and other competing priorities. STAKEHOLDER ENGAGEMENT Commission work plans are discussed publicly either at regular BCC meetings or retreats. ENVIRONMENTAL REVIEW Council action on this item is not a project as defined by CEQA because this is a continuing administrative activity that will not result in direct or indirect physical changes in the environment. CEQA Guidelines section 15378(b)(5). ATTACHMENTS Attachment A: 2025-2026 Architectural Review Board Work Plan Attachment B: 2025-2026 Historic Resources Board Work Plan Attachment C: 2025-2026 Planning and Transportation Commission Work Plan Attachment D: 2025-2026 Utilities Advisory Commission Work Plan APPROVED BY: Mahealani Ah Yun, City Clerk 3 City Council, December 2, 2024; Agenda Item #14; SR # 2409-3480 https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=83110&dbid=0&repo=PaloAlto Item 7 Item 7 Staff Report Item 7: Staff Report Pg. 2 Packet Pg. 92 of 228  Architectural Review Board 2025-2026 Workplan Staff Liaison: Steven Switzer, Historic Preservation Planner Lead Department: Current Planning, Planning and Development Services Division About the Board The Architectural Review Board is composed of five members, at least three of whom are architects, landscape architects, . Terms are for three years. See Palo Alto Municipal Code (PAMC) 2.21. Residency is not required. For the ARB webpage go to bit.ly/paloaltoARB. Boardmembers • • Kendra Rosenberg (Chair) • Marton Jojarth • Mousam Adcock • Yingxi Chen (Vice Chair) Mission Statement The Architectural Review Board reviews and makes recommendations to the Planning Director on the building design, site planning, landscape planning, massing and facades, material selection, lighting, signage and other related issues for most major truction including additions and renovations that alter the exterior building face. The type of buildings reviewed include multiple-family residential. In addition, the ARB is a resource as knowledgeable observers of many urban environments, to assist Palo Alto as it develops area plans to accommodate additional housing. , Chapter 18.76 under Section 18.76.020 as well as in Prior Year Accomplishments • See attached summary for more information. Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 3  Packet Pg. 93 of 228  PROJECT/GOAL 1: Review Planning applications for conformance with ARB Findings and Objective Standards BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED This is the Board's main mission and serves to ensure the City develops high quality projects -quality architecture HIGH PRIORITY LOWER PRIORITY COUNCIL-DIRECTED POLICY UPDATE N/A PROJECT/GOAL 2: Provide feedback to staff and Council on the creation of new guidelines, ordinances, and/or streetscapes, as directed by Council BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED The ARB has unique feedback to provide as a stakeholder as they have interest in approving the aesthetic environment of the City while also understanding constraints that architects/developers may come across when implementing standards being considered 25 HIGH PRIORITY LOWER PRIORITY COUNCIL-DIRECTED • Housing generation and feasibility. • Innovative housing structures (e.g., micro-units, intergenerational housing, aging adults, students and lower-income units, etc.) consistent with Housing Element Program 6.5. • Review and recommend aesthetic standards for Wireless Communication Facilities (WCFs) as part of an ongoing WCF Ordinance update. PROJECT/GOAL 3: Assist the City as it considers modifications to Objective Standards; Provide feedback based on research from projects as they go through the objective standards ministerial processes. Suggest ways to better address different housing typology. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED Streamline the objective standard review process and ensure that projects using the streamlined review process/objective -quality design standards the end of FY 2026; If 6 Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 4  Packet Pg. 94 of 228  PROJECT/GOAL 3: Assist the City as it considers modifications to Objective Standards; Provide feedback based on research from projects as they go through the objective standards ministerial processes. Suggest ways to better address different housing typology. HIGH LOWER COUNCIL-DIRECTED POLICY UPDATE • Modifications to South of Forest Area Coordinated Area Plan (SOFA) subjective development standards with objective standards consistent with Housing Element Program 3.7. • Modifications to address objective standards (18.24) based on review of several projects using the standards at Council’s direction. PROJECT/GOAL 4: Discuss specific Coordinated Area Plans/ streetscape improvements and provide comments that the ARB would recommend exploring/implementing. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED This project would enhance implementation of the City's Comprehensive Plan. ; coordination with long HIGH PRIORITY LOWER PRIORITY COUNCIL-DIRECTED POLICY UPDATE • San Antonio Road Area Plan • Downtown Housing Plan • California Avenue streetscape improvements • University Avenue streetscape improvements PROJECT/GOAL 5: Improve Coordination between the Architectural Review Board and other boards, commissions, and Council. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED Improved coordination between boards/commissions and council to get feedback from colleagues on other boards. ore coordinated feedback from the . • updates in the pending projects attachment on development proposals. • The ARB can appoint a representative to attend Council and PTC and to provide feedback HIGH PRIORITY LOWER PRIORITY COUNCIL-DIRECTED No Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 5  Packet Pg. 95 of 228  ARCHITECTURAL REVIEW BOARD ANNUAL REPORT PRIOR YEAR ACCOMPLISHMENTS AND ARB RECOMMENDATIONS FOR FISCAL YEAR 2025 ITEMS OF NOTE • The ARB reviewed roughly 100 projects for the 2025 Design Awards and selected six winners to recognize their contributions to Palo Alto. • The ARB provided a comprehensive review and made recommendations on updates to the objective standards to better address townhome style designs and modifications to SB 9 objective standards. This work was consistent with Goal 2 of the 24/25 Work Plan. • The ARB provided valuable feedback to assist Council with respect to Car Free Streets Implementation Plan, specifically for California Avenue Signage. Although not explicitly identified in the work plan, this work was consistent with Goal 3 of the 24/25 Work Plan. • The ARB provided valuable feedback to assist Council with respect to the Lighting and Bird Safe Glazing Ordinances, Parklet designs, El Camino Real Focus Area, and Housing Incentive Program (HIP) consistent with Goal 4 of the 24/25 Work Plan. • The ARB reviewed around 20 projects, including multi-family housing with below-market units, mixed-use developments, master sign programs, and retail modifications at Stanford Shopping Center, aligning with Goal 1 of the 24/25 Work Plan. APPLICATION REVIEW The ARB prides itself on its collaborative review process, where board member’s diverse perspectives enhance proposed projects and improve Palo Alto's built environment. Our oversight has made a significant impact, as shown in the renderings section of this report, comparing initial proposals to final designs. ADDRESS/PROJECT DESCRIPTION Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 6  Packet Pg. 96 of 228  ADDRESS/PROJECT DESCRIPTION 660 University Avenue Mixed Use (Office with Housing) El Camino Real Focus Area Ordinance Architecture Review Board Awards Award Program (Occurs every 5 years) 640 Waverley Street Mixed Use (Office with Housing) 164 Hamilton Avenue Façade 180 El Camino Real Delarosa Façade California Ave Signage Car Free Street improvements City Parking Garages Signage Exceptions 180 El Camino Real Cedar & Sage Façade 340 Portage Avenue Master Sign Program Additionally, several projects were submitted for preliminary review to gather early feedback from the ARB. This early input helped incorporate key programming and design changes, streamlining the formal application process. These projects including 540 University Avenue and 640 Waverley Street. ARB RECOMMENDATIONS TO COUNCIL Palo Alto Municipal Code (PAMC) Section 2.21.030 directs the Architectural Review Board to report annually our “concerns… with respect to the city’s plans, policies, ordinances and procedures as these affect the projects which the board reviews.” Our reviews are site specific, focusing on individual development proposals rather than broad policies. However, we evaluate each project in its physical and regulatory context—considering its impact on the neighborhood and its alignment with City policies, from the Comprehensive Plan to the various design guidelines. Because the ARB looks at many projects each year, and its board members have years of experience in Palo Alto, patterns emerge and specific areas of concern have been identified. Our comments this year are centered around the increasing importance of housing projects to the city. 1. Objective Design Standard Refinements. In our continuing response to recently enacted state legislation, Palo Alto previously adopted objective design review standards for housing projects, effectively eliminating architectural review on residential and mixed-use projects where objective standards can be met in order to streamline review of those applications. Several residential projects over the past years were townhouse type developments (3200 Park Boulevard, 739 Sutter Avenue, 420 Acacia, and 70 Encina). In our review, it was noted that some of the current standards focused more on larger multi-family buildings. Therefore, some aspects of townhouse style design were not fully addressed/accommodated for in the standards. Through an Ad Hoc committee we studied many local townhouse developments and have provided the planning department with recommendations to modify the Objective Design Standards to address townhome designs as well as larger multi-family designs. The ARB recommends that refinements be made to the objective standards based on implementation of the standards for a series of projects as well as with the recommendations from the ARB regarding modifications for townhome designs. 2. Coordinated Area Plans to Encourage Housing Development and Better Planning. • San Antonio Avenue: The San Antonio Avenue area is experiencing increasing residential development but our zoning regulations for the area are outdated and focused on commercial development, resulting in applicant uncertainty and long entitlement processes. The existing Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 7  Packet Pg. 97 of 228  one-story light industrial and commercial buildings will be substantially replaced in the coming decade. A coordinated area plan will allow us to consider larger issues such as transportation, neighborhood parks, city services, pedestrian/bicycle pathways, and integration with nearby developments in Mountain View as this area transforms. • Downtown Housing Plan: To increase housing, the downtown area needs revised standards to accommodate redevelopment of parking lots as to encourage housing additions while maintaining the vibrancy of the downtown area and its pedestrian friendly streetscape. • California Avenue: With State requirements as outlined in AB 2097 and Builder’s Remedy, the California Avenue area will experience more development then in the past. This area should have a coordinated area plan to better scope future development. 3. City Council/Planning Commission Communication. The Architecture Review Board has very little formal interaction with the City Council, the Planning Commission and the Historic Resources Board. Board members are forced to act on individual initiative to gain input from council members and other commissioners. Joint meetings with full boards are rarely productive; yet uncoordinated serial meetings leave commissioners unaware of feedback from colleagues on other boards. Applicants often feel that they are ‘running a gauntlet’ of approvals rather than facing a coordinated review. • Have staff continue to provide updates in the pending projects attachment on development proposals. • Take direct feedback from the ARB on reviewed projects up for Council approval where Council approval is required. The ARB can appoint a member to represent the board directly to the Council. • Request staff to schedule joint preliminary discussions between the ARB, PTC and HRB chairs/vice-chairs on projects of common interest. These ‘preliminary meetings’ would not be to review specifics of a project; rather they would serve to coordinate the review process between boards and planning staff. • Appoint HRB, PTC and Council liaisons to the ARB to facilitate open communication between boards and commissions and city council. ARB liaisons will provide a clear channel for passing information between reviewing bodies, enabling all board and commission and council members, as well as the general public, direct access to relevant information on a project-by-project basis. RENDERINGS Below are renderings of approved projects, showcasing the evolution from their initial proposal to designs with the incorporated ARB feedback. A summary of key design modifications made based on ARB feedback is also provided. 70 ENCINA AVE Initial Proposal: Final Design: Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 8  Packet Pg. 98 of 228  70 ENCINA AVE Incorporated Feedback: • Encouraged more usable landscaped area. • Encouraged the design to better address privacy between units, including views from the public parking lot into the units. • Consideration of material choices and how the project would be visually compatible to the adjacent Town and Country. 640 WAVERLEY STEET Initial Proposal: Final Design: Incorporated Feedback: • The ARB provided feedback to enhance an already well-designed project, resulting in improving its interface with the neighboring building at 636 Waverley Street through reduced concrete on the façade, a clearer and more efficient parking layout, and refined landscape planting with long- term maintenance details. • The project provides a good mixed-use development, integrating office and retail spaces on the ground floor with residential units on the upper floors. Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 9  Packet Pg. 99 of 228  3265 EL CAMINO REAL Initial Proposal: Final Design: Incorporated Feedback: • The ARB encouraged for a window or decorative reveal and extended around to the back of the building and for the rooftop terrace to be more engaging. • The ARB provided feedback on the internal programing and suggestions for the vehicles utilizing the stacking stalls. • The applicant incorporated feedback and also added an additional floor to the development to increase density. Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 10  Packet Pg. 100 of 228  4335-4345 El Camino Real Initial Proposal: Final Design: Incorporated Feedback: • The initial roof forms were complex and recommended to be reevaluated, while still maintaining separate roofs for each unit. This involved the removal of the third story balconies and fake roof dormers for a more simplified rooftop. • The ARB encouraged accenting the doors for more variation, but overall approved the color scheme with its subtle differences in color. Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 11  Packet Pg. 101 of 228  824 San Antonio Rd Initial Proposal: Final Design: • Refined material and color selections to ensure better contrast. Simplify the front façade by reducing the visual segments from three to two. • The ARB encouraged the drop-off area to be redesigned in a way that did not impede the front entrance and more simplified balcony designs in relation to their usage by residents. 3950 Fabian Way Initial Proposal: Final Design: • Relocated bicycle parking to the front of the building for better site circulation and adding additional skylights to provide more light into the interior of the building. • The project utilized an existing office building with a new gymnasium addition and interior improvements to accommodate a private middle school. Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 12  Packet Pg. 102 of 228  ARB AWARDS Beginning in 1998, the awards program has been held every five years to honor the creative and responsive designs that help shape Palo Alto’s unique visual character. By recognizing these outstanding architectural contributions, the program celebrates the efforts of architects and designers who enrich the community and foster a healthy, vibrant environment. From a pool of approximately 100 reviewed projects, the following six were selected: 620 Emerson Street | Nobu 180 El Camino Real | Sushi Roku 588 Webster Street | Arbora Apartments 3705 El Camino Real | Wilton Court Apartments Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 13  Packet Pg. 103 of 228  1700 Embarcadero Road | Mercedes Benz Dealership 3215 Porter Drive | The Hub at Stanford Research Park Item 7 Attachment A - 2025-2026 Architectural Review Board Work Plan        Item 7: Staff Report Pg. 14  Packet Pg. 104 of 228  Prior Year Accomplishments The HRB recommended that a total of 21 new properties be designated on the Palo Alto Historic Inventory, and that five (5) existing properties on the local inventory to be upgraded in their category listing. These additions were the result of the 2023 Reconnaissance Survey efforts and represented the continued implementation of Palo Alto’s Comprehensive Plan Policy (L7.2). The HRB reviewed five (5) development proposals on historic properties, recommended naming for the Fred Eyerly Tower Well Park, reviewed updated public education materials on the City’s website, and established a local Historic Preservation Award program that will be held in 2026. The HRB reviewed the Certified Local Government Program (CLG) annual report to maintain the City’s CLG status, held since 1992. Continued participation in the CLG program supports local historic preservation efforts by providing added credibility, access to resources, and increased opportunities for funding. Historic Resources Board Staff Liaison: Steven Switzer, Historic Preservation Planner Lead Department: Planning and Development Services About the Commission The City is a Certified Local Government (CLG) responsible for historic preservation - to identify, evaluate, register, and preserve historic properties within its jurisdictions and promote the integration of local preservation interests and concerns into local planning and decision-making processes. Staff prepares an annual report of the activities of the Certified Local Government each spring for the prior year and submits these to the State Office of Historic Preservation. This HRB Work Plan covers July 2025 - July 2026. The HRB consists of five members with terms for 3 years and are staggered per PAMC Section 2.27.020. For more information please visit https://www.cityofpaloalto.org/City-Hall/Boards-Commissions/Historic-Resources-Board. The Department webpages are a wealth of information, go to: https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Historic-Preservation 2025-2026 Workplan Mission Statement Per Palo Alto Municipal Code Chapter 2.27 Historic Resources Board, Section 2.27.040 Duties, HRB purview is: (a) Render advice and guidance to a property owner upon the owner's application for alteration of any historic single-family or duplex building in the downtown area and any such building designated as significant elsewhere in the city (b) Inform the ARB of the historical and/or architectural significance of historic commercial and multiple-family structures in the downtown area and any such buildings designated as significant elsewhere in the City that are under review by the ARB. Submit recommendations to the ARB regarding proposed exterior alterations of such historic structures (c) Recommend to the Council the designation of additional buildings and districts as historic. Research available information and add historical information to the inventory sheets of historic structures/sites. This inventory is maintained in the department of planning and development services. Current Commissioners Alisa Eagleston-Cieslewicz (Chair), Samantha Rohman (Vice Chair), Christian Pease, Caroline Willis, and Geddes Ulinskas Item 7 Attachment B - 2025-2026 Historic Resources Board Work Plan        Item 7: Staff Report Pg. 15  Packet Pg. 105 of 228  TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED Subject to Council direction, to begin in the second quarter City Council direction and accommodation in the PDS department workplan would be needed. HRB subcommittee and staff of planning and city attorney departments to prepare draft amendments for Council review and adoption Well-written ordinance language that assists the public's understanding and calms the fears of property owners about governmental overreach Council may provide direction to modify PAMC 16.49; CLG cities maintain historic preservation ordinances. COUNCIL-DIRECTED POLICY UPDATE Council may provide direction to modify PAMC 16.49; CLG cities maintain historic preservation ordinances 2025-2026 Workplan The benefits are providing clarification of the HRB's role for the public Historic Resources Board PROJECT/GOAL 1: BENEFICIAL IMPACTS Limited modification to PAMC 16.49, historic preservation, providing clarifications regarding the HRB’s role. The HRB could discuss language providing clarifications of its role with respect to three potential topics: (a) the nomination process, (b) the effect of HRB recommendations regarding exterior modifications to residential historic resources, and (c) category changes (upgrades, downgrades, removals) Staff Liaison: Steven Switzer, Historic Preservation Planner Lead Department: Planning and Development Services PURPOSE STATEMENT: The Board/Commission's goals and purposes (purview) are set in Palo Alto Municipal Code Chapter 2.27 Historic Resources Board, Section 2.27.040 Duties. These duties include reviewing alterations to historic resources and providing recommendations on nominations to the local historic resources of historic evaluations to determine eligibility for the California Register of Historical Resources and associated tracking), Policy L7.1.1 (recommend eligible resources to the local inventory), and Policy L7.1.2: Reassess Historic Preservation Ordinance. HIGH PRIORITY Priority is high to enable greater understanding of the HRB's role and address property owners' concerns with respect to Goal items (a) and (b) LOWER PRIORITY Lower priority: Goal item (c) - listed historic resources placed on the City's inventory in the late 1970s and 1980s have not been reviewed to determine whether local historic resource category. Item 7 Attachment B - 2025-2026 Historic Resources Board Work Plan        Item 7: Staff Report Pg. 16  Packet Pg. 106 of 228  TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED To begin in the first quarter and continue throughout the duration of the 25/26 work plan cycle HRB ad hoc committee to make progress. Website contains links to information resources and videos, to assist property owners, staff, and others. N/A COUNCIL-DIRECTED POLICY UPDATE N/A TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED To begin in the first quarter and continue throughout the duration of the 25/26 work plan cycle HRB ad hoc committee to make progress. Website contains links to updated staff, and others. No COUNCIL-DIRECTED POLICY UPDATE No PROJECT/GOAL 3:Prepare an updated Local Inventory Resource list that incorporates the recently designated properties from the 2023 Historic Reconnaissance Survey efforts, Category Upgrades, and removal of properties that have been demolished. BENEFICIAL IMPACTS The benefits would be to improve preservation in Palo Alto and clarity for owners of historic properties. Item (a) a table of existing zoning code incentives and another table of historic building code provisions and Item (b) improvements to types of communications used to promote historic preservation. PROJECT/GOAL 2: BENEFICIAL IMPACTS Education and Creating New User-Friendly Resources/Communication Regarding Historic Preservation. (a) find new ways to promote preservation, including use of the existing zoning code incentives and State historic building code (b) improve upon communication types to provide the community accessible information, including the use of videos (linked to the City’s and State’s webpages) to help property owners understand the local and State preservation incentives and codes, (c) continue to provide updates to the historic review process bulletin as needed to communicate CEQA requirements related to PAMC 16.49 and listed historic resources, and (d) enable the HRB staff liaison(s), the City’s historic preservation consultant, and Chief Building Official to implement training providing an ongoing opportunity for HRB members, staff, and the community to gain working knowledge as to the use of the State’s historic building code HIGH PRIORITY LOWER PRIORITY Items (c) and (d) Providing the public with updated information HIGH PRIORITY LOWER PRIORITY Properties that have been demolished remove from local inventory Properties that have lost integrity over time that may need a category change Item 7 Attachment B - 2025-2026 Historic Resources Board Work Plan        Item 7: Staff Report Pg. 17  Packet Pg. 107 of 228  TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED Goal 4 to begin during plan quarter 2 (item a) and subject to Council direction, continue through quarter 4 (April - June 2025, items b and c) PDS staff and CAO staff. City Council direction and accommodation in the PDS department workplan would be needed. More historic properties are preserved for future enjoyment of the owners and community, due to the additional incentives. Council may provide direction to modify PAMC title 18. COUNCIL-DIRECTED POLICY UPDATE N/A TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED To begin in the first quarter and continue throughout the duration of the 25/26 work plan cycle HRB ad hoc committee to make progress. Establish historic preservation award selection criteria and frequency of awards by end of 25-26 Fiscal Year. Comprehensive Plan Policy L-7.6 COUNCIL-DIRECTED POLICY UPDATE No BENEFICIAL IMPACTS A HRB historical preservation award program would express appreciation for the efforts to preserve and protect Palo Alto’s culturally, historically, and architecturally significant places that create a vibrant and sustainable community that fully reflects Palo Alto’s diverse past. HIGH PRIORITY LOWER PRIORITY Item (a) discuss and determine the selection criteria for eligible projects and/or properties and establish award frequency, and Item (b) discuss and determine award frequency (e.g., annual, bi-annual, 5-year cycle, etc.) Items (c) and (d) PROJECT/GOAL 5:Establish a Historical Preservation Award Program. (a) discuss and determine the selection criteria for eligible projects and/or properties; (b) discuss and determine frequency of awards (e.g., annual, bi-annual, 5-year cycle, etc.); (c) select projects and/or properties to award; (d) conduct an award ceremony and present historic preservation awards. BENEFICIAL IMPACTS PROJECT/GOAL 4: Additional preservation incentives (a) discuss and recommend additional zoning code incentives to continue the community engagement process that began with the 2023 reconnaissance survey/ inventory update; (b) represent the HRB’s interests during public hearings, or participate in joint meetings with the Planning and Transportation Commission and City Council, to review any proposed zoning code modifications incentivizing historic preservation incentives; (c) outreach to the community after adoption of any adopted new incentives. not currently see any benefit to listing their property on the City's historic inventory HIGH PRIORITY LOWER PRIORITY Item a is to gather ideas for new incentives in the zoning code to add to a table of existing incentives in the zoning code.Subject to Council direction, items b and c would follow item a. Item 7 Attachment B - 2025-2026 Historic Resources Board Work Plan        Item 7: Staff Report Pg. 18  Packet Pg. 108 of 228  8 Planning and Transportation Commission (PTC) 2025-26 Work Plan Date Reviewed by PTC July 9, 2025 Staff Liaison: Jennifer Armer, Assistant Director, Planning and Development Services (PDS) Lead Department: Planning and Development Services (PDS); Office of Transportation (OOT) About the Commission The seven-member Planning & Transportation Commission adopted its 2025-26 work plan on July 9, 2025. The members and chairs are listed below. Members serve 4-year terms. See Planning & Transportation Commission (PTC) webpage link: http://www.paloalto.gov/gov/boards/ptc/default.asp Current Commissioners • Allen Akin (Chair) • Bryna Chang (Vice Chair) • Todd James • Bart Hechtman • Kevin Ji • Dr. Forest Olaf Peterson • Cari Templeton Mission Statement The Planning & Transportation Commission advises the City Council, Planning Director, and Chief Transportation Official on land use and transportation matters, including the Comprehensive Plan, zoning, transportation programs, and related matters. The Commission's primary responsibilities include: • Preparing and making recommendations to the City Council on the City's Comprehensive Plan and applying the Comprehensive Plan to proposed development, public facilities, and transportation in Palo Alto; • Considering and making recommendations to the City Council on zoning map and zoning ordinance changes; any changes to Title 18 of the Palo Alto Municipal Code must be reviewed by the PTC and the City Council; • Reviewing and making recommendations to the City Council on subdivisions and Site and Design Reviews, on appeals on variances and use permits; • Considering other policies and programs affecting development and land use in Palo Alto for final City Council action; • Reviewing and making recommendations on individual projects as described in the Municipal Code, and Open Space development; • Reviewing and making recommendations to the City Council on transportation, parking, and other related mobility issues; and • Ensuring robust community engagement and dialogue regarding planning, land use, and transportation and providing recommendations to the City Council regarding these matters and incorporating the public discussion. The PTC hearings provide a forum for public comment and public interaction. Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 19  Packet Pg. 109 of 228  8 Prior Year Work Plan On October 21, 2024, the City Council accepted the April 24, 2025 PTC recommended 2024-25 Work Plan: https://www.paloalto.gov/files/assets/public/v/1/agendas-minutes-reports/agendas-minutes/planning-and- transportation-commission/ptc-2024-2025-work-plan.pdf Prior Year Accomplishments During the period of the PTC 2024-25 Work Plan: • The PTC's transportation efforts included study sessions and/or recommendations on: Shared Micromobility Program; Safe Streets for All (SS4A) Safety Action Plan; Bicycle and Pedestrian Transportation Plan Update; Crescent Park Traffic Calming; South Palo Alto Bike/Ped Connectivity; Parking Data Report; Car-Free Streets; VTA Speed and Reliability; and Palo Alto Link. • The PTC's work on implementing the Comprehensive Plan, Housing Element, and Council Priorities included study sessions and/or recommendations on: Retail Code Amendments; Stream Corridor Protections; Bird Friendly Design Ordinance; Lighting Ordinance Update; Annual Review of Comprehensive Plan and Housing Element progress report; Code Amendment for Housing Element Implementation including amendments to the HIP/AHIP regulations; El Camino Real Focus Area; El Camino Real Retail Preservation Nodes Map; and ADU regulations. • The PTC's work on development projects included review and recommendations on three Vesting Tentative Maps; a Planned Community (PC) amendment; and two Planned Home Zone (PHZ) applications. PROJECT/GOAL 1: Retail Ordinance Updates: As part of adoption of an interim ordinance, Council has directed PTC to amend Zoning Code. This is a Council priority (objective ED 4): “Council consideration of an ordinance that expands retail opportunities and promotes retail resiliency.” Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Overall, this project aims to ensure a strong climate for retail businesses in Palo Alto that can allow residents to meet their daily needs and have a high quality of life. The PTC is likely to discuss a retail ordinance in fall 2025, with consideration of an ordinance by the end of the year. Consultant work, staff oversight, and meetings preparation, and participation from the local retail community. Development of new ordinances and/or broader policy recommendations to the City Council. Yes – Council assigned. High Priority Lower Priority Council-Directed Policy Update Any shifts in retail trends that will endure, are occurring, and can benefit from further and refined action by the City. While this is an impactful body of work, the need to get it right and coordinate with existing and new resources outweighs the need to quickly pursue the work. Yes Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 20  Packet Pg. 110 of 228  8 PROJECT/GOAL 2: Area Planning: This goal carries forward the prior year goal for neighborhood planning approaches and overall effectiveness of various approaches to neighborhood planning. The staff and PTC will consider new neighborhoods that result from the 6th cycle Housing Element sites and demand for public facilities/services. This goal includes continued work on both the Downtown Housing Plan and the San Antonio Road Area Plan. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Development policy recommendations and preferred alternatives for the new area plans enable City Council to provide direction to guide the City's future development. By June 2026 Staff time to research and prepare a staff report to PTC and ARB. Consultant budgets have already been allocated Successful conversation and recommendations of policies and preferred alternatives to City Council. Yes – Council assigned. High Priority Lower Priority Council-Directed Policy Update Council directed work toward future area plans. N/A Yes PROJECT/GOAL 3: Housing Program Implementation: The Housing Element was adopted by City Council on April 15, 2024, and certified by California Department of Housing and Community Development (HCD) on August 20, 2024. PTC will continue work on Housing Element implementation programs as scheduled within the Housing Element. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Complying with the requirements of the adopted Housing Element to encourage housing development and comply with State Law. PTC and Council review of a number of programs will proceed over the work plan year, as required by the Housing Element. Staff and consultant resources employed. Implementation of programs by target dates. Yes - State Mandated High Priority Lower Priority Council-Directed Policy Update Program 3.9 (incentivizing multi-family as an alternative to commercial development) and Program 6.5 (supporting innovative housing types). SOFA objective standards Yes Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 21  Packet Pg. 111 of 228  8 PROJECT/GOAL 4: State Law Implementation – Laws with Prior Effective Dates and any new 2025 Laws to Become Effective in 2026: The State adopts new laws every year, some like Assembly Bill (AB) 2097, required quick action through an interim ordinance during the last fiscal year, that will then require consideration and recommendation from PTC of a permanent ordinance, others like Senate Bill (SB) 9 will require modifications to maintain consistency with State law and Housing Element goals. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Provide clarity to property owners and potential developers. Ordinance Recommendation during 2025-26 work plan term. Staff resources. Adoption of ordinance amendments. Yes - State High Priority Lower Priority Council-Directed Policy Update Implementing State laws and discuss policy considerations N/A Possibly PROJECT/GOAL 5: Parking Programs: The PTC will receive periodic updates regarding options for improving the City’s parking programs. This includes a Roadmap for Residential Parking Permit Program improvements and commercial parking improvements. Parking Data Portal - PTC will receive an update regarding parking availability data. The new license plate reader technology allows for regular collection and reporting of parking availability. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Improved parking operations. Ongoing. Ongoing. Feedback from PTC and continued engagement from the public. Yes High Priority Lower Priority Council-Directed Policy Update The staff work behind the project continues; proposed updates help advance the work. Additionally, the PTC welcomes opportunities to engage w/the public on this topic. This project represents a large body of ongoing work to manage parking supply and parking policy. Yes Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 22  Packet Pg. 112 of 228  8 PROJECT/GOAL 6: Bicycle and Pedestrian Transportation Plan Update: A citywide evaluation of the bicycle network and pedestrian network. The plan will identify opportunities to enhance and connect the network. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Updated Bicycle and Pedestrian Transportation Plan and increase safe connectivity across the City. Public review draft plan and discussion of South Palo Alto bike/ped connectivity in fall 2025. Fully funded by a TDA3 grant Updated bike and ped plan No High Priority Lower Priority Council-Directed Policy Update N/A Update is timely, but not mandated by any State laws. No PROJECT/GOAL 7: Comprehensive Plan Policy Implementation: This includes Streamside Corridor and Bird Friendly Design changes in Title 18 and other Comp Plan policies that lead to Title 18 revisions. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Comprehensive Plan policies and programs to completion. Revised stream corridor ordinance at July 30, 2025 PTC. Others as directed by Council. Staff and consultant assistance – particularly when staff resources will be focused on implementation of the Housing Element. Adopted ordinances to amend Title 18. No High Priority Lower Priority Council-Directed Policy Update N/A N/A Yes – Comprehensive Plan Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 23  Packet Pg. 113 of 228  8 PROJECT/GOAL 8: Title 18 Updates: Considering and making recommendations to the City Council on any changes to Title 18 of the Palo Alto Municipal Code as directed by City Council, for example updates to the City’s Wireless Communications Facilities Ordinance. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Development of code recommendations to support City Council updates. As directed by Council. Staff and consultant resources would be identified based on specific projects. Wireless Ordinance update is currently unsourced. Adopted ordinances to amend Title 18. No High Priority Lower Priority Council-Directed Policy Update N/A N/A Yes PROJECT/GOAL 9: Project Review: The PTC will provide review as part of their regular ongoing responsibility for recommendations to City Council and staff on quasi-judicial development projects and transportation projects. Beneficial Impacts Timeline Resources Needed Measure Of Success State Mandated/ Local Law/ Council Approved Public review of planning and transportation projects. Ongoing. Ongoing. Feedback from PTC and continued engagement from the public. Yes High Priority Lower Priority Council-Directed Policy Update N/A N/A Yes Item 7 Attachment C - 2025-2026 Planning and Transportation Commission Work Plan        Item 7: Staff Report Pg. 24  Packet Pg. 114 of 228  Utilities Advisory Commission 2025-2026 Workplan Staff Liaison: Alan Kurotori, Utilities Director Lead Department: About the Commission The Utilities Advisory Commission (UAC) is charged with providing advice on long range planning and policy matters, acquisition, development, and financial review of electric, gas and water resources; joint action projects with other public or private entities which involve electric, gas or water resources; environmental implications of proposed electric, gas or water utility projects; and conservation and demand management. Additionally, the UAC is charged with providing advice on the acquisition, development and financial review of the dark fiber network and wastewater collection utilities. As a highly regulated industry, there may be matters not listed below that will be presented to the UAC in accordance with current or future (local, state, or federal) legislative requirements. . The Commission is composed of seven (7) members. Terms are for three (3) years and commence on the first meeting in April. See Palo Alto Municipal Code (PAMC) Sections 2.23.010 (Membership), 2.23.030 (Term of Office), 2.23.040 (Officers), 2.23.050 (Purpose and Duties), and 2.23.060 (Meetings). Current Commissioners • Greg Scharff (Chair) • Meagan Mauter (Vice Chair) • Rachael Croft • Utsav Gupta • Phil Metz • Robert Phillips • Chris Tucher Mission Statement The purpose of the Utilities Advisory Commission shall be to advise the City Council on present and prospective long- range planning, policies, major program, and project matters relating to the electric, gas, water, wastewater collection, fiber optics utilities, and recycled water matters, excluding daily operations. The Utilities Advisory Commission shall have the following duties: • Advise the City Council on long-range planning and policy matters pertaining to: o Joint action projects with other public or private entities which involve, affect or impact the utilities; o Environmental aspects and attributes of the utilities; o Water and energy conservation, energy efficiency, and demand side management; and o Recycled water matters not otherwise addressed in the preceding sub-paragraphs; • Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 25  Packet Pg. 115 of 228  programs of any major utilities. • Formulate and review legislative proposals regarding the utilities, to which the city is a party, in which the city has an interest, or by which the city may be affected. • Review the utilities capital improvement programs, operating budgets and related reserves, rates, and the recycled water program, budget, rate, and thereafter forward any comments and recommendations to the finance committee or its successor. • Provide advice upon such other matters as the City Council may from time to time assign. The Utilities Advisory Commission shall not have the power or authority to cause the expenditure of city funds or to bind the city to any written, oral, or implied contract. The Utilities Advisory Commission may, subject to its City Council-approved bylaws and at the discretion of the City Council, foster and facilitate engagement with the general public, not excluding representatives of commerce and industry, in regard to the utility matters referred to in subsections above. Prior Year Accomplishments Advanced Heat Pump Water Heater (HPWH) Pilot Program: • Over 500 customers have installed a heat pump water heater using the city’s rebate, full service, or emergency replacement program. The pace of installations is approximately 20% of annual water heater replacements in the city. Advanced Meter Infrastructure (AMI) • 21,492 gas meter installations completed. • 18,035 water meter installations completed. • 21,411 electric meter installations completed. Renewable Energy Credit (REC) Exchange Program • Approved by C ity Council on December 12, 2022 to continue the program and return to the UAC and Council in 2025 • Sold 161,900 Portfolio Content Category 1 (PCC1 or Bucket 1) RECs and purchased 160,000 PCC3 RECs (Bucket 3), yielding $10.86 million in net revenue for 2024. Fiber-to-the-Premises (FTTP) • Began coordinating electric grid modernization project with FTTP. • Identified and began addressing key challenges. o Established pilot project to align grid modernization with FTTP. o CEQA initial study for FTTP. Electric Grid Modernization (Grid Mod) • An Electrification Study was performed by a consultant with the goal of identifying any electric system upgrades needed across the electric distribution system. The focus of the Study resulted in recommendations for upgrades to line transformers, feeder capacity, increasing the number of switches and connections on the system between feeders and substations, and upgrading substation equipment. • Staff prepared plans and construction drawings for a pilot area selected within the Phase 1 boundary of the Grid Modernization (Grid Mod) project. Construction began in Q2 2024 for a 1200-home neighborhood area bounded by Embarcadero Road, Louis Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 26  Packet Pg. 116 of 228  • The grid modernization activities will be coordinated with fiber to the premise (FTTP) construction. To capitalize on synergies between Grid Mod and FTTP, the city identified a pilot project boundary area to combine construction activities for both Grid Mod and FTTP. The city contracted with consultant Entrust for Grid Mod and construction began in Q3 of 2024. Construction is anticipated to be complete near the end of Q2 2025. As of January 9, 2025, 60 out of 74 identified electric utility poles have been replaced, 51 new transformers installed, and electric service to over 500 households in the pilot area upgraded and prepared for electrification. Engineering staff have started planning and design work for the remainder of the Phase 1 area and expect construction to be completed by Q4 of 2025. Gas Main Replacement (GMR) Project #24B • Successfully completed GMR Project #24B along University Ave between Webster Street and Fulton Street and on Middlefield Road between Hamilton Avenue and Lytton Avenue. • Replaced approximately 20,000 linear feet of natural gas mains and services with polyethylene pipe. Sewer System Replacement (SSR) Project #31 • Successfully completed SSR Project #31 along El Camino Real and Page Mill Road. • Replaced approximately 10,924 linear feet of sanitary sewer collection system pipe, mains, and replaced or rehabilitated 43 sewer manholes. • The existing vitrified clay pipe (VCP) mains were replaced with high-density polyethylene pipe (HDPE). In addition, 89 existing city-owned sewer service laterals and cleanouts were replaced with new 4” and 6” HDPE service laterals and cleanouts. Water Main Replacement (WMR) Project #29 • Successfully completed WMR Project #29 to replace asbestos cement and other aging pipelines with high density polyethylene mains in six different areas throughout the city. • Installed approximately 8,000 linear feet of new water mains of various sizes, 124 new water services, 17 new fire hydrants, 22 isolation valves, and 101 water meters. Lead Service Line Inventory • Completed an inventory of the entire city service area to identify potential lead in water lines serving customers. No lead was identified. Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 27  Packet Pg. 117 of 228  STANDING TOPIC 1 Budget: Rate changes to Water, Gas, Electric, Wastewater Collection, Fiber Optic Services, Electric Time-of-Use review of credit card fees for utilities bill payment. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- The community will have a better understanding of the rates and why they are being charged. each rate change is by the Cost-of- (COSA) inance Committee review is in ity Council approval . Consultant time to create the COSA report. HIGH PRIORITY LOWER PRIORITY Rates are always a high priority. The change has an impact on the community and economy. STANDING TOPIC 2 Consider potential future sources of water supply and water quality. This includes recycled water, demand graywater, treatment efforts, use of effluent, and testing for contaminants. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- The benefit to the community is to have ample water source and supply when needed in the event of a drought or for basic uses year-round consultant time for work products. supply plan(s). HIGH PRIORITY LOWER PRIORITY Having knowledge of where the city's water supply comes from and how we manage that supply is a maintained priority. Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 28  Packet Pg. 118 of 228  STANDING TOPIC 3 System and Supply: Discuss and advise City Council regarding electric system and supply portfolio, including grid r, power portfolio, smart home technologies, distributed energy resources, city for datacenters, and coordination with Palo Alto Planning Department to enable technological . BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS / COUNCIL-APPROVED Reliability for customers, health benefits, and clean energy responsible for the vast carbon reduction the city has achieved over the past decade legal needed, and technology renewable energy supply options in the Integrated Resource Plan (IRP). Have the IRP near completion to present to the UAC for review expanding the zero emissions portion of the portfolio and HIGH PRIORITY LOWER PRIORITY The health and well-being of the community is a high priority for Council and Utilities STANDING TOPIC 4 System and Supply: Consider aspects of the gas system and supply portfolio, including the City of Palo Alto Utilities CPAU) development of a long-term plan to accommodate anticipated decrease in gas use. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS MANDATED / LOCAL Gas is a type of energy used to provide some residences and businesses in Palo Alto with heat for their facilities and some cooking appliances. -round consultant time when necessary 10% below PG&E's rates year round. HIGH PRIORITY LOWER PRIORITY The health and well-being of the community is a high priority for Council and Utilities Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 29  Packet Pg. 119 of 228  STANDING TOPIC 5 Capital Improvement Projects (CIP): Discuss CIP projects. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL-APPROVED The Utilities Department manages multiple CIPs each year for the benefit to the city and community. CIPs may include rebuilding water reservoirs, repairing and replacing sewer lines or water mains, maintaining street lights, building out the fiber optic backbone, or budget. Most of procurement time for setting up contracts, contractors for work completion. measured by completion of the project within the timeline and budget approved by Council. HIGH PRIORITY LOWER PRIORITY Maintaining quality of life for the community is a priority for the Utilities Department and projects. Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 30  Packet Pg. 120 of 228  STANDING TOPIC 6 and Adaptation: Ongoing discussions regarding the reliability and resiliency of the City of Palo Alto tilities (CPAU), including Utilities emergency preparedness plan and annual discussion of efficiency programs, demand side BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- This matter encompasses a number of situations including but not limited to the Sustainability and Climate Action Plan (S/CAP). The benefit of any of the reliability or resiliency projects is to support the city and community now and into the future with reliable, safe connections, water, electricity, fiber and natural gas year-round and do not have , the S/CAP is set to its primary goals by . additional consultants efficient, safe, economic, and reliable services. Utilities Emergency Preparedness: 1. Determination of the CPAU emergency preparedness. 2. Establishment of CPAU’s risk assessment framework in coordination with the Office of Emergency Services (OES). 3. Determination of CPAU’s roles and specific actions in each such emergency. 4. Completion of action planning and implementation in coordination with HIGH PRIORITY LOWER PRIORITY The S/CAP is a Council priority and therefore a high priority for the Utilities Advisory Commission. Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 31  Packet Pg. 121 of 228  STANDING TOPIC 7 Initiatives: Utilities tracks many local, state and federal bills that touch on utilities. Should any new laws, or ordinances pass during the year, the UAC may need to discuss the changes. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- Staff track the possible changes in laws and regulations and presents the proposed changes to the UAC for review and consideration to the Council. affect utilities review time project HIGH PRIORITY LOWER PRIORITY N/A The level of priority is based on the particular legislation being proposed and how it affects the Utilities Department. STANDING TOPIC 8 -Driven Initiatives: The UAC will address any matter assigned by the City Council. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- The UAC is made up of a diverse group with knowledge of the utilities industry and related issues. . task. HIGH PRIORITY LOWER PRIORITY Typically when Council requests a review of an item it is considered a high priority. Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 32  Packet Pg. 122 of 228  Standing Topic 9 Discuss community engagement, technology (current & emerging), finance, and community scaling of S/CAP plans to meet the city’s goals for sustainability and climate action. potential full or partial retirement of the gas distribution and electrification of gas appliances. It also includes permitting and inspection processes for customers wishing to panels, electrify appliances, or install solar photovoltaics (PV), energy storage, and/or electric vehicle (EV) BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- UAC expertise will help the Council Climate Action and Sustainability Committee (CASC) make progress on achieving S/CAP goals with benefits to reducing the impacts of climate change. executing coordinating planning efforts, incentives, programs, and infrastructure investments to support S/CAP efforts. and S/CAP Work Plan items in collaboration with other departments. 2025 Work Plan approved by Council in June 2023, Council Priorities in this area adopted annually. HIGH PRIORITY LOWER PRIORITY Support relevant Council Priority Objectives in the Climate Action and Adaptation and Natural Environment Protection Priority area and 2023- 2025 S/CAP Work Plan Items Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 33  Packet Pg. 123 of 228  STANDING TOPIC 10 : Review Pilot and Phase 1 progress and outcomes, business model, and metrics affecting ity’s decision whether to move forward with full city rollout. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- Enhances high‐speed internet and provides equitable access for among broadband , network upgrades, – 2026: Complete Pilot, cost, operating take‐rate. 26 – 2027: Evaluate pilot delivery staffing, for Phase Strategic partners for customer service, home installation, and after-hours troubleshooting. Capital investment for fiber deployment. Marketing budget. Ongoing operational & maintenance funding. Pilot. Phase 1. financial model to ‐recover operationally wit . Council-approved on December 19, 2022. City Council Priority May 2025 HIGH PRIORITY LOWER PRIORITY High priority. Provide UAC and Council with status updates as it metrics for success during Pilot and Phase 1 (i.e. take rate, N/A N/A Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 34  Packet Pg. 124 of 228  Standing Topic 11 Develop a comprehensive 5–20 year plan to align the gas utility with climate goals, financial stability, and regulatory changes, while evaluating options for electrification, biogas integration, and -term infrastructure strategy. BENEFICIAL IMPACTS TIMELINE RESOURCES NEEDED MEASURE OF SUCCESS STATE MANDATED / LOCAL LAW / COUNCIL- Integrates climate impact, regulatory environment, and evolving market conditions (e.g., supply, building electrification trends). ity. Identifies how best to align the gas utility with Palo Alto’s sustainability goals and community expectations over the long term. . Staff analysis (Utilities, Administrative Services Department, S/CAP) and potential consultants for policy, engineering, and market assessments. Consulting support for hydraulic model development, analysis, rate studies, and financial modeling. Legal counsel for evolving regulations Stakeholder outreach resources for public engagement. City Council –20 year gas ‐managed utility city Positive feedback from community stakeholders on transparency and alignment Gas regulation federal laws (CPUC, etc.). Local ordinances or building codes may approval). Council likely to be involved if new rate structures or code changes are required. HIGH PRIORITY LOWER PRIORITY High Priority, but not urgent. N/A Expected Item 7 Attachment D - 2025-2026 Utilities Advisory Commission Work Plan        Item 7: Staff Report Pg. 35  Packet Pg. 125 of 228  City Council Staff Report From: City Manager Report Type: ACTION ITEMS Lead Department: Public Works Meeting Date: February 2, 2026 Report #:2512-5688 TITLE Review the 2024 Greenhouse Gas Inventory and S/CAP Key Performance Indicators Annual Progress Report, and Approve the 2026-2027 S/CAP Work Plan and Receive Six S/CAP Studies Recommended by the Climate Action and Sustainability Committee; CEQA Status: Review GHG Inventory and Key Performance Indicators: Not a Project; Potential Environmental Impacts of the S/CAP Work Plan were Studied in the June 5, 2023 S/CAP Addendum to the 2017-2031 Comprehensive Plan EIR; this Project is also Exempt Pursuant to CEQA Guidelines Section 15183 RECOMMENDATION Staff recommends that the City Council: 1. Review the 2024 Citywide and Municipal Greenhouse Gas Emissions Inventories; and 2. Review the Sustainability and Climate Action Plan (S/CAP) Key Performance Indicators Annual Progress Report for calendar year 2024. The Climate Action and Sustainability Committee and staff recommend that the City Council: 3. Approve the 2026-2027 S/CAP Work Plan; and 4. Receive the following studies: a. S/CAP Funding and Financing Study; b. S/CAP Funding Source Survey; c. EV Charger Needs Assessment; and d. Single-family, Multi-family, and Non-Residential Building Sector Studies. EXECUTIVE SUMMARY This staff report presents the Palo Alto Citywide and Municipal GHG Emissions Inventories for calendar year 2024, a historical comparison of Citywide GHG Inventories, the Sustainability and Climate Action Plan (S/CAP) Key Performance Indicators (KPI) Annual Progress Report for calendar year 2024, and the Climate Action and Sustainability Committee recommended priorities for the 2026-2027 Sustainability and Climate Action Plan Work Plan. Item 8 Item 8 Staff Report Item 8: Staff Report Pg. 1 Packet Pg. 126 of 228  In addition, the Climate Action and Sustainability Committee is recommending the City Council’s receipt of six studies that were attached to and summarized in the staff report for the December 13, 2025 Climate Action and Sustainability Committee (CASC) workshop on electrification funding and financing strategies. These studies document the work done to develop models and data for City staff and policy makers to use to support strategic decision- making about community-scale electrification funding, financing, and program design. They also include insights about the financial dynamics of community-scale electrification based on three illustrative scenarios analyzed. One key insight surfaced is that if the City were to rely on up- front incentives available to all community members as a way to achieve its goals, it would result in City expenses that exceed currently available resources for climate action. This points to the need for new strategies and additional modeling. Staff intends to use these tools and data throughout 2026 and 2027 to support strategic planning efforts under 2026-2027 S/CAP Work Plan item C13 (Develop Funding and Financing Strategies for Consideration) and to model different strategies and scenarios for community-wide electrification. BACKGROUND Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 2  Packet Pg. 127 of 228  In June 2023, City Council adopted the 2022 Sustainability and Climate Action Plan (S/CAP),2 certified the Comprehensive Plan Environmental Impact Report Addendum: Update to the Sustainability and Climate Action Plan,3 and accepted the 2023-2025 S/CAP Work Plan.4 The S/CAP aligns with several goals of the 2030 Comprehensive Plan Implementation plan, as well as the City Council 2025 Priority Area ”Climate Action and Adaptation, & Natural Environment Protection”.5,6 Both the Palo Alto Citywide and Municipal GHG Emissions Inventories calculate emissions for calendar year 2024. As a result of various City-led initiatives, programs, and activities focused on sustainability and climate action, by the end of 2024 Palo Alto reduced total citywide greenhouse gas (GHG) emissions 50.2% from the 1990 baseline, despite a population increase of 22% during that same time period. Due to changes in methodology, it is not possible to do an equivalent comparison of the 2024 Municipal GHG Inventory with previous inventories. However, by the end of 2024 the City reduced total municipal GHG emissions roughly 64% from the 2005 baseline. Due to delays associated with the COVID-19 pandemic, the 2019 GHG inventory was not completed until 2021. Previous GHG inventories were all completed by the following calendar year. Staff and external experts worked to complete both the 2023 and 2024 GHG inventories in 2025 to provide more timely reporting on the City’s progress towards the 80 x 30 and carbon neutrality goals. While this report focuses on the 2024 GHG inventory, new data from the 2023 GHG inventory is also included in figures, tables, and attachments. In addition, staff and external experts updated the 1990 Citywide GHG inventory to align with the methodology used for the 2019 through 2024 Citywide GHG inventories. This allows for a more equivalent comparison between the inventories. The City has reached the end of its 2023-2025 S/CAP work planning period. The 2023-2025 S/CAP Work Plan guided S/CAP Implementation with 77 work items, of which 27 focused on sustainability and 50 on climate action. Staff developed a proposed 2026-2027 S/CAP Work Plan to continue progress towards achieving the S/CAP goals. Development of the 2026-2027 S/CAP Work Plan aligns with one of 2 2022 Sustainability and Climate Action Plan; https://www.cityofpaloalto.org/files/assets/public/v/1/sustainability/reports/2022-scap-report_final.pdf 3 Comprehensive Plan Environmental Impact Report Addendum: Update to the Sustainability and Climate Action Plan, 2023; https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/agendas- minutes/city-council-agendas-minutes/2023/2023comprehensive-plan-environmental-impact-report-addendum- update-to-the-scap.pdf 4 2023-2025 S/CAP Workplan, 2023; https://www.cityofpaloalto.org/files/assets/public/v/1/sustainability/reports/2023-2025-scap-work-plan_final.pdf 5 2030 Comprehensive Plan; https://www.cityofpaloalto.org/Departments/Planning-Development- Services/Housing-Policies-Projects/2030-Comprehensive-Plan 6 City Council, May 5, 2025; Agenda Item #8; SR #2504-4466, https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=83379&dbid=0&repo=PaloAlto Item 8 Item 8 Staff Report Item 8: Staff Report Pg. 3 Packet Pg. 128 of 228  the four Council Priorities for CY 2025: Climate Action and Adaptation, and Natural Environment Protection, and fulfills Council Priority Objective CA 23 - Develop and obtain Council approval for strategies and a 2026/2027 work plan for the next phase of S/CAP implementation of climate and sustainability goals. At the January 9, 2026 Climate Action and Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 4  Packet Pg. 129 of 228  Sustainability Committee meeting, the Committee received an update on the status of the 2023-2025 S/CAP Work Plan and discussed the recommended priorities for the 2026-2027 S/CAP Work Plan.11 The Committee voted unanimously, inclusive of staff and committee consensus modifications, to recommend that the City Council approve the work plan. Council recognized the importance of developing a long-term financial strategy as part of S/CAP implementation in the 2023–2025 Work Plan, which included initiation of an S/CAP Funding Study to explore potential funding and financing sources, as well as several complementary studies (an EV Charger Needs Assessment, studies of electrification opportunities in multi- family and non-residential buildings, and a Funding Source Survey). The City issued a Request for Proposals for these studies in August 2023 and retained a consultant team - Willdan, E3 (a Willdan company), and Rincon - to complete them.12 This model and its input studies – including assessments of gas equipment in single-family, multi- family, and non-residential buildings, an Electric Vehicle (EV) charger needs assessment, and a survey of funding sources – provide data to evaluate different electrification rollout scenarios and their financial implications. ANALYSIS The City is committed to a sustainable future. The City owns, operates, and maintains a full- service utilities portfolio that provides electric, natural gas, fiber, water, refuse, and wastewater services to residents and businesses in Palo Alto. Palo Alto’s continued leadership in advancing sustainability commitments has succeeded mainly because of the continued collaboration of community stakeholders, City departments, and the leadership of the City Council. This report presents a 2026-2027 S/CAP Work Plan to continue the City’s progress on sustainability and emissions reduction, a 2024 update to the Citywide and Municipal GHG Emissions Inventories showing progress to-date, and asks the City Council to receive six reports related to the S/CAP Funding Study that provide data and a modeling framework that will be used for policy discussions on funding community-wide electrification through 2026 and 2027. Starting with the 2019 Citywide GHG Emissions Inventory, the City followed the calculation and reporting standards outlined in the Global Protocol for Community-Scale GHG Emissions Inventories (GPC). However, the 1990 Citywide GHG Emissions Inventory followed a different methodology, and did not include several emissions sources, including: Airport Emissions, Off- Road Vehicles and Equipment, Caltrain Commuter Rail, Composting, Palo Alto Landfill Gas Flaring, and Wastewater Biosolid Treatment. Staff and external experts corrected this error and the 1990 Citywide GHG Emissions Inventory now follows the same GPC Protocol used in the 11 Climate Action and Sustainability Committee, January 9, 2026; Agenda Item 1; SR #2507-5027, https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=18309 12 City Council, January 16, 2024; Agenda Item #4; SR #2308--1939, https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=82633&dbid=0&repo=PaloAlto Item 8 Item 8 Staff Report Item 8: Staff Report Pg. 5 Packet Pg. 130 of 228  2019 through 2024 Citywide GHG Emissions Inventories. Historical comparisons are now more equivalent and provide a clearer picture of the City’s sustainability and climate action progress. 2e) from the residential, commercial, industrial, transportation, waste, water, and municipal sectors. In comparison to the 1990 base year emissions (which have increased to 798,868 MT from the previously calculated 780,119 MT due to corrections in methodology and additions of excluded emissions sources), these emissions represent a 50.2% decrease in total community emissions, despite a population increase of 22% during that same period. Emissions in 2024 equated to 5.9 MT per capita. The California Air Resource Board’s 2017 Scoping Plan Update recommends a goal for local governments of 6 MT CO2e per capita by 2030 and 2 MT CO2e per capita by 2050.15 In order to achieve 80 x 30, Citywide GHG Emissions need to be at 160,000 MT CO2e (corrected from the previous target of 156,024 MT CO2e). 15 California Air Resources Board 2022 Scoping Plan Appendix D Local Actions, November 2022; https://ww2.arb.ca.gov/sites/default/files/2022-11/2022-sp-appendix-d-local-actions.pdf Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 6  Packet Pg. 131 of 228  Figure 1: 2024 Palo Alto Citywide Greenhouse Gas Emissions by Sector As shown in Figure 2, total GHG emissions steadily decreased between 1990 and 2021. However, emissions increased between 2021 and 2022 and slightly increased between 2022 and 2023. The main driver of the increase in 2022 was On-Road Transportation, in part due to the shift away from pandemic-level (reduced) driving frequency, returning to the office after working from home, and economic recovery. These effects likely continued into 2023 as employers continued to change hybrid work policies and economic and travel activities continued to shift. GHG emissions from Transportation and Mobile Sources are estimated to have increased slightly (by less than 1%) between 2023 and 2024 but remain 27% lower than 1990 Transportation and Mobile Sources emissions. Within Transportation and Mobile Sources, On- Road Transportation increased slightly (less than half a percent). However, this estimate is preliminary due to lack of data. Vehicle miles traveled (VMT) data for 2024 were not yet available when the 2024 GHG inventory was prepared. City staff and external experts calculated a preliminary estimate of 2024 VMT by scaling 2023 per capita VMT based on 2024 population for passenger vehicles and service population for commercial vehicles and buses. This estimate reflects demographic growth and may not capture actual VMT trends. The largest increase between 2023 and 2024 within Transportation and Mobile Sources was from Airport Emissions, Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 7  Packet Pg. 132 of 228  which increased 22.4% from 2023. The full comparison between GHG inventories can be found in Attachment B. Figure 2: Palo Alto Citywide GHG Emissions by Sector, 1990 and 2019 – 2024 2e from municipal operations, which is a slight reduction from 2023. As shown in Figure 3, GHG emissions from Palo Alto’s municipal operations are from five main sectors: Buildings and Other Facilities, Streetlights and Traffic Signals, Wastewater Facilities, City Vehicles and Equipment, and Indirect Emissions. Since the methodology has changed significantly for certain sectors since the first Municipal GHG Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 8  Packet Pg. 133 of 228  Inventory was conducted in 2005, it is no longer possible to do an equivalent comparison with previous Municipal GHG inventories. However, the methodologies for Buildings and Other Facilities, Streetlights and Traffic Signals, and City Vehicles and Equipment are similar enough to do rough comparisons for those sectors. By the end of 2024 the City reduced total municipal GHG emissions roughly 64% from the 2005 baseline. Figure 3: 2024 Palo Alto Municipal Greenhouse Gas Emissions by Sector Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 9  Packet Pg. 134 of 228  Other Facilities GHG emissions), and natural gas leakage (about 3% of Buildings and Other Facilities GHG emissions). Figure 4. Palo Alto Municipal GHG Emissions, 2005 and 2022-2024 Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 10  Packet Pg. 135 of 228  GHG emissions factor than conventional fossil diesel. Table 1 and Figure 5 show a historical comparison of On-Road Vehicle GHG emissions by City Department. Table 1: On-Road Vehicle GHG emissions by City Department (MT CO2e) City Department 2022 2023 2024 % of Total in 2024 Total MT CO2e 1550.2 1307.6 1268.1 100.0% Note: Percentages and MT CO2e may not add to the total due to rounding Figure 5: Palo Alto On-Road Vehicle GHG Emissions by City Department Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 11  Packet Pg. 136 of 228  Palo Alto’s Progress Toward Carbon Neutrality Figure 6: 2024 Progress Toward Carbon Neutrality Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 12  Packet Pg. 137 of 228  Half Moon Bay, Menlo Park, and Watsonville). Many cities’ targets cannot be compared directly because of different baseline years. Table 2 displays the emission reduction targets of surveyed cities using the same baseline year as Palo Alto (1990). Table 2: Comparison of Select Greenhouse Gas Emission Reduction Targets City Reduction Target Reduction Target Year Baseline Year *The City Council of Irvine has not ratified their climate action plan. Table 3: Greenhouse Gas Emission Reductions of Surveyed Cities City Reduction Target Baseline Year GHG Inventory Year GHG Reduction Cities with 1990 baseline year Palo Alto 80% by 2030 1990 2024 50% Cities with other baseline years Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 13  Packet Pg. 138 of 228  Sunnyvale 56% by 2030 2008 2023 37% Berkeley 100% by 2045 2000 2023 41% Hayward 55% by 2030 2005 2023 35% Millbrae 49% by 2030 2005 2023 30% Menlo Park 90% by 2030 2005 2023 27% Half Moon Bay 40% by 2030 2005 2023 27% Brisbane 66% by 2030 2005 2023 16% Santa Barbara 100% by 2035 1990 2019 15% Belmont 40% by 2030 1990 2023 15% Solana Beach 85% by 2045 2016 2018 9% Mountainview 80% by 2050 2005 2019 14% Burlingame 40% by 2030 2005 No data No data *The City Council of Irvine has not ratified their climate action plan. S/CAP Key Performance Indicators Annual Progress Report Achieving 80 x 30 and carbon neutrality by 2030 are the overarching goals for the S/CAP. The S/CAP also outlines Goals and Key Actions in eight areas: Climate Action, Energy, Electric Vehicles, Mobility, Water, Climate Adaptation and Sea Level Rise, Natural Environment, and Zero Waste. The climate action areas of Climate Action, Energy, Electric Vehicles, and Mobility primarily focus on the 80 x 30 and carbon neutrality by 2030 goals. The sustainability areas of Water, Climate Adaptation and Sea Level Rise, Natural Environment, and Zero Waste do not necessarily have a direct impact on greenhouse gas reductions, but have critically important sustainability, public health and safety, regional, resource conservation, and equity benefits that contribute to overall climate action. Progress towards achieving the S/CAP Key Performance Indicators can be found in Attachment D and are summarized in Attachment E. 2026 – 2027 S/CAP Work Plan The City has reached the end of its 2023-2025 S/CAP work planning period. The 2023-2025 S/CAP Work Plan guided S/CAP Implementation with 77 work items, of which 27 focused on sustainability and 50 on climate action. Of the 50 climate action items, 16 were ongoing work items and 34 were discrete projects, of which 27 were completed, 6 are in progress, and 1 is delayed (not started). Of the 27 sustainability work items, 14 were ongoing and 13 were discrete projects, of which 8 were completed. Five of the remaining items are in progress and one is delayed. A summary of the progress of the 2023 – 2025 S/CAP Work Plan can be found in Attachment F. Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 14  Packet Pg. 139 of 228  The proposed 2026-2027 S/CAP Work Plan includes 28 strategies focused on Climate Action, 16 strategies focused on Sustainability, and 3 strategies for overall S/CAP Communications for all areas of the S/CAP. The full 2026 – 2027 Work Plan can be found in Attachment G. At a high level, the Climate Action priorities in the Work Plan are intended to help the community develop a funding strategy for community-wide electrification at a pace that balances community willingness to fund climate action, utility rate impacts, and the community’s desire to maintain leadership in this area. It will do this through piloting cost- efficient building electrification and EV charging program models in the single-family, multi- family, and non-residential sectors that minimize the cost to the City while remaining attractive to customers. In parallel, staff will present different strategies and scenarios for funding community-wide electrification and carbon neutrality using the data and modeling frameworks developed in the S/CAP Funding Study. The key areas of focus for the Sustainability priorities in the Work Plan are water, sea level rise, wildfire protection, natural environment, green stormwater infrastructure, and zero waste. While sustainability strategies do not necessarily have a direct impact on greenhouse gas reductions, they have critically important sustainability, public health and safety, regional, resource conservation, and equity benefits that contribute to overall climate action. These strategies contribute towards achieving the goals of the S/CAP and are directly tied to the Sustainability Key Actions. The City developed a 2026-2027 S/CAP Work Plan to continue progress towards achieving the S/CAP goals. Development of the 2026-2027 S/CAP Work Plan aligns with one of the four Council Priorities for CY 2025: Climate Action and Adaptation, and Natural Environment Protection, and fulfills Council Priority Objective CA 23 - Develop and obtain Council approval for strategies and a 2026/2027 work plan for the next phase of S/CAP implementation of climate and sustainability goals. At the January 9, 2026 Climate Action and Sustainability Committee meeting, the Committee received an update on the status of the 2023-2025 S/CAP Work Plan and discussed the recommended priorities for the 2026-2027 S/CAP Work Plan.17 The development of the 2026-2027 S/CAP Work Plan is described in more depth in the staff report for the January 9, 2026 Climate Action and Sustainability Committee meeting. At that meeting the Committee voted unanimously, inclusive of staff and committee consensus modifications, to recommend that the City Council approve the work plan. Six Studies Requested to be Received The Climate Action and Sustainability Committee and staff recommend the City Council receive six studies that were attached to and summarized in the staff report for the December 13, 2025 17 Climate Action and Sustainability Committee, January 9, 2026; Agenda Item 1; SR #2507-5027, https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=18309 Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 15  Packet Pg. 140 of 228  Climate Action and Sustainability Committee (CASC) workshop on electrification funding and financing strategies.19 These include: The S/CAP Funding and Financing Study (Attachment H), which uses an “S/CAP Funding Model” developed via collaboration between the consultant and City staff and the data and analysis from the other studies to model three illustrative electrification scenarios that show various financial dynamics of community-scale electrification. The EV Charger Needs Assessment (Attachment I), which evaluates illustrative scenarios for EV adoption and charging strategies in Palo Alto to show charging capacity needs and the financial and operational dynamics of different business models and strategies for providing EV charging. Three studies of building electrification strategies and costs in the single-family (Attachment J), multi-family (Attachment K), and non-residential sectors (Attachment L) that provide data and insights that can be used for program design and strategic planning. The S/CAP Funding Source Survey (Attachment M), an inventory of potential funding sources for community-wide electrification. FISCAL/RESOURCE IMPACT 19 Climate Action and Sustainability Committee, December 13, 2025; Agenda Item #A; SR #2507-5025, https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=18114 Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 16  Packet Pg. 141 of 228  that significant financial investment would be needed that exceeds current available resources if the City were to pay for all the needed incremental investment using incentives. As part of the 2026-2027 S/CAP Work Plan, staff will need to work with the City Council and the community to grapple with the funding needs for community-wide electrification in a current environment where federal support has changed and with the local competing priority of maintaining low utility rates. STAKEHOLDER ENGAGEMENT C1. Build awareness about sustainability and climate action and City programs available to the community C2. Drive community actions to achieve S/CAP goals C3. S/CAP Data Collection and Annual Reporting Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 17  Packet Pg. 142 of 228  and programs, as well as unmet needs and priorities. The 2024 and 2025 Community Surveys included a question about familiarity with the S/CAP and 80 x 30, with 42% of residents noting they were familiar with the S/CAP and 80 x 30 in both surveys. The only difference is that in 2025 6% of respondents noted that they were very familiar with the S/CAP and 80 x 30 compared to 5% in 2024. The communications focus of the 2026 – 2027 Work Plan will strive to increase awareness from the current 42% of residents who are familiar with the S/CAP and 80 x 30. Mobility-related work items (CA21 – CA25) may require consultation with the Planning and Transportation Commission depending on the project. Infrastructure-related Climate Action items (CA19 – CA20) and Water-related work items (S1-S3) would require consulting or informing the Utilities Advisory Commission (UAC) at various stages of the projects. The UAC would also discuss the potential rate impacts of any utility-related climate action programs as part of the utility financial planning process. ENVIRONMENTAL REVIEW Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 18  Packet Pg. 143 of 228  consistent with an existing general or comprehensive plan and does not require additional CEQA review (CEQA Guidelines section 15183). ATTACHMENTS APPROVED BY: Item 8 Item 8 Staff Report        Item 8: Staff Report Pg. 19  Packet Pg. 144 of 228  Page 1 of 12 Attachment A: Palo Alto 2024 Citywide Greenhouse Gas Emissions Inventory 1.a. Overview of Methodology for Quantifying Greenhouse Gas Emissions Cities represent the single greatest opportunity for tackling climate change, as they are responsible for 70% of global energy-related carbon dioxide emissions, with transportation and buildings among the largest contributors.1 The first step for cities to realize their potential is to identify and measure the sources of their emissions. Best practices for identifying these sources and quantifying emissions are to utilize a standardized GHG inventory. There are two types of Greenhouse Gas (GHG) emissions inventories: 1.Generation-based GHG inventory – This measurement method helps a community understand its level of emissions based on community energy use. It includes 1) direct consumption of energy, 2) consumption of energy via the electrical grid, and 3) emissions from the treatment/decomposition of waste. This is the industry-accepted methodology for quantifying community GHG emissions, with emissions reported by emission source category.2 2.Consumption-based GHG inventory – This measurement method helps a community understand its level of emissions based on consumption. It offers an alternative, more holistic, approach for quantifying emissions within a community, quantifying consumption of goods and services (including food, clothing, electronic equipment, etc.) by residents of a city, with emissions reported by consumption category. In 2014, World Resources Institute, C40 Cities Climate Leadership Group (C40) and ICLEI – Local Governments for Sustainability (ICLEI)3 partnered to create a global standard protocol for generation-based GHG inventories. The Global Protocol for Community-Scale GHG Emissions Inventories (GPC) provides a robust framework for accounting and reporting city-wide GHG emissions for a generation-based inventory. The GPC Protocol is the official protocol specified by the Global Covenant of Mayors and defines what emissions must be reported and how. In addition, this inventory draws on methods from the U.S. Community Protocol,4 which provides more detailed methodology specific to the U.S. It seeks to: Help cities develop a comprehensive GHG inventory to support climate action planning Help cities establish a base year emissions inventory, set reduction targets, and track their performance Ensure consistent and transparent measurement and reporting of GHG emissions between cities, following internationally recognized GHG accounting and reporting principles 1 See UN Environment Programme, ”Cities and Climate Change,” https://www.unep.org/explore-topics/resource- efficiency/what-we-do/cities/cities-and-climate-change 2 There are two reporting frameworks commonly used by cities: the U.S. Community Protocol and the Global Protocol for Communities (GPC). Palo Alto uses the GPC framework. 3 Formerly the International Council for Local Environmental Initiatives, renamed in 2003 to ICLEI – Local Governments for Sustainability. 4 U.S. Community Protocol; https://icleiusa.org/us-community-protocol/ Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 20  Packet Pg. 145 of 228  Page 2 of 12 Enable city inventories to be aggregated at subnational and national levels Demonstrate the important role that cities play in tackling climate change, and facilitate insight through benchmarking – and aggregation – of comparable data Palo Alto’s first generation-based citywide inventory was completed for 2005 and then extrapolated for 1990 (the baseline year). Beginning in 2010, new citywide GHG inventories were completed annually, enabling Palo Alto to track progress over time. The 2024 Palo Alto Citywide GHG inventory, completed by Rincon Consultants, follows the calculation and reporting standards outlined in the GPC BASIC reporting level.9 Inventory calculations were performed using Rincon’s GHG Inventory tool and uploaded into ClearPath 2.0,10 a software platform designed for creating generation-based GHG inventories. GHG emissions from community activities are classified into three main sectors: •Stationary Energy (e.g., building electricity consumption, fugitive natural gas emissions) •Transportation (e.g., on-road passenger vehicles, off-road equipment) •Waste (e.g., solid waste disposal, wastewater treatment and discharge) Activities taking place within a city can generate GHG emissions that occur inside the city boundary as well as outside the city boundary. To distinguish among them, the GPC groups emissions into three categories based on where they occur: Scope 1: GHG emissions from sources located within the city boundary, such as stationary fuel consumption. Scope 2: GHG emissions occurring due to the use of grid-supplied electricity, heat, steam, and/or cooling within the city boundary. Scope 3: All other GHG emissions that occur outside the city boundary as a result of activities taking place within the city boundary. This inventory follows the city-inducted framework in the GPC protocol, which totals GHG emissions attributable to activities taking place within the geographic boundary of the city.11 Under the Basic reporting level as defined by the GPC protocol, the inventory requirements cover scope 1 and scope 2 emissions from stationary energy and transportation, as well as all emissions resulting from waste generating within the city boundary. While the 2024 Inventory follows GPC BASIC reporting standards and aligns with previous GHG emissions inventories, minor updates to calculation methodologies were included in the 2024 Inventory and previous inventories following the GPC protocol were corrected as well. Of note, the 1990 Inventory was updated to follow GPC BASIC reporting standards and align with GHG emissions inventories from 2019 through 2024. Previously excluded emissions sources were added, including: Airport Emissions, Off-Road Vehicles and Equipment, Caltrain Commuter Rail, Composting, Palo Alto Landfill Gas Flaring, and Wastewater Biosolid Treatment. 9 GPC Executive Summary; https://ghgprotocol.org/sites/default/files/2022-12/GPC_Executive_Summary_1.pdf 10 ClearPath 2.0 tool; https://icleiusa.org/clearpath-2/ 11 GPC Protocol; https://ghgprotocol.org/sites/default/files/standards/GHGP_GPC_0.pdf Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 21  Packet Pg. 146 of 228  Page 3 of 12 The City did not complete a consumption-based GHG inventory. The California Air Resources Board (CARB) has been tasked with developing an implementation framework and accounting to track consumption-based emissions over time.15 In particular, this framework needs to address how to account for the embodied emissions in the food, goods, and services the community purchases not covered by generation-based GHG inventories. 1.b. Palo Alto’s 2024 GHG Emissions In 2024, Palo Alto emitted an estimated 397,791 metric tons (MT) of carbon dioxide equivalent (CO2e) from the residential, commercial, industrial, transportation, waste, water, and municipal sectors. In comparison to the 1990 base year emissions (which have increased to 798,868 MT from the previously calculated 780,119 MT due to corrections in methodology and additions of excluded emissions sources), these emissions represent a 50.2% decrease in total community emissions, despite a population increase of 22% during that same period. Emissions in 2024 equated to 5.9 MT per capita. The California Air Resource Board’s 2017 Scoping Plan Update recommends a goal for local governments of 6 MT CO2e per capita by 2030 and 2 MT CO2e per capita by 2050.8 In order to achieve 80 x 30, Citywide GHG Emissions need to be at 160,000 MT CO2e (corrected from the previous target of 156,024 MT CO2e). Of the GHG emissions reductions to date, 46.4% came from providing carbon free for the City’s electricity portfolio, 23.4% from declines in transportation emissions, 16.7% from reduction in natural gas (methane) consumption, 11.5% from declines in solid waste emissions, and 1.9% from declines in wastewater-related emissions. For citywide GHG emission sources in 2024, 64.1% of GHG emissions were from Transportation and Mobile Sources, 31.9% from Natural Gas (Methane) Use, and the remainder are from other sources. A comparison of 1990 and 2019 through 2024 Citywide GHG emissions is shown in Figure 1. The full comparison between the inventories can be found in Attachment B Historical Comparison of Citywide GHG Emissions by Sector. Total GHG emissions steadily decreased between 1990 and 2021. However, emissions increased between 2021 and 2022 and slightly increased between 2022 and 2023. The main driver of the increase in 2022 was On-Road Transportation, in part due to the shift away from pandemic- level (reduced) driving frequency, returning to the office after working from home, and economic recovery. These effects likely continued into 2023 as employers continued to change hybrid work policies and economic and travel activities continued to shift. GHG emissions decreased by 4% between 2023 and 2024. This decrease was primarily driven by reductions in Natural Gas (Methane) Use: residential natural gas GHG emissions decreased by 14.2%, commercial by 10.9%, and industrial by 20.1% since 2023. 15 Executive Department State of California. (2019). Executive Order B-55-18 to Achieve Carbon Neutrality. https://www.ca.gov/archive/gov39/wp-content/uploads/2018/09/9.10.18-Executive-Order.pdf. Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 22  Packet Pg. 147 of 228  Page 4 of 12 Figure 1: Palo Alto Citywide Greenhouse Gas Emissions by Sector, 1990 and 2019 - 2024 As shown in Figure 2, the two largest categories of emissions are Transportation and Mobile Sources (including On-Road Transportation, Airport Emissions, Off-Road Vehicles and Equipment, and Caltrain Commuter Rail) and Natural Gas (Methane) Use (including Residential, Commercial, and Industrial). Transportation and Mobile Sources include emissions from private, commercial, and fleet vehicles driven within the City’s geographical boundaries, as well as the emissions from public transit vehicles and the City-owned fleet. Off-Road Vehicles and Equipment include airport ground support, construction and mining, industrial, light commercial, portable equipment, and transportation refrigeration units. Natural Gas (Methane) Use includes emissions that result from natural gas (methane) consumption in both private and public sector buildings and facilities, and residential, commercial, and industrial sources. Fugitive emissions related to natural gas (methane) consumption are calculated separately and are discussed in Section 1.d. The City’s electricity supply has been carbon free since 2013, when the City Council approved a Carbon Neutral Electric Resource Plan, committing Palo Alto to pursuing only carbon-neutral electric resources and effectively eliminating all GHG emissions from the City's electric portfolio. Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 23  Packet Pg. 148 of 228  Page 5 of 12 Figure 2: 2024 Palo Alto Citywide Greenhouse Gas Emissions by Sector In 2024, Transportation and Mobile Sources accounted for 64.1% of total citywide GHG emissions in Palo Alto. GHG emissions from Transportation and Mobile Sources are estimated to have increased slightly (by less than 1%) between 2023 and 2024 but remain 27% lower than 1990 transportation and mobile emissions. Within Transportation and Mobile Sources, On-Road Transportation increased slightly (less than half a percent). However, this estimate is preliminary due to lack of data. Vehicle miles traveled (VMT) data for 2024 were not yet available when the 2024 GHG inventory was prepared. City staff and external experts calculated a preliminary estimate of 2024 VMT by scaling 2023 per capita VMT based on 2024 population for passenger vehicles and service population for commercial vehicles and buses. This estimate reflects demographic growth and may not capture actual VMT trends. The largest increase between 2023 and 2024 was from Airport Emissions, which increased 22.4% from 2023. The largest increase from 1990 was from Off-Road Vehicles and Equipment, which increased 173%. As shown in Table 2, transportation and mobile sources consist of: On-Road Transportation – This includes all daily vehicular trips made entirely within the Palo Alto city limits (in-boundary trips), one-half of daily vehicular trips with an origin within Palo Alto city limits and a destination outside of Palo Alto city limits (outbound trips; this assumes that Palo Alto shares half the responsibility for trips traveling from other jurisdictions), and one-half of daily vehicular trips with an origin outside Palo Alto Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 24  Packet Pg. 149 of 228  Page 6 of 12 city limits and a destination within Palo Alto city limits (inbound trips; this assumes that Palo Alto shares the responsibility of trips traveling to other jurisdictions). Vehicular trips through Palo Alto (such as commuters on Highway 101) are not included because Palo Alto cannot solely implement policies that influence the trip-making behavior. Rather, through trips are assigned to other jurisdictions that can influence either the origin or destination side of the trip-making behavior. Airport Emissions – This includes emissions from take-offs and landings from trips that start and end at Palo Alto Airport. This includes emergency services helicopters, sightseeing helicopters, and training flights. Flights that take-off from Palo Alto Airport but land elsewhere, and flights that land in Palo Alto Airport but take-off from elsewhere are not included per GPC Basic Protocol. Off-Road Vehicles and Equipment - This includes airport ground support (based on take- offs and landings), construction and mining, industrial (based on employment data), light commercial (based on employment data), portable equipment, and transportation refrigeration units (based on service population). Caltrain Commuter Rail – This includes emissions from Caltrain travel within Palo Alto. Table 2: Transportation and Mobile Sources GHG Emissions by Subsector (MT CO2e) Subsector 1990 2019 2020 2021 2022 2023 2024 % of Total 2024 GHG On-Road Transportation 331,840 293,413 217,279 185,925 221,923 225,387 226,019 64.1% Airport Emissions 3,096 2,192 1,664 2,641 1,837 1,935 2,369 0.6% Off-road Vehicles 7,431 14,634 15,029 18,961 20,191 19,129 20,287 5.1% Caltrain Commuter Rail 6,390 4,842 4,552 3,876 7,272 6,377 6,331 1.6% Total MT CO2e 348,757 315,081 238,523 211,403 251,223 252,828 255,006 61.2% Note: Percentages and MT CO2e may not add to the total due to rounding The main driver of GHG emissions from Transportation and Mobile sources is fuel combustion from internal combustion engine (ICE) vehicles, specifically passenger vehicles, commercial vehicles, and buses (69%, 18%, and 2% of all transportation GHG emissions, respectively). Since electricity in the City is carbon-neutral, there are no GHG emissions attributed to passenger, commercial, or bus EVs. The 2024 inventory utilized vehicles miles traveled (VMT) data from Google’s Environmental Insights Explorer (EIE) and VMT-weighted emission factors from the California Air Resources Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 25  Packet Pg. 150 of 228  Page 7 of 12 (CARB) Emission FACtor (EMFAC) model17 to estimate GHG emissions from all passenger, commercial, and bus ICE vehicles. Because 2024 VMT data is not yet available from Google EIE, City staff and external experts calculated a preliminary estimate of 2024 VMT by scaling 2023 per capita VMT based on 2024 population for passenger vehicles and service population for commercial vehicles and buses. When the Google EIE data becomes available, the City will update 2024 VMT accordingly. In 2023, 46% of VMT was from inbound trips, 45% from outbound trips, and 9% from in-boundary trips. 18 Commercial and bus VMT data were then multiplied by their respective EV share percentages to determine EVMT of these vehicle categories. 19 including airport ground support, construction, mining, industrial, light commercial, portable equipment, and transportation refrigeration units. All attribution factors used to allocate 17 CARB EMFAC v1.0.1.; https://ww2.arb.ca.gov/our-work/programs/msei/on-road-emfac 18 While these percent EV share estimates also come from CEC’s ZEV Statistics database, only county-level data is available for medium- and heavy-duty (i.e., commercial and bus) ZEVs. The average percent EV share for Santa Clara and San Mateo County was used as a proxy for Palo Alto because Palo Alto shares one zip code (94303) with San Mateo, and much I-E/E-I EVMT attributed to Palo Alto is assumed to be between these two counties 19 CARB OFFROAD v1.0.5.; https://arb.ca.gov/emfac/offroad/ Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 26  Packet Pg. 151 of 228  Page 8 of 12 countywide fuel consumption to Palo Alto in 2024 remained the same as previous inventories,23 except airport ground support. Attributed fuel consumption from each off-road sector was then multiplied by its respective GHG emissions factor (MT CO2e/gallon) depending on fuel type (i.e., gasoline, diesel, or natural gas) to estimate GHG emissions. Sustainability Report as the most recently available data.24 It is assumed that the total fuel consumption and allocation methodology described above is comparable to Palo Alto’s share of Caltrain commuter rail emissions in 2024. This estimation method results in the highest emissions to remain conservative. Caltrain electrification is a key component of the Caltrain Modernization program,25 with Caltrain electrified in late September 2024. Now that the Caltrain Modernization program is complete, most of the Caltrain commuter rail emissions will be eliminated in future Citywide GHG Emissions Inventories. 1.d Natural Gas (Methane) Use 23 Attribution factors are based off demographic data such as population, employment, and service population (except for airport ground support). 24 Caltrain 2023 Sustainability Report; https://www.caltrain.com/media/33109 25 Caltrain Modernization Program; https://calmod.org/ Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 27  Packet Pg. 152 of 228  Page 9 of 12 appliances. Overall, Natural Gas (Methane) Use emissions remain far below 1990 levels (34.5% decrease). 1Table 3: Natural Gas (Methane) Consumption by Subsector (Therms) Subsector 2019 2020 2021 2022 2023 2024 % of Total 2024 GHG Commercial 12,954,768 10,061,842 10,468,041 11,729,819 12,502,216 11,144,038 15.0% Residential 13,565,360 12,952,262 12,756,160 13,037,423 12,686,165 10,884,832 14.6% Industrial 2,707,034 2,253,641 2,294,119 2,372,902 2,193,781 1,752,352 2.4% Total Therms 28,867,162 25,267,739 25,518,320 27,140,144 27,382,162 23,781,222 31.9% Note: Percentages and Therms may not add to the total due to rounding Natural Gas (Methane) Fugitive Emissions 4), some of which escapes during the drilling, extraction, and transportation processes. Such releases are known as fugitive emissions. The primary sources of these emissions may include equipment leaks, evaporation losses, venting, flaring, and accidental releases. Methane is a potent greenhouse gas – approximately 25 times more powerful than carbon dioxide over a 100-year timescale. Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 28  Packet Pg. 153 of 228  Page 10 of 12 1.e. Solid Waste In 2024, Palo Alto's solid waste diversion rate was 88%, far exceeding the 50% mandate for local jurisdictions. “Diversion” includes all waste prevention, reuse, recycling, and composting activities that “divert” materials from landfills. The City uses the diversion rate to measure progress on waste reduction and resource conservation goals. The diversion rate of 88% is an improvement from the 62% rate in 2007, 81% rate in 2019, and 84% rate in 2022 and 2021. However, it is a decrease from the 91% rate in 2022 and 2023 due to increased waste landfilled in 2024. As part of the 2016 S/CAP Framework, the City Council adopted a goal of 95% diversion of materials from landfills by 2030.29 Solid Waste emissions accounted for 2.3% of total 2024 citywide GHG emissions in Palo Alto, a 6.4% decrease from 2023 and an 83.4% decrease from 1990. As shown in Table 4, the 2024 inventory included emissions from solid waste generated in the City but treated biologically outside of the city. This includes composting emissions at the Zero Waste Energy Development Company’s (ZWED) Dry Fermentation Anaerobic Digestion (AD) Facility in San Jose, CA, composting emissions at the Synagro El Nido Central Valley Composting (CVC) facility in Dos Palos, as well as Palo Alto Landfill Gas Flaring Emissions. 2e) 0 731 1,154 843 1,142 1,242 1,308 0.3% 226 281 316 237 233 186 176 0% 24,325 n/a30 n/a n/a n/a n/a n/a n/a 30,732 5,519 4,721 5,029 5,297 6,702 7,715 1.9% 2e Note: Percentages and MT CO2e may not add to the total due to rounding Solid Waste emissions increased slightly in 2024, with landfill methane emissions increasing by 15.1% compared to 2023 but remaining 74.9% lower than 1990 levels. Organic Waste Composting emissions also increased slightly (5.3%) compared to 2023, continuing the trend driven by state-mandated organic waste diversion programs such as SB 1383. 29 Sustainability and Climate Action Plan Framework, November 2016; https://www.cityofpaloalto.org/civicax/filebank/documents/64814 30 Not included because the Palo Alto landfill was closed Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 29  Packet Pg. 154 of 228  Page 11 of 12 Waste emissions result from organic material decomposing in the anaerobic conditions present in a landfill and releasing methane (CH4) – a greenhouse gas much more potent than CO2. Organic materials (e.g., paper, plant debris, food waste, etc.) generate methane within the anaerobic environment of a landfill while non-organic materials (e.g., metal, glass, etc.) do not. This is why diverting waste from landfills is so important. In 2016, Governor Brown signed Senate Bill 1383 (SB 1383) to reduce GHG emissions from a variety of short-lived climate pollutants, including methane from organic materials disposed in landfills. SB 1383 is the largest and most prescriptive waste management legislation in California since the California Integrated Waste Management Act of 1989 (AB 939) and aspires to reduce statewide disposal of organic waste 75% by 2025 and recover at least 20% of the currently disposed edible food for human consumption by 2025. Palo Alto is in compliance with many of SB 1383 requirements due to the City’s progressive zero waste programs and initiatives and is continuing to take initiatives to further reduce organic materials from being disposed in landfills. 1.f. Wastewater Treatment 3Table 5: Wastewater-Related GHG Emissions by Subsector (MT CO2e) Subsector 1990 2019 2020 2021 2022 2023 2024 % of Total 2024 GHG Wastewater Biosolid Treatment33 Wastewater Treatment Wastewater Effluent Wastewater Sludge Composting Total MT CO2e 10,110 2,197 1,857 1,674 2,615 2,463 2,409 0.6% Note: Percentages and MT CO2e may not add to the total due to rounding 33 Sludge incineration Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 30  Packet Pg. 155 of 228  Page 12 of 12 As shown in Figure 3, RWQCP operations achieved significant GHG reductions in 2019 when the facility’s sewage sludge incinerators were replaced with the more environmentally friendly Sludge Dewatering and Truck Loadout Facility. Previously, RWQCP incinerators were the City’s largest facility-related GHG source. The updated biosolids treatment process has and will continue to reduce GHG emissions by approximately 15,000 MT of CO2e per year when compared to the emissions from incineration. This approximates the carbon dioxide emissions of 3,000 passenger cars. The dewatered sludge is used as agricultural soil supplements. Figure 3: Regional Water Quality Control Plant Historical Total Greenhouse Gas Emissions Item 8 Attachment A - 2024 Citywide GHG Inventory        Item 8: Staff Report Pg. 31  Packet Pg. 156 of 228  1 0 2 4 7 Attachment B: Historical Comparison of Palo Alto Citywide GHG Emissions by Sector Sector and Subsector 1990 GHG emissions (MT CO2e) 2019 GHG emissions (MT CO2e) 2020 GHG emissions (MT CO2e) 2021 GHG emissions (MT CO2e) 2022 GHG emissions (MT CO2e) 2023 GHG emissions (MT CO2e) 2024 GHG emissions (MT CO2e) % Change in 2024 from 1990 % of Total 2024 Emissions Total Transportation & Mobile Sources 348,757 315,081 238,523 211,403 251,223 252,828 255,0061 -26.9%64.1% -On-Road Transportation 331,840 293,413 217,279 185,925 221,923 225,387 226,019 -31.9%56.8% -Airport Emissions 3,096 2,192 1,664 2,641 1,837 1,935 2,369 -23.5%0.6% -Off-road Vehicles 7,431 14,634 15,029 18,961 20,191 19,129 20,287 173.0%5.1% -Caltrain Commuter Rail 6,390 4,842 4,552 3,876 7,272 6,377 6,331 -0.9%1.6% Total Natural Gas (Methane) 194,000 153,509 134,365 135,697 144,996 146,289 127,051 -34.5%31.9% -Commercial Energy 66,987 53,515 55,676 62,667 66,793 59,537 n/a 15.0% -Industrial Energy 14,373 11,961 12,176 12,677 11,720 9,362 n/a 2.4% -Residential Energy 72,149 68,889 67,846 69,652 67,776 58,152 n/a 14.6% Natural Gas (Methane) Fugitive 4,718 5,009 4,384 4,427 4,709 4,751 4,126 -12.5%1.0% Total Wastewater-Related Emissions 10,110 2,197 1,857 1,674 2,615 2,463 2,409 -76.2%0.6% -Wastewater Biosolid Treatment2 1,606 403 0 0 0 0 0 -100.0%0% -Wastewater Treatment 380 381 346 86 82 85 n/a 0% -Wastewater Effluent 8,504 1,005 1,007 915 2,344 2,163 2,077 n/a 0.5% -Wastewater Sludge Composting 409 469 412 185 218 247 -97.1%0.1% Total Solid Waste Emissions 55,283 6,531 6,191 6,110 6,672 8,130 9,199 -83.4%2.3% -Organic Waste Composting (ZWED)0 731 1,154 843 1,142 1,242 1,308 n/a 0.3% -Palo Alto Landfill Gas Flaring 226 281 316 237 233 186 176 -22.1%0% -Palo Alto Landfill Gas Fugitive 24,325 n/a3 n/a n/a n/a n/a n/a -100.0%0% -Palo Alto Landfill Methane 30,732 5,519 4,721 5,029 5,297 6,702 7,715 -74.9%1.9% Brown Power Supply (Electricity)186,000 04 0 0 0 0 0 -100.0%0% Total GHG Emissions (MT CO2e)798,868 482,237 385,320 359,312 410,215 414,461 397,791 -50.2%100% Notes: MT CO2e = metric tons of carbon dioxide equivalent. Percentages and MT CO2e may not add to the total due to rounding 1 Based on a preliminary estimate of 2024 Vehicle Miles Travelled (VMT). 2024 Google Environmental Insights Explorer VMT data was unavailable at time of publication. 2 Sludge Incineration. In 2019, the sewage sludge incinerators at the Regional Water Quality Control Plant were replaced with a Sludge Dewatering and Truck Loadout Facility. 3 Not included because the Palo Alto landfill was closed. 4 Since 2013, the City provides carbon free electricity to all customers. Item 8 Attachment B - Historical Comparison of Citywide GHG Emissions by Sector        Item 8: Staff Report Pg. 32  Packet Pg. 157 of 228  Page 1 of 7 Attachment C: Palo Alto 2024 Municipal Greenhouse Gas Emissions Inventory Overview of Methodology for Quantifying Greenhouse Gas Emissions The 2024 Municipal Greenhouse Gas (GHG) Emissions Inventory follows the calculation and reporting standards outlined in the International Council for Local Environmental Initiatives’ (ICLEI) Local Government Operation (LGO) Protocol1, which aligns with the Global Protocol for Community-Scale GHG Emissions Inventories (GPC) local government operations protocol.2 Under the LGO Protocol, GHG Emissions from Palo Alto’s municipal operations can be classified into four main sectors: Buildings and other facilities (e.g., stationary combustion) Streetlights and Traffic Signals (e.g., electricity use) City vehicle and equipment fleet (e.g., mobile combustion) Wastewater facilities (e.g., wastewater treatment and discharge) Indirect emissions (e.g., employee commuting, landfilled solid waste generation) Activities taking place within a city can generate GHG emissions that occur inside the city boundary as well as outside the city boundary. To distinguish among them, the LGO Protocol groups emissions into three categories based on where they occur: Scope 1 emissions: GHG emissions from sources located within the city boundary Scope 2 emissions: GHG emissions occurring as a consequence of the use of grid- supplied electricity, heat, steam and/or cooling within the city boundary Scope 3 emissions: All other GHG emissions that occur outside the city boundary as a result of activities taking places within the city boundary Palo Alto’s 2024 Municipal GHG Emissions In 2024, the City emitted a total of 14,590 metric tons (MT) of carbon dioxide equivalent (CO2e) from municipal operations. As shown in Figure 1, GHG emissions from Palo Alto’s municipal operations are from five main sectors: Buildings and Other Facilities, Streetlights and Traffic Signals, City Vehicles and Equipment, Wastewater Facilities, and Indirect Emissions. Since the methodology has changed significantly for certain sectors since the first Municipal GHG Inventory was conducted in 2005, it is no longer possible to do an equivalent comparison with previous Municipal GHG inventories. However, the methodologies for Buildings and Other Facilities, Streetlights and Traffic Signals, and City Vehicles and Equipment are similar enough to make rough comparisons. For reference only, in 2005 the City emitted a total of 40,499 MT CO2e from municipal operations. By the end of 2024 the City reduced total municipal GHG emissions roughly 64% from the 2005 baseline. 1 LGO Protocol Rulebook; https://icleiusa.org/resources/local-government-operations-lgo-protocol/ 2 GPC Inventories for local government operations; https://ghgprotocol.org/sites/default/files/standards/GPC_Full_MASTER_RW_v7.pdf Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 33  Packet Pg. 158 of 228  Page 2 of 7 Figure 1: 2024 Palo Alto Municipal Greenhouse Gas Emissions by Sector The majority of municipal GHG emissions, about 37%, are attributed to the Regional Water Quality Control Plant (RWQCP). Since the RWQCP is owned and operated by the City, 100% of GHG emissions are attributed to the City and are Scope 1. These GHG emissions include indirect nitrous oxide (N2O) emissions from wastewater effluent (about 95% of total wastewater GHG emissions), process nitrous oxide emissions from the treatment of wastewater without nitrification/denitrification (about 4% of total Wastewater Facilities sector GHG emissions), and natural gas combustion/leakage (about 1% of total Wastewater Facilities GHG emissions). The second major contributor to GHG emissions is attributed to the Indirect Sources sector, or the City’s Scope 3 sources. These indirect sources account for about 33% of total GHG emissions and include GHG emissions resulting from employee commute mobile combustion (about 44% of the Indirect Emission Sources GHG emissions) and methane emissions resulting from landfilled solid waste (about 56% of the Indirect Emissions Sources GHG emissions). Landfilled solid waste methane emissions are a product of decomposing organic material generated and sent to the landfill by municipal operations. This subsector attributes methane emissions based on total landfilled solid waste generated in the inventory year and does not account for pre- existing landfilled solid waste methane emissions. The third major contributor to GHG emissions includes GHG emissions from natural gas usage in Buildings and Other Facilities (excluding the RWQCP), considered a Scope 1 source. These GHG emissions accounted for 22% of total GHG emissions and are driven by natural gas combustion (about 97% of Buildings and Other Facilities GHG emissions), and natural gas leakage (about 3% of Buildings and Other Facilities GHG emissions). Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 34  Packet Pg. 159 of 228  Page 3 of 7 The final contributor to GHG emissions includes the City’s vehicle and equipment fleet sector, considered a Scope 1 source (except for the City’s electric vehicles, EVs, which are considered a Scope 2 source due to the energy source being purchased electricity). Together, these account for about 9% of total GHG emissions and are mainly driven by the City’s on-road vehicle fleet powered by gasoline, renewable diesel, and compressed natural gas (CNG) and off- vehicle/equipment fleet powered by gasoline and diesel. The City’s on-road vehicle fleet makes up about 97% of City Vehicle and Equipment Fleet GHG emissions, while off-road vehicles and equipment make up the remaining 3%. Figure 2: Palo Alto Municipal GHG Emissions, 2005 and 2022-2024 Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 35  Packet Pg. 160 of 228  Page 4 of 7 Table 1: Palo Alto Municipal GHG Emissions (MT CO2e) Sector and Subsector Scope 2005 2022 2023 2024 % Change in 2024 from 2005* Buildings and Other Facilities 10,698 3,398 2,844 3,154 - 70.5% - Electricity Use Scope 2 0 0 0 - Natural Gas Combustion Scope 1 3,291 2,755 3,055 - Natural Gas Leakage Scope 1 107 89 99 - Water-Energy Consumption Scope 2 0 0 0 Streetlights & Traffic Signals 748 0 0 0 - 100% City Vehicles and Equipment Fleet 2,835 1,676 1,352 1,308 - 53.9% - On-road Renewable Diesel**Scope 1 499 182 182 - On-road Gasoline Scope 1 1,045 1,108 1,079 - On-road CNG Scope 1 6 20 7 - On-road Electric Scope 2 0 0 0 - Off-road Renewable Diesel**Scope 1 124 40 37 - Off-road Gasoline Scope 1 3 2 3 Wastewater Facilities (Regional Water Quality Control Plant)11,269*5,715 5,722 5,354 - 52.5%* - Effluent Discharge Fugitive Scope 1 5,448 5,414 5,070 - Process N₂O Emissions Scope 1 200 206 207 - Electricity Use Scope 2 0 0 0 - Natural Gas Combustion Scope 1 65 99 75 - Natural Gas Leakage Scope 1 2 3 2 Indirect Emission Sources 5,567*4,758 4,873 4,774 - 14.2%* - Employee Commute Scope 3 1,865 1,980 2,096 - Landfill Methane Scope 3 5,567 2,893 2,893 2,678 Power Generation Facilities 9,308 n/a n/a n/a n/a Water Delivery Facilities 74 n/a n/a n/a n/a Total MT CO2e 40,499*15,546 14,792 14,590 - 64%* Note: Percentages and MT CO2e may not add to the total due to rounding * Not an equivalent comparison due to different methodologies ** Diesel emissions factors were used in 2022 Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 36  Packet Pg. 161 of 228  Page 5 of 7 Despite the overall downward trend, GHG emissions from natural gas combustion (Scope 1) in the Buildings and Other Facilities sector increased between 2023 and 2024 due to higher therms usage. These emissions had previously decreased by 16% from 2022 to 2023 but rose by 11% from 2023 to 2024. Nonetheless, total GHG emissions from natural gas combustion declined by 7% between 2022 and 2024. 5 Administrative Services Department – purchasing and printing Community Services Department – administration, arts and culture, recreation, parks and golf Fire Department – operations, support Information Technology Department – information technology Planning and Development Department – inspection services Police Department – police, animal services Public Works Department – engineering, facilities management, equipment management, operations, wastewater treatment operations, storm drainage, refuse, Palo Alto airport operations Utilities Department – administrative services, electric operations, electric engineering, water / gas / wastewater engineering, water / gas / wastewater operations, resource management 5 CARB staff has reached out to several renewable diesel fuel producers and as of February 2023, is aware that renewable diesel produced by Neste meets the regulatory requirements and standards. Estimates in GHG emissions reduction based on emission factors provided by Neste accessed at: https://www.neste.com/en- us/products-and-innovation/neste-my-renewable-diesel/product-information Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 37  Packet Pg. 162 of 228  Page 6 of 7 Table 2: On-Road Vehicle GHG emissions by City Department & Vehicle Fuel Type (MT CO2e) City Department Diesel Vehicles Gasoline Vehicles CNG Vehicles Total (MT CO2e) Administrative Services 2.4 0 0.2 2.6 Community Services 5.4 87.8 0 93.2 Fire 52.5 66 0.02 118.5 Information Technology 0 2.3 0 2.3 Planning and Development 0 18.6 0.03 18.7 Police 7 413.5 0 420.5 Public Works 56 214.3 4.5 274.9 Utilities 58.5 276.4 2.5 337.4 Total MT CO2e 181.9 1,078.8 7.3 1,268 Note: Totals and MT CO2e may not add to the total due to rounding Table 3: On-Road Vehicle GHG emissions by City Department (MT CO2e) City Department 2022 2023 2024 % of Total in 2024 Administrative Services 8.3 2.8 2.6 0.2% Community Services 88.9 87.9 93.2 7.4% Fire 228.9 118.7 118.5 9.3% Information Technology 2.5 2.4 2.3 0.2% Planning and Development 18.1 22.2 18.7 1.5% Police 430 421.7 420.5 33.2% Public Works 337.8 323.5 274.9 21.7% Utilities 436 328.5 337.4 26.6% Total MT CO2e 1550.2 1307.6 1268 100.0% Note: Percentages and MT CO2e may not add to the total due to rounding Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 38  Packet Pg. 163 of 228  Page 7 of 7 Figure 3: Palo Alto On-Road Vehicle GHG Emissions by City Department Item 8 Attachment C - 2024 Municipal GHG Inventory        Item 8: Staff Report Pg. 39  Packet Pg. 164 of 228  1 0 2 4 9 Attachment D: S/CAP Key Performance Indicators Progress Report This progress report provides an update on the Sustainability and Climate Action Plan (S/CAP) Key Performance Indicators (KPIs) for calendar year 2024. The S/CAP Key Actions are abbreviated for the purposes of this report, but the full key actions can be found in Section 5: Goals and Key Actions of the S/CAP.1 Significant actions and accomplishments from 2024 can be found on the Sustainability website2. Climate Action GOAL  Reduce GHG emissions 80% below 1990 levels by 2030 KEY ACTIONS Community assistance C1. Provide building and transportation emissions consultations for residents C2. Develop major employer custom emissions reduction plans Staff Analysis C3. Study additional key actions needed for 80 x 30 C4. Study staffing and budgetary needs C5. Study funding alternatives C6. Conduct an electrification affordability study C7. Study carbon neutrality options Staff and Council action C8. Accelerate GHG reductions KEY PERFORMANCE INDICATORS  GHG reductions  Community awareness  Participation in Climate Pledge Climate Action KPI: GHG Reductions Palo Alto has already made significant progress in its sustainability and climate action efforts, decreasing its community emissions to 397,791 metric tons (MT) CO2e, or 5.9 MT CO2e per Palo Alto resident in 2024 (50.2% decrease compared to 1990 levels). However, to achieve the 80 x 30 and carbon neutrality by 2030 goals, Palo Alto must meet a greenhouse gas (GHG) emissions target of 160,000 MT CO2e, or 2 MT CO2e per Palo Alto resident by 2030. In order to make 1 2022 Sustainability and Climate Action Plan; https://www.paloalto.gov/files/assets/public/v/1/sustainability/reports/2022-scap-report_final.pdf 2 Sustainability Actions and Accomplishments; https://www.cityofpaloalto.org/City-Hall/Sustainability/Goals-and- Progress/Sustainability-Actions-and-Accomplishments Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 40  Packet Pg. 165 of 228  1 0 2 4 9 progress on the GHG reductions goal, in 2024 the City focused on community assistance (Key Action C1, C2), staff analysis (C3, C4, C5, and C6), and staff and Council action (C8). Climate Action KPI: Community Awareness 5 Fifty-eight percent of Palo Altans were not familiar with the S/CAP and it’s 80 x 30 goal. Climate Action KPI: Participation in Climate Pledge GOALS Reduce GHG emissions from the direct use of natural gas in Palo Alto’s building sector by at least 60% below 1990 levels (116,400 MT CO2e reduction) Reduce GHG emissions from the direct use of natural gas in Palo Alto’s building sector by at least 60% below 1990 levels (116,400 MT CO2e reduction) KEY ACTIONS Reduce greenhouse gas emissions in appliances and equipment E1.Reduce GHG emissions in Single-Family Appliances and Equipment E2.Reduce GHG emissions in Non-Residential Equipment Reduce natural gas use in buildings E3.Reduce Gas Use in Major Facilities E4.Reduce natural gas use at City facilities 5 Palo Alto Community Survey, 2024; https://www.paloalto.gov/files/assets/public/v/1/city- manager/communications-office/general/palo-alto-community-survey-report-2024-final.pdf Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 41  Packet Pg. 166 of 228  1 0 2 4 9 Make it affordable E5.Support income-qualified residents and vulnerable businesses with electrification E6.Develop electric rate options Paving the road to electrification E7.Use codes and ordinances to facilitate electrification E8.Electric grid modernization plan E9.Additional electrification opportunities in commercial and multi-family buildings KEY PERFORMANCE INDICATORS GHG emissions from natural gas use in buildings (single-family, multifamily, nonresidential) Percentage of single-family households with no gas connections Percentage of gas use reduction in major facilities and City facilities In order to make progress on the Energy goals, in 2024 the City focused on key actions to reduce GHGs in appliances and equipment (E1, E2), reduce natural gas use in buildings (E3, E4), make it affordable (E5, E6), and pave the road to electrification (E7, E8). In 2024, total natural gas (methane) use in buildings was 23,781,222 therms7 or 127,051 MT CO2e, which is a decrease from 2023. In 2023, total natural gas (methane) use in buildings was 27,382,162 therms or 146,289 MT CO2e. This is a slight increase from 2022, when total natural gas (methane) use in buildings was 27,140,144 therms or 144,996 MT of CO2e. This is most likely because it was colder in the first three months of 2023 than it was in the first three months of 2022. It could also be because more people were returning to work in offices and continuing to return to Palo Alto for dining, shopping, and recreation. The decrease between 2024 and 2023 is partly because January 2024 was the warmest January on record. It could also be partly because residents have replaced more gas appliances with electric appliances. The City estimates that 2.0% of single-family households (289 single-family homes) have no gas connections. The S/CAP impact analysis found that in order to achieve 80 x 30, virtually all single-family gas appliances need to be switched to electric appliances. Natural gas (methane) use in City facilities in 2024 decreased by 45 percent compared to the 2016 baseline. Data is currently not available for other major facilities. 7 One therm is the energy content of approximately 100 cubic feet of natural gas at standard temperature and pressure. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 42  Packet Pg. 167 of 228  1 0 2 4 9 Electric Vehicles GOALS Reduce transportation related GHG emissions at least 65% below 1990 levels (215,696 MT CO2e reduction) Develop a public and private charging network to support EV adoption KEY ACTIONS Education, awareness, and collaboration EV1.Raise awareness of alternative transportation modes, micro-mobility, and EVs EV2.Collaborate to promote EV adoption regionally EV3.Promote EV adoption and alternative commutes for commuters EV4.Facilitate the adoption of EVs, e-bikes and other light EVs EV5.Promote alternative transportation modes and infrastructure to support adoption Expand EV infrastructure EV6.Expand EV charging access for multi-family residents EV7.Improve EV charging access for income-qualified residents EV8.Ensure EV charging capacity supports EV growth Electrify fleet vehicles EV9.Electrify municipal vehicle fleet EV10.Support policy to electrify fleet vehicles KEY PERFORMANCE INDICATORS GHG emissions from vehicle travel Percentage of registered EV vehicles in Palo Alto Percentage of new vehicle sales that are EVs Percentage of multifamily residents with access to overnight EV charging Gasoline sales in Palo Alto EV KPI: GHG emissions from vehicle travel 2e of citywide GHG emissions were attributed to on-road vehicle transportation. While VMT data were not available for 2024, City staff and external experts calculated a preliminary estimate of 2024 VMT based on 2023 per capita VMT, 2024 population for passenger vehicles, and service population for commercial vehicles and buses. The preliminary estimate of 226,019 MT CO2e is an increase compared to the past four years, but a decrease compared to pre-COVID-19 emissions from VMT. Emissions from passenger vehicles decreased slightly, but emissions from commercial vehicles and buses increased slightly. EV KPI: Percentage of registered electric vehicles in Palo Alto Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 43  Packet Pg. 168 of 228  1 0 2 4 9 Electric vehicles (EVs) made up 19% of all registered vehicles in Palo Alto in 2024 (9,673 EVs).9 This percentage follows a trend of increasing EV registrations in Palo Alto since 2021: EVs made up 11% of all registered vehicles in Palo Alto in 2021 (5,499 EVs out of 50,192 total registrations), 13% in 2022 (6,496 EVs), and 16% in 2023 (8,019 EVs). EV KPI: Percentage of new vehicle sales that are EVs EV KPI: Percentage of multifamily residents with access to overnight EV charging EV KPI: Gasoline sales in Palo Alto GOALS Reduce total vehicle miles traveled 12% by 2030, compared to a 2019 baseline, by reducing commute vehicle miles traveled 20%, visitor vehicles miles traveled 10%, and resident vehicle miles traveled 6% Increase the mode share for active transportation (walking, biking) and transit from 19% to 40% of local work trips by 2030 KEY ACTIONS Promote alternatives to single occupancy car trips M1.Increase active transportation and transit for local work trips M2.Expand availability of transit and shared mobility services M3.Implement the Bicycle and Pedestrian Transportation Plan M4.Improve Transportation Demand Management for employees and residents Change the way we think about parking cars M5.Implement smart parking infrastructure in public garages Learn how we can grow without increasing GHG emissions M6.Study land use and transportation M7.Continue to implement the City’s Housing Element M8.Improve transit and traffic flow 9 Electric vehicles (EVs) and plug-in hybrid electric vehicles combined. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 44  Packet Pg. 169 of 228  1 0 2 4 9 Leverage current tools to foster mobility related GHG reductions M9.Create housing density and land use mix that supports transit and non-SOV (Single Occupancy Vehicle) transportation modes M10.Encourage reductions in GHGs and VMT (vehicle miles traveled) KEY PERFORMANCE INDICATORS Total VMT Commute mode share for all modes Commute Benefits participation by City employees Transit ridership, the proportion of residents within a quarter-mile walkshed of frequent transit, and the proportion of residents covered by on-demand transit services (data may not be available every year) Number and proportion of residents within a 10-minute walk of retail or other essential services/land uses (data may not be available every year) Number of businesses participating in Transportation Demand Management (TDM) programs (when regional TDM Program data becomes available) In order to make progress on the Mobility goals, in 2024 the City focused on key actions to promote alternatives to single occupancy car trips (M1, M2, M3), change the way we think about parking cars (M5), learn how we can grow without increasing GHG emissions (M7, M8), and leverage current tools to foster mobility related GHG reductions (M9). Mobility KPI: Total VMT In 2023, total VMT was 597,735,000, which is an increase from 2022, when total VMT was 575,389,724. While VMT data were not available for 2024, City staff and external experts calculated a preliminary estimate of 2024 VMT based on 2023 per capita VMT, 2024 population for passenger vehicles, and service population for commercial vehicles and buses. The preliminary estimate of 601,350,463 is an increase from 2023, but significantly less than the pre-COVID 19 VMT of 952,584,400 in 2019. Mobility KPI: Commute mode share for all modes Table 1 shows the commute mode share for Palo Alto residents age 16 and older. These data are from the US Census American Community Survey. Data from 2019 is also included as a comparison to pre-COVID 19 pandemic commute mode share. The share of trips taken by solo drivers in automobiles has increased since 2022 but is less than 2019. The share of trips taken by Palo Alto residents driving in carpools has increased from all years. The share of Palo Alto residents taking public transportation has not returned to pre-COVID 10 levels. However, the share of Palo Alto residents bicycling and walking has increased since 2019. It is important to note that the share of Palo Alto residents working from home has increased significantly since 2019, with 9.7% working from home in 2019 compared to 22.4% working from in 2024. The share of Palo Alto residents working from home in 2024 decreased from both 2023 and 2022. The large increase in Palo Alto residents working from home reduces the total number of work trips and changes the mode share for other modes. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 45  Packet Pg. 170 of 228  1 0 2 4 9 Table 1. Mode share estimates as a percentage of commute trips taken by Palo Alto residents age 16 and older Mode 2019 2022 2023 2024 Automobile – Solo Driver 61.2%46.1%51.6%51.5% Automobile – Carpool 5.2%2.4%3.9%6.2% Taxi, motorcycle, or other 2.1%1.7%2.1%1.2% Public Transportation 8.0%1.6%2.3%1.2% Bicycle 10.0%9.2%6.7%11.0% Walk 3.9%6.4%5.4%6.6% Work from home 9.7%32.6%27.9%22.4% Table 2 shows the mode share for all trips taken within, inbound to Palo Alto, or outbound to Palo Alto by all travelers – residents, commuters, and visitors - in 2022 through 2023. These data are from Google Environmental Insights Explorer, which has not released transportation data for 2024. This includes travel mode share for Palo Alto, which is not yet available for 2024. Data from 2019 is also included as a comparison to pre-COVID 19 pandemic trip mode share. The shares of trips taken by automobile, rail, and walking in 2023 were comparable to 2022. Bus ridership increased in 2023 compared to 2022, returning to pre-COVID 19 levels. However, rail ridership is still lower than pre-COVID 19 and bicycle ridership further decreased below pre- COVID 19 levels. Table 2. Mode share estimates as a percentage of trips taken within, inbound to Palo Alto, or outbound from Palo Alto by all travelers Mode 2019 2022 2023 Automobile 71.7%79.8%79.9% Rail 2.8%1.3%1.5% Bus 1.3%0.8%1.3% Bicycle 5.2%5.1%4.6% Walk 19%13.1%12.8% Mobility KPI: Commute Benefits participation by City employees In 2024, 25% of full-time City employees participated in commute benefits programs. Mobility KPI: Transit ridership, the proportion of residents within a quarter-mile walkshed of frequent transit, and the proportion of residents covered by on-demand transit services In 2024, 1.2% of Palo Alto residents took transit for their commute to work. For all trips in Palo Alto by all travelers – residents, commuters, and visitors – 2.1% of all trips were by transit in 2023. 2024 data is not yet available. In 2024, 17.6% of residents were within a quarter-mile walkshed of frequent transit. Walksheds are a visual representation of the area a pedestrian can travel to access transit, and “frequent transit” is defined as a stop or station with service every 15 minutes or less. Since the introduction of Palo Alto Link in 2023, 67,000 Palo Alto residents (99% of the population) are covered by on-demand transit. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 46  Packet Pg. 171 of 228  1 0 2 4 9 Mobility KPI: Number and proportion of residents within a 10-minute walk of retail or other essential services/land uses In 2024, 37,800 Palo Alto residents (56.2% of all 67,231 residents) lived within a 10-minute walk of retail locations or other essential services. Mobility KPI: Number of businesses participating in Transportation Demand Management (TDM) programs The City will report on the “Number of businesses participating in TDM programs” KPI when regional TDM program data becomes available. Water GOALS Reduce Palo Alto’s potable water consumption 30% compared to a 1990 baseline (subject to refinement based on forthcoming California water efficiency standards expected in 2024) Develop a water supply portfolio which is resilient to droughts, changes in climate, and water demand and regulations, that supports our urban canopy KEY ACTIONS W1.Maximize water conservation and efficiency W2.Build a salt removal facility W3.Implement One Water Portfolio projects W4.Develop a dynamic water planning tool KEY PERFORMANCE INDICATORS Estimated indoor per capita residential water consumption Estimated outdoor residential water consumption for irrigation Water consumption of commercial customers with irrigation meters Amount of recycled water used in Palo Alto Volume of stormwater that is captured and reused The near-term focus for water is reducing water consumption while exploring ways to capture and store water and increase the availability and use of recycled water. In 2024, the City held three landscape workshops on water-saving topics including drought- tolerant landscape design, lawn conversion, and information on available rebates. The City tabled at five neighborhood events to educate residents on water efficiency programs and rebates. The City also provides the WaterSmart water management tool which gives residents information about their water consumption and personalized water conservation recommendations. The Water KPIs are shown in Table 3. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 47  Packet Pg. 172 of 228  1 0 2 4 9 Table 3: S/CAP Key Performance Indicators for Water (2024) KPI 2024 Estimated indoor per capita residential water consumption 17,927 Gallons per capita Estimated outdoor residential water consumption for irrigation 662 Million gallons Water consumption of commercial customers with irrigation meters 349 Million gallons Amount of recycled water used in Palo Alto 63 Million gallons Volume of stormwater that is captured and reused No data to report – no active stormwater reuse projects at this time Climate Adaptation and Sea Level Rise GOALS Develop and adopt a multi-year Sea Level Rise Adaptation Plan including a Sea Level Rise Vulnerability Assessment and adaptation plan Minimize wildland fire hazards by ensuring adequate provisions for vegetation management, emergency access and communications, inter- agency firefighting, and standards for design and development within wildland areas KEY ACTIONS Minimize the impacts of sea level rise S1. Complete a Sea Level Rise Vulnerability Assessment S2. Implement a Sea Level Rise Adaptation Plan S3. Begin design process for a levee project S4. Complete bridge improvements and identify protection strategies from flood events Minimize the impacts of wildland fire hazards S5.Implement the Foothills Fire Management Plan S6.Minimize fire hazards through zoning S7.Collaborate on reducing wildfire hazards S8.Implement CAL FIRE education programs KEY PERFORMANCE INDICATORS Percent of vulnerable locations protected from three feet of sea level rise Percent of properties protected from San Francisquito Creek flooding Progress towards sea level rise levee alignments Implementation of Foothills Fire Management Plan mitigation measures The near-term focus for Climate Adaptation and Sea Level Rise is to develop and adopt a multi- year Sea Level Rise Adaptation Plan and minimize wildland fire hazards through Foothills Fire Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 48  Packet Pg. 173 of 228  1 0 2 4 9 Management Plan implementation, zoning, and collaborating with Fire agencies. In order to make progress on the Climate Adaptation and Sea Level rise goals, in 2024 the City focused on key actions to minimize the impacts of sea level rise (S1, S2, S3, S4) and minimize the impacts of wildland fire hazards (S5, S6, S7, S8). Sea Level Rise KPI: Percent of vulnerable locations protected from three feet of sea level rise Sea Level Rise KPI: Percent of properties protected from San Francisquito Creek flooding 11,12 Sea Level Rise KPI: Progress towards sea level rise levee alignments 11 Palo Alto Storm Drain Master Plan; 2015; https://www.paloalto.gov/files/assets/public/v/1/public- works/engineering-services/webpages/stormwater/storm-drain/storm-drain-master-plan-update-june-2015.pdf 12 Ballot Measure Description of the Proposed Storm Water Management Fee; 2017; https://www.paloalto.gov/files/assets/public/v/1/public-works/flood-and-storm/storm-water-management- program/stormwater-management-fee-ballot-2017-final.pdf Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 49  Packet Pg. 174 of 228  1 0 2 4 9 community assets. If funded, this work will complement the preexisting City’s Vulnerability Assessment15 that was completed in 2022. SB1 grant funding is not slated to reexamine levee alignments themselves but would provide additional protection strategies that could be considered. Climate Adaptation KPI: Implementation of Foothills Fire Management Plan mitigation measures Table 4: S/CAP Key Performance Indicators for Foothills Fire Management Plan Mitigation Measures (2022-2023) Foothills Fire Management Plan Mitigation Measure 2022 2023 2024 15 2022 Palo Alto Sea Level Rise Vulnerability Assessment; https://www.cityofpaloalto.org/files/assets/public/v/1/public-works/environmental-compliance/sea-level- rise/palo-alto-sea-level-rise-vulnerability-assessment-june-2022-062822-linked-final.pdf Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 50  Packet Pg. 175 of 228  1 0 2 4 9 Number of residential defensive space re-inspections that are required 33 homes 18 homes 21 homes Percent of miles of overhead utility line tree trimming in Foothills completed 65.73% (7.25 miles) 67.91% (7.49 miles) 54.49% (2.91 of 5.34 total miles) Total miles of electric lines undergrounded in the City of Palo Alto Utilities Foothills Coverage Area Approx. 2.94 miles (15,500 feet) Approx. 1.04 miles (5,500 feet) Approx. 2.27 miles (12,000 feet) Percent of electric line miles undergrounded in the City of Palo Alto Utilities Foothills Coverage Area 31.5%11.2% 24.4% Natural Environment GOALS Restore and enhance resilience and biodiversity of our natural environment throughout the City Increase tree canopy to 40% city-wide coverage by 2030 By 2030, achieve a 10% increase in land area that uses green stormwater infrastructure to treat urban water runoff, compared to a 2020 baseline KEY ACTIONS Maintain and protect tree canopy N1.Increase Palo Alto’s tree canopy N2.Ensure No Net Tree Canopy Loss for all projects N3.Reduce pesticide use in parks and open space preserves N4.Enhance pollinator habitat N5.Establish a carbon storage of tree canopy baseline and KPI Restore and enhance biodiversity Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 51  Packet Pg. 176 of 228  1 0 2 4 9 N6.Maximize biodiversity and soil health N7.Coordinate implementation of the City Natural Environment-Related Plans N8.Expand Water Efficient Landscape Ordinance (WELO) requirements N9.Phase out gas-powered lawn and garden equipment Reduce pollutants entering the Bay N10.Support the Green Stormwater Infrastructure Plan. N11.Incorporate green stormwater infrastructure in municipal projects KEY PERFORMANCE INDICATORS City-wide Tree Canopy coverage Native species on City property and in new landscape projects (to measure biodiversity) Land area that uses green stormwater infrastructure to treat urban water runoff The near-term focus for Natural Environment is to increase Palo Alto’s Tree Canopy, reduce pesticide usage in parks and open space preserves, and support the Green Stormwater Infrastructure Plan and incorporate it in municipal projects. In order to make progress on the Natural Environment goals, in 2024 the City focused on key actions to maintain and protect tree canopy (N2, N3, N4, N5), restore and enhance biodiversity (N6, N7, N8, N9), and reduce pollutants entering the Bay (N10, N11). Ongoing tree planting efforts to increase tree canopy will be integrated with traditional tree planting programs and Green Stormwater Infrastructure to provide co-benefits including carbon sequestration, improve water quality, capture stormwater when feasible, and reduce the urban heat island. Natural Environment KPI: City-wide Tree Canopy coverage 2024 canopy coverage data is not yet available. In 2023, citywide tree canopy coverage was 44%, however this includes open space and the Foothills Nature Preserve. Tree canopy coverage in urbanized areas only was 26%. Natural Environment KPI: Native species on City property and in new landscape projects (to measure biodiversity) In 2024, City landscape projects included the Boulware Park renovation, Cameron Park butterfly garden installation, and Mitchell Park Dog Park. Of the 996 individual plants established at these sites, 935 were native to California. Across the sites, 22 native species were planted. Natural Environment KPI: Land area that uses green stormwater infrastructure to treat urban water runoff There is currently no data to report for the “Land area that uses green stormwater infrastructure to treat urban water runoff” KPI. Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 52  Packet Pg. 177 of 228  1 0 2 4 9 Zero Waste GOALS Divert 95% of waste from landfills by 2030, leading to zero waste Implement short- and medium-term initiatives identified in the 2018 Zero Waste Plan KEY ACTIONS Education and outreach ZW1.Encourage food waste prevention and require food recovery from commercial food generators ZW2.Promote residential food waste reduction ZW3.Champion waste prevention, reduction, reusables, and the sharing economy ZW4.Provide waste prevention technical assistance to the commercial sector Collaborate on and expand policies ZW5.Prioritize domestic processing of recyclable materials ZW6.Eliminate single-use disposable containers ZW7.Expand the Deconstruction and Construction Materials Management Ordinance ZW8.Implement Reach Code standard for low carbon construction materials KEY PERFORMANCE INDICATORS Diversion rate Number of Zero Waste Plan initiatives implemented The near-term focus for Zero Waste is to encourage residents and businesses to reduce their food waste, which will also reduce the associated greenhouse gas emissions, lower their waste generation through the undertaking of zero waste living practices of using less at home and at work; to champion waste prevention technical assistance to businesses; eliminate single-use disposable containers; and prioritize domestic processing of recyclable materials. In order to make progress on the Zero Waste goals, in 2024 the City focused on key actions on education and outreach (ZW1, ZW2, ZW3, ZW4) and to collaborate on and expand policies (ZW5, ZW8). The City developed a new booklet for businesses, “Multi-Ordinance Checklist”, that summarizes Palo Alto’s Zero Waste and SB 1383 requirements such as requirements for the use of colored refuse containers as well as see-through colored bags to match the color of the containers for Compost, Recycle, and Landfill materials. The printed copies were mailed to 425 commercial businesses, specifically food service establishments, in November 2023. In addition, the City developed a new brochure for the Very Small Quantity Generator Program for household hazardous waste and has been distributing it during household hazardous waste events and direct business engagement. Expanding the Disposable Foodware Ordinance (ZW6) has been put on hold until further clarification is received through Senate Bill 54 final regulations and other recent legislation Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 53  Packet Pg. 178 of 228  1 0 2 4 9 creating changes on what will be considered recyclable and compostable. The City developed and printed postcard and trifold brochures on the Disposable Foodware Ordinance/AB 1276 to be mailed and handed out to 450 food service establishments. Zero Waste KPI: Diversion rate Zero Waste KPI: Number of Zero Waste Plan initiatives implemented Item 8 Attachment D - SCAP Key Performance Indicators Progress Report        Item 8: Staff Report Pg. 54  Packet Pg. 179 of 228  1 0 2 5 0 Attachment E: S/CAP Key Performance Indicators Progress Summary Key Performance Indicator 2022 2023 2024 GHG reductions (1990 baseline)47.4%48.1%50.2% Community awareness No data 68% of participants indicated that it is essential or very important for Palo Alto to focus on GHGs in the next 2 years 40% of Community Survey respondents indicated they were at least slightly familiar with the S/CAP and 80x30 goalCl i m a t e A c t i o n Participation in Climate Pledge No data No data 3 GHG emissions from natural gas use in buildings 144,996 MT CO2e 146,289 MT CO2e 127,051 MT CO2e % of single-family households in Palo Alto with no natural gas connections 1.2% (208 homes)1.5% (232 homes)2.0% (289 homes) En e r g y % of natural gas use reduction in major facilities and City facilities (2016 baseline) No data 45% reduction in City facilities 45% reduction in City facilities GHG emissions, vehicle travel 221,923 MT CO2e 225,387 MT CO2e 226,019 MT CO2e* % of registered vehicles in Palo Alto that are EVs 13%16%19% % of new vehicle sales in Palo Alto that are EVs 43%52%55% % of multifamily residents with access to overnight EV charging 3%4%7.6% El e c t r i c V e h i c l e s Gasoline sales in Palo Alto Data unavailable Data unavailable Data unavailable Total Vehicle Miles Traveled (VMT) 575,190,655 597,735,000 601,350,463* (preliminary estimate) Commute mode share (commute trips by residents age 16 and older) Automobile – solo driver Automobile – carpool Taxi, motorcycle, or other Public Transportation Bicycle Walk Work from home 46.1% 2.4% 1.7% 1.6% 9.2% 6.4% 32.6% 51.6% 3.9% 2.1% 2.3% 6.7% 5.4% 27.9% 51.5% 6.2% 1.2% 1.2% 11.0% 6.6% 27.4% Trip mode share (all trips by all travelers) Automobile Rail Bus Bicycle Walk 71.7% 2.8% 1.3 5.2% 19% 79.9% 1.5% 1.3% 4.6% 12.8% Data forthcoming* Mo b i l i t y City employee commute benefits participation No data 19%25% Item 8 Attachment E - SCAP Key Performance Indicators Progress Summary        Item 8: Staff Report Pg. 55  Packet Pg. 180 of 228  1 0 2 5 0 Key Performance Indicator 2022 2023 2024 Transit ridership by adult residents for commute trips Transit ridership by all travelers for all trips The proportion of residents within a quarter-mile walkshed of frequent transit Proportion of residents covered by on-demand transit services 1.6% 2.1% Data unavailable Data unavailable 2.3% 2.8% 21.9% 99.7% 1.2% Data forthcoming* 17.6% 99% Number and proportion of residents within a 10-minute walk of retail or other essential services/land uses Data unavailable 32,700 (48% of all 68,112 residents) 37,800 (56.2% of all 67,231 residents) Businesses participating in Transportation Demand Management (TDM) programs Data unavailable Data unavailable Data unavailable Indoor per capita residential water consumption (estimated) 24,171 gallons 17,537 gallons 17,927 gallons Outdoor residential water consumption for irrigation (estimated) 427 million gallons 620 million gallons 662 million gallons Water consumption of commercial customers with irrigation meters 348 million gallons 312 million gallons 349 gallons Amount of recycled water used in Palo Alto 113.5 million gallons 81.05 million gallons 63.21 million gallons Wa t e r Volume of stormwater that is captured and reused No data No data No data Percent of vulnerable locations protected from three feet of sea level rise No data No data No data Percent of properties protected from San Francisquito Creek flooding No data No data No data Cl i m a t e A d a p t a t i o n a n d S e a Le v e l R i s e Progress towards sea level rise levee alignments Not launched yet No data USACE feasibility study conducted; no federal interest in funding large levee alignment projects at this time Item 8 Attachment E - SCAP Key Performance Indicators Progress Summary        Item 8: Staff Report Pg. 56  Packet Pg. 181 of 228  1 0 2 5 0 Key Performance Indicator 2022 2023 2024 Implementation of Foothills Fire Management Plan mitigation measures Number of residential defensive space re- inspections that are required % of miles of overhead utility line tree trimming in Foothills completed Total miles of electric lines undergrounded in the City of Palo Alto Utilities Foothills Coverage Area % of electric line miles undergrounded in the City of Palo Alto Utilities Foothills Coverage Area 33 homes 65.73% (7.25 miles completed) 2.94 miles 31.5% 18 homes 67.91% (7.49 miles completed) 1.04 miles 11.2% 21 homes 54.49% (2.9 miles completed of 5.3 total miles) 2.27 miles 24.4% City-wide tree canopy coverage No data 26% of urbanized areas 44% including Foothills Nature Preserve area Data forthcoming Native species on City property and in new City landscape projects (to measure biodiversity) No data No new landscape projects to report 935 individual native plants; 22 native species Na t u r a l E n v i r o n m e n t Land area that uses green stormwater infrastructure to treat urban water runoff No data No data No data Diversion rate 91%91%88% Ze r o Wa s t e Zero Waste Plan initiatives implemented No data 18 completed 15 in progress 15 remaining 18 completed 15 in progress 15 remaining * VMT data were not available in Google Environmental Insights Explorer (Google EIE) for 2024. City staff and external experts calculated a preliminary estimate of 2024 VMT based on 2023 per capita VMT, 2024 population for passenger vehicles, and service population for commercial vehicles and buses. 2024 KPI data will be revised when 2024 Google EIE data becomes available. Item 8 Attachment E - SCAP Key Performance Indicators Progress Summary        Item 8: Staff Report Pg. 57  Packet Pg. 182 of 228  Attachment F: 2023-2025 S/CAP Work Plan Status For more details, see the 2025 Q1-2 S/CAP report1. The 2025 Q3-4 report will be published in February. Item No.Work Plan Item Status 1 City Council, November 3, 2025; Agenda Item A; SR #2505-4672, https://recordsportal.paloalto.gov/WebLink/DocView.aspx? id=83784&dbid=0&repo=PaloAlto Item 8 Attachment F - 2023-2025 SCAP Work Plan Status Item 8: Staff Report Pg. 58 Packet Pg. 183 of 228  2.2B Rooftop Packaged HVAC Advanced Pilot Design 2.2C Establish Major Employer Partnerships 2.2D Commuter Transportation and EV Charging Strategy 2.2E Identify Regional and State Partnerships 2.3A Transportation and Land Use Policies and Programs 2.3B Housing Element Adoption 2.3C Housing Element Implementation 2.3D Micro-mobility Evaluations 2.3E Launch On-demand Transit Pilot 2.3F Update Bicycle Plan (final draft plan complete, going to Council in early 2026) 2.3G Vision Zero Program (Safety Action Plan completed in 2025, transitioning this item to be to an ongoing item in future reports to reflect ongoing plan implementation) 2.3H Evaluate Expansion of Employer Transportation Demand Management (TDM) 2.3I Proposals for Managing Downtown Parking Availability 2.3J Implement Efficient Downtown Parking Management 2.3K Traffic Signal Improvements & Transit Signal Priority 2.4A Facility Electrification Assessment Plan 2.4B Facility Electrification Assessment Implementation 2.4C Electrify Equipment at City Facilities during Routine Replacement 2.4D Electrify City Vehicle Fleet 2.3E Build City Fleet and Employee Charging Infrastructure 2.4F Publicly Owned Charger Strategic Plan 2.5A Electric Vehicle Strategic Plan Development 3.1A Build awareness of the need for climate action and the benefits the City and its utility can receive and provide 3.1B Drive community actions to achieve S/CAP goals Item 8 Attachment F - 2023-2025 SCAP Work Plan Status        Item 8: Staff Report Pg. 59  Packet Pg. 184 of 228  3.1C S/CAP Survey Program 3.1D S/CAP Reporting 3.1E Build confidence in the City’s electric infrastructure 4A Multi-family and Commercial End Use Study 4B Idea Generation and Additional Research 4C Additional Emissions Reduction Project Prioritization 5A Resource Needs Assessment 5B Funding Alternatives 5C Affordability Study 5D Gas Utility Financial and Operating Plan 8A Maximize Water Conservation and Efficiency 8B Design and Build a Salt Removal Facility for the Regional Water Quality Control Plant 8C Develop a “One Water” Portfolio for Palo Alto 8D Develop a tool for dynamic water planning in the future 8E Complete the Sea Level Rise Vulnerability Assessment 8F Develop a Sea Level Rise Adaptation Plan 8G Begin Design Process for a Levee Project 8H Identify Protection Strategies from Significant Flood Events at Newell Road Bridge 8I Identify Protection Strategies from Significant Flood Events at Pope Chaucer Bridge and Creek 8J Identify Protection Strategies from Significant Flood Events 8K Implement Foothills Fire Management Plan 8L Minimize Fire Hazards Through Zoning 8M Collaborate on Reducing Wildfire Hazards 8N Implement CAL FIRE Public Education Programs 8O Increase Palo Alto’s Tree Canopy and establish a baseline and Key Performance Indicator for carbon storage of tree canopy Canopy Item 8 Attachment F - 2023-2025 SCAP Work Plan Status        Item 8: Staff Report Pg. 60  Packet Pg. 185 of 228  Carbon Storage 8P Ensure No Net Tree Canopy Loss for all Projects 8Q Reduce Pesticide Use in Parks and Open Space Preserves 8R Coordinate Implementation of City Natural Environment-Related Plans 8S Support the Green Stormwater Infrastructure (GSI) Plan and incorporate GSI in Municipal Projects 8T Encourage Food Waste Prevention and Require Food Recovery from Commercial Food Generators 8U Promote Residential Food Waste Reduction 8V Champion Waste Prevention, Reduction, Reusables, and the Sharing Economy 8W Provide Waste Prevention Technical Assistance to the Commercial Sector 8X Prioritize Domestic Processing of Recyclable Materials 8Y Eliminate Single-Use Disposable Containers 8Z Expand the Deconstruction and Construction Materials Management Ordinance 8aa Implement Reach Code standard for Low Carbon Construction Materials Item 8 Attachment F - 2023-2025 SCAP Work Plan Status        Item 8: Staff Report Pg. 61  Packet Pg. 186 of 228  1 2026-2027 Sustainability and Climate Action Plan Work Plan The Sustainability and Climate Action Plan (S/CAP) outlines the strategies for achieving the City’s greenhouse gas (GHG) emissions reduction targets, while improving our natural environment, adapting to climate impacts, and increasing livability for Palo Alto residents. The S/CAP outlines goals and key actions in eight areas: Climate Action, Energy, Electric Vehicles, Mobility, Water, Climate Adaptation and Sea Level Rise, Natural Environment, and Zero Waste. The climate action areas of Climate Action, Energy, Electric Vehicles, and Mobility primarily focus on the overarching goals to reduce GHG emissions 80% below 1990 levels and achieve carbon neutrality by 2030. The sustainability areas of Water, Climate Adaptation and Sea Level Rise, Natural Environment, and Zero Waste do not necessarily have a direct impact on greenhouse gas reductions, but have critically important sustainability, public health and safety, regional, resource conservation, and equity benefits that contribute to overall climate action. The 2026-2027 S/CAP Work Plan includes 28 strategies focused on climate action, 16 strategies focused on sustainability and three strategies for overall S/CAP Communications for all areas of the S/CAP. Climate Action Single-Family CA1.Continue Advanced Home Electrification Pilot Program: Offer full suite of program services to support residents with home electrification projects, including turnkey service, technical assistance, and rebates. Offer enhanced rebates and 0% financing to income-qualified households. Goals and funding levels to be developed annually and coordinated with annual budget process. Program will be designed and changed as needed to complement the Bay Area Air District’s Zero-NOx rules (Rules 9-4 and 9- 6). Resource Availability: Fully staffed; goals and funding levels to be considered on timeline in alignment with annual budget process. Explore ways to promote resources for renters, including information on appliances like portable induction cooktops and window-mounted heat pumps that can help renters reduce emissions without asking landlords to make major improvements to the units. Target Completion Date: On- going. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 62  Packet Pg. 187 of 228  2 CA2.Develop a Residential Electrification as a Service or Similar Financing Pilot for Council Approval: Offer electrification as a service or similar creative financing pilot to residents to support financing of gas to heat pump projects as a pilot of more financially efficient program design. Develop pilot participation agreement, enable tracking of debt repayment in billing system, create process to enroll customer in EaaS. Resource Availability: Program team fully staffed, IT / administrative staffing needs evaluation; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: Q3 2026 (tentative, pending staff evaluation). CA3.Enhance Data Tracking for Home Electrification: Enhance existing database to more comprehensively track home electrification status and incorporate data from existing program databases, home assessments, gas data analytics to estimate home gas equipment, and results from voluntary data inputs by residents. This will allow staff to more effectively track program results, perform more targeted outreach, and tailor communications to homeowners based on their building characteristics. Resource Availability: As staff time is available; consultant resources needed, covered within existing budget. Target Completion Date: Q4 2026. Multi-Family CA4.Launch Enhanced Multifamily EV Charging Infrastructure Program: Update program guidelines, incentives (i.e. rebates, financing), and technical assistance offerings for the installation of EV charging infrastructure that supports multifamily residents through: private on-site charging at multifamily properties; publicly-accessible charging at neighborhood e-mobility hubs at public or private properties; or publicly-owned or public-private partnership neighborhood curbside charging installations This work includes complementary programming supporting EV adoption by income- qualified customers and integration of alternative transportation infrastructure, launch in alignment with design guidelines approved by the City Council on November 17, 2025. Resource Availability: Fully staffed; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: Launch in 2026. CA5.Develop a Charging-as-a-Service (CaaS) or Similar Financing Pilot for Council Approval: Offer charging-as-a-service (CaaS) or a similar creative financing program to multi-family property owners to support financing of EV infrastructure projects developed through the Multifamily EV Charging Infrastructure Program. Develop pilot participation agreement, enable tracking of debt repayment in billing system, create process to enroll customer in CaaS, and collaborate with EV service providers to Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 63  Packet Pg. 188 of 228  3 identify projects. Resource Availability: Program team fully staffed, IT / administrative staffing needs evaluation; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: Launch in 2026. CA6.Continue Affordable Multifamily Building Electrification Incentive Program: Continue pilot electrification program for affordable multifamily properties providing rebates to support the electrification of central water heating and/or space heating equipment in at least 3-5 properties and in-unit electrification of at least one property. The pilot program will provide opportunities to design and test innovative low-interest financing models as well as opportunities to model turn-key multifamily residential electrification. Resource Availability: Fully staffed; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: End of 2027. CA7.Launch Multi-Family Electrification Technical Assistance: Design and implement a technical assistance program to address the particular challenges associated with electrification of multi-family buildings. This would complement incentives or other financial assistance provided by other programs (e.g. via residential whole home programs and electrification as a service for multi-family in-unit improvements and via commercial electrification programs for central system improvements). Resource Availability: As staff time is available; goals and funding levels to be considered on timeline in alignment with annual budget process. Explore ways to promote resources for renters, including information on appliances like portable induction cooktops and window-mounted heat pumps that can help renters reduce emissions without asking landlords to make major improvements to the units. Target Completion Date: End of 2027. Non-Residential CA8.Launch Advanced Heat Pump HVAC Program: Launch an advanced Heat Pump HVAC (HPHVAC) program to transition aging gas systems (rooftop units and ground mounted) off of gas in alignment with Council-approved design guidelines. Resource Availability: Fully staffed; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: Q4 2026 - Q1 2027. CA9.Develop a Commercial Electrification as a Service pilot or Similar Financing Pilot for Council Approval: Offer electrification as a service or a similar creative financing program to commercial property owners to support financing of gas to heat pump projects as a pilot of more financially efficient program design. Develop pilot participation agreement, enable tracking of debt repayment in billing system, create process to enroll customer in Electrification as a Service (EaaS). Resource Availability: Program team fully staffed, IT / administrative staffing needs evaluation. Target Completion Date: Q3 2027 (tentative, pending staff evaluation). CA10.Launch Workplace EV Charging Pilot: Implement a workplace EV charging program building upon the framework of the multifamily EV charging program. Advance Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 64  Packet Pg. 189 of 228  4 additional analysis as needed on the current state of workplace charging, available electric capacity and commute patterns. Collaborate with the EV Team and Office of Transportation on grant opportunities to promote to commercial property owners. Resource Availability: Fully staffed. Target Completion Date: 2027 CA11.Launch Pilot Program for Electrification of Centralized Water Heaters and Boilers: Provide incentives for a select number of large equipment replacements to collect performance data, identify barriers to electrification, and compare cost impacts of like-for-like versus electric options, including effects on customer utility bills. Resource Availability: As staff time is available; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: 2027. CA12.Establish One or More Partnerships with Large Commercial Facility Owners: Develop custom sustainability partnerships with at least one major employer, such as creative financing options, electrification pilots with large facilities, and support of corporate electrification efforts. Resource Availability: Fully staffed; goals and funding levels to be considered on timeline in alignment with annual budget process. Target Completion Date: 2026. Regulatory, Analytics, Finances, and Strategy CA13.Develop S/CAP Funding and Financing Strategies for City Council Consideration: Using insights and models developed for S/CAP Funding Study, City staff will develop potential funding and financing strategies for City Council consideration. Policies will consider different timelines, the effect of regulatory requirements, and equipment focus to provide a range of policy alternatives. Analyses will consider resource needs, additional revenue requirements, and potential impact on utility rates. Resource Availability: Fully staffed, to be absorbed from existing budgets. Target Completion Date: Q4 2026. CA14.Develop Potential Regulatory Measures to Drive Climate Action: Develop a list of potential regulatory measures to drive electrification, energy efficiency, and EV adoption in Palo Alto for consideration by City Council, in addition to implementation of Reach Codes that apply. Seek regulatory measures that could serve as the “regulatory backbone” of a decarbonization strategy (e.g. a Building Emissions Savings Ordinance that would require compliance at the time of residential or commercial property listing or a commercial Building Performance Standard). Consider the programs needed to make such mandates work, such as incentives and technical assistance programs to help building owners meet regulatory requirements. Resource Availability: Fully staffed. Target Completion Date: Q4 2026. CA15.Develop Carbon Neutrality Strategies for City Council Consideration: Develop potential strategies for City Council consideration for achieving community carbon neutrality by 2030. Resource Availability: Fully staffed. Target Completion Date: Q4 2026. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 65  Packet Pg. 190 of 228  5 CA16.Develop Potential Strategies for Cost-Based Pricing of Non-Electric Decarbonization and Inefficient Electrification: Based in industry research and legal analysis, develop potential strategies for Council consideration for reflecting the cost of decarbonization without electrification (e.g. via renewable fuels like biogas and hydrogen) and the costs of electrification that does not incorporate efficient electrification practices on distribution costs (e.g. due to 400A panel upgrades for higher demand appliances than are needed to serve the electrified uses, leading to the need to build more electric distribution capacity). Examples of potential strategies for consideration include electrical capacity fees and voluntary carbon pricing reflecting the cost of decarbonizing with renewable fuels). Resource Availability: Fully staffed. Some consulting budget may be needed, to be considered via annual budget process. Target Completion Date: Q4 2026. CA17.Reduce Permitting, Interconnection, and Other Barriers to Adoption of Vehicle and Building Electrification and Flexible Energy Technologies for Reliability and Resiliency: Reduce barriers to adoption of vehicle and building electrification technologies, flexible energy technologies for reliability and resiliency, and efficient electrification best practices. Focus on planning and zoning rules, utility rules and regulations, fees, and potential barriers that could be relieved through climate program services such as technical assistance. Look for efficient project approaches, such as bundling multiple electric readiness projects together at once and exploring different approaches to electric panel load calculations, such as by using smart meter data. Develop and implement annual list of priority areas for consideration and timeline for evaluation of potential options. Resource Availability: As staff time is available, higher level of effort possible with resources. Target Completion Date: On- going. CA18.Develop Public Charging Siting and Business Models: As needed, perform siting analysis and develop business models for public charging on public and private properties to support multi-family, workplace, and visitor charging needs. Work is expected to be performed primarily using in-house staff with light consulting assistance as needed. Resource Availability: Fully staffed; some consulting budget may be needed, to be considered via annual budget process. Target Completion Date: Q1 2027. Infrastructure CA19.Continue Grid Modernization: Continue electric distribution system grid modernization program with the completed pilot informing program implementation, at the pace needed to provide adequate capacity for building and vehicle electrification. Resource Availability: Fully staffed; project and consulting budgets to be requested via annual budget process as needed. Target Completion Date: On- going. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 66  Packet Pg. 191 of 228  6 CA20.Develop Gas Transition Management Strategies: Complete study of gas system physical and financial operation under various electrification scenarios, discuss relevant findings with policy makers, and develop and implement any policies, programs, or operational practices needed to ensure safe, financially viable, and equitable operation of the gas utility as electrification proceeds. Resource Availability: Fully staffed; project and consulting budgets to be requested via annual budget process as needed. Target Completion Date: On-going. Mobility CA21.Achieve Benchmarks for Bicycle and Pedestrian Capital Improvement Projects: South Palo Alto Bikeways Demonstration Project: Upgrade crossings and bicycle facilities on East Meadow Drive and Fabian Way to improve safety, especially for students traveling to school. Information learned throughout the demonstration project will be incorporated into an update of the Palo Alto Safety Action Plan and will inform permanent design changes to the corridor. Resource Availability: Project is fully funded but requires staffing. Target Completion Date: Pilot construction anticipated for summer 2027. Churchill Avenue Enhanced Bikeway Project: Improve walking and bicycling on Churchill Avenue with a multi-use path, intersection improvements, and landscaping. Project work is focused between the Caltrain tracks and El Camino Real. Target Completion Date: Construction is scheduled to finish by fall 2026. Quarry Road Extension at El Camino Park: Develop underused portion of El Camino Park to provide a direct connection from El Camino Real to the Palo Alto Transit Center. Project is led by Stanford. Target Completion Date: By fall 2027, project will complete the Caltrans process for the Encroachment Permit and prepare plans, specifications, and estimate construction documents for the project in both Caltrans and City right-of-way. In addition, the team will perform both a bike and transit operations assessment and recommend operational scenarios to inform future bikes, bus and shuttle operations in and around the Transit Center. South Palo Alto Bike/Ped Connectivity: Identify locations and design concepts for additional east-west bicycle and pedestrian crossings of the Caltrain railroad tracks in the southern part of the City. Council selected the El Dorado Avenue option (also called Alternative A) for further planning and development work. Two variants of Alternative A were advanced: A1 (signalized crossing of Alma Street at El Dorado Avenue) and A2 (tunnel under both Alma Street and the Caltrain tracks). Additional community engagement activities are planned for early 2026 to support the decision- making process and incorporate public feedback on the alternatives in the vicinity of El Dorado Avenue. Target Completion Date: Study will complete following Council Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 67  Packet Pg. 192 of 228  7 adoption of a final report in spring 2027, and next steps include securing grant funding for environmental documentation, final design and construction. CA22.Implement Micromobility Feasibility Study Recommendations: Pursue next steps for a bike/e-bike/e-scooter share pilot program or other recommendation as advised by the Micromobility Feasibility Study, to be finalized in early 2026. Resource Availability: Fully staffed and partially funded, need to evaluate based on recommendation in the study. Target Completion Date: 2027. CA23.Continue Traffic Signal Operations and Multimodal Improvements: Maintain and modernize current traffic signals and central management systems. Use technology to improve traffic operations and safety. Work with transit providers on transit signal priority where feasible. Projects that include operational improvements include the Quarry Road Intelligent Transportation Systems and Operations Improvement (in-progress), Citywide Central Management and ITS Updates (Ongoing), Citywide Arterial Operations Optimization (on-going pending staff resources), and Automated Traffic Signal Performance Measure (ATSPM) implementation (near future). Each of these projects includes multimodal improvements and optimization to improve operations and reduce emissions. Resource Availability: Mostly funded, long-term funding needs being evaluated. Target Completion Date: On-going. CA24.Continue Implementing the Housing Element / Land Use Planning and Policy: Implement the goals, policies, and programs in the City's 2023-2031 Housing Element of the Comprehensive Plan to improve the City's jobs-housing balance and to reduce vehicle miles traveled (VMT). Implementation will continue creating a housing density and land use mix that supports transit and non-SOV (Single Occupancy Vehicle) transportation modes, such as efforts on land use and area plans, housing plans, development standards, and affordable housing projects. Resource Availability: Funding via grants and annual City budget process. Target Completion Date: 2030. CA25.Update City’s Traffic Calming Policy and Process: Update the City’s Traffic Calming Process to provide more clarity on traffic calming design details and criteria for consideration in relation to engineering judgment. Resource Availability: Proceed as staff time available. Target Completion Date: End of 2027. Municipal Assets and Operations CA26.Develop and Begin Implementing a City Facility Electrification Plan: Building on the citywide Facilities Assessment, create a multi-year plan to begin replacing fossil fuel use in City buildings in alignment with S/CAP goals, and begin implementing through the Capital Improvement Program. Target Completion Date: On-going. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 68  Packet Pg. 193 of 228  8 CA27.Electrify City Vehicle Fleet when Feasible: Convert all Palo Alto municipal vehicles to EVs when feasible and when the replacement is operationally acceptable. Support state policy efforts to electrify fleet vehicles, including delivery trucks. Determine municipal EV charging needs to ensure adequate EV charging infrastructure for City fleet vehicles. Where possible, explore a shared use of fleet chargers that would allow for City staff to use the fleet chargers during the day. Also explore options for providing EV chargers in employee parking lots. Resource Availability: Fully staffed; EV acquisition evaluated with each scheduled vehicle replacement, additional funding needed for certain vehicle classes. Funding for charging infrastructure evaluated project by project and funded through annual budget process. Target Completion Date: On-going. CA28.Explore the Electric Capacity Needs of the Palo Alto Airport for Electric Aviation: Explore the electric capacity needs of the Palo Alto Airport to ensure adequate infrastructure to accommodate electric aviation, as well as electric fleet vehicles. Resource Availability: Proceed as staff time is available. Target Completion Date: 2030. Sustainability Water S1.Implement Water Efficiency and Conversation Measures: Deploy water efficiency and conservation measures that achieve water savings above and beyond what is required by state regulations. Resource Availability: Fully staffed and funded. Target Completion Date: 2030. S2.Improve Recycled Water Quality through Salt Removal: Improve the quality of recycled water produced at the Regional Water Quality Control Plant. Resource Availability: Fully staffed and funded. Target Completion Date: 2028. S3.Identify and Implement Water Distribution System Adaptation Measures: Identify risks from climate change to the water distribution system and implement solutions. Resource Availability: Fully staffed; funding to implement projects not identified. Target Completion Date: 2026. Sea Level Rise S4.Finalize Partnership Agreement with Santa Clara County on SB272 Regional Shoreline Adaptation Plan Requirements to Develop a Regional Vulnerability Assessment and Adaptation Plan: If grant funding is received, this project is anticipated to identify and align county-wide sea level rise adaptation planning projects. Resource Availability: To be determined. Target Completion Date: 2027. S5.Update the City's Sea Level Rise Adaptation Policy to Include Sea Level Rise Planning Decision-Making Points in the City: Update the City's Sea Level Rise Adaptation Policy Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 69  Packet Pg. 194 of 228  9 to include newest technical information, best practices, and decision-making points in the City where sea level rise and shallow groundwater changes should be considered for new projects and operations/maintenance. Resource Availability: Existing funding. Target Completion Date: 2027. S6.Complete Construction and Begin Monitoring the Palo Alto Horizontal Levee Pilot Project (PAHLPP): The PAHLPP will be the first Bay Area horizontal levee to be hydrologically connected to the Bay. The project will inform future potential levee improvements that expand habitat benefits. The City and partner agencies will advance monitoring and research following project completion, anticipated in early 2026. Resource Availability: Existing funding. Target Completion Date: 2026. S7.Continue Partnership with Valley Water on Sea Level Rise / Shoreline Levee Improvement Efforts: Track developments with Valley Water and Army Corps of Engineers. Resource Availability: Staffing available, future funding needed. Target Completion Date: 2027. Wildfire Protection S8.Implement the Foothills Fire Management Plan: Implement the Foothills Fire Management Plan to balance conservation of natural resources with reduction of fire hazards especially in open space areas. Priority implementation areas include: Mitigating fire risk from electrical equipment through projects such as moving the overhead electric lines underground in areas generally within the City limits west of Highway 280, known as the Foothills area, and mitigating fire risk from vegetation, including through the removal of targeted Eucalyptus groves in specific project areas. Resource Availability: General Funds, Staffing, CIP EL-21001. Target Completion Date: On-going. Natural Environment S9.Increase Tree Canopy in South Palo Alto: Develop programs to plant trees in South Palo Alto to increase tree canopy – that will be integrated with traditional tree planting programs and Green Stormwater Infrastructure programs – and provide carbon sequestration, improve water quality, capture stormwater when feasible, and reduce the urban heat island effect. Resource Availability: Partially funded, Staff available as time permits. Target Completion Date: On-going. S10.Reduce Pesticide Use in Parks and Open Space Preserves: Continue to review the use of pesticides in all parks and open space preserves to identify opportunities to further reduce and eliminate the use of pesticides. Resource Availability: Staff available as time permits. Target Completion Date: On-Going. Green Stormwater Infrastructure S11.Construct a Green Stormwater Infrastructure Project at a City of Palo Alto Park: A green stormwater infrastructure (GSI) project proposed at Juana Briones Park will be Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 70  Packet Pg. 195 of 228  10 designed and constructed. The GSI project will treat an estimated drainage area of 14.8 acres, 6.6 acres of which are impervious. Proposed design will include community features for park users during dry periods throughout the year. Resource Availability: Funding includes U.S. EPA grant to be supplemented by Stormwater Management Fund as needed. Target Completion Date for Design: September 2027. S12.Increase Green Stormwater Infrastructure on City of Palo Alto Property and/or Right- of-Way: Evaluate planned Capital Improvement Program projects for integration of green stormwater infrastructure to treat additional impervious surfaces. Resource Availability: Existing staff resources. Target Completion Date: Ongoing. S13.Quantify Land Area that Uses Green Stormwater Infrastructure to Treat Urban Water Runoff: Quantify the amount of land area in the City of Palo Alto that uses green stormwater infrastructure to treat urban water runoff. This includes quantifying the amount of impervious surfaces, and will be used as a baseline for future S/CAP work. Resource Availability: Consultant will be contracted to support City staff. Target Completion Date: December 2026. Zero Waste S14.Champion Waste Prevention, Reduction, Reusables, and the Sharing Economy: Create new collaborations with city departments (such as libraries) and community organizations to advance reuse and repair initiatives, including textile re-use and recycling. Resource Availability: Existing staff resources and outreach funding. Target Completion Date: 2027. S15.Eliminate Single-Use Disposable Containers and Reduce Disposable Foodware: Assess compliance with existing foodware ordinance requirements, identify key challenges and barriers to reducing additional single-use disposables and to requiring reusable alternatives. Develop new comprehensive plan to effectively expand and strengthen the foodware ordinance. Resource Availability: Funded for Ordinance Requirement, need additional funding for implementation of future requirements. Target Completion Date: 2027. S16.Promote Food Waste Reduction: Maintain and enhance ongoing public education and outreach initiatives aimed at promoting food waste reduction throughout the community. These efforts will also support and ensure continued compliance with the requirements of Senate Bill 1383 (2016). Messaging strategies will be aligned with sustainability goals and tailored to foster greater community engagement and behavioral change. Resource Availability: Existing staff resources and outreach funding. Target Completion Date: On-going. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 71  Packet Pg. 196 of 228  10 Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 72  Packet Pg. 197 of 228  11 Communications C1.Build Awareness about Sustainability and Climate Action and City Programs Available to the Community. Achieve widespread awareness about sustainability and climate action, the 80 x 30 goal, City services and programs, and achievements. Collaborate with partnerships and volunteers to support grassroots outreach helping to build residents, commercial customers, and contractors awareness. Resource Availability: Fully staffed, partially funded. Target Completion Date: On-going. C2.Drive Community Actions to Achieve S/CAP Goals: Run effective marketing and outreach campaigns that seek to increase program participation and drive community action in initiatives to achieve S/CAP goals. Resource Availability: Fully staffed, partially funded. Target Completion Date: On-going. C3.S/CAP Data Collection and Annual Reporting: Track community sentiment and engagement, including key performance indicators, through tools such as surveys and on-line analytics, and program analysis to guide decision making. Annually develop, implement, and report out on S/CAP communications objectives and progress. Resource Availability: Fully staffed, partially funded. Target Completion Date: On-going. Index of S/CAP Key Actions and the 2026-2027 S/CAP Work Items that Implement them S/CAP Key Action Title 2026-2027 S/CAP Work Plan Item(s) C1. Provide Building and Transportation Emissions Consultations for Residents (On-going item initiated in 2023-2025 S/CAP Work Plan) C2. Develop Major Employer Custom Emissions Reduction Plans CA12. Establish One or More Partnerships with Large Commercial Facility Owners C3. Study Additional Key Actions Needed for 80 x 30 CA11. Launch Pilot Program for Electrification of Centralized Water Heaters and Boilers C4. Study Staffing and Budgetary Needs CA13. Develop S/CAP Funding and Financing Strategies for City Council Consideration CA20. Develop Gas Transition Management Strategies C5. Study Funding Alternatives C6. Conduct an Electrification Affordability Study C7. Study Carbon Neutrality Options CA15. Develop Carbon Neutrality Strategies for City Council Consideration Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 73  Packet Pg. 198 of 228  12 C8. Accelerate GHG reductions through Mandates or Price Signals CA8. Launch Advanced Heat Pump HVAC Program CA10. Launch Workplace EV Charging Pilot CA14. Develop Potential Regulatory Measures to Drive Climate Action CA16. Develop Potential Strategies for Cost-Based Pricing of Non-Electric Decarbonization and Inefficient Electrification E1. Reduce GHG emissions in Single-Family Appliances and Equipment CA1. Continue Advanced Home Electrification Pilot Program CA2. Develop a Residential Electrification as a Service or Similar Financing Pilot for Council Approval CA3. Enhanced Data Tracking for Home Electrification E2. Reduce GHG emissions in Non-Residential Equipment CA8. Launch Advanced Heat Pump HVAC Program CA9. Develop a Commercial Electrification as a Service or Similar Financing Pilot for Council Approval CA12. Establish One or More Partnerships with Large Commercial Facility Owners E3. Reduce Gas Use in Major Facilities CA8. Launch Advanced Heat Pump HVAC Program CA9. Develop a Commercial Electrification as a Service or Similar Financing Pilot for Council Approval CA12. Establish One or More Partnerships with Large Commercial Facility Owners E4. Reduce Natural Gas Use at City facilities CA8. Launch Advanced Heat Pump HVAC Program CA9. Develop a Commercial Electrification as a Service or Similar Financing Pilot for Council Approval CA26. Develop and Begin Implementing a City Facility Electrification Plan E5. Support Income-Qualified Residents and Vulnerable Businesses with Electrification CA1. Continue Advanced Home Electrification Pilot Program Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 74  Packet Pg. 199 of 228  13 CA2. Develop a Residential Electrification as a Service or Similar Financing Pilot for Council Approval CA3. Enhanced Data Tracking for Home Electrification CA6. Continue Affordable Multifamily Building Electrification Incentive Program CA7. Launch Multi-Family Electrification Technical Assistance E6. Develop Electric Rate Options (Completed in 2023-2025 S/CAP Work Plan) E7. Use Codes and Ordinances to Facilitate Electrification CA8. Launch Advanced Heat Pump HVAC Program CA17. Reduce Permitting, Interconnection, and Other Barriers to Adoption of Vehicle and Building Electrification and Flexible Energy Technologies for Reliability and Resiliency E8. Electric Grid Modernization Plan CA17. Reduce Permitting, Interconnection, and Other Barriers to Adoption of Vehicle and Building Electrification and Flexible Energy Technologies for Reliability and Resiliency CA19. Continue Grid Modernization CA28. Explore the Electric Capacity Needs of the Palo Alto Airport for electric aviation E9. Additional Electrification Opportunities in Commercial and Multi-Family Buildings CA8. Launch Advanced Heat Pump HVAC Program CA9. Develop a Commercial Electrification as a Service or Similar Financing Pilot for Council Approval EV1. Raise Awareness of Alternative Transportation Modes, Micromobility, and EVs. CA4. Launch Enhanced Multifamily EV Charging Infrastructure Program CA5. Develop a Charging-as-a-Service (CaaS) or Similar Financing Pilot for Council Approval CA10. Launch Workplace EV Charging Pilot EV2. Collaborate to Promote EV Adoption Regionally (On-going item initiated in 2023-2025 S/CAP Work Plan) EV3. Promote EV Adoption and Alternative Commutes for Commuters CA10. Launch Workplace EV Charging Pilot Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 75  Packet Pg. 200 of 228  14 CA12. Establish One or More Partnerships with Large Commercial Facility Owners EV4. Facilitate the Adoption of EVs, E-bikes and other Light EVs. CA4. Launch Enhanced Multifamily EV Charging Infrastructure Program EV5. Promote Alternative Transportation Modes and Infrastructure to Support Adoption CA4. Launch Enhanced Multifamily EV Charging Infrastructure Program CA6. Continue Affordable Multifamily Building Electrification Incentive Program CA7. Launch Multi-Family Electrification Technical Assistance EV6. Expand EV Charging Access for Multi-Family Residents CA4. Launch Enhanced Multifamily EV Charging Infrastructure Program CA5. Develop a Charging-as-a-Service (CaaS) or Similar Financing Pilot for Council Approval CA18. Develop Public Charging Siting and Business Models EV7. Improve EV Charging Access for Income- Qualified residents CA4. Launch Enhanced Multifamily EV Charging Infrastructure Program CA5. Develop a Charging-as-a-Service (CaaS) or Similar Pilot for Council Approval CA6. Continue Affordable Multifamily Building Electrification Incentive Program CA7. Launch Multi-Family Electrification Technical Assistance EV8. Ensure EV Charging Capacity Supports EV Growth CA10. Launch Workplace EV Charging Pilot CA18. Develop Public Charging Siting and Business Models EV9. Electrify Municipal Vehicle Fleet CA27.Electrify City Vehicle Fleet when Feasible EV10. Support Policy to Electrify Fleet Vehicles CA27.Electrify City Vehicle Fleet when Feasible M1. Increase Active Transportation and Transit for Local Work Trips CA21. Achieve Benchmarks for Bicycle and Pedestrian Capital Improvement Projects CA22. Implement Micromobility Feasibility Study Recommendations CA25. Update City’s Traffic Calming Policy and Process Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 76  Packet Pg. 201 of 228  15 M2. Expand Availability of Transit and Shared Mobility Services CA21. Achieve Benchmarks for Bicycle and Pedestrian Capital Improvement Projects CA22. Implement Micromobility Feasibility Study Recommendations CA25. Update City’s Traffic Calming Policy and Process M3. Implement the Bicycle and Pedestrian Transportation Plan CA21. Achieve Benchmarks for Bicycle and Pedestrian Capital Improvement Projects M4. Improve Transportation Demand Management for Employees and Residents M5. Implement Smart Parking Infrastructure in Public Garages and Parking Fees in Business Districts M6. Study Land Use and Transportation M7. Continue to Implement the City’s Housing Element CA24. Continue Implementing the Housing Element / Land Use Planning and Policy M8. Improve Transit and Traffic Flow CA23. Continue Traffic Signal Operations and Multimodal Improvements M9. Create Housing Density and Land Use Mix that Supports Transit and Non-SOV Transportation CA24. Housing Element Implementation / Land Use Planning and Policy M10. Encourage Reductions in GHGs and VMT W1. Maximize Water Conservation and Efficiency S3. Identify and Implement Water Distribution System Adaptation Measures W2. Build a Salt Removal Facility S2. Improve Recycled Water Quality through Salt Removal W3. Implement One Water Portfolio Projects S1. Implement Water Efficiency and Conversation Measures W4. Develop a Dynamic Water Planning Tool (Completed in 2023-2025 S/CAP Work Plan) S1. Complete a Sea Level Rise Vulnerability Assessment (Completed in 2023-2025 S/CAP Work Plan) S2. Implement a Sea Level Rise Adaptation Plan S4. Finalize Partnership Agreement with Santa Clara County on SB272 Regional Shoreline Adaptation Plan Requirements to Develop a Regional Vulnerability Assessment and Adaptation Plan. Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 77  Packet Pg. 202 of 228  16 S5. Update the City's Sea Level Rise Adaptation Policy to Include Sea level Rise Planning Decision Making points in the City. S3. Begin Design Process for a Levee Project S6. Complete Construction and Begin Monitoring the Palo Alto Horizontal Levee Pilot Project (PAHLPP). S7. Continue Partnership with Valley Water on SLR / Shoreline Levee Improvement Efforts S4. Complete Bridge improvements and Identify Protection Strategies from Flood Events S7. Continue Partnership with Valley Water on SLR / Shoreline Levee Improvement Efforts S5. Implement the Foothills Fire Management Plan S8. Implement the Foothills Fire Management Plan S6. Minimize Fire Hazards Through Zoning (On-going item initiated in 2023-2025 S/CAP Work Plan) S7. Collaborate on Reducing Wildfire Hazards S8. Implement the Foothills Fire Management Plan S8. Implement CAL FIRE Public Education Programs (On-going item initiated in 2023-2025 S/CAP Work Plan) N1. Increase Palo Alto's Tree Canopy S9. Increase Tree Canopy in South Palo Alto N2. Ensure No Net Tree Canopy Loss for all Projects (On-going item initiated in 2023-2025 S/CAP Work Plan) N3. Reduce Pesticide Use in Parks and Open Space Preserves S10. Reduce Pesticide Use in Parks and Open Space Preserves N4. Enhance Pollinator Habitat N5. Establish a Carbon Storage of Tree Canopy Baseline and KPI S9. Increase Tree Canopy in South Palo Alto N6. Maximize Biodiversity and Soil Health N7. Coordinate Implementation of City Natural Environment-Related Plans (On-going item initiated in 2023-2025 S/CAP Work Plan) N8. Expand Water Efficient Landscape Ordinance (WELO) Requirements N9. Phase out Gas-Powered Lawn and Garden Equipment (Addressed by CA Assembly Bill 1346 banning the sale of new gas-powered small off-road engines) N10. Support the Green Stormwater Infrastructure Plan S11. Construct a Green Stormwater Infrastructure Project at a City of Palo Alto Park Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 78  Packet Pg. 203 of 228  17 S13. Quantify Land Area that Uses Green Stormwater Infrastructure to Treat Urban Water Runoff N11. Incorporate Green Stormwater Infrastructure in Municipal Projects S12. Increase Green Stormwater Infrastructure on City of Palo Alto Property and/or Right-of-Way ZW1. Encourage Food Waste Prevention and Require Food Recovery from Commercial Food Generators (On-going item initiated in 2023-2025 S/CAP Work Plan) ZW2. Promote Residential Food Waste Reduction S16. Promote Food Waste Reduction ZW3. Champion Waste Prevention, Reduction, Reusables, and the Sharing Economy S14. Champion Waste Prevention, Reduction, Reusables, and the Sharing Economy ZW4. Provide Waste Prevention Technical Assistance to the Commercial Sector (On-going item initiated in 2023-2025 S/CAP Work Plan) ZW5. Prioritize Domestic Processing of Recyclable Materials (Completed in 2023-2025 S/CAP Work Plan with on- going review) ZW6. Eliminate Single-Use Disposable Plastics S15. Eliminate Single-Use Disposable Containers and Reduce Disposable Foodware ZW7. Expand the Deconstruction and Construction Materials Management Ordinance (On-going item initiated in 2023-2025 S/CAP Work Plan) ZW8. Implement Reach Code standard for Low Carbon Construction Materials (Completed in 2023-2025 S/CAP Work Plan) Item 8 Attachment G - 2026-2027 SCAP Work Plan        Item 8: Staff Report Pg. 79  Packet Pg. 204 of 228  Attachments H through M for Staff Report 2512-5688 are available at the below links: Attachment H: S/CAP Funding and Financing Study Attachment I: EV Charger Needs Assessment Attachment J: Single-family Building Sector Study Attachment K: Multi-family Building Sector Study Attachment L: Non-Residential Building Sector Study Attachment M: Funding Source Survey Item 8 Attachment H - M Links        Item 8: Staff Report Pg. 80  Packet Pg. 205 of 228  City Council Staff Report Report Type: INFORMATION REPORTS Lead Department: Administrative Services Meeting Date: February 2, 2026 Report #:2501-4035 TITLE Monthly Investment Report - December 2025 (Unaudited) RECOMMENDATION This is an Information Report. No Council action is required. ANALYSIS The City’s Investment Policy (Policy) 1and California Government Code Section 53607 requires that a report of transactions (investments, reinvestment, sold, and exchanged securities) be made available to the Council on a monthly basis. This reporting requirement is separate and distinct from the quarterly investment report submitted under California Government Code Section 53646 that includes portfolio composition, a detailed list of all securities, performance compared to the Policy, overall compliance with the Policy, and the City’s ability to meet expenditure requirements over the next six months ATTACHMENTS Attachment A - Investment Portfolio Transaction Ledger – December 2025 APPROVED BY: Lauren Lai, Administrative Services Director 1 Investment Policy Fiscal Year 2025-2026 (Adopted June 16, 2025); https://www.paloalto.gov/files/assets/public/v/2/administrative-services/investment-policies/investment-policy- fy-2025-2026.pdf Item A Item A Staff Report Item A: Staff Report Pg. 1 Packet Pg. 206 of 228  Buy Call Redemption Maturity Summary CUSIP Security Description Security Type Transaction Type Settlement Date Quantity Price Acq/Disp Yield Amount Purchased/Sold Interest Total Amount 91282CPP0 UNITED STATES TREASURY 3.5 12/15/2028 US GOV Buy 12/15/2025 5,000,000.00 99.621 3.634 -4,981,054.69 0.00 -4,981,054.69 91282CPN5 UNITED STATES TREASURY 3.5 11/30/2030 US GOV Buy 12/10/2025 10,000,000.00 98.785 3.770 -9,878,515.63 9,615.38 -9,888,131.01 ------US GOV Buy 12/12/2025 15,000,000.00 ---3.725 -14,859,570.32 9,615.38 -14,869,185.70 CUSIP Security Description Security Type Transaction Type Settlement Date Quantity Price Acq/Disp Yield Amount Purchased/Sold Interest Total Amount 3133ERVD0 FEDERAL FARM CREDIT BANKS FUNDING CORP 5.1 04/01/2033 AGCY BOND Call Redemption 12/09/2025 -1,000,000.00 100.000 5.100 1,000,000.00 0.00 1,000,000.00 3133ERVD0 FEDERAL FARM CREDIT BANKS FUNDING CORP 5.1 04/01/2033 AGCY BOND Call Redemption 12/09/2025 -1,000,000.00 100.000 5.100 1,000,000.00 0.00 1,000,000.00 CUSIP Security Description Security Type Transaction Type Settlement Date Quantity Price Acq/Disp Yield Amount Purchased/Sold Interest Total Amount 91282CBC4 UNITED STATES TREASURY 0.375 12/31/2025 US GOV Maturity 12/31/2025 -1,500,000.00 100.000 0.742 1,500,000.00 0.00 1,500,000.00 882214AA7 Texas Bank 0.45 12/23/2025 CD Maturity 12/23/2025 -249,000.00 100.000 0.040 249,000.00 0.00 249,000.00 77357DAK4 Rockland Federal Credit Union 4.5 12/26/2025 CD Maturity 12/26/2025 -240,000.00 100.000 4.416 240,000.00 0.00 240,000.00 672319CF5 OAKLAND CALIF PENSION OBLIG 4.676 12/15/2025 MUNI Maturity 12/15/2025 -230,000.00 100.000 1.583 230,000.00 0.00 230,000.00 3135G06Q1 FEDERAL NATIONAL MORTGAGE ASSOCIATION 0.64 12/30/2025 AGCY BOND Maturity 12/30/2025 -1,000,000.00 100.000 0.470 1,000,000.00 0.00 1,000,000.00 13067WRC8 CALIFORNIA ST DEPT WTR RES CENT VY PROJ REV 0.79 12/01/2025 MUNI Maturity 12/01/2025 -180,000.00 100.000 1.320 180,000.00 0.00 180,000.00 06251A2Q2 Bank Hapoalim B.M. - New York Branch 0.5 12/15/2025 CD Maturity 12/15/2025 -249,000.00 100.000 0.551 249,000.00 0.00 249,000.00 ---------Maturity 12/26/2025 -3,648,000.00 100.000 0.930 3,648,000.00 0.00 3,648,000.00 CUSIP Security Description Security Type Transaction Type Settlement Date Quantity Price Acq/Disp Yield Amount Purchased/Sold Interest Total Amount ------------12/14/2025 10,352,000.00 ---3.272 -10,211,570.32 9,615.38 -10,221,185.70 Palo Alto Monthly Transactions 12/01/2025 - 12/31/2025 1 ATTACHMENT A Item AAttachment A - InvestmentPortfolio TransactionLedger - December 2025       Item A: Staff Report Pg. 2  Packet Pg. 207 of 228  City Council Staff Report From: City Manager Report Type: INFORMATION REPORTS Lead Department: Utilities Meeting Date: February 2, 2026 Report #:2512-5623 TITLE Informational Report on Calendar Year 2024 Annual Update for the Cap-and-Trade Program RECOMMENDATION This is an informational item. There is no recommendation. BACKGROUND California’s Cap-and-Trade Program, launched in 2013 under the Global Warming Solutions Act (AB 32), is a market-based system that caps greenhouse gas (GHG) emissions and lowers the cap each year to drive greenhouse gas emissions reductions. Under CARB’s cap-and-trade rules, Palo Alto must sell all of the allowances freely allocated to the Electric Utility. For the Gas utility, Palo Alto uses some of the freely allocated allowances for greenhouse gas compliance obligations and sells the remaining allowances using the proceeds for the benefit of ratepayers, consistent with AB 32. The City Council has adopted a policy on the use of cap- and-trade program revenue (see Resolution 94871 and Reso 100772). This City policy allows auction proceeds from the sale of Allocated Allowances to be used for renewable energy investments, energy efficiency programs, GHG emissions reduction initiatives, fuel-switching (such as electrification), and ratepayer rebates (with Council approval). Revenues from the sale of allowances freely allocated to the Electric Utility (“electric allowance revenues”) must benefit electric customers only, and similarly, revenues from the sale of allowances freely allocated to the Gas Utility (“gas allowance revenues”) must benefit gas customers. ANALYSIS Electric Utility In calendar year (CY) 2024, Palo Alto received 142,536 freely allocated allowances from the 1 Council Resolution 9487 (adopted January 26, 2015): https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=53850&dbid=0&repo=PaloAlto 2 Council Resolution 10077 (adopted October 3, 2022): https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=61567&dbid=0&repo=PaloAlto Item B Item B Staff Report Item B: Staff Report Pg. 1 Packet Pg. 208 of 228  State, all of which were sold at state-run auctions which generated about $5 million in revenue. About $2.47 million was spent on renewable energy purchases to help meet the City’s Renewable Portfolio Standard (RPS) targets. The remaining $2.55 million was transferred to the Electric Cap and Trade reserve at the end of Fiscal Year (FY) 2025 to fund future electric greenhouse gas emissions reduction programs. The Electric Cap and Trade reserve has about $6.68 million at the end of FY 2025. The types of S/CAP related expenditures for Electric Cap and Trade revenues are for Electric Vehicle Programs to provide access to EV charging for multi-family residents and a proposed alternative transportation pilot. Electric Allowance Revenues and Expenditures ($) Calendar Year Allowance Revenues Allowance Expenditures 2023 4,968,167 3,076,027 2024*5,021,890 2,470,160 * Unspent funding transferred to reserve for future programs. Gas Utility Gas Allowance Revenues and Expenditures ($) Calendar Year Allowance Revenues Allowance Expenditures 2023 2,983,655 210,196 2024*3,349,973 722,122 * Unspent funding transferred to reserve for future programs. FISCAL/RESOURCE IMPACT STAKEHOLDER ENGAGEMENT Item B Item B Staff Report        Item B: Staff Report Pg. 2  Packet Pg. 209 of 228  ENVIRONMENTAL REVIEW APPROVED BY: Alan Kurotori, Director of Utilities Item B Item B Staff Report        Item B: Staff Report Pg. 3  Packet Pg. 210 of 228  Item No. 8. Page 1 of 1 City Council Supplemental Report From: Brad Eggleston, Director Public Works/City Engineer Meeting Date: February 2, 2026 Item Number: 8 Report #:2601-5858 TITLE SUPPLEMENTAL REPORT: Review the 2024 Greenhouse Gas Inventory and S/CAP Key Performance Indicators Annual Progress Report, and Approve the 2026-2027 S/CAP Work Plan and Receive Six S/CAP Studies Recommended by the Climate Action and Sustainability Committee; CEQA Status: Review GHG Inventory and Key Performance Indicators: Not a Project; Potential Environmental Impacts of the S/CAP Work Plan were Studied in the June 5, 2023 S/CAP Addendum to the 2017-2031 Comprehensive Plan EIR; this Project is also Exempt Pursuant to CEQA Guidelines Section 15183 BACKGROUND The attached summary of the public workshop held December 13, 2025 by the Climate Action and Sustainability Committee (CASC), and which was mentioned in the Executive Summary, Analysis, and Fiscal Impact sections of the report, was inadvertently not attached to the initial staff report ATTACHMENTS Supplemental Attachment A: Summary of December 13, 2025 CASC Workshop APPROVED BY: Brad Eggleston, Director Public Works/City Engineer Item 8 Item 8 Supplemental Report        Item 8: Staff Report Pg. 1  Packet Pg. 211 of 228  BluePoint Planning 12/22/25 1 S/CAP Priorities Workshop Summary On December 13, 2025, Palo Alto hosted a Climate Action Priorities public workshop aimed at identifying the types of mechanisms that Council and the public is interested in using to advance the Sustainability and Climate Action Plan ( S/CAP) 80x30 goals related to climate action for the residential sector. This workshop was also held as part of a special public meeting of the Climate Action and Sustainability Committee (Committee). The three council members of the Committee (Vicki Veenker, Patrick Burt, and George Lu) and Commissioner Rachel Croft from the Utilities Advisory Commission attended the meeting, with an additional 20 members of the public in attendance. The public workshop was also designed to promote greater understanding of tradeoffs in financing and regulations to achieve the City’s 80x30 goals. The workshop focused on an interactive tabletop game named “Decarb Quest.” This game asked participants to pick at random cards representing different resident types and characteristics, home types, and home triggers. From there, participants must decide the strategy or combination of strategies that would best promote electrification in each scenario. Participants could also design additional strategy cards for scenarios in which they felt the suite of potential strategies was not sufficient. The workshop followed the following agenda: Introductions Climate Action Priorities Presentation Breakout Group Discussion o Benefits and challenges of mandates and incentives Evaluating Decarbonization Programs Presentation Breakout Group Discussion o Decarb Quest game on potential tools and approaches for electrification Public Comment Closing Comments Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 2  Packet Pg. 212 of 228  BluePoint Planning 12/22/25 2 Wall Graphic Recording Below is the wall graphic recording from the workshop that captured high-level takeaways from breakout group conversations. Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 3  Packet Pg. 213 of 228  BluePoint Planning 12/22/25 2 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 4  Packet Pg. 214 of 228  BluePoint Planning 12/22/25 3 Mandates and Incentives Presentation and Discussion Ahead of the first breakout group discussion on mandates and incentives, Jonathan Abendschein, Assistant Director of Climate Action, delivered a presentation on the S/CAP Electrification Funding Study, discussing the quantification of total benefits to the Palo Alto community over time from switching from gas to electric appliances and some initial considerations for utilizing incentives and mandates to accomplish electrification. Jonathan then took questions and comments from the Council Members present (full list of comments is listed under the detailed notes). Participants were then asked to discuss the benefits and drawbacks of utilizing incentives vs. mandates to accomplish 80% reduction in GHG emissions by 2030. Summary of Participant Comments Below are the takeaways from the breakout groups discussion: There is a place for both mandates and incentives to reach 80x30 goals Storytelling and effective communication is essential to support mandates and incentives o Mandates need to be paired with communication training; if people believe that their contributions are important, more people are likely to follow suit o Voluntary incentives give people agency and encourage personal storytelling It is important to quantify health savings as part of the discussion about avoided costs from electrification City should utilize mandates and include incentives as a stop gap measure o City can set health and safety standards/ mandates that must be met, and then use incentives to get people to reach those standards Incentives should focus on less affluent residents with higher need o City must do incentives o Some groups stated that incentives should be income qualified Programs that support incentives and mandates should be designed to reduce friction as much as possible for residents Workforce needs to be involved in leading electrification efforts Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 5  Packet Pg. 215 of 228  BluePoint Planning 12/22/25 4 Detailed Comments Below are additional notes from Council Members about the Decarbonization Strategies Presentation. Council Member Pat Burt Emphasize health and safety benefits of electric appliances o Appealing to community for support for programs based on climate impacts will capture chunk of community; more people spurred to action by health benefits o Should quantify economics of health benefits in study and feature these benefits to community o Safety should be a priority element EV trips likely account for greater share of trips than reflected in the EV ownership rate (of 16%) o Around 50% of purchases are EVs o Most people who purchase EVs use them more than their older car o Trends in equipment cost moving forward may decline o Wondered to what degree we are basing funding projections on current costs of electric appliances Council Member George Lu Can the funding study take into account a decrease in EV charging installation costs/ HPWH costs over time? o Is there a scenario where we can count on some national technology curve How are offsets assessed to users? o Offsets could be used more creatively as stick or carrot Vice Mayor Vicki Veenker Consider savings from gas transition study from Air District Implementation of Air District rules could save 89 deaths annually and $890 mil per year Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 6  Packet Pg. 216 of 228  BluePoint Planning 12/22/25 4 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 7  Packet Pg. 217 of 228  BluePoint Planning 12/22/25 5 Electrification Strategies, Discussion, Decarb Quest Game Before the second breakout group, which focused on electrification strategies, Jonathan delivered a presentation on considerations for electrification strategies, including financing options for incentives. This included considerations for how a Building Emissions Savings Ordinance (BESO) could operate, and an overview of financing cash flows for Electrification as a Service (EaaS) for Palo Alto residents. Jonathan then took questions from the Council Members present (full list of comments is listed under the detailed notes). Participants then rearranged into different breakout groups and completed an interactive tabletop game, “Decarb Quest.” This game asks participants to pick at random cards representing different resident types and characteristics, home types, and triggers for electrification upgrades. From there, participants must decide the strategy or combination of strategies that would best promote electrification in each scenario. Participants fill out the game board, picking at random from the deck two resident characteristics, a home type card, and a trigger for what may be happening to that home type (e.g. selling house, wanted to remodel, etc.). Participants then score how well that suite of strategies will encourage the resident with that home type to electrify, using game pieces to score on a scale of 1-4. Strategies that score a 1 would mean that residents would not electrify, and 4 means they would certainly electrify. Participants could also design additional strategy cards for scenarios in which they felt the suite of potential strategies was not sufficient. Below are images of the blank board and cards that participants were given. The images of the filled out boards from the game are included below at the end of this summary. Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 8  Packet Pg. 218 of 228  BluePoint Planning 12/22/25 6 Decarb Quest Game Board Decarb Quest resident characteristic, housing characteristic and housing trigger cards Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 9  Packet Pg. 219 of 228  BluePoint Planning 12/22/25 7 Summary of Participant Comments Below are the takeaways from the breakout groups discussion: Overall, the BESO and EaaS were popular strategies o BESO and EaaS work well for more affluent, singly family (SF) households, especially those doing remodels or large projects o May need to increase cost for BESO-funded upgrades for buyers o Traditional financing and EaaS may work for those with affordability issue o City could host investment fund to help support EaaS program Communication and storytelling must be part of BESO and EaaS programs o Emphasize that natural gas prices will rise and the City needs to protect residents’ health; by electrifying, the City will end up with lower, cheaper utility bills and improve residents’ health o Emphasize that electrification increases home value o Publicize existing programs more! The renter segment is difficult to reach o Mandates would work better for renters; renters need to be empowered to reach landlords o There are some other residents and scenarios that are difficult to electrify (e.g. a young, financially constrained family who is selling their house; landlord with renters who are high energy users and have a broken appliance) Multifamily (MF) homes typically have access to a traditional financing qualification In some scenarios it may make more sense for buyers to complete/ pay for energy assessment as part of BESO; buyer would then be required to upgrade to code when doing a construction project Require those selling their home to future proof it to become all-electric Implement the Watt Diet (strategic selection of electric products and load sharing among devices) to reduce the need for panel upgrades o City could price amp services differently, with higher watt panels costing more Technical assistance is a throughline for many electrification strategies Homeowners associations (HOAs) are a different scenario than rental apartments because there are so many hoops to jump through o Incentives would not be the driver of upgrades o EaaS may be a partial solution but there may still be a gap for HOAs City could pool electrification projects for more income-constrained residents Should be easier for residents to use electric vehicles (EVs), especially for MF properties o They can be a battery for homes and support resilience o Time of use (TOU) rates could be mandated; they would support EV usage and make EVs more affordable Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 10  Packet Pg. 220 of 228  BluePoint Planning 12/22/25 8 Additional Strategies Below is the full list additional strategies that participants brainstormed during the Decarb Quest game: BESO without public reporting For BESO, the seller can do the energy assessment but the buyer is required to upgrade (as opposed to the seller) Progressive loans (particularly for financially constrained households) Building owner makes bulk electric appliance purchase at reduced upfront cost (for MF renters) Building performance standard– each home has an environmental rating o May not be public for homeowners o Building performance standards (BPS) may work well for larger, MF properties, and would give these properties a timeline to electrify Pool electric project scopes for multiple homes City fund for electrification as service to reduce costs to residents o Some funds would be invested and get returns, some given to EaaS o This would help subsidize financially constrained residents EV charging in City lots adjacent to MF properties Streetside charging Portable induction cooktops Use City investment funds so City can be full financer of EaaS (City already covers loans under GoGreen) Education and communication around electrification benefits must underpin all strategies o Lawn signs can promote emergency heat pump water heater (HPWH) replacements and GoGreen financing Below are additional notes from Council Members about the Decarbonization Strategies Presentation. Vice Mayor Vicki Veenker Very interested in what has traction with residents Strategies aren’t necessarily alternatives, but can be combined– what is interplay between the strategies? Interested in understanding BESO ordinance Sees potential for Electrification as a Service Council Member Pat Burt Under EaaS we have lender involvement; to what extent would that be friction point? How simple could that become? Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 11  Packet Pg. 221 of 228  BluePoint Planning 12/22/25 9 o Palo Alto has simplified permitting for solar o Jonathan: there is discussion regionally on lender friction Where does funding come from for existing electrification and energy efficiency (EE) efforts and what legal latitude can apply? o Jonathan: electric public benefits funding is collected for EE, income qualified programs, renewable energy, and research and development. City has used funds for some electrification programs and is in conversation on how to use this in defensible way and what the competing priorities are Council Member George Lu Interested in both BESO and EaaS, lots of questions for both Interested in how we can reach MF apartments through sales of buildings and individual condos EaaS is more uncertain and has more moving parts; there are lots of questions to consider o What lenders exist out there? o How much risk is City taking on? o What happens if homeowners want to get expensive appliances? What happens if homeowners get into financial trouble? o Make process as simple as possible Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 12  Packet Pg. 222 of 228  BluePoint Planning 12/22/25 9 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 13  Packet Pg. 223 of 228  BluePoint Planning 12/22/25 10 Game Board Result Images Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 14  Packet Pg. 224 of 228  BluePoint Planning 12/22/25 11 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 15  Packet Pg. 225 of 228  BluePoint Planning 12/22/25 11 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 16  Packet Pg. 226 of 228  BluePoint Planning 12/22/25 12 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 17  Packet Pg. 227 of 228  BluePoint Planning 12/22/25 13 Item 8 Supplemental Attachment A - Summary of December 13, 2025 CASC Workshop        Item 8: Staff Report Pg. 18  Packet Pg. 228 of 228