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HomeMy WebLinkAbout2026-03-02 City Council Summary MinutesCITY COUNCIL SUMMARY MINUTES Page 1 of 26 Regular Meeting March 2, 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, Reckdahl, Stone, Veenker Present Remotely: Lythcott-Haims (Traditional Brown Act) Absent: None Call to Order Mayor Veenker called the meeting to order and welcomed everyone. City Clerk Mahealani Ah Yun called roll and declared all were present. Councilmember Lythcott-Haims noted that she was attending the meeting remotely from the Omni Hotel located at 4 Riverway in Houston, Texas. Councilmember Lythcott-Haims was in the Museum Park Conference Room, which was open to the public. The Palo Alto City Council Meeting Agenda had been posted outside the room early Friday. Special Orders of the Day 1. Santa Clara County Science and Engineering Fair Association 2026 Science Fair Winners from Palo Alto NO ACTION SCVSEFA Board Member Forrest Williams thanked the Mayor, Council Members, and Staff for recognizing the students who were preparing themselves for the future and making it better for all. The SCVSEFA would strive to resolve many problems. Board Member Williams introduced some of the team. All were invited to the Science Fair on March 10. The students were invited to speak about their projects. A Valley Christian student discussed his project comparing 2 algorithms for pathfinding to wildfires. A student from Stratford Palo Alto designed and prototyped healthy menstrual pads. SUMMARY MINUTES Page 2 of 26 City Council Meeting Summary Minutes: 03/02/2026 A Gunn High School student designed an experiment that tested the effect of different nutrients of lawns grown hydroponically. A senior at Gunn High School student built and designed a wearable glove to enable long-distance communication for deaf/blind individuals. A junior at Gunn High School student spoke of his project related to the nilpotence of Moufang loops. An 8th grade Stratford Palo Alto student’s project addressed levitating cities using electromagnetism. A Gideon Hausner Day School student’s project involved creating a glove that could become warm using chemical reaction. The project of a junior at Gunn High School involved engineering an AI communication system to aide Alzheimer’s patients facing social isolation. A sophomore at Harker School created a project called Deep Sleep using deep learning to detect obstructive sleep apnea from encephalogram data. Mayor Veenker thanked the inspirational students for speaking and invited them to the dais for a picture. 2. Review Applications and Select Candidates to Interview for the Historic Resources Board (HRB), Human Relations Commission (HRC), Planning & Transportation Commission (PTC), Stormwater Management Oversight Committee (SWMOC), and Utilities Advisory Commission (UAC) Vacancies; CEQA Status - Not a Project NO ACTION Deputy City Clerk Nicole Bissell voiced that electronic ballots had been sent to Council and the results were being tabulated. Deputy City Clerk Bissell provided some details of the recruitment cycle, including number of vacancies across 5 commissions and dates of recruitment opening and closing. Candidate interviews were tentatively scheduled for March 23 and appointments for April 6. Deputy City Clerk Bissell outlined the interview process, displayed a slide showing vacancies and applications, and discussed the results. There were 3 applicants for 3 vacancies on the HRB, so all candidates should be interviewed. Council could extend recruitment for any board or commission. Deputy City Clerk Bissell detailed the number of votes for HRC, PTC, and the UAC applicants and number of candidates advancing to the interview process. No applications were received for the SWMOC and staff recommended extending the recruitment. The Clerk’s Office would coordinate interviews with the candidates. Mayor Veenker mentioned there would be extended recruitment for the SWMOC. Council elected to extend HRB recruitment to provide a larger pool. SUMMARY MINUTES Page 3 of 26 City Council Meeting Summary Minutes: 03/02/2026 Staff would extend recruitment for the HRB. Agenda Changes, Additions and Deletions City Manager Ed Shikada announced there were no changes. Public Comment 1. Barbara H. opposed closing Churchill Avenue at the train tracks even on a temporary basis due to traffic concerns and requested an underpass solution. 2. Oteskwe S., Co-Chair for the Stanford Powwow, requested assistance in bringing the 2026 Powwow together. Financial support was needed. 3. Angela W., Co-Chair for the Stanford Powwow, stated donations were needed and $16K was being sought in City partnership support. Angela W. welcomed the opportunity to follow up with City staff to explore structuring the partnership. All were invited to attend the powwow. Mayor Veenker suggested that Angela W. reach out to staff with further information. Council Member Questions, Comments and Announcements Councilmember Lauing reported that he attended the Chinese New Year celebration, the Ramadan Dinner, and the Purim celebration, which were personally meaningful. Councilmember Burt requested an update on the Public Safety Building. Councilmember Lythcott-Haims was proud of and inspired by the Science and Engineering Fair winners. Councilmember Lythcott-Haims had attended the Stanford Powwow many times, which was student run, and was in favor of putting some Council contingency funds toward the partnership request. Councilmember Lythcott-Haims attended the Lunar New Year celebration and the Iftar Dinner. Mayor Veenker was excited to hear about the powwow. Mayor Veenker mentioned that she had attended the Teen Career Path event, the Lunar New Year celebration, and the Iftar Dinner. Flags were lowered half-staff in remembrance, respect, and mourning of the late Reverend Jesse Jackson Sr., and would continue through March 7. It was being done as part of a collective action led by the African American Mayors Association (AAMA). Mayor Veenker quoted a portion of the AAMA letter. Mayor Veenker asked all to join her in a moment of silence. Study Session 3. Palo Alto Link Program & Transit Futures Review; CEQA status – not a project. NO ACTION SUMMARY MINUTES Page 4 of 26 City Council Meeting Summary Minutes: 03/02/2026 Transportation Planning Manager Nate Baird highlighted Palo Alto’s unique and regionally fragmented transit context, which presented first/last mile challenges for pedestrians and bicyclists. The on-demand transit pilot would extend through the end of the fiscal year. Link service contracts had been renewed through June 30, 2026. Funds from the Transportation for Clean Air Fund had been awarded and the service would continue through the end of the fiscal year. Stanford Research Park (SRP) partnership funds and grant funds balanced by some fare recovery extended the 18-month pilot to 36 months but grant funds were not expected for additional outyears. In reviewing service adjustment options to the current Link Program, a return to shuttles, or a switch to subsidizing TNC services, staff reviewed ridership impacts and cost. Partnering with other municipalities with a local subregional strategy would be advantageous but it would not be easy with available funding sources. Manager Baird discussed the cost of the current Link Program and staff had considered raising fares, prebooking, etc., but such would decrease ridership. Prioritizing shifting rides to available transit options and resuming the former shuttle system would shrink the service area and each route would likely cost as much as Link and would be without any identified funding partners. With a Link or TNC service designed to serve just vulnerable riders, cost per trip would likely rise without partnership funding. None of the options staff considered stood to increase ridership or improve the cost per rider. Feedback from the PTC and users generally had been positive. Some seniors had difficulty with the app-based nature of the service and many wanted the service to go beyond current boundaries and into the evenings and weekends. Manager Baird summarized the fiscal impact. Link would conclude service on June 30, 2026. Councilmember Reckdahl asked Mr. Baird to describe the 250 power users and how many people were served over the year. Manager Baird answered that power users were regular riders. Manager Baird would find out how many people were served over the year. There was a mix of regular and infrequent users. Via Transportation Ton Chookhare replied that since September 1 there had been 1,426 unique riders. Power users used the service multiple times per week. Councilmember Burt inquired if the TFCA grant would be renewed. Councilmember Burt wanted to know what the impact would be on the FY2027 budget if the City stuck with the FY2026 budget, including the TFCA grant. Councilmember Burt asked if eliminating the program would save only $250K per year. Manager Baird did not anticipate renewing the TFCA grant but current funds could be stretched to June 30, 2027. Because the TFCA could be stretched, $250K would be needed for 1 more year. Councilmember Burt questioned what was meant by stretching TFCA funds. Manager Baird stated that because funding had been an issue the last couple years, staff had been experimenting with different budgets each month. Budgeting for less cost per month SUMMARY MINUTES Page 5 of 26 City Council Meeting Summary Minutes: 03/02/2026 impacted service and quality of usage. By budgeting a higher cost per month, service and quality of usage were better but funds were spent quicker. Councilmember Burt asked if continuing the service level would allow TFCA funds to carry over into FY2027. Manager Baird stated the funds were available through June 30, 2027. The plan was to spend as much as possible through June 30. Councilmember Burt inquired how much TFCA funds would be left if the current service continued. Manager Baird responded that $456K was available and billing could start in January. If current service was continued, the remainder of the TFCA funds would be consumed in FY2026. If service was reduced, there would be some funds for FY2027. Public Comment 1. Herb B. suggested returning to a free fixed-route service rather than continuing the Link system. 2. Ton C. with Via stated the service was valuable to the Palo Alto’s vulnerable residents, specifically the elderly and disabled who were economically challenged. Ton C. encouraged Council to extend service beyond June 2026 under 2 conditions – that Link be redesigned to prioritize vulnerable riders and that collaborative funding options continue to be explored. Vice Mayor Stone queried what percentage of riders were youth and youth accessing free rides to seek mental health and other services. Vice Mayor Stone wanted to prioritize transit options for youth accessing mental health services as transportation could challenging. There was benefit in narrowing the focus of Link to address youth, seniors, and disabled community members but the cost impact needed to be better understood. Vice Mayor Stone questioned if extended wait times had deterred ridership. Link addressed the last-mile problem but challenging decisions needed to be made. Vice Mayor Stone was a little disappointed with the information presented because there was not enough data to determine if the pilot’s objectives had been achieved nor could the cost savings be determined if service should be reduced. Vice Mayor Stone agreed with the shuttle service recommendation and some of the options but some did not make sense. Manager Baird would follow up with information related to youth ridership. Extended wait times degraded service. Councilmember Lythcott-Haims was a fan of Link generally but was concerned with performance, ridership, and the number of strings attached. Youth should not have to divulge that they were using Link for mental health services, which was a privacy issue. Councilmember Lythcott-Haims wanted to know how that worked transactionally. SUMMARY MINUTES Page 6 of 26 City Council Meeting Summary Minutes: 03/02/2026 Manager Baird responded that no clarifying questions were asked. It was based on a person being a youth and going to a designated location. Manager Baird spoke of destinations that would not qualify for the eligible discount. Free rides were available to those going to the libraries and the community centers. Councilmember Lythcott-Haims asked if youth received free rides to Alcove and how the service was being promoted. Youth, seniors, and the disabled should be priorities. Councilmember Lythcott-Haims had a hard time hanging hope of continuing Link on youth ridership increasing because there was not enough information on the percentage of youth ridership. Councilmember Lythcott-Haims questioned if there had been discussion about a shuttle service in the San Antonio Road Area Plan process. City Manager Ed Shikada answered that Alcove was on the list for free rides. Promotion was handled through the Community Services Department. Manager Baird would provide a list related to free rides. Chief Transportation Official Ria Lo replied that transportation options for the San Antonio area were being looked at holistically and she was not aware that a specific shuttle for the area was being discussed. Councilmember Lythcott-Haims asked if Link had come up in the conversations. Chief Transportation Official Lo would check to see if Link had been discussed. Manager Baird remarked that the San Antonio staff planners had talked to him about Link. As it was a pilot program, it was listed as something that might serve the area. In the last 2 months, youth ridership had been about 4 percent of all trips. Mayor Veenker questioned what was known about Sunnyvale’s program, which was almost identical to Link. Manager Baird responded that Sunnyvale’s program was more regional and Cupertino was involved and received many of the same transit funds. Manager Baird did know how Sunnyvale was funding it in the outyears. Sunnyvale might have won additional funds because of regional coordination. Chief Transportation Official Lo added that Sunnyvale was using funds from a VTA Innovative Transit grant. Mayor Veenker questioned if Sunnyvale was getting funding from the California State Transportation Agency (CalSTA) and what would happen to the Link fleet if the City returned to a shuttle-type service. Chief Transportation Official Lo thought Sunnyvale received TIRCP and VTA grant funding. Palo Alto did not apply for TIRCP. SUMMARY MINUTES Page 7 of 26 City Council Meeting Summary Minutes: 03/02/2026 Manager Baird added that the next application for that funding would be in May and the City could apply but he did not think the funds would come online for July 1. The fleet was leased and built into the monthly operating costs and included in the hourly cost the City was charged per service hour. Councilmember Lu stated Palo Alto was barely short of winning several hundred thousand dollars and a couple programs received their full funding request. If programs were funded at a 50- percent level instead of some getting everything and some getting nothing, there could potentially be a better solution. The VTA funding nature was why some cities were spinning up and why Palo Alto was under stress. Councilmember Lu asked how confident Palo Alto was in the partnership with SRP and if the SRP might fund other options or possibly pull funding even if the program continued. Manager Baird responded that SRP had been a great partner and open to conversations. SRP needed their needs met and had riders coming from all over the city. Most were commuters and paying full cost for morning and evening trips, which helped subsidize midday trips. SRP might be interested in a subsidized rideshare or taxi service. Chief Transportation Official Lo added that SRP was not interested in partnering on a shuttle program nor in Palo Alto providing extra funds for the Marguerite service. Councilmember Lu stated if SRP had interest in a subsidized rideshare or taxi service it could mean similar outcomes for SRP and more sustainable options for Palo Alto. Councilmember Lu asked if the timeline for the final decision would be addressed as part of the budget process or if there would be another action item for Council. Manager Baird answered that the default was to wind down by June 30. Without General funds, it could possibly extend a few days or some amount of time with the TFCA funds. Without clear direction or funding proposed as part of the budget process, there would not be another session and the program would wind down. Councilmember Lu was comfortable increasing the ride price and was interested in reducing subsidies. It would decrease ridership and there would be other tradeoffs and it still might not be financially sustainable. The fixed shuttle was not recommended for good reason. It would be useful to understand what other rideshare companies had to offer. Uber and Lyft might not have enough electric vehicles in their fleet for Palo Alto to subsidize shared rides only on electric vehicles. If there were options to do something like that, the budget impact would have to be substantially less if SRP would agree to implement some subsidies through those vendors. Otherwise the default might be inevitable. Councilmember Lauing commented that Packet Page 178 did not show a lot of sensitivity to the price or the ridership relative to the fixed cost of operating the program. Mayor Lauing asked if there was a price sensitivity to increasing ride cost to $6 or $7 and if the cost to the City would be $1.2 a year without subsidies. The slides had noted that $700K would be saved every year SUMMARY MINUTES Page 8 of 26 City Council Meeting Summary Minutes: 03/02/2026 because of the Stanford grant. Councilmember Lauing inquired what Stanford’s stance was on continuing the program. Chief Transportation Official Lo replied that the change in ridership did not have much to do with a change in price but more to with prioritizing different riders. Decreasing ridership or increasing price would move the needle on the total cost of operation. Manager Baird responded that without subsidies the program would cost the City about $100K a month, which was in the middle of a high versus a low service level. With no further grant funds assumed, $700K would be saved per year because of the Stanford grant, though staff would continue to pursue grants. If the program should be continued, Stanford would work with the City. Councilmember Lauing queried if $1.2M would reduce to $500K if Stanford continued to work with the City and if there was optimism for grant funding. Councilmember Lauing did find the proposal to refocus the program to groups to be more efficient or that it would cost less. Piloting a shuttle would require funding. Councilmember Lauing supported continuing the program at a cost of $700K, although other funding should be pursued. Manager Baird explained that the reduction would depend on Stanford’s usage. No grant funds were lined up for the next fiscal year and such funding should not be assumed. It was sometimes easier to use the City’s committed funds to get more committed funds. City Manager Shikada asked if terminating the service would equal a savings of $700K. Chief Transportation Official Lo answered that after using the TFCA funding the difference was $700K on an annual basis. Councilmember Reckdahl understood that folks liked Link but long wait times was not good service. The City paying $26 per ride was high and Uber and Lyft were less expensive. Councilmember Reckdahl discussed Uber and Lyft’s voucher system, which was a more sustainable model than operating Link. A voucher system could target low-income people. Councilmember Burt stated the way VTA set up the grants created a series of unsustainable programs. A shared cost might be more sustainable. If the regional transit tax passed, VTA would have funding to expand service and it had been implied that the microtransit would be scaled. There were bus routes in the San Antonio corridor, although it might need to be expanded. Councilmember Burt asked if staff was under the impression that there would not be General Fund dollars for FY2027. Manager Baird understood that 95 percent of the funds for the project had been grant funds and on June 16, there had been a discussion about winding down Link by December 31, 2025, based on the amount of funds the City had for Link this fiscal year. SUMMARY MINUTES Page 9 of 26 City Council Meeting Summary Minutes: 03/02/2026 Councilmember Burt recalled that there was a scenario the Finance Committee wanted to purse but a clear decision had not been made. A voucher program with Uber and Lyft was an option, although they might not have capability for wheelchairs. Councilmember Burt asked what capability Link had to accommodate wheelchairs. Manager Baird replied that Link had 2 vehicles available to accommodate wheelchairs. Councilmember Burt noted that VTA had a paratransit system but it required a lot of scheduling, so it would not provide the same quality of service as Link but the 2 approaches could be merged. Councilmember Burt would support a voucher program focusing on those in need. Alcove counselors were going to the high schools and were at the wellness centers and the Link Program was not promoted at the wellness centers and the target audience needed to know what was available. Palo Alto Link and bike routes should be provided to the wellness centers. If direction should be given to staff or the Finance Committee, there needed to be consensus on that direction. Mayor Veenker mentioned that grant funding was unpredictable and asked if the City would compete well in the CalSTA grant. Manager Baird noted that pursuing Transit funds was easier with a local commitment. It was a very competitive environment and the local match was usually a large part of the assessment. There were many ways to pursue funding. City Manager Shikada added that grants were typically focused on a very finite period of time. Obtaining grants on an ongoing basis was not impossible but very difficult and would be a dilemma going forward. If the City wanted to continue to leverage additional local dollars for a few more years, that would be taken as direction in budget planning. Mayor Veenker remarked that the City could commit to pursuing grants and put together a package with the SRP. Mayor Veenker queried why the TFCA was ending. Chief Transportation Official Lo answered that the City received the TFCA grant. Chief Transportation Official Lo understood that the direction was to continue service to the end of the fiscal year and to see what would happen with the VTA's Innovative Transit grant and the TFCA grant. A number of pilots were no longer eligible because the pilots were not new but it did not necessarily address the model. Mayor Veenker expressed that the grant landscape did not seem to be as bleak as presented with surrounding areas launching a new program. Mayor Veenker was concerned about vulnerable riders and wanted to help the first/last-mile commuters. Mayor Veenker questioned how a voucher system would compare in cost and if the $26 was after accounting for the $4 fare. Chief Transportation Official Lo stated that with a voucher system there would be a risk of losing the Stanford partnership. SUMMARY MINUTES Page 10 of 26 City Council Meeting Summary Minutes: 03/02/2026 City Manager Shikada answered, related to cost, that it was $22 net. Manager Baird added that, in addition to cost, other variables were involved in terms of demand changes and $26 was averaging a large number of inputs. Mayor Veenker understood that Council was interested in funding streams and in serving vulnerable riders. Councilmember Lauing noted that Avenidas served senior citizens with multiple vehicles and drivers and service could be expanded. The voucher system was a good idea but some issues would need to be addressed, such as the very elderly and disabled using the app. Councilmember Lauing wanted to fund the first half of 2027 with $350K or a little more, which would allow time to raise grants for the second half of 2027. The grants could be from organizations other than VTA. That approach would give staff direction to work the budget until June. Councilmember Burt commented that grants would not be sustainable but might give some lifeline but he was skeptical that a grant would be awarded in a time frame that would reduce the cost for FY2027. As part of the budget process, Councilmember Burt requested that staff determine if there were grant opportunities and the time frame and likelihood of an award. Transit service work should be done with Avenidas and Marguerite. Councilmember Burt asked why Stanford was not interested and what leverage Palo Alto had to convince them to work with the City on altering routes to better serve the community. Council might need to have a conversation with Stanford. Councilmember Burt recommended that staff return ASAP (no later than the budget process) with a preliminary evaluation of what would be needed to implement a voucher program. Councilmember Lu agreed with Councilmember Burt’s comments. Mayor Veenker expressed that Reach Your Destination Easily was a great program and thought that was the senior transportation program at Avenidas. Mayor Veenker requested that staff provide an overview of the grant situation and explore the voucher program by the budget timeline. Councilmember Reckdahl echoed Councilmember Burt’s comments. Councilmember Reckdahl was skeptical because of the tight budget and was concerned that continuing Link would mean cutting more desired programs. Mayor Veenker understood that Council wanted to focus on the most vulnerable with a voucher- type program. Chief Transportation Official Lo clarified that the City applied for TIRCP in 2023 but was not successful. SUMMARY MINUTES Page 11 of 26 City Council Meeting Summary Minutes: 03/02/2026 Consent Calendar 4. Endorsement of the Connect Bay Area Transit Initiative 5. Authorize Transmittal of the 2025 Comprehensive Plan Annual Progress Report to the Governor’s Office of Land Use and Climate Innovation and the 2025 Housing Element Annual Progress Report to the Department of Housing and Community Development. CEQA Status: Not a Project. 6. Approval of General Service Contract No. C26195719 with Clean Harbors Environmental Services, Inc. in an Amount Not-to-Exceed $1,914,000 to Provide Household Hazardous Waste Management and Emergency Response Services for a Period of Five Years, and Approval of a Budget Amendment in the Refuse Fund; CEQA Status – Negative Declarations Previously Approved 7. Approval of Professional Services Contract Number C26195818 With BKF Engineers in an Amount Not to Exceed of $900,000 Over a 3-year Term for On-Call Surveying and Design Support Services; CEQA Status – Not a Project 8. Approval of Amendment No. 1 to the Multi-Agency Staffing Agreement for Fire Station 8. CEQA Status – Not a Project. Public Comment 1. Herb B. did not support Item 4 and suggested that the companies/corporations fund it. 2. Justine B., Executive Director of the Palo Alto Transportation Management Association, urged Council to support Connect Bay Area’s effort to fund mass transit on the November 2026 ballot measure. MOTION: Vice Mayor Stone moved, seconded by Councilmember Lu, to approve Agenda Item Numbers 4-8. MOTION PASSED: 7-0 City Manager Comments City Manager Ed Shikada stated the Public Safety Building was nearly complete on audio, visual, and communication systems and there had been progress on smoke control system in the detention area. However, Swinerton declined to complete some required work, so staff was contacting third-party party contractors, which was estimated take an additional 90 days. Another contractor was starting work to fit out the dispatch area. June was the time frame for the next phase of work. A community listening session related to the temporary closure of the Churchill rail crossing was scheduled for March 12. There was ongoing work between the City SUMMARY MINUTES Page 12 of 26 City Council Meeting Summary Minutes: 03/02/2026 and the Jed Foundation and there would be a workshop on March 18 and 19. Additional information could be found at paloalto.gov/tempchurchillclosure. City Manager Shikada announced that a number of community events were scheduled for March and details could be found at paloalto.gov/calendar. Council items for next week included a study session on a development proposal at 51 Encina, next steps on SB 79 related to development around rail transit stations, and follow-up on Council priority objectives and committee work plans. On March 16, Council would address a builder’s remedy project at 2100 Geng Road, a demolition order appeal for 531 Stanford Avenue, and development approval for 475 El Camino way. March 23 would be a special meeting, which would include a consent calendar, an action item related to the CEDAW Ordinance, and interviews of perspective board/commission/committee appointees. City Manager Shikada furnished a slide showing agenda items for April and beyond. [Council took a 20-minute break] Action Items 9. 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 Public Works Director Brad Eggleston introduced the item. Environmental Control Program Manager Christine Luong provided details related to the 2024 greenhouse gases (GHG) emissions inventory and presented graphics. Manager Luong explained that the emissions reduction target had been corrected from the previous target. Palo Alto was a member of the Green Cities California (GCC) and of the 21 cities surveyed Palo Alto was 1 of 4 that aimed to achieve carbon neutrality by 2030. Of the GCC cities with the 1990 baseline year, 4 cities, including Palo Alto, achieved reductions of more than 30 percent. By the end of 2024, Palo Alto reduced total municipal GHG emissions by roughly 64 percent from the 2005 baseline, although it was no longer possible to do an equivalent comparison due to changes in methodology. The 2024 key performance indicator (KPI) progress could be found in Attachment D and was summarized in Attachment E. Manager Luong stated that staff would continue to report on progress and examine how to improve data collection to report on KPIs. Staff requested that Council approve the 2026-2027 S/CAP Work Plan as recommended by the Climate Action and Sustainability Committee. S/CAP focused on 4 areas related to climate action and 4 areas related to sustainability. The 2023-2025 Work Plan had guided the implementation priorities for a few years. Staff developed the next Work Plan with input from the Climate Action and Sustainability Committee and the Climate SUMMARY MINUTES Page 13 of 26 City Council Meeting Summary Minutes: 03/02/2026 Action Working Group focusing on priorities for 2026-2027. Manager Luong discussed the items in 2023-2025 Work Plan. The accomplishments in 2023-2025 helped shape strategies for the 2026-2027 Work Plan. The 2026-2027 Work Plan had 16 strategies for sustainability, water, sea level rise, wildfire protection, natural environment, green stormwater infrastructure, and zero waste and included 3 new strategies for communication. Sustainability and Climate Action Assistant Director Jonathan Abendschein commented that the 2023 through 2025 S/CAP Work Plan had 50 items in climate action of which 34 were discrete projects and 27 were completed, 6 were in progress, and 1 was delayed. Five projects would transfer to the 2026-2027 Work Plan. Two of the removed projects related to evaluating the City’s Transportation Demand Management (TDM) Ordinance and downtown parking availability had been removed based on committee feedback. Assistant Director Abendschein spoke of the successes in 2023 through 2026, which included launching programs, building community awareness, and doing studies, and tools and data were built to develop policy options on funding and financing community-wide electrification. Assistant Director Abendschein shared a slide listing the single-family, multifamily and non-residential program goals in the 2026-2027 Work Plan, which included offering more electrification services in multifamily and non-residential sectors and introduced new cost-efficient program models in all sectors. Assistant Director Abendschein spoke of the goals with the cost-efficient program models. Building out policy options based on the program designs was a major focus for 2026 and 2027 as was continuing infrastructure investment in the electric grid, bike network, and City fleet and facilities. Assistant Director Abendschein stated the work plan received extensive feedback and review from the Sustainability Committee and Working Group and broader community feedback had been provided through a December workshop. Staff requested that Council receive 6 studies that had been done over the last few years. The studies provided staff with data and modeling tools needed to develop new programs in 2026 and 2027 and to develop policy options on communitywide electrification. The studies were described in detail in the report on the December 13 workshop. The core findings were that community-wide electrification would benefit to the community but that the costs and benefits were distributed unevenly. An incentive-only approach would require revenues exceeding available City resources, so alternative programs were needed. The real value of the studies was that they provided the data and the modeling tools that staff could use through 2026 to develop policy options and refine assumptions to provide more actionable policy options. Ideas gathered from the December workshop were incorporated in the plan. Staff recommended that Council review the GHG emissions inventory information and the KPIs and staff requested that Council approve the 2026- 2027 Work Plan and receive the 6 studies. Councilmember Reckdahl referenced Slide 9 and inquired why there was a lot of difference in Palo Alto’s data and Belmont’s data. Manager Luong replied that most cities followed the same GPC protocol for GHG inventories. Manager Luong would look at Belmont again but the bulk of most cities’ emissions were SUMMARY MINUTES Page 14 of 26 City Council Meeting Summary Minutes: 03/02/2026 transportation or buildings. Belmont did not have a downtown, so they might have not have as many commercial and industrial buildings as Palo Alto. Councilmember Reckdahl queried if it was or could be an apples-to-apples comparison. If it was such a comparison, Belmont could be doing something better, which Palo Alto should copy. Councilmember Burt wanted to know what leading cities were doing and wanted those cities to know what was working for Palo Alto, so there would be sharing of information. In particular, Councilmember Burt wanted to know what Santa Monica had done. In trying to convince the community to electrify, one of the themes that came out of community workshop was the health impacts of methane in the home, which could move the dial in the communications plan. Councilmember Burt did not see anything related to health impacts in the communications programs and he requested that be elevated and amended. Councilmember Burt spoke of EVs and combustion engine vehicles and explained that it would be important to recalibrate the GHG assumption. Streamlining processes would help government efficiency and make it more efficient for customers. Leveraging community resources would help with the government efficiency goal and Councilmember Burt suggested that be formalized. Manager Luong addressed the prior question related to Santa Monica and noted that their population was larger but much denser. Santa Monica switched to 100-percent clean power through the Clean Power Alliance CCA. The biggest difference in Santa Monica was more people worked from home or took transit to work and everyone who lived in Santa Monica lived in the same county. Santa Monica reduced their vehicle transportation emissions 48 percent from their baseline and Palo Alto 32 percent. In commercial natural gas use, Santa Monica reduced 47 percent and Palo Alto 20 percent. Councilmember Burt wanted to know how that occurred. Councilmember Lu added that Santa Monica owned its own bus system, which provided for flexibility and the ability to incentivize public transit, and there had been a major rail extension in 2015 or 2016. While Santa Monica had a slightly larger reduction, their population increased by 7 percent and Palo Alto’s increased 22 percent over the same period. Palo Alto’s per capita reduction was better than Santa Monica’s. Councilmember Lu was optimistic that some vehicles would be taken off the road as a result of Caltrain’s electrification and vehicle ownership might be underestimated. Goals should be realistic. Goals that were too ambitious could result in slackness and make accountability for different initiatives more difficult. Maybe the 80 x 30 goal should be per capita. Mayor Veenker remarked that the communication strategies should indicate what residents could do, how the City could help, and the impact it would make. Mayor Veenker wanted to take advantage of the Community Working Group, Council’s resources, and the learnings in other cities to find out what instigated participation. Council should discuss the 80 x 30 goal more. Mayor Veenker appreciated that it pushed Council. The City should continue with the parts that SUMMARY MINUTES Page 15 of 26 City Council Meeting Summary Minutes: 03/02/2026 could be achieved in certain categories and possibly redefine or swap out other parts for something else. It should be examined what Council should hold to. Councilmember Lauing inquired why Palo Alto had higher goals than and accomplished so much more than other cities and questioned if the other cities were committed to the effort. Manager Luong responded that Palo Alto owning and operating its own utilities was a huge advantage. Assistant Director Abendschein added that municipalities that did own their own utility needed to work in concert with their local CCA and county sustainability organization. Public Comment 1. Justine B., Executive Director of PATMA, stated that in 2022 on-road transportation contributed 51 percent of GHG and 56 percent in 2024. Justine B. provided examples of benefits of sustainable transportation options. 2. Avroh S. was happy that sea level rise was being taken seriously and believed Palo Alto had a good plan. Residents should be educated on sea level rise. 3. Prisha G. was concerned with the public health decline due to the environment and spoke of a study published in the International Journal of Epidemiology. Prisha G. hoped to make progress toward the 80 x 30 goal by shifting away from gas. Prisha G. provided Council with a handout and encouraged the City to provide information on the website. 4. Hilary G. shared an electrification messaging kit put together by the County of San Mateo’s Sustainability Team, which the Bay Area Air District was going to use. Hilary G. urged Palo Alto to adopt the free messaging kit and to provide a free induction cooking hob to residents who had gas stoves and qualified for reduced utility. 5. Erin P., a Gunn High School student, provided the City Clerk with a petition containing 597 signatures requesting that Council direct Palo Alto Utilities to inform residents of the health risks from gas appliance use. Erin P. mentioned that gas stoves should have a working hood vent and that residents should be made aware of the alternatives to gas cooking. 6. Sven T. (Zoom) seconded previous speakers’ comments. 7. Debbie M. (Zoom), a member of many climate groups, suggested giving publicity to those who made progress toward electrification and to available rebates, etc. Debbie M. requested that the public be educated on the negative effects of using gas in the home. SUMMARY MINUTES Page 16 of 26 City Council Meeting Summary Minutes: 03/02/2026 8. Alice (Zoom), a Notre Dame High School student, echoed the comments of Erin P. 9. Sarah S. (Zoom), an 8th grader at Ellen Fletcher Middle School, seconded the comments of previous speakers. 10. Anya R. (Zoom), a junior at Paly, endorsed all previous speakers’ comments. 11. Zara H. (Zoom), a junior at Palo Alto High School, seconded all previous comments made by students. 12. Serena (Zoom), a junior at Palo Alto Middle College High School, echoed all previous comments. 13. Kanami (Zoom), a student, seconded all previous comments related reducing GHG emissions and supporting climate change and sustainability and thanked Council for their work. 14. Valen V. (Zoom), a student at Los Altos High, requested that the City continue to support induction cooking and that the City label gas stoves with their harmful effects. Valen V. noted that Stanford research indicated that induction cooking was 3 times more efficient than gas. Mayor Veenker thanked the public commenters, liked the idea of induction cooktops for those on reduced utility rates, and suggested that folks think about ventilation in general with respect to health. Vice Mayor Stone was optimistic that there would be progress with the 80 x 30 goal but did not know if the goal would be met. There should be a framework to share information with other cities. Consideration should be given to the electrification messaging kit put together by San Mateo County. Vice Mayor Stone queried how staff anticipated reducing GHG emissions by over half and asked if the 40-percent tree canopy coverage related to the urbanized areas. It did not appear that great progress was being made in the multifamily area. Vice Mayor Stone addressed increasing the percentage of multifamily residents with access to overnight EV charging and requested more detail. Assistant Director Abendschein answered that the chart on Page 447 assumed meeting the primary emissions reductions needed to achieve 80 x 30 and it illustrated what was needed to achieve carbon neutrality. It did not address how to reach the emissions reductions. Over the last few years, staff had been focusing on EV charging while doing studies to determine where there were opportunities to build electrification and there had been a lot of success in the multifamily EV charging area. The focus had been on getting shared chargers into buildings to support EV drivers. Over 10-percent of the City’s multifamily housing stock had been equipped with EV chargers. The next phase would be to figure out a full continuum of access. In the next 2 years, staff would experiment with business models that could be scaled cost efficiently and there would be a focus on nearby EV charging, which might be easier than installing chargers into the SUMMARY MINUTES Page 17 of 26 City Council Meeting Summary Minutes: 03/02/2026 buildings themselves. With a higher level of EV adoption within buildings, staff would look at installing chargers in individual parking spaces. There was an Affordable Housing Grant Program and staff had been working with providers and if all projects were achieved, as much as 30 percent of the central systems in affordable housing could be electrified. Manager Luong replied that the 40-percent tree canopy coverage related to the urbanized areas but it did not include Foothills. Director Eggleston added that the March 9 agenda would include a detailed informational report on S/CAP implementation for the third and fourth quarters of calendar year 2025. Vice Mayor Stone asked if there were incentives for multifamily buildings to switch from gas to electric stoves and other types of appliance conversions. Assistant Director Abendschein Staff replied that staff was in the midst of launching incentive programs and induction cooktop loaner programs for single-family homes and multifamily buildings. Vice Mayor Stone remarked that when developing incentives or policies it was important that it not just be end-of-life but upon tenants moving out. If an apartment had a natural gas stove, maybe the dangers of gas should be disclosed and existing program information provided in the lease information. Assistant Director Abendschein commented that staff would work on providing education and incentives for portable replacements for gas equipment. As for end-of-life, the incentive programs were accessible to multifamily landlords. One of the work items in the 2026-2027 Work Plan was to develop technical assistance specifically for landlords and condo associations. Councilmember Reckdahl agreed with the concerns related to multifamily. Councilmember Reckdahl voiced that the City should pay attention its own GHG emissions and inquired if there was a plan to reduce GHG from wastewater, if landfill composting compliance could be improved, and if there was motion on low-carbon concrete. Director Eggleston explained that it was difficult to control GHG emissions from wastewater but staff was working on a biosolids facilities plan, which would be presented to the Climate Action Sustainability Committee later in 2026 and then to Council. Landfill GHG emissions was not measured data but modeled using standard factors for a properly managed landfill, so not a lot could be done to reduce those emissions. A low-carbon concrete ordinance was passed in 2022 and the requirements had been implemented by the Building Department. Manager Luong noted that another part of the indirect emissions sources on the slide labeled in orange was staff commute, so alternate transportation could be encouraged. Low-carbon concrete was not included in the inventory because those emissions were not in the stats. Since passing the ordinance, there had been much compliance with the Planning Department enforcing it. Manager Luong understood that it was working as intended. SUMMARY MINUTES Page 18 of 26 City Council Meeting Summary Minutes: 03/02/2026 Councilmember Reckdahl queried if low-carbon concrete was used for sidewalks. Councilmember Reckdahl was concerned about the tree canopy because the density of housing developments was being maximized, so there was less room for trees, so the City needed to consider trees in parks, school playgrounds, etc. Director Eggleston replied that low-carbon concrete was not used for sidewalks but staff was discussing it with the Public Works Team. Councilmember Lu hoped best practices and the process would be considered, supported communicating health risks of natural gas in the home, and seconded the comments related to multifamily and renters and the tree canopy, especially in parks. There were challenging implementation gaps on water heating, space heating, etc. The Committee had had a lot of public comment on bike/ped infrastructure. Councilmember Lu expressed that Santa Monica was aggressively investing in separated bike lanes and improved bike lanes overall, and Palo Alto should consider taking that direction. There were items looking at incentives, regulatory measures, zoning, permitting, and barriers to adoption and an expansive view could be taken, such as electrified commercial buildings being allowed to have marginally smaller setbacks or taller buildings, incentives to reduce the effective cost of electrification, TDRs for a commercial electrification initiative, etc. The Committee had received comments that these be as quantitative as possible, so metrics could be developed for actual GHG emission reductions. Councilmember Burt stated there were incentives in place to almost invariably electrify new buildings. The challenge was retrofitting existing buildings. Transit-oriented development with services that were walkable would reduce trip reductions and car ownership and there should be a reference to that and not merely adjacency to transit. Councilmember Burt wanted to know the quantification of the GHG reductions from the progress made and what was projected for low-carbon concrete. The funding plan did not include enough dollars to incentivize reaching the goal. A greater proportion of the subsidies should concentrate on lower income. To move the dial without subsidies, there should be communication about induction cooktops. There could be a movement from incentivizing and subsidizing to reasonable, gradual mandates in some areas. Councilmember Burt was glad to see there were a number of ways to scale the induction cooktop program. A loaner with a buy option would go over well. As for internal City transportation reductions, Enschede’s (a Sister City of Palo Alto) staff used E-bikes for City business and needed special permission to use a car. Technology was improving and costs reducing. It appeared that the goal was out of reach but Palo Alto needed to come as close as possible and it could be recalibrated in 2029. Carbon neutrality should be pursued. Regarding biosolids, if a pyrolysis process should be pursued and used, it would become a carbon capture. Councilmember Lauing voiced that the fundamental issue with advancing a home electrification pilot was money. Education needed to be provided and consideration should be given to more than a program and rebates. The idea of a cooktop loaner was great. Councilmember Lauing’s concern with the Work Plan was the S/CAP funding and developing potential financing strategies for consideration in Q4 of 2026 and he requested that financing strategies for existing homes and businesses be accelerated. SUMMARY MINUTES Page 19 of 26 City Council Meeting Summary Minutes: 03/02/2026 Director Eggleston stated financing pilots were high priority. If pilots were launched and successful, CA13 addressed scaling them up communitywide. Assistant Director Abendschein added that the first discussion with the Climate Action Committee concerning the Q4 topic would be in one month, so staff would address it right away. Mayor Veenker appreciated that there were not enough funds to maintain the desired incentives, so consideration must be targeted. Decisions would have to be made about zero-interest financing and the different options. Mayor Veenker encouraged that the focus be on building performance standards, which could be mandated but perhaps it could start with reporting and then over time increase the standards and what other cities were doing could be explored. MOTION: Councilmember Burt moved, seconded by Councilmember Reckdahl, to: 1. Approve the 2026-2027 S/CAP Work Plan; and 2. Receive the following studies: a. S/CAP Funding and Financing Study; b. S/CAP Funding Source Survey; c. EV Charger Needs Assessment; d. Single-family, Multi-family, and Non-Residential Building Sector Studies; and 3. Communications additions: a. Emphasize the health risks; b. Develop a communication plan similar to the San Mateo County model and incentivizing behavior toward our climate action goals; c. Leverage community partners. Councilmember Burt noted that in calendar year 2025 GHG had been reduced city-wide by nearly 2 percent as a result of Caltrain electrification. Going forward, staff needed the capacity to address this complex set of initiatives. Conversation ensued regarding motion language. Councilmember Lauing asked what C meant. Councilmember Burt replied that C was to utilize various community partners and codify the partnering as part of the plan. SUMMARY MINUTES Page 20 of 26 City Council Meeting Summary Minutes: 03/02/2026 MOTION PASSED: 6-0-1 (Councilmember Reckdahl, Vice Mayor Stone, Mayor Veenker, Councilmember Lauing, Councilmember Burt, Councilmember Lu voted yes) (Council Member Lythcott-Haims was absent) 10. Status Update on Implementation of the Reliability and Resiliency Strategic Plan; Accept 1) Palo Alto’s Electric System Reliability Indices and Recommended Goals and Reporting, 2) the “Evaluation of Local Energy Resources to Lower Costs and Improve Reliability and Resiliency” Report (as recommended by Climate Action and Sustainability Committee and Utilities Advisory Commission) to Complete Reliability and Resiliency Strategic Plan Strategy Four and Strategy Five; and Provide Direction to Pursue Various Activities Related to Flexible Energy Resource and Efficient Electrification to Improve Reliability and Resiliency; CEQA Status - Not a Project Sustainability and Climate Action Assistant Director Jonathan Abendschein asked Council to consider a staff recommendation on reliability metrics and the Sustainability Committee and the UAC’s recommendations on cost-benefit analysis of flexible energy technologies and efficient electrification. Assistant Director Abendschein provided an update on the Reliability and Resiliency Plan. The City had done a lot to reduce barriers to community adoption of the technologies. In addition to barrier reduction with technologies, staff questioned if incentives and intensive programs should be provided to the community to drive widespread adoption. Utilities Chief Operating Officer Terry Crowley commented that the city had finished a pilot area for grid modernization and lessons had been learned in how to approach it. Staff was considering looking at safety and reliability first and identifying and building those projects and building out capacity as the projects were being built, which would focus on rebuilding substations. As the distribution systems were being built out, it might be advantageous to focus on where customers were truly electrifying, rather than continuing to build out neighborhoods, which would probably better position for the electricity and help keep rates low. Staff was working to improve reliability with the second transmission line into the Colorado Receiving Station, which was approved to be built as soon as 2034 but it could be needed by 2030, so staff would review and approve a new and updated plan, which might include advancing the Ames 115 line to 2030. A workforce was needed to move the projects forward and positions were being filling but staff was leaving at about the same rate as positions were being filled. The Wildfire Mitigation Plan included undergrounding of the Foothills area, which was planned to be completed by the summer of 2026. Staff was continuing to improve the outage system and communication with customers. Chief Operating Officer Crowley explained how system reliability and availability were measured with SAIDI, SAIFI, and CAIDI and how staff recommended reliability goals be measured with SAIDI and SAIFI. Chief Operating Officer Crowley supplied a slide showing Palo Alto’s performance versus other Utilities. Assistant Director Abendschein discussed the cost-benefit analysis. Buro Happold helped staff value flexible energy technologies and efficient electrification in reducing electric utility supply and enhancing short-term community resiliency and they worked with staff on a qualitative assessment of long-term resiliency. Staff worked with Energea to evaluate the potential to defer SUMMARY MINUTES Page 21 of 26 City Council Meeting Summary Minutes: 03/02/2026 distribution investment and a preliminary analysis had been done to see if a more in-depth analysis would be worthwhile. The studies found that all the technologies had benefits but the day-to-day cost would increase for the customers adopting the technologies, although there would be value in having long-term resiliency protection against extended outages but it would not be a positive cost-benefit related to utility energy supply and short-term outage protection. Current policies allowed customers to make those decisions on an individual basis. The study concluded that that a major push to adopt City incentives and intensive programs to promote the technologies would raise overall energy costs to the community, so staff did not recommend adopting such programs at this time. Staff would continue to monitor in case the cost-benefit changed. Commercial solar and battery storage showed a break-even value and could be cost effective on a case-by-case basis. Partnering with commercial customers on such projects generally required more rapid paybacks on their investment than what a break-even cost-benefit would typically provide but looking at it on a case-by-case basis would be worthwhile. Assistant Director Abendschein stated the studies did not find any opportunities for deferring distribution investment with the technologies. Assistant Director Abendschein displayed slides showing the residential and commercial cost benefits. Staff recommended that Council accept the electric system reliability indices recommended in the report, which would fulfill Strategy 1, Action 6 of the Reliability and Resiliency Strategic Plan. Staff had received slightly different recommendations from the Sustainability Committee and the UAC on the cost-benefit analysis. Both bodies recommended that Council accept the report, direct staff to promote shifting electric load to off-peak periods, promote and reduce barriers for various technologies, periodically review and update the cost-benefit analysis, and evaluate large-scale solar and battery opportunities and both wanted to have a follow-up discussion on microgrids and long-term resiliency in 2026. One of the differences was how to intensively pursue recommendation 3B – reducing barriers and promoting technologies. The Sustainability Committee recommended a higher level of effort, which would involve adding a part-time hourly, and the UAC recommended continuing the current practice of addressing issues as they arose and as staff time was available. Both bodies recommended a full update to the cost-benefit analysis every other year but the UAC recommended updating just the electric supply costs, which would not take much effort by staff. If Council adopted the Sustainability Committee recommendation, staff would need to incorporate a budget proposal in the FY2027 budget for the halftime hourly but the UAC recommendation would not require additional resources. Public Comment: 1. Stephen R. (Zoom) supported Item 10 and opined that grid straining could be alleviated with local storage, which could act as emergency backup. Stephen R. spoke of a program in New Orleans that provided incentives for citizens putting batteries in their homes. Assistant Director Abendschein announced that Commissioner Croft was on the line. SUMMARY MINUTES Page 22 of 26 City Council Meeting Summary Minutes: 03/02/2026 Mayor Veenker welcomed Commissioner Croft. Councilmember Reckdahl asked why Palo Alto had longer outages than other communities and requested that staff speak to the technologies that had been considered. As for reliability goals, the City should look back at past outages and determine if grid modernization would improve that and if it would be an improvement, it would be more of a selling point to customers than noting that other communities had less reliable service. The public should be made aware that that City was making progress and that there would be fewer outages. Chief Operating Officer Crowley responded that Palo Alto’s outages were typically due to equipment failure and required a crew to repair/replace/rebuild equipment, which was time consuming. It was suspected that equipment failure was due to aging equipment. Chief Operating Officer Crowley understood that it was not relevant to Palo Altans if other communities were less reliable but public utilities demonstrated how they were performing relative to surrounding areas to note value being added. Staff expected to see improvements with grid modernization. There would be improvements in reliability and restoration times by using modern utility practices versus practices done in the 1970s. Assistant Director Abendschein furnished a slide showing the technologies staff had considered. New functionality was being added to the grid as opposed to just modernizing the grid. There would not be an opportunity to add battery systems, solar storage, or vehicle to grid until the cost of technology came down. Councilmember Burt expressed that improvements were being made to reliability and resiliency through the Grid Modernization Program, the advanced metering system, and improving the Dispatch Center staffing and the second transmission line was on the horizon. Councilmember Burt did not find any reference to quantitative goals and customers needed to be convinced to move in the direction of the 80 x 30 goal and confident that their utilities would be reliable and resilient. It was not an issue of Palo Alto being compared to another Utility. There needed to be higher quantitative goals than what was outlined. There should be a goal to get back to the best the City was in the past and a number should be set indicating where the City needed to be to convince the community to electrify, which was fundamental to the entire Climate Program. Comparison to other communities was a valuable selling point. Councilmember Burt commented that staff had noted that the cost-benefits did not include direct financial and quantified benefits and it needed to be clarified that they were quantifiable financial benefits. Councilmember Lu echoed comments made by Council Members Reckdahl and Burt. There should be relative industry metrics and absolute metric improvement goals, such as X-percent improvement year over year on each metric. It appeared that Palo Alto was well above the top quartile for SAIDI and SAIFI, so the goals were not ambitious enough and there should be a TBD absolute improvement goal. Councilmember Lu assumed solar and battery storage opportunities were being overlooked by the average numbers calculated. It was important that programs identify where residential uptick was coming from. There were significant commercial opportunities. Councilmember Lu expected there was a lot of latent demand for solar and battery SUMMARY MINUTES Page 23 of 26 City Council Meeting Summary Minutes: 03/02/2026 storage. Councilmember Lu questioned where the Sustainability Committee and the UAC’s diverged. Commissioner Croft answered that everyone was disappointed that the cost-benefit was not more compelling and 2 commissioners were concerned that long-term resiliency, especially in emergent situations, was not monetarily valued in the report and the commissioners wanted to see more of that and thought it should have been modeled/quantitated. Commissioner Croft thought there was agreement to determine who was doing these things and to encourage them but was following the methodology on whether money should be invested in incentives to do so. Rates were increasing faster than the UAC desired and with the City budget challenges, the market might not be ready to respond to the pushing of new technologies without a lot of known ways to integrate the new technologies. The UAC did not agree on getting additional resources to more aggressively push and agreed with the original staff recommendation. The UAC moved to amend and update the cost-benefit analysis annually for electricity prices, which might change the analysis and make some of the options more attractive sooner than a 2-year time period. There was a 3-2 vote to approve the staff recommendation with the amendment to update for electricity prices in 1 year. The no votes were due to not finding the long-term resiliency to be appropriately valued in the methodology. One of the 2, thought something should be chosen and moved on. Mayor Veenker echoed comments related to broadening the cost-benefit concept as there was more to it than dollars. The timing and analysis could become more attractive from the quantifiable point of view depending on the fluctuation of electricity rates, so the City should keep an eye on that as there could be advantage in continuing to encourage those. Mayor Veenker questioned if there were metrics related to the total time out of service for the average customer. Chief Operating Officer Crowley responded that SAIDI and CAIDI provided information related to the total time out of service for the average customer. Chief Operating Officer Crowley discussed the information gleaned from CAIDI. Utility systems used indices to rank and track systems over time and to compare to neighboring systems for performance. Total customer outage minutes and number of outages in a year could be pulled out and tracked separately but they were baked into the SAIDI, SAIFI, and CAIDI numbers, so it would be somewhat redundant. Mayor Veenker asked if the city could be subdivided to determine if there had been a relative improvement in the areas with the grid modifications. Chief Operating Officer Crowley answered, regarding subdividing the city, that staff could likely look at breaking out outages by circuits or substations, which would indicate certain areas within the city and show which substations or circuits were more reliable than others. It would be more difficult to break it out by geographical zones regardless of the circuit but it was possible. Mayor Veenker noted that it would be interesting to quantifiably demonstrate the improvement with one thing being done, which could build more support for ongoing grid modernization. SUMMARY MINUTES Page 24 of 26 City Council Meeting Summary Minutes: 03/02/2026 Mayor Veenker addressed reliability goals and inquired how the metrics compared with metrics for private power. Chief Operating Officer Crowley replied that publicly owned utilities generally outpaced investor- owned utilities. Mayor Veenker understood that Palo Alto was above the top quartile for private power across the country and asked how staff would set a number to remain in the top quartile or if a relative should be used instead. Chief Operating Officer Crowley stated that some utilities set goals relative to their specific utility, not based on neighboring utilities, and reducing outages, etc., by X percent a year and establishing a declining trendline. It would be more reasonable to do a rolling average over X number of years to level out some of the fluctuations from year to year. Chief Operating Officer Crowley could not set that target toward the floor, the minimum achievable number, while maintaining decent rates. At some point, the City would hit a floor and guaranteeing no outages was not possible. Mayor Veenker queried if APPA averages had a certain trend and if the goals should be year over year to avoid having a flat trend. Chief Operating Officer Crowley stated that the most recent APPA trends were fairly flat and confirmed that the goals should be year over year to avoid having a flat trend. Mayor Veenker wanted staff to provide more information related to the floor. Councilmember Lauing noted that there was a limit and asked what the best was the City could do, what the magnitude of cost would be, and if Palo Alto could do better than the top quartile. Chief Operating Officer Crowley answered that tree trimming and maintaining the system were continued costs. Equipment needed to be replaced, which was somewhat baked into the rates, as 40 to 50 percent of outages were equipment failures. The City should be strategic in equipment replacement and thought should be given to how to approach and restore outages. Palo Alto could do better than the top quartile as there was room for improvement and staff was committed and desired to do good work. Councilmember Lauing asked if staff could quantify what it would take to be better than the quartile. Chief Operating Officer Crowley did not know if the comparison was being made to the APPA or PG&E or looking at the City’s own numbers but maybe the goal could be to be 10 percent below the 3-year average, which might be possible but there might be things that prevent it. MOTION: Councilmember Burt moved, seconded by Mayor Veenker, to: SUMMARY MINUTES Page 25 of 26 City Council Meeting Summary Minutes: 03/02/2026 1. Accept Palo Alto’s electric system reliability indices and recommended goals and reporting. 2. Accept the “Evaluation of Local Energy Resources to Lower Costs and Improve Reliability and Resiliency” report to complete Reliability and Resiliency Strategic Plan Strategies Four (Value the benefits of flexible technologies to the utility and community) and Five (Evaluate the resource needs for various demand reduction and resiliency programs). 3. Direct staff to: a. Promote City of Palo Alto Utilities (CPAU) customer’s use of energy in off-peak periods to reduce both greenhouse gas emissions and strain on the electric grid, and lower energy costs; b. As opportunities present themselves, and to the extent staff time is available, evaluate large scale solar and battery opportunities in Palo Alto, either at publicly owned facilities or through partnerships with private landowners; and c. Engage the Utilities Advisory Commission, Climate Action and Sustainability Committee, and Council in an additional discussion on microgrids and long-term resiliency in 2026. d. Promote and reduce barriers to adoption, as appropriate, for demand response capable technologies, solar photovoltaics (PV), battery energy storage system (BESS), thermal storage, and vehicle to load, home, and grid technologies, including, but not limited to: i. Recurring and widespread outreach; ii. Developing educational materials, online decision tools, and other resources to help community members evaluate these technologies for themselves; iii. Actively auditing regulations and processes for streamlining opportunities; and iv. Actively and continuously integrating flexible energy technologies and efficient electrification into energy programs; e. Within two years, update cost-benefit analysis for demand response, solar PV, batteries, thermal storage, and vehicle to load, home, and grid technologies with an interim annual update of just electric supply costs; 4. Return with recommendations for quantified reductions in SAIDI, SAIFI, and CAIDI, in addition to the performance metrics already recommended as comparison to industry. SUMMARY MINUTES Page 26 of 26 City Council Meeting Summary Minutes: 03/02/2026 Councilmember Burt spoke of the recommendations of the UAC and the Climate Action Committee. When staff presented at the Climate Action Committee, the Committee chose the moderately more aggressive and stronger one to better the chances of reaching the 80 x 30 goal. Councilmember Burt pointed out the differences in the recommendations and noted that the Committee had chosen recurring and widespread outreach over regular outreach as opportunities were presented; developing education materials, etc., over posting such materials; actively auditing regulations and streamlining opportunities rather than facilitating regulatory and process changes as staff became aware; and to actively and continuously integrate flexible energy technologies instead of integrating it when staff time was available. The resources to do the aforementioned equaled a little over 0.5 FTE per year, which was a small investment for big changes and outcome. Mayor Veenker supported being more aggressive but the budget was tight and she hoped it would make it through the Finance Committee process. Councilmember Burt asked if the additional staff funding would come from the Utilities Department and the General Fund. Assistant Director Abendschein would have to confer on where additional staff funding would come from. Councilmember Lu noted that the motion did not address long-term resiliency and modeling that value. Councilmember Lu asked if recommendations would return to the full Council as an action item. Assistant Director Abendschein answered that 3C directed staff to return with a conversation on long-term resiliency. Councilmember Burt assumed this would go to the Climate Committee and then to Council perhaps on consent unless there was a need for more discussion. Mayor Veenker questioned if it should go to the UAC. City Manager Ed Shikada stated it did not need to specify if it would go to the UAC at this point. MOTION PASSED: 6-0-1 (Mayor Veenker, Councilmember Lauing, Vice Mayor Stone, Councilmember Reckdahl, Councilmember Lu, and Councilmember Burt voted yes) (Councilmember Lythcott-Haims was absent) Adjournment: The meeting was adjourned at 10:44 p.m.