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HomeMy WebLinkAbout2016-06-06 City Council Agenda PacketCity Council 1 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. June 6, 2016 Special Meeting Council Chambers 5:00 PM Agenda posted according to PAMC Section 2.04.070. Supporting materials are available in the Council Chambers on the Thursday 10 days preceding the meeting. PUBLIC COMMENT Members of the public may speak to agendized items; up to three minutes per speaker, to be determined by the presiding officer. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located on the table at the entrance to the Council Chambers, and deliver it to the City Clerk prior to discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful. TIME ESTIMATES Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public. To ensure participation in a particular item, we suggest arriving at the beginning of the meeting and remaining until the item is called. HEARINGS REQUIRED BY LAW Applicants and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and up to three minutes for concluding remarks after other members of the public have spoken. Call to Order Closed Session 5:00-6:00 PM Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker. 1.CONFERENCE WITH CITY ATTORNEY Existing Litigation - 1 Matter Authority: Government Code Section 54956.9(d)(1) Buena Vista MHP Residents Association v. City of Palo Alto, et al. Santa Clara County Superior Court, Case No. 115CV284763 Existing Litigation - 1 Matter Authority: Government Code Section 54956.9(d)(1) Toufic and Eva Jisser, and the Toufic and Eva Jisser Revocable Trust v. City of Palo Alto, et al. United States District Court for the Northern District of California – San Jose Division, Case No.5:15-CV-05295 EJD REVISED 2 June 6, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Agenda Changes, Additions and Deletions City Manager Comments 6:00-6:10 PM Oral Communications 6:10-6:25 PM Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes. Minutes Approval 6:25-6:30 PM 2.Approval of Action Minutes for the May 9 and May 16, 2016 CouncilMeetings Consent Calendar 6:30-6:35 PM Items will be voted on in one motion unless removed from the calendar by three Council Members. 3.Adoption of a Resolution Approving two Escrow Deposit and Deposit Agreements, Authorizing the Deposit of $6.1 Million Into Escrow Funds Related to two Series of Library and Community Center General Obligation Bonds and $2 Million for the University Avenue Parking Assessment District Bonds for the Purpose of Early Redemption of Such Bonds, and Authorizing Related Actions 4.Approval of Contract Number C16163554 for $206,056 With Trafficware for San Antonio Road SynchroGreen Adaptive TimingSystem Implementation and an Associated Amendment of the Budget Appropriation for the General Fund and Capital Fund 5.Adoption of a Resolution Summarily Vacating a Public Utility Easement at 3276 Kipling Avenue 6.Acceptance of the Palo Alto Fire Department Quarterly Performance Report for Third Quarter Fiscal Year 2016 7.Approval of Four Contracts for On-Call Inspection and Plan Review Services in a Combined Amount Not-to-Exceed $7,700,000 Over a Three Year Term Ending June 30, 2019 With: (1) 4Leaf, Inc.; (2) Kutzmann and Associates, Inc.; (3) SAFEbuilt; and (4) Shums Coda Associates 8.Approval of a Contract With Airport Management Consulting Group inthe Amount of $183,008 for Planning and Consulting Services at Palo Alto Airport, including Evaluation of Options in Managing the OfficeContract 3 June 6, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Spaces and Hangars, Development of Primary Management and Compliance Documents Including the Airport Rules and Regulations, Minimum Business Standards and Leasing/Rents and Fees Policies, and Related Matters; and Approval of Budget Amendments in the General Fund and Airport Fund 9.Approval to Amend the Current Purchase Order to Include Equipment for new Ambulance Purchase 10.Approval of the First Amended Agreement With the San Francisquito Creek Joint Powers Authority and its Member Agencies for Funding of Construction of the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 11.SECOND READING: Adopt an Ordinance Repealing Ordinance Number 4936, the Council's Prior Authorization for Natural Gas Purchases (FIRST READING: May 16, 2016 PASSED: 9-0) 12.SECOND READING: Adopt an Ordinance Amending Municipal Code Sections 12.32.010 (Water Use Restrictions) and 12.32.020 (Enforcement) (FIRST READING: May 16, 2016 PASSED: 9-0) 13.Approval and Authorization for the Mayor to Sign a Letter Responding to the California High Speed Rail Authority's Notice of Intent/Notice of Preparation Action Items Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 6:35-6:50 PM 14.PUBLIC HEARING: to Hear Objections to the Levy of Proposed Assessments on the Palo Alto Downtown Business Improvement District and Adoption of a Resolution Confirming the Report of the Advisory Board and Levying Assessment for Fiscal Year 2017 on the Downtown Palo Alto Business Improvement District 6:50-7:50 PM 15.Review of Recommendations From the Storm Drain Blue Ribbon Committee Regarding Future Storm Water Management Funding and Request for Council Direction on Whether to Proceed With a Proposition 218 Hearing and Property Owner Ballot-by-Mail to Approve Future Storm Water Management Rates 7:50-9:20 PM 16.PUBLIC HEARING: Request for City Council and Public Comments on the Draft Environmental Impact Report (DEIR) and Fiscal Study 4 June 6, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Prepared for the Comprehensive Plan Update. The Draft Environmental Impact Report was Published on February 5, 2016 for a Public Comment Period That Will end on June 8, 2016 9:20-10:45 PM 17.PUBLIC HEARING: Adoption of a Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program, and Approval of a Site and Design Application to Demolish the Existing Approximately 18,000 Square Foot Building and Construct a new Approximately 62,000 Square Foot Building for an Automobile Dealership Located at 1700 Embarcadero Road. The Application Includes Design Enhancement Exception Request to Allow Deviation from the 10 Foot Build-to-Line From Embarcadero Road and Bayshore Road. There is Also a Request to Apply the Automobile Dealership (AD) Zoning Overlay. Environmental Assessment: An Initial Study and Mitigated Negative Declaration was Circulated. Zoning District: CS (D) Service Commercial and Site Design Review Combining District. The Planning and Transportation Commission Recommended Approval. Inter-Governmental Legislative Affairs Council Member Questions, Comments and Announcements Members of the public may not speak to the item(s) Adjournment AMERICANS WITH DISABILITY ACT (ADA) Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance. 10:45-11:00 PM Authorization for the Mayor to Sign a Letter Regarding the Governor's By Right Housing Proposal 18. 5 June 6, 2016 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Additional Information Standing Committee Meetings Sp. City Council Rail Committee Meeting May 31, 2016 Sp. Local Transportation Funding Committee Meeting June 2, 2016 Sp. Finance Committee Meeting June 7, 2016 Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Informational Report Status Report Update of the Sale of Transfer Development Rights for the Sea Scout Building Located at 2560 Embarcadero Road Public Letters to Council Set 1 CITY OF PALO ALTO OFFICE OF THE CITY CLERK June 6, 2016 The Honorable City Council Attention: Finance Committee Palo Alto, California Approval of Action Minutes for the May 9 and May 16, 2016 Council Meetings Staff is requesting Council review and approve the attached Action Minutes. ATTACHMENTS:  Attachment A: 05-09-16 DRAFT Action Minutes (DOC)  Attachment B: 05-16-16 DRAFT Action Minutes (DOC) Department Head: Beth Minor, City Clerk Page 2 CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 10 Regular Meeting May 9, 2016 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:08 P.M. Present: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Absent: Special Orders of the Day 1. Appointment of two Candidates to the Human Relations Commission, two Candidates to the Library Advisory Commission, and Three Candidates to the Utilities Advisory Commission for Terms Ending May 31, 2019 and one Candidate to the Utilities Advisory Commission for one Unexpired Term Ending May 31, 2017. First Round of voting for two positions on the Human Relations Commission with a terms ending May 31, 2019: Voting For Jill O’Nan: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Voting For Greer Stone: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Beth Minor, City Clerk announced that Jill O’Nan with nine votes and Greer Stone with nine votes were appointed to the Utilities Advisory Commission for terms ending May 31, 2019. First Round of voting for two positions on the Library Advisory Commission with a terms ending May 31, 2019: Voting For Allan Bennett: DRAFT ACTION MINUTES Page 2 of 10 City Council Meeting Draft Action Minutes: 5/9/16 Voting For Sheena Chin: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Voting For Natasha Kachenko: Wolbach Voting For Bob Moss: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid Ms. Minor announced that Sheena Chin with nine votes and Bob Moss with eight votes were appointed to the Library Advisory Commission for terms ending May 31, 2019. First Round of voting for three positions on the Utilities Advisory Commission with a terms ending May 31, 2019: Voting For Chris DiBona: Voting For Lisa Forssell: Filseth, Wolbach Voting For A.C. Johnston: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Voting For Henrik Morkner: Voting For William Ross: DuBois, Filseth, Holman, Schmid Voting For Judith Schwartz: Berman, Burt, Holman, Kniss, Scharff, Wolbach Voting For Terry Trumbull: Berman, Burt, DuBois, Kniss, Scharff, Schmid Ms. Minor announced that A.C. Johnston with nine votes, Judith Schwartz with six votes, and Terry Trumbull with six votes were appointed to the Utilities Advisory Commission for terms ending May 31, 2016. First Round of voting for one position on the Utilities Advisory Commission with a term ending May 31, 2017: DRAFT ACTION MINUTES Page 3 of 10 City Council Meeting Draft Action Minutes: 5/9/16 Voting For Chris DiBona: Voting For Lisa Forssell: Berman, Burt, Kniss, Scharff, Wolbach Voting For Henrik Morkner: Voting For William Ross: DuBois, Filseth, Holman, Schmid Ms. Minor announced that Lisa Forssell with five votes was appointed to the Utilities Advisory Commission for an unexpired term ending May 31, 2017. Study Session 2. Council Study Session on Sea Level Rise (Continued to May 31, 2016). Agenda Changes, Additions and Deletions None. Minutes Approval 3. Approval of Action Minutes for the April 25, 2016 Council Meeting. MOTION: Vice Mayor Scharff moved, seconded by Council Member Berman to approve the Action Minutes for the April 25, 2016 Council Meeting. MOTION PASSED: 9-0 Consent Calendar MOTION: Council Member Wolbach moved, seconded by Council Member Kniss to approve Agenda Item Numbers 4-8. 4. Approval of a Contract With the United States Geological Survey for Five Years in the Amount of $60,023 per Year for a Total of $310,315 for San Francisco Bay Monitoring Near the Regional Water Quality Control Plant's Discharge. 5. Approval of the Donation of a Surplus Ambulance to Oaxaca, Mexico. DRAFT ACTION MINUTES Page 4 of 10 City Council Meeting Draft Action Minutes: 5/9/16 6. Approval of an Allocation of $1 Million to the Palo Alto Unified School District in the Event the City of Palo Alto Wins the $5 Million Georgetown University Energy Prize. 7. Resolution 9584 Entitled, “Resolution of the Council of the City of Palo Alto (a) Endorsing the Community Plan to end Homelessness in Santa Clara County 2015- 2020;” and Resolution 9585 Entitled, “Resolution of the Council of the City of Palo Alto (b) Supporting City Programs to Encourage and Fund Affordable Housing as Urged by the Santa Clara County Housing Task Force.” 8. Authorize the City Manager to Execute an Agreement Between the City of Palo Alto and Team Sheeper LLC, for the Learn to Swim Program for Summer 2016 at an Amount Not-to-Exceed $236,500, and Approve a Budget Amendment in the General Fund. MOTION PASSED: 9-0 Action Items 9. Approval of the Concept Plan for Bicycle and Pedestrian Improvements Along Amarillo Avenue, Bryant Street, East Meadow Drive, Montrose Avenue, Moreno Avenue, Louis Road, Palo Alto Avenue, and Ross Road (Continued from April 18, 2016); Approval of Professional Services Contract Number C16163533 With Alta Planning + Design, Inc. in the Amount of $824,542 for Preparation of Plans, Specifications and Estimates for the Amarillo Avenue-Moreno Avenue, Bryant Street Update, Louis Road-Montrose Avenue, and Ross Road Bicycle Boulevard Projects; and Approval of Professional Services Contract Number C16161534 With Fehr & Peers in the Amount of $544,509 for Preparation of Plans, Specifications and Estimates for the Bryant Street Extension, Maybell Avenue, and Park Boulevard-Wilkie Way Bicycle Boulevard Projects. Environmental Assessment: Exempt From the California Environmental Quality Act per Section 15301. Council Member DuBois advised he would not participate in this Agenda Item as it relates to Bryant Street because he owns real property near Bryant Street. Council Member DuBois left the meeting at 8:21 P.M. DRAFT ACTION MINUTES Page 5 of 10 City Council Meeting Draft Action Minutes: 5/9/16 MOTION: Council Member Kniss moved, seconded by Vice Mayor Scharff to: A. Adopt a California Environmental Quality Act (CEQA) exemption and approve the Concept Plan for the Bryant Street Update; and B. Approve professional services contract number C16163533 with Alta Planning + Design, Inc. in the amount of $824,542 for a period of one year for the preparation of plans, specifications and estimates for the Amarillo Avenue-Moreno Avenue, Bryant Street Update, Louis Road- Montrose Avenue, and Ross Road bicycle boulevard projects. AMENDMENT: Council Member Schmid moved, seconded by Council Member XX to add to the Motion, “Alta Planning to return in six months, after data is available from the Downtown Residential Preferential Parking Permit Program Phase 2 (RPP) for an opportunity to relook at parking spaces in the RPP District.” AMENDMENT FAILED DUE TO THE LACK OF A SECOND AMENDMENT: Council Member Holman moved, seconded by Council Member XX to add to the Motion, “direct Staff, in a proactive manner, to reduce the number of permits being sold in the area as a result of the reduction in parking spaces.” AMENDMENT RESTATED AND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “at the time of the awarding of the bike construction contract, direct Staff to report to the Council any adjustments to parking that have been made to the Bicycle Boulevard Plan in response to the Downtown Residential Preferential Parking Program Phase 2 (RPP) or adjustments to RPP in response to the Bicycle Boulevard Plan.” (New Part C) MOTION RESTATED: Council Member Kniss moved, seconded by Vice Mayor Scharff to: A. Adopt a California Environmental Quality Act (CEQA) exemption and approve the Concept Plan for the Bryant Street Update; and B. Approve professional services contract number C16163533 with Alta Planning + Design, Inc. in the amount of $824,542 for a period of one DRAFT ACTION MINUTES Page 6 of 10 City Council Meeting Draft Action Minutes: 5/9/16 year for the preparation of plans, specifications and estimates for the Amarillo Avenue-Moreno Avenue, Bryant Street Update, Louis Road- Montrose Avenue, and Ross Road Bicycle Boulevard Projects; and C. At the time of the awarding of the bike construction contract, direct Staff to report to the Council any adjustments to parking that have been made to the Bicycle Boulevard Plan in response to the Downtown Residential Preferential Parking Program Phase 2 (RPP) or adjustments to RPP in response to the Bike Boulevard Plan. MOTION AS AMENDED PASSED: 8-0 DuBois not participating Council Member DuBois returned to the meeting at 8:53 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Berman to: A. Approve Concept Plans for the Amarillo Avenue-Moreno Avenue, Louis Road-Montrose Avenue, and Ross Road Bicycle Boulevard Projects, and direct Staff to move forward with the Final Design phase for these four Bicycle Boulevards Projects; and B. Approve professional services contract number C16161534 with Fehr & Peers in the amount of $544,509 for a period of one year for the preparation of plans, specifications and estimates for the previously- approved Bryant Street Extension, Maybell Avenue, and Park Boulevard-Wilkie Way Bicycle Boulevard Projects. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “direct Staff to reduce the removal of parking spaces near Greer Park.” (New Park C) AMENDMENT: Council Member Wolbach moved, seconded by Council Member Berman to replace in the Motion Part C, “reduce” with “explore reducing.” AMENDMENT FAILED: 4-5 Berman, Burt, Kniss, Wolbach yes MOTION RESTATED: Vice Mayor Scharff moved, seconded by Council Member Berman to: DRAFT ACTION MINUTES Page 7 of 10 City Council Meeting Draft Action Minutes: 5/9/16 A. Approve Concept Plans for the Amarillo Avenue-Moreno Avenue, Louis Road-Montrose Avenue, and Ross Road Bicycle Boulevard Projects, and direct Staff to move forward with the Final Design phase for these four Bicycle Boulevards Projects; and B. Approve professional services contract number C16161534 with Fehr & Peers in the amount of $544,509 for a period of one year for the preparation of plans, specifications and estimates for the previously- approved Bryant Street Extension, Maybell Avenue, and Park Boulevard-Wilkie Way Bicycle Boulevard Projects; and C. Direct Staff to reduce the removal of parking spaces near Greer Park. MOTION AS AMENDED PASSED: 9-0 10. Direction to Staff Regarding Implementation Priority for the Following new Residential Preferential Parking (RPP) Districts: a Portion of Crescent Park, the Edgewood Plaza Area, the Southgate and Evergreen Park Neighborhoods. Council Member Kniss advised she would not participate in this Agenda Item because she owns real property in the Evergreen Park neighborhood. Council Member Kniss left the meeting at 9:16 P.M. Council took a break from 9:16 P.M. to 9:27 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Berman to: A. Approve a budget allocation for implementation of Residential Preferential Parking Programs (RPP) for the Southgate and Evergreen Park Neighborhoods; and B. Implement an RPP in the Southgate neighborhood through a stakeholder process including looking at engineering, enforcement, and Transportation Demand Management (TDM) solutions with Palo Alto Unified School District (PAUSD) where appropriate; and DRAFT ACTION MINUTES Page 8 of 10 City Council Meeting Draft Action Minutes: 5/9/16 C. Implement an RPP in Evergreen Park through a stakeholder process including parking management options and determining how many permits to be sold for retail and personal service workers; and D. Determine whether the Crescent Park neighborhood should be annexed into the Downtown RPP or if a separate RPP should be created for the neighborhood. AMENDMENT: Council Member DuBois moved, seconded by Council Member XX to add to the Motion Part A, “to be deployed in parallel” after “Park Neighborhoods.” AMENDMENT RESTATED AND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion Part A, “and attempt to align deployment of both RPP programs” after “Park Neighborhoods.” AMENDMENT: Council Member DuBois moved, seconded by Council Member XX to replace the Motion Part D with, “implement a separate RPP in the Crescent Park neighborhood.” AMENDMENT FAILED DUE TO THE LACK OF A SECOND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND THE SECONDER to add to the Motion, “Edgewood Plaza would be fourth priority.” (New Part E) AMENDMENT: Council Member DuBois moved, seconded by Council Member XX to add to the Motion Part C, “in nearby ground floor districts.” AMENDMENT WITHDRAWN BY THE MAKER INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion Part D, “which would be given third priority.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to replace the Motion Part D with, “recommend that the Crescent Park neighborhood be added to the Downtown RPP eligibility area and if the neighborhood is not annexed, the residents can come back as the third priority for a separate RPP. DRAFT ACTION MINUTES Page 9 of 10 City Council Meeting Draft Action Minutes: 5/9/16 INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to the replace in the Motion Part A, “approve” with “direct the Finance Committee to identify.” AMENDMENT: Council Member Holman moved, seconded by Council Member XX to add to the Motion at the end of Part C, “from the adjacent California Avenue district, which permits to be phased out overtime.” AMENDMENT RESTATED AND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion at the end of Part C, “from the adjacent California Avenue district.” AMENDMENT: Council Member Holman moved, seconded by Council Member DuBois to add to the Motion, “direct Staff to determine if retail and personal service employees can share permits within the district and in the neighborhood.” AMENDMENT RESTATED: Council Member Holman moved, seconded by Council Member DuBois to add to the Motion, “direct Staff to explore if retail and personal service employees can share permits within the district and in the neighborhood.” AMENDMENT RESTATED AND INCORPRATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “direct Staff to explore options including sharing permits so that retail and personal service employees can afford permits.” (New Part F) AMENDMENT: Council Member Wolbach moved, seconded by Council Member XX to combine Parts C and F of the Motion. AMENDMENT FAILED DUE TO THE LACK OF A SECOND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion Parts C and F, “low income workers as well as” before “retail and personal service.” MOTION RESTATED: Vice Mayor Scharff moved, seconded by Council Member Berman to: A. Direct the Finance Committee to identify a budget allocation for implementation of Residential Preferential Parking Programs (RPP) for DRAFT ACTION MINUTES Page 10 of 10 City Council Meeting Draft Action Minutes: 5/9/16 the Southgate and Evergreen Park Neighborhoods and attempt to align deployment of both RPP programs; and B. Implement an RPP in the Southgate neighborhood through a stakeholder process including looking at engineering, enforcement, and Transportation Demand Management (TDM) solutions with Palo Alto Unified School District (PAUSD) where appropriate; and C. Implement an RPP in Evergreen Park through a stakeholder process including parking management options and determining how many permits to be sold for low income workers as well as retail and personal service workers from the adjacent California Avenue district; and D. Recommend that the Crescent Park neighborhood be added to the Downtown RPP eligibility area and if the neighborhood is not annexed, the residents can come back as the third priority for a separate RPP; and E. Edgewood Plaza would be fourth priority; and F. Direct Staff to explore options including sharing permits so that low income workers as well as retail and personal service employees can afford permits. MOTION AS AMENDED PASSED: 8-0 Kniss not participating Inter-Governmental Legislative Affairs None. Council Member Questions, Comments and Announcements None. Adjournment: The meeting was adjourned at 12:34 A.M. CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 7 Regular Meeting May 16, 2016 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:08 P.M. Present: Berman arrived at 7:33 P.M., Burt, DuBois, Filseth, Holman arrived at 7:49 P.M., Kniss, Scharff arrived at 7:34 P.M., Schmid arrived at 7:35 P.M., Wolbach Absent: Study Session 1. Prescreening of a Proposed District Map Amendment (“Rezone”) From Planned Community (PC) Zoning District to Downtown Commercial (CD-C (P)) Zoning District at 550 Hamilton Avenue. Molly Stump, City Attorney advised that Council Member Berman, Council Member Holman and Vice Mayor Scharff did not participate in this Agenda Item due to owning real property near the subject property. Agenda Changes, Additions and Deletions None. Minutes Approval 2. Approval of Action Minutes for the May 2, 2016 Council Meeting. MOTION: Vice Mayor Scharff moved, seconded by Council Member Berman to approve the Action Minutes for the May 2, 2016 Council Meeting. MOTION PASSED: 9-0 DRAFT ACTION MINUTES Page 2 of 7 City Council Meeting Draft Action Minutes: 5/16/16 Consent Calendar MOTION: Council Member DuBois moved, seconded by Council Member Kniss to approve Agenda Item Numbers 3-10. 3. Resolution 9586 Entitled, “Resolution of the Council of the City of Palo Alto Authorizing the City Manager to Purchase a Portion of the City’s Natural Gas Requirements From Certain Prequalified Natural Gas Suppliers Under Specified Terms and Conditions During Calendar Years 2016 Through 2022, Inclusive, With a $100 Million Maximum Aggregate Transaction Limit;” and Adopt an Ordinance Repealing Ordinance Number 4936, the Council's Prior Authorization for Natural Gas Purchases. 4. Approval of a Contract With O'Grady Paving, Inc. for a Not-to-Exceed Amount of $3,980,143 for the FY 2016 Asphalt Paving, Capital Improvements Program Project PE-86070. 5. Resolution 9587 Entitled, “Resolution of the Council of the City of Palo Alto Authorizing the City Manager to File an Application for 2016/2017 Transportation Development Act Funds in the Amount of $203,463 for Bicycle and Pedestrian Projects.” 6. Approval of Advanced Water Purification System Feasibility Contract With MNS Engineers, Inc./GHD, Inc. for a Total Amount Not-to-Exceed $325,875, for Partner Funding Agreements With the Santa Clara Valley Water District and City of Mountain View, and a Budget Amendment in the Wastewater Treatment Fund. 7. Approval of a Contract Amendment With SoftwareOne, Inc., (Formerly CompuCom Systems, Inc.,) in the Amount of $179,028 for Annual Microsoft Licensing True-Up, $39,119 for Additional Office 365 Licenses and $17,903 for a Contract Contingency - Contract Number C12144913. 8. Approval of a Vehicle Lease and Purchase Option With Altec Capital in an Amount Not-to-Exceed $602,847 for two Model Year 2017 Articulating Aerial Device Bucket Trucks and Approval of Budget Amendments in the Electric Fund and Vehicle Equipment and Replacement Fund. DRAFT ACTION MINUTES Page 3 of 7 City Council Meeting Draft Action Minutes: 5/16/16 9. Approve and Authorize the City Manager to Execute Contract Amendment Number 1 to Contract Number C14150694 in the Amount of $1,019,123 With Mark Thomas & Company for Final Design Services for the Charleston/Arastradero Corridor Project, Capital Improvements Program Project (PE-13011), and Approve Budget Amendments in the Capital Fund and Developer Impact Fee Fund. 10. Preliminary Approval of the Report of the Advisory Board for Fiscal Year 2016 in Connection With the Palo Alto Downtown Business Improvement District and Resolution 9588 Entitled, “Resolution of the Council of the City of Palo Alto Declaring its Intention to Levy an Assessment Against Businesses Within the Downtown Palo Alto Business Improvement District for Fiscal Year 2017 and Setting a Time and Place for a Public Hearing on June 6, 2016 at 6:00 PM or Thereafter, in the City Council Chambers.” MOTION PASSED: 9-0 Action Items 11. PUBLIC HEARING: Resolution 9589 Entitled, “Resolution of the Council of the City of Palo Alto Approving the 2015 Urban Water Management Plan and Adopt an Ordinance Amending Municipal Code Sections 12.32.010 (Water Use Restrictions) and 12.32.020 (Enforcement).” Public Hearing opened at 8:24 P.M. Public Hearing closed at 8:28 P.M. MOTION: Vice Mayor Scharff moved, seconded by Council Member Kniss to adopt: A. A Resolution approving the 2015 Urban Water Management Plan; and B. An Ordinance amending Municipal Code Sections 12.32.010, Water Use Restrictions, and 12.32.020, Enforcement. AMENDMENT: Council Member Holman moved, seconded by Council Member XX to add to the Motion, “use of potable water for construction/demolition should not be used if other water sources are available.” DRAFT ACTION MINUTES Page 4 of 7 City Council Meeting Draft Action Minutes: 5/16/16 AMENDMENT FAILED DUE TO THE LACK OF A SECOND AMENDMENT: Council Member Schmid moved, seconded by Council Member XX to add to the Motion, “add to the Resolution that Staff return with an assessment of assumptions that are made regarding growth of accounts and that this information be made available during future discussions of the Sustainability and Climate Action Plan (S/CAP) and the Comprehensive Plan.” AMENDMENT RESTATED AND INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, “direct Staff to return with an assessment of assumptions that are made regarding growth of accounts and that this information be made available during future discussions of the Sustainability and Climate Action Plan (S/CAP) and the Comprehensive Plan.” (New Part C) MOTION RESTATED: Vice Mayor Scharff moved, seconded by Council Member Kniss to: A. Adopt a Resolution approving the 2015 Urban Water Management Plan; and B. Adopt an Ordinance amending Municipal Code Sections 12.32.010, Water Use Restrictions, and 12.32.020, Enforcement; and C. Direct Staff to return with an assessment of assumptions that are made regarding growth of accounts and that this information be made available during future discussions of the Sustainability and Climate Action Plan (S/CAP) and the Comprehensive Plan. MOTION AS AMENDED PASSED: 9-0 12. Direction on the Fifth Scenario Proposed for Analysis in the Comprehensive Plan Update Environmental Impact Report (EIR), Approval of Amendment Number 5 to Placeworks Contract Number C08125506 for the Analysis, and Approval of a Related Budget Appropriation. MOTION: Mayor Burt moved, seconded by Vice Mayor Scharff to direct Staff to evaluate two variations of Scenario Number 5: DRAFT ACTION MINUTES Page 5 of 7 City Council Meeting Draft Action Minutes: 5/16/16 A. Option B from the Staff Report; and B. Option C from the Staff Report, incorporating 6,000 housing units. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to replace in the Motion Part A, “Option B” with “Option A.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion after “two variations of Scenario Number 5,” “including a performance based approach with policies and mitigation measures to limit the impacts of growth and other quality of life issues. Both Scenarios would include Staff recommended Sustainability and Climate Action Plan (S/CAP) elements.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion, C. Approve Amendment Number 5 to Contract Number C08125506 with Placeworks to add $423,814 for a total not to exceed $2,801,157 for completion of the Comprehensive Plan Update and associated EIR; and D. Amend the Fiscal Year 2016 Budget Appropriation Ordinance for the General Fund by: i. Increasing the Planning and Community Environment Department appropriation by $356,140; and ii. Decreasing the Budget Stabilization Reserve by $423,814. AMENDMENT: Council Member Wolbach moved, seconded by Council Member XX to replace in the Motion Part A, “Option A” with “Option C” and replace in the Motion Part B, “6,000” with “8,800.” AMENDMENT FAILED DUE TO THE LACK OF A SECOND AMENDMENT: Council Member Schmid moved, seconded by Council Member DuBois to add to the Motion Part A, “incorporating 6,200 jobs.” AMENDMENT FAILED: 2-7 DuBois, Schmid yes DRAFT ACTION MINUTES Page 6 of 7 City Council Meeting Draft Action Minutes: 5/16/16 AMENDMENT: Council Member Berman moved, seconded by Council Member Wolbach to replace in the Motion Part B, “6,000” with “6,500.” AMENDMENT FAILED: 4-5 Berman, DuBois, Kniss, Wolbach yes SUBSTITUTE MOTION: Council Member Holman moved, seconded by Council Member DuBois to continue this Motion to the June 6, 2016 City Council meeting. SUBSTITUTE MOTION FAILED: 4-5 DuBois, Filseth, Holman, Schmid yes AMENDMENT: Council Member Filseth moved, seconded by Council Member XX to add to the Motion Part A, “including 7,220 housing units.” AMENDMENT WITHDRAWN BY THE MAKER MOTION RESTATED: Mayor Burt moved, seconded by Vice Mayor Scharff to direct Staff to evaluate two variations of Scenario Number 5 including a performance based approach with policies and mitigation measures to limit the impacts of growth and other quality of life issues. Both Scenarios would include Staff recommended Sustainability and Climate Action Plan (S/CAP) elements: A. Option A from the Staff Report; and B. Option C from the Staff Report, incorporating 6,000 housing units; and C. Approve Amendment Number 5 to Contract Number C08125506 with Placeworks to add $423,814 for a total not to exceed $2,801,157 for completion of the Comprehensive Plan Update and associated EIR; and D. Amend the Fiscal Year 2016 Budget Appropriation Ordinance for the General Fund by: i. Increasing the Planning and Community Environment Department appropriation by $356,140; and ii. Decreasing the Budget Stabilization Reserve by $423,814. MOTION AS AMENDED PASSED: 7-2 Holman, Schmid no DRAFT ACTION MINUTES Page 7 of 7 City Council Meeting Draft Action Minutes: 5/16/16 Inter-Governmental Legislative Affairs None. Council Member Questions, Comments and Announcements Council Member Holman reported that Planned Community Zoning Districts (PC) did not originally require a public benefit. The public benefit requirement was added at a later date. Adjournment: The meeting was adjourned at 12:41 A.M. City of Palo Alto (ID # 6993) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Defeasing GO and Univ. Ave. P'king Assessment Bonds Title: Adoption of a Resolution Approving Two Escrow Deposit and Deposit Agreements, Authorizing the Deposit of $6.1 Million into Escrow Funds Related to Two Series of Library and Community Center General Obligation Bonds and $2 Million for the University Avenue Parking Assessment District Bonds for the Purpose of Early Redemption of such Bonds, and Authorizing Related Actions From: City Manager Lead Department: Administrative Services Recommendation Staff recommends that City Council use project surplus and bond premium monies to redeem outstanding bonds by approving the following: 1. Adopting a Resolution “Approving two escrow deposit and deposit agreements, authorizing the deposit of funds into escrow funds related to two series of (Library and Community Center) General Obligation Bonds (Election of 2008) and the University Avenue Off-Street Parking Assessment District Bonds for the payment and early redemption of such bonds, and authorizing related actions” (Attachment A) a. Use $6,094,467 of the Series 2010A & 2013A General Obligation (Measure N) Bonds ($3,007,702 from project savings and $3,086,765 from bond premiums) to retire or defease a portion of outstanding bonds and to pay associated redemption costs. These funds will be placed in an Escrow Deposit governed by a Trust Agreement (Attachment B). b. Use $2,030,697 of the 2012 University Avenue Off-Street Parking Assessment District Bonds project savings to retire or defease a portion of outstanding bonds and to pay associated redemption costs. These funds will be placed in an Escrow Deposit governed by a Trust Agreement (Attachment C). City of Palo Alto Page 2 Background General Obligation (Measure N) Bonds On November 4, 2008, City voters passed Measure N, which gave the City the authority to issue a maximum amount of $76,000,000 million of General Obligation bonds (the “Bonds”) for capital improvements to the Mitchell Park, Downtown, and Main libraries and to the Mitchell Park community center. Bonds were issued in two phases based on construction schedules for the downtown library and Mitchell Park facilities and then for rehabilitation of the Main Library. Of the bond proceeds generated for Measure N projects, there remains $3.09 million that can be used to redeem outstanding bonds. In addition, there is $3.1 million in remaining bond “premium” monies that also can be used to redeem bonds. The premium was used to pay bond issuance costs and was generated as a consequence of a legal requirement that GO bonds must be sold competitively and that bids be for not less than the par amount of the bonds. Staff has been using the premium to offset annual debt service payments and Bond Counsel has opined that they can now be used to redeem bonds. University Avenue Assessment District Bonds On March 19, 2001, the City Council adopted a Resolution that established a University Avenue Parking Assessment District. The District was formed to finance the design and construction of two new downtown parking garages. The City then issued two series of bonds for a total of $44.6 million to construct the R Garage on High and Alma streets and the S/L Garage on Bryant and Lytton streets and to refinance prior University Avenue Assessment debt. Of these proceeds, there is now $2.03 million available to redeem bonds. In 2012 and due to the historically low interest environment, the City refinanced the Assessment District bonds resulting in net present value cash savings of $7.5 million for Downtown Assessment District property owners. Discussion General Obligation (Library and Community Center) Bonds On March 1, 2016, Council approved the decommissioning of the Library Bond Oversight Committee and accepted a financial report showing approximately $3.0 million in project savings (CMR: 6632). An update of that report and savings is provided below. City of Palo Alto Page 3 The $3.0 million in savings can be used to either offset annual debt service resulting in reduced annual property tax assessments or to redeem outstanding bonds thereby reducing principal and interest costs. After analysis conducted by the City’s Financial Advisor staff recommends redeeming or defeasing bonds. This course of action will result in maximum savings to residential and commercial property owners primarily because principal will be repaid to bond holders and interest payments will not be incurred (similar to making higher or additional monthly principal payments on a mortgage). Likewise, staff is recommending that the bond premium (discussed above) of $3.1 million be used to redeem or defease bonds. Per the City’s Bond Counsel, both State and Federal tax law allow the premium to be used for bond redemptions. Between project savings and the premium usage the City has $6.1 million to defease existing bonds and pay associated redemption costs With GO Bonds and the available funds, the City has two options. The first is to call or pay off the longest bonds to maximum interest savings and the second is to redeem bonds on a pro- rata basis whereby saving are evenly and annually realized over the life of the bonds. Analysis performed by the City’s Financial Advisor shows that calling the longest bonds results in $1.8 million in higher savings compared to redeeming bonds on a pro-rata basis. Total savings using this method are $11 million which includes $4.9 million in interest savings over time. Staff recommends redeeming long-term bonds since it results in higher savings to property owners over the remaining life of the bonds. It should be noted, however, that redeeming the long bonds versus a pro-rata redemption results in uneven savings over the remaining life of the bonds. Of the $11 million, $5.4 million will be saved through FY 2040 while $5.6 million will be saved from FY 2041 through FY 2044. Based on FY 2016 assessed values, a property with an assessed value of $1 million will realize $12.80 in annual savings during the period of FY 2017 through FY 2040 and triple this amount from FY 2041 through FY 2044. The costs associated with redeeming the General Obligation bonds such as for Financial Advisor, Bond Counsel, and Escrow Agent are $37,333. City of Palo Alto Page 4 University Avenue Area Off-Street Parking Assessment District The City Auditors’ March 14, 2016 Audit of Parking Funds report reflected oversights whereby garage construction costs that were paid with fees transferred from the Parking In-lieu fund were also drawn down from the bond proceeds. The total for this was $1,790,295. In addition, there was a double counting of garage expenditures of $240,402. Based on the Auditor’s findings, these funds totaling $2,030,697 have been returned to the University Avenue Area Off-Street Parking Assessment District debt service fund. These monies can be used to offset annual debt service or to redeem outstanding bonds. As with the GO Bond analysis, redeeming bonds will maximize savings to property owners within the Assessment District since interest payments will be foregone. For these bonds, the only methodology allowed for redemption is on a pro-rata basis. This will result in total savings of $2.5 million of which $0.5 million is attributable to interest. The costs associated with redeeming the Assessment District bonds such as for Financial Advisor, Bond Counsel, and Escrow Agent are $34,917. Resource Impact There is a surplus of $6.1 million in Measure N General Obligation Bond proceeds. By using these funds to redeem outstanding bonds, $11 million in total savings ($4.9 million in interest) will be realized by Palo Alto property owners during the remaining amortization period. With available funds of $2.03 million to redeem bonds, the University Avenue Area Parking Assessment District will realize $2.5 million in total savings ($0.5 million in interest) for the remaining amortization period. Costs associated with redeeming the GO bonds are $37,333 and costs for the Assessment District are $34,917. Policy Implication Through prior reports from the City Manager and the City Auditor, Council has been apprised of the availability of excess General Obligation and Assessment District Bond funds. Council has given direction to staff to redeem current outstanding bonds. Staff has worked with the City Attorney’s Office and the City’s Bond Counsel to determine the methods permitted by the original bond documents and by State and Federal law to redeem bonds. Time Line With approval of the resolution and staff’s recommendations, staff will have adequate time to complete bond redemptions by June 30, 2016 and reflect consequent savings in the County’s 2016-17 tax notice to Palo Alto property owners. Environmental Review This information report is not a project under the California Environmental Quality Act; therefore, an environmental review is not required. Attachments: City of Palo Alto Page 5  Attachment A: Resolution Approving GO Bonds & University Ave Assessment Bonds (PDF)  Attachment B: General Obligation Bonds Escrow Deposit and Trust Agreement (PDF)  Attachment C: University Ave Area Off-Street Parking Assessment District Bonds Escrow Deposit and Trust Agreement (PDF) Not Yet Approved 160523 jb 0131510 Resolution No. ______ Resolution of the City Council of the City of Palo Alto Approving Two Escrow Deposit and Trust Agreements, Authorizing the Deposit of Funds into Escrow Funds Related To Two Series of General Obligation Bonds (Election of 2008) and the University Avenue Off-Street Parking Assessment District Bonds for the Payment and Early Redemption of Such Bonds, and Authorizing Related Actions R E C I T A L S A. The City previously entered into a Paying Agent Agreement, dated as of June 1, 2010 (the “2010 Paying Agent Agreement”), with U.S. Bank National Association (the “Paying Agent”), and issued the $55,305,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2010A (the “2010 Bonds”). B. The City previously entered into a Paying Agent Agreement, dated as of June 1, 2013 (the “2013 Paying Agent Agreement”), with the Paying Agent, and issued the $20,695,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2013A (the “2013 Bonds”). C. The City previously entered into a Paying Agent Agreement, dated as of February 1, 2012 (the “2012 Paying Agent Agreement”), with the Paying Agent, and issued the $31,130,000 Limited Obligation Refunding Improvement Bonds, City of Palo Alto, University Avenue Area Off-Street Parking Assessment District (Reassessment and Refunding of 2012) (the “2012 Bonds”; together with the 2010 Bonds and the 2013 Bonds, the “Outstanding Bonds”). D. The City wishes to provide for a mechanism to pay debt service on and redeem a portion of the Outstanding Bonds with (a) certain proceeds of the Outstanding Bonds and (b) other available monies. E. There has been presented to the Council the form of two Escrow Deposit and Trust Agreements (each, an “Escrow Agreement”), one related to the 2010 Bonds and the 2013 Bonds and the other related to the 2012 Bonds. F. Under the Escrow Agreements, proceeds of the Outstanding Bonds and other available monies will be used to pay debt service on and redeem a portion of the related Outstanding Bonds. G. The Council has had the opportunity to review the Escrow Agreements and the other related information presented to this Council and wishes to approve the Escrow Attachment A Not Yet Approved 160523 jb 0131510 Agreements and to authorize and direct the establishment of one or more escrow funds and the use of the monies in the escrow funds to pay debt service on and purchase or redeem a portion of the Outstanding Bonds in the manner described in the Escrow Agreements, when executed and delivered by the City. NOW, THEREFORE, the Council of the City of Palo Alto hereby RESOLVES, as follows: 1. Approval of Escrow Agreements. The Successor Agency hereby approves the form of the Escrow Agreements on file with the City Clerk. Each of the Mayor, the City Manager, the Director of Administrative Services, the City Attorney, and the written designee of any such officer (each, an “Authorized Officer”), is hereby authorized and directed to execute and deliver, and the City Clerk is hereby authorized and directed to attest to, the Escrow Agreements for and in the name and on behalf of the City, in substantially the form on file with the City Clerk, with such changes therein, deletions therefrom and additions thereto as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by the execution and delivery of the Escrow Agreements. The City Council hereby authorizes the delivery and performance of the Escrow Agreements. 2. Authorization related to Escrow Agreements. The City Council hereby authorizes each Authorized Officer to implement on behalf of the City (i) the funding of the escrow funds described in the Escrow Agreements, (ii) the purchase of securities for investment in the escrow funds and (iii) the application of monies in the Escrow Funds to pay a portion of the debt service on the Outstanding Bonds and the redemption price for a portion of the Outstanding Bonds and/or the purchase of the Outstanding Bonds for cancellation. 3. Further Actions. The City Manager and the Finance Director are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions, including execution and delivery of any and all certificates, agreements, notices, consents and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the actions approved by the City Council pursuant to this Resolution. Whenever in this resolution any officer of the City is authorized to execute any document or take any action, such execution or action may be taken on behalf of such officer by any person designated by such officer to act on his or her behalf in case such officer is absent or unavailable. Not Yet Approved 160523 jb 0131510 4. Effective Date. This resolution shall take effect immediately upon its adoption. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: APPROVED: Beth Minor Pat Burt City Clerk Mayor APPROVED AS TO FORM: Jones Hall, James Keene A Professional Law Corporation City Manager By: Mike Sartor Christopher K. Lynch Director of Public Works Bond Counsel Lalo Perez Director of Administrative Services Cara Silver Senior Asst. City Attorney 1 ESCROW DEPOSIT AND TRUST AGREEMENT Relating to $55,305,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2010A $20,695,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2013A This ESCROW DEPOSIT AND TRUST AGREEMENT (this “Agreement”), dated as of ____ 1, 2016, is between the CITY OF PALO ALTO, a chartered city and municipal corporation organized and existing under the Constitution and laws of the State of California (the “City”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, acting as escrow agent for the Outstanding Bonds described below (the “Escrow Bank”) and as paying agent (the “Paying Agent”) for the Outstanding Bonds. BACKGROUND: 1. The City previously entered into a Paying Agent Agreement, dated as of June 1, 2010 (the “2010 Paying Agent Agreement”), with the Paying Agent, and the City issued the $55,305,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2010A (the “2010 Bonds”). 2. The City previously entered into a Paying Agent Agreement, dated as of June 1, 2013 (the “2013 Paying Agent Agreement”), with the Paying Agent, and the City issued the $20,695,000 City of Palo Alto General Obligation Bonds Election of 2008, Series 2013A (the “2013 Bonds”; together with the 2010 Bonds, the “Outstanding Bonds”). 3. The City wishes to provide for a mechanism to pay debt service on and redeem a portion of the 2010 Bonds with certain proceeds of the 2010 Bonds currently on deposit in the Project Fund and the Debt Service Fund established under the 2010 Paying Agent Agreement. 4. The City wishes to provide for a mechanism to pay debt service on and redeem a portion of the 2013 Bonds with certain proceeds of the 2013 Bonds currently on deposit in the Project Fund and the Debt Service Fund established under the 2013 Paying Agent Agreement. 5. The City wishes to appoint the Escrow Bank for the purpose of establishing an escrow fund to be funded, invested, held and administered for the purpose of providing for the payment of the debt service on and redeem a portion of each of the 2010 Bonds and the 2013 Bonds, respectively, as described in this Agreement. 2 AGREEMENT: In consideration of the premises and the material covenants contained herein, the City and U.S. Bank National Association, as Escrow Bank and Paying Agent, hereby agree as follows: SECTION 1. Appointment of Escrow Bank; Establishment of Escrow Funds. The City hereby appoints the Escrow Bank for purposes of administering the two escrow funds described in this Agreement. The Escrow Bank is directed to establish the following escrow funds (collectively, the “Escrow Funds”) to be held by the Escrow Bank in escrow as irrevocable escrows securing the payment of the 2010 Bonds and the 2013 Bonds, respectively: (a) The Escrow Bank is directed to establish a “2010 Escrow Fund” to be held by the Escrow Bank in escrow as an irrevocable escrow securing the payment of the 2010 Bonds as set forth below. All cash and securities in the 2010 Escrow Fund are hereby irrevocably pledged as a special fund for the payment of the principal of and interest and premium (if any) on the 2010 Bonds in accordance with the 2010 Paying Agent Agreement. (b) The Escrow Bank is directed to establish a “2013 Escrow Fund” to be held by the Escrow Bank in escrow as an irrevocable escrow securing the payment of the 2013 Bonds as set forth below. All cash and securities in the 2013 Escrow Fund are hereby irrevocably pledged as a special fund for the payment of the principal of and interest and premium (if any) on the 2013 Bonds in accordance with the 2013 Paying Agent Agreement. SECTION 2. Deposit and Investment of Amounts in Escrow Funds. (a) 2010 Escrow Fund. On _____, 2016 (the “Closing Date”), the City will cause to be transferred to the Escrow Bank for deposit into the 2010 Escrow Fund the amount of $__________ in immediately available funds. On the Closing Date, the Escrow Bank shall invest all of the amounts deposited in the 2010 Escrow Fund in the investments listed on Exhibit A. The investments listed on Exhibit A and the fund listed in the previous sentence constitute authorized investments for the City under applicable provisions of California law and the City’s investment policy and they are Permitted Investments as defined in the 2010 Paying Agent Agreement. The Escrow Bank shall hold all investments in the 2010 Escrow Fund in the name of the Escrow Bank in its capacity as Escrow Bank and Paying Agent with respect to the 2010 Bonds, and will retain any earnings received on such investments and any reinvestment thereof in the 2010 Escrow Fund and disburse such amounts as provided in Section 3. The Escrow Bank shall invest any cash held uninvested in the 2010 Escrow Fund upon receipt of written investment directions from the City. The City shall establish a tracking system to ensure that the aggregate yield of investments held in the 2010 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2010 Escrow Fund is made, exceed the arbitrage yield on the 2010 Bonds. If the City determines that the aggregate yield of investments held in the 2010 Escrow Fund will, on the date on which the final expenditure of moneys in the 2010 Escrow Fund is made, 3 exceed the arbitrage yield on the 2010 Bonds, it shall immediately consult with an independent certified public accountant with expertise in federal tax exempt bonds and its bond counsel and take appropriate remedial action so that the aggregate yield of investments held in the 2010 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2010 Escrow Fund is made, exceed the arbitrage yield on the 2010 Bonds. To the extent that the 2010 Paying Agent Agreement requires any of the funds described in paragraph (a) to be deposited into the 2010 Debt Service Fund, such provisions are hereby amended as set forth herein. (b) 2013 Escrow Fund. On the Closing Date, the City will cause to be transferred to the Escrow Bank for deposit into the 2013 Escrow Fund the amount of $__________ in immediately available funds. On the Closing Date, the Escrow Bank shall invest all of the amounts deposited in the 2013 Escrow Fund in the investments listed on Exhibit A. The investments listed on Exhibit A and the fund listed in the previous sentence constitute authorized investments for the City under applicable provisions of California law and the City’s investment policy and they are Permitted Investments as defined in the 2013 Paying Agent Agreement. The Escrow Bank shall hold all investments in the 2013 Escrow Fund in the name of the Escrow Bank in its capacity as Escrow Bank and Paying Agent with respect to the 2013 Bonds, and will retain any earnings received on such investments and any reinvestment thereof in the 2013 Escrow Fund and disburse such amounts as provided in Section 3. The Escrow Bank shall invest any cash held uninvested in the 2013 Escrow Fund upon receipt of written investment directions from the City. The City shall establish a tracking system to ensure that the aggregate yield of investments held in the 2013 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2013 Escrow Fund is made, exceed the arbitrage yield on the 2013 Bonds. If the City determines that the aggregate yield of investments held in the 2013 Escrow Fund will, on the date on which the final expenditure of moneys in the 2013 Escrow Fund is made, exceed the arbitrage yield on the 2013 Bonds, it shall immediately consult with an independent certified public accountant with expertise in federal tax exempt bonds and its bond counsel and take appropriate remedial action so that the aggregate yield of investments held in the 2013 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2013 Escrow Fund is made, exceed the arbitrage yield on the 2013 Bonds. To the extent that the 2013 Paying Agent Agreement requires any of the funds described in paragraph (a) to be deposited into the 2013 Debt Service Fund, such provisions are hereby amended as set forth herein. 4 SECTION 3. Application of Amounts in Escrow Funds. (a) 2010 Escrow Fund. The Escrow Bank is hereby instructed to withdraw from the 2010 Escrow Fund and transfer to the Paying Agent for deposit in the Debt Service Fund established under the 2010 Paying Agent Agreement (the “2010 Debt Service Fund”) an amount required to pay the principal of and interest and redemption premium (if any) on the 2010 Bonds, in accordance with the schedule attached as Exhibit B hereto. Following the payment and redemption of the 2010 Bonds in accordance with Exhibit B, the Escrow Bank, after payment of all fees and expenses of the Escrow Bank, shall transfer any amounts remaining on deposit in the 2010 Escrow Fund to the Paying Agent for deposit in the 2010 Debt Service Fund. (b) 2013 Escrow Fund. The Escrow Bank is hereby instructed to withdraw from the 2013 Escrow Fund and transfer to the Paying Agent for deposit in the Debt Service Fund established under the 2013 Paying Agent Agreement (the “2013 Debt Service Fund”) an amount required to pay the principal of and interest and redemption premium (if any) on the 2013 Bonds, in accordance with the schedule attached as Exhibit B hereto. Following the payment and redemption of the 2013 Bonds in accordance with Exhibit B, the Escrow Bank, after payment of all fees and expenses of the Escrow Bank, shall transfer any amounts remaining on deposit in the 2013 Escrow Fund to the Paying Agent for deposit in the 2013 Debt Service Fund. SECTION 4. Redemption Notice. (a) 2010 Bonds. The City has irrevocably elected to pay and redeem a portion of the outstanding 2010 Bonds on the date(s) set forth in Exhibit B, in accordance with the provisions of the 2010 Paying Agent Agreement. The City hereby directs the Paying Agent to give notice of the redemption of the 2010 Bonds in accordance with the requirements of the 2010 Paying Agent Agreement, at the expense of the City. (b) 2013 Bonds. The City has irrevocably elected to pay and redeem all of the outstanding 2013 Bonds on the date(s) set forth in Exhibit B, in accordance with the provisions of the 2013 Paying Agent Agreement. The City hereby directs the Paying Agent to give notice of the redemption of the 2013 Bonds in accordance with the requirements of the 2013 Paying Agent Agreement, at the expense of the City. SECTION 5. Compensation to Escrow Bank. The City shall pay the Escrow Bank full compensation for its services under this Agreement, including out-of-pocket costs such as publication costs, redemption expenses, legal fees and other costs and expenses relating hereto and, in addition, all fees, costs and expenses relating to the purchase, substitution or withdrawal of any securities after the date hereof. Under no circumstances shall amounts deposited in or credited to the Escrow Funds be deemed to be available for said purposes. The Escrow Bank has no lien upon or right of set off against the cash and securities at any time on deposit in the Escrow Funds. SECTION 6. Immunities and Liability of Escrow Bank. The Escrow Bank undertakes to perform only such duties as are expressly set forth in this Agreement and 5 no implied duties, covenants or obligations shall be read into this Agreement against the Escrow Bank. The Escrow Bank shall not have any liability hereunder except to the extent of its negligence or willful misconduct. In no event shall the Escrow Bank be liable for any special, indirect or consequential damages. The Escrow Bank shall not be liable for any loss from any investment made by it in accordance with the terms of this Agreement. The Escrow Bank may consult with legal counsel of its own choice and the Escrow Bank shall not be liable for any action taken or not taken by it in good faith in reliance upon the opinion or advice of such counsel. The Escrow Bank shall not be liable for the recitals or representations contained in this Agreement and shall not be responsible for the validity of this Agreement, the sufficiency of the Escrow Fund or the moneys and securities to pay the principal of and interest and redemption premium on the Outstanding Bonds. Whenever in the administration of this Agreement the Escrow Bank deems it necessary or desirable that a matter be proved or established prior to taking or not taking any action, such matter may be deemed to be conclusively proved and established by a certificate of an authorized representative of the City and shall be full protection for any action taken or not taken by the Escrow Bank in good faith reliance thereon. The Escrow Bank may conclusively rely as to the truth and accuracy of the statements and correctness of any opinions or calculations provided to it in connection with this Agreement and shall be protected in acting, or refraining from acting, upon any notice, instruction, request, certificate, document, opinion or other writing furnished to the Escrow Bank in connection with this Agreement and believed by the Escrow Bank to be signed by the proper party, and it need not investigate any fact or matter stated therein. None of the provisions of this Agreement shall require the Escrow Bank to expend or risk its own funds or otherwise to incur any liability, financial or otherwise, in the performance of any of its duties hereunder. The Escrow Bank may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, attorneys, custodians or nominees appointed with due care. The Escrow Bank may at any time resign by giving 30 days written notice of resignation to the City. Upon receiving such notice of resignation, the City shall promptly appoint a successor and, upon the acceptance by the successor of such appointment, release the resigning Escrow Bank from its obligations hereunder by written instrument, a copy of which instrument shall be delivered to the resigning Escrow Bank and the successor. If no successor shall have been so appointed and have accepted appointment within 30 days after the giving of such notice of resignation, the resigning Escrow Bank may petition any court of competent jurisdiction for the appointment of a successor. Any bank, corporation or association into which the Escrow Bank may be merged or converted or with which it may be consolidated, or any bank, corporation or association resulting from any merger, conversion or consolidation to which the Escrow Bank shall be a party, or any bank, corporation or association succeeding to all or substantially all of the corporate trust business of the Escrow Bank shall be the successor of the Escrow Bank hereunder without the execution or filing of any paper with any party hereto or any further act on the part of any of the parties hereto except on the part of any of the parties hereto where an instrument of transfer or assignment is 6 required by law to effect such succession, anything herein to the contrary notwithstanding. The City shall indemnify, defend and hold harmless the Escrow Bank and its officers, directors, employees, representatives and agents, from and against and reimburse the Escrow Bank for any and all claims, obligations, liabilities, losses, damages, actions, suits, judgments, reasonable costs and expenses (including reasonable attorneys’ and agents’ fees and expenses) of whatever kind or nature regardless of their merit, demanded, asserted or claimed against the Escrow Bank directly or indirectly relating to, or arising from, claims against the Escrow Bank by reason of its participation in the transactions contemplated hereby except to the extent caused by the Escrow Bank’s negligence or willful misconduct. The provisions of the foregoing sentence shall survive the termination of this Agreement or the earlier resignation or removal of the Escrow Bank. The Escrow Bank agrees to accept and act upon instructions or directions pursuant to this Agreement sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, provided, however, that, the Escrow Bank shall have received an incumbency certificate listing persons designated to give such instructions or directions and containing specimen signatures of such designated persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing. If the City elects to give the Escrow Bank e-mail or facsimile instructions (or instructions by a similar electronic method) and the Escrow Bank in its discretion elects to act upon such instructions, the Escrow Bank’s understanding of such instructions shall be deemed controlling. The Escrow Bank shall not be liable for any losses, costs or expenses arising directly or indirectly from the Escrow Bank’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The City agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Escrow Bank, including without limitation the risk of the Escrow Bank acting on unauthorized instructions, and the risk of interception and misuse by third parties. SECTION 7. Termination of Agreement. Upon application of the moneys in the Escrow Funds as set forth in this Agreement and the payment by the City of all fees, expense and charges of the Escrow Bank as described above, this Agreement shall terminate and the Escrow Bank shall be discharged from any further obligation or responsibility hereunder. SECTION 8. Execution in Counterparts. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. SECTION 9. Notices. Any notice, request, demand, communication or other paper shall be sufficiently given and shall be deemed given when delivered or upon receipt when mailed by first class, registered or certified mail, postage prepaid, or sent by telegram, addressed as follows: If to the City: City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 Attention: Administrative Services Director 7 If to the Escrow Agent: U.S. Bank National Association One California Street, Suite 1000 San Francisco, CA 94111 Attention: Global Corporate Trust Services SECTION 10. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. CITY OF PALO ALTO By: City Manager APPROVED AS TO FORM: By City Attorney U.S. BANK NATIONAL ASSOCIATION, as Escrow Bank and as Paying Agent By Authorized Officer A-1 EXHIBIT A ESCROW SECURITIES 2010 Bonds Type of Security CUSIP or ID Purchase Date Maturity Date First IPD Par Amount Yield Purchase Price Interest Class 2013 Bonds Type of Security CUSIP or ID Purchase Date Maturity Date First IPD Par Amount Yield Purchase Price Interest Class B-1 EXHIBIT B ESCROW REQUIREMENTS 2010 Bonds Payment Date Interest Payment Redeemed Principal Redemption Premium Total Payment 2013 Bonds Payment Date Interest Payment Redeemed Principal Redemption Premium Total Payment 1 ESCROW DEPOSIT AND TRUST AGREEMENT Relating to $31,130,000 Limited Obligation Refunding Improvement Bonds, City of Palo Alto, University Avenue Area Off-Street Parking Assessment District (Reassessment and Refunding of 2012) This ESCROW DEPOSIT AND TRUST AGREEMENT (this “Agreement”), dated as of ____ 1, 2016, is between the CITY OF PALO ALTO, a chartered city and municipal corporation organized and existing under the Constitution and laws of the State of California (the “City”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, acting as escrow agent for the Outstanding Bonds described below (the “Escrow Bank”) and as paying agent (the “Paying Agent”) for the Outstanding Bonds. BACKGROUND: 1. The City previously entered into a Paying Agent Agreement, dated as of February 1, 2012 (the “2012 Paying Agent Agreement”), with the Paying Agent, and the City issued the $31,130,000 Limited Obligation Refunding Improvement Bonds, City of Palo Alto, University Avenue Area Off-Street Parking Assessment District (Reassessment and Refunding of 2012) (the “2012 Bonds”). 2. The City wishes to provide for a mechanism to pay debt service on and redeem a portion of the 2012 Bonds with (a) certain proceeds of the 2012 Bonds in the funds and accounts established under the 2012 Paying Agent Agreement and (b) other available moneys. 3. The City wishes to appoint the Escrow Bank for the purpose of establishing an escrow fund to be funded, invested, held and administered for the purpose of providing for the payment of the debt service on and redeem a portion of each of the 2012 Bonds as described in this Agreement. AGREEMENT: In consideration of the premises and the material covenants contained herein, the City and U.S. Bank National Association, as Escrow Bank and Paying Agent, hereby agree as follows: SECTION 1. Appointment of Escrow Bank; Establishment of 2012 Escrow Fund. The City hereby appoints the Escrow Bank for purposes of administering the 2012 Escrow Fund described in this Agreement. The Escrow Bank is directed to establish a “2012 Escrow Fund” to be held by the Escrow Bank in escrow as an irrevocable escrow securing the payment of the 2012 Bonds as set forth below. All cash and securities in the 2012 Escrow Fund are hereby 2 irrevocably pledged as a special fund for the payment of the principal of and interest and premium (if any) on the 2012 Bonds in accordance with the 2012 Paying Agent Agreement. SECTION 2. Deposit and Investment of Amounts in 2012 Escrow Fund. On _____, 2016 (the “Closing Date”), the City will cause to be transferred to the Escrow Bank for deposit into the 2012 Escrow Fund the amount of $__________ in immediately available funds. On the Closing Date, the Escrow Bank shall invest all of the amounts deposited in the 2012 Escrow Fund in the investments listed on Exhibit A. The investments listed on Exhibit A and the fund listed in the previous sentence constitute authorized investments for the City under applicable provisions of California law and the City’s investment policy and they are Permitted Investments as defined in the 2012 Paying Agent Agreement. The Escrow Bank shall hold all investments in the 2012 Escrow Fund in the name of the Escrow Bank in its capacity as Escrow Bank and Paying Agent with respect to the 2012 Bonds, and will retain any earnings received on such investments and any reinvestment thereof in the 2012 Escrow Fund and disburse such amounts as provided in Section 3. The Escrow Bank shall invest any cash held uninvested in the 2012 Escrow Fund upon receipt of written investment directions from the City. The City shall establish a tracking system to ensure that the aggregate yield of investments held in the 2012 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2012 Escrow Fund is made, exceed the arbitrage yield on the 2012 Bonds. If the City determines that the aggregate yield of investments held in the 2012 Escrow Fund will, on the date on which the final expenditure of moneys in the 2012 Escrow Fund is made, exceed the arbitrage yield on the 2012 Bonds, it shall immediately consult with an independent certified public accountant with expertise in federal tax exempt bonds and its bond counsel and take appropriate remedial action so that the aggregate yield of investments held in the 2012 Escrow Fund will not, on the date on which the final expenditure of moneys in the 2012 Escrow Fund is made, exceed the arbitrage yield on the 2012 Bonds. To the extent that the 2012 Paying Agent Agreement requires any of the funds described in paragraph (a) to be deposited into the 2012 Redemption Fund, such provisions are hereby amended as set forth herein. SECTION 3. Application of Amounts in 2012 Escrow Fund. The Escrow Bank is hereby instructed to withdraw from the 2012 Escrow Fund and transfer to the Paying Agent for deposit in the Redemption Fund established under the 2012 Paying Agent Agreement (the “2012 Redemption Fund”) an amount required to pay the principal of and interest and redemption premium (if any) on the 2012 Bonds, in accordance with the schedule attached as Exhibit B hereto. Following the payment and redemption of the 2012 Bonds in accordance with Exhibit B, the Escrow Bank, after payment of all fees and expenses of the Escrow Bank, shall transfer any amounts remaining on deposit in the 2012 Escrow Fund to the Paying Agent for deposit in the 2012 Redemption Fund. 3 SECTION 4. Redemption Notice. The City has irrevocably elected to pay and redeem a portion of the outstanding 2012 Bonds on the date(s) set forth in Exhibit B, in accordance with the provisions of the 2012 Paying Agent Agreement. The City hereby directs the Paying Agent to give notice of the redemption of the 2012 Bonds in accordance with the requirements of the 2012 Paying Agent Agreement, at the expense of the City. SECTION 5. Compensation to Escrow Bank. The City shall pay the Escrow Bank full compensation for its services under this Agreement, including out-of-pocket costs such as publication costs, redemption expenses, legal fees and other costs and expenses relating hereto and, in addition, all fees, costs and expenses relating to the purchase, substitution or withdrawal of any securities after the date hereof. Under no circumstances shall amounts deposited in or credited to the 2012 Escrow Fund be deemed to be available for said purposes. The Escrow Bank has no lien upon or right of set off against the cash and securities at any time on deposit in the 2012 Escrow Fund. SECTION 6. Immunities and Liability of Escrow Bank. The Escrow Bank undertakes to perform only such duties as are expressly set forth in this Agreement and no implied duties, covenants or obligations shall be read into this Agreement against the Escrow Bank. The Escrow Bank shall not have any liability hereunder except to the extent of its negligence or willful misconduct. In no event shall the Escrow Bank be liable for any special, indirect or consequential damages. The Escrow Bank shall not be liable for any loss from any investment made by it in accordance with the terms of this Agreement. The Escrow Bank may consult with legal counsel of its own choice and the Escrow Bank shall not be liable for any action taken or not taken by it in good faith in reliance upon the opinion or advice of such counsel. The Escrow Bank shall not be liable for the recitals or representations contained in this Agreement and shall not be responsible for the validity of this Agreement, the sufficiency of the Escrow Fund or the moneys and securities to pay the principal of and interest and redemption premium on the Outstanding Bonds. Whenever in the administration of this Agreement the Escrow Bank deems it necessary or desirable that a matter be proved or established prior to taking or not taking any action, such matter may be deemed to be conclusively proved and established by a certificate of an authorized representative of the City and shall be full protection for any action taken or not taken by the Escrow Bank in good faith reliance thereon. The Escrow Bank may conclusively rely as to the truth and accuracy of the statements and correctness of any opinions or calculations provided to it in connection with this Agreement and shall be protected in acting, or refraining from acting, upon any notice, instruction, request, certificate, document, opinion or other writing furnished to the Escrow Bank in connection with this Agreement and believed by the Escrow Bank to be signed by the proper party, and it need not investigate any fact or matter stated therein. None of the provisions of this Agreement shall require the Escrow Bank to expend or risk its own funds or otherwise to incur any liability, financial or otherwise, in the performance of any of its duties hereunder. The Escrow Bank may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, attorneys, custodians or nominees appointed with due care. 4 The Escrow Bank may at any time resign by giving 30 days written notice of resignation to the City. Upon receiving such notice of resignation, the City shall promptly appoint a successor and, upon the acceptance by the successor of such appointment, release the resigning Escrow Bank from its obligations hereunder by written instrument, a copy of which instrument shall be delivered to the resigning Escrow Bank and the successor. If no successor shall have been so appointed and have accepted appointment within 30 days after the giving of such notice of resignation, the resigning Escrow Bank may petition any court of competent jurisdiction for the appointment of a successor. Any bank, corporation or association into which the Escrow Bank may be merged or converted or with which it may be consolidated, or any bank, corporation or association resulting from any merger, conversion or consolidation to which the Escrow Bank shall be a party, or any bank, corporation or association succeeding to all or substantially all of the corporate trust business of the Escrow Bank shall be the successor of the Escrow Bank hereunder without the execution or filing of any paper with any party hereto or any further act on the part of any of the parties hereto except on the part of any of the parties hereto where an instrument of transfer or assignment is required by law to effect such succession, anything herein to the contrary notwithstanding. The City shall indemnify, defend and hold harmless the Escrow Bank and its officers, directors, employees, representatives and agents, from and against and reimburse the Escrow Bank for any and all claims, obligations, liabilities, losses, damages, actions, suits, judgments, reasonable costs and expenses (including reasonable attorneys’ and agents’ fees and expenses) of whatever kind or nature regardless of their merit, demanded, asserted or claimed against the Escrow Bank directly or indirectly relating to, or arising from, claims against the Escrow Bank by reason of its participation in the transactions contemplated hereby except to the extent caused by the Escrow Bank’s negligence or willful misconduct. The provisions of the foregoing sentence shall survive the termination of this Agreement or the earlier resignation or removal of the Escrow Bank. The Escrow Bank agrees to accept and act upon instructions or directions pursuant to this Agreement sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, provided, however, that, the Escrow Bank shall have received an incumbency certificate listing persons designated to give such instructions or directions and containing specimen signatures of such designated persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing. If the City elects to give the Escrow Bank e-mail or facsimile instructions (or instructions by a similar electronic method) and the Escrow Bank in its discretion elects to act upon such instructions, the Escrow Bank’s understanding of such instructions shall be deemed controlling. The Escrow Bank shall not be liable for any losses, costs or expenses arising directly or indirectly from the Escrow Bank’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The City agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Escrow Bank, including without limitation the risk of the Escrow Bank acting on unauthorized instructions, and the risk of interception and misuse by third parties. 5 SECTION 7. Termination of Agreement. Upon application of the moneys in the 2012 Escrow Fund as set forth in this Agreement and the payment by the City of all fees, expense and charges of the Escrow Bank as described above, this Agreement shall terminate and the Escrow Bank shall be discharged from any further obligation or responsibility hereunder. SECTION 8. Execution in Counterparts. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. SECTION 9. Notices. Any notice, request, demand, communication or other paper shall be sufficiently given and shall be deemed given when delivered or upon receipt when mailed by first class, registered or certified mail, postage prepaid, or sent by telegram, addressed as follows: If to the City: City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 Attention: Administrative Services Director If to the Escrow Agent: U.S. Bank National Association One California Street, Suite 1000 San Francisco, CA 94111 Attention: Global Corporate Trust Services SECTION 10. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. CITY OF PALO ALTO By: City Manager APPROVED AS TO FORM: By City Attorney U.S. BANK NATIONAL ASSOCIATION, as Escrow Bank and as Paying Agent 6 By Authorized Officer A-1 EXHIBIT A ESCROW SECURITIES Type of Security CUSIP or ID Purchase Date Maturity Date First IPD Par Amount Yield Purchase Price Interest Class B-1 EXHIBIT B ESCROW REQUIREMENTS Payment Date Interest Payment Redeemed Principal Redemption Premium Total Payment City of Palo Alto (ID # 6794) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Council Priority: Land Use and Transportation Planning Summary Title: San Antonio Road SynchroGreen Adaptive Timing Implementation Title: Approval of Contract Number C16163554 for $206,056 With Trafficware for San Antonio Road SynchroGreen Adaptive Timing System Implementation and an Associated Amendment of the Budget Appropriation for the General Fund and Capital Fund From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council: 1. Authorize the City Manager or designee to execute Contract No. C16163554 (Attachment A) with TrafficWare to provide SynchroGreen Intersection Software, intersection video detection hardware, and professional services for the San Antonio Road corridor in an amount not to exceed $206,056, and 2. Amend the Fiscal Year 2016 Budget Appropriation Ordinance for a. the General Fund by: i. Increase the transfer to the Capital Fund in the amount of $206,056; and, ii. Decrease the Transportation Contingency in the amount of $206,056; b. the General Capital Improvement Fund by: i. Increase the estimated transfer from the General Fund in the amount of $206,056 ii. Increase the appropriation to Traffic Signal and Intelligent Transportation Systems (PL-05030) in the amount of $206,056. Background The City entered into an agreement with Trafficware Group, Incorporated, in October 2014 for the procurement, deployment, and integration support services of an City of Palo Alto Page 2 Advanced Traffic management System (ATMS). Currently Trafficware is supporting city staff with the on-going operation of the City’s traffic signal operation system, which includes intelligent transportation systems (ITS) devices and remote operation and maintenance of the City’s 101 signalized intersections, as well as for future dissemination of operational traffic data. Trafficware is also the developer of adaptive timing software, SynchroGreen. SynchroGreen was selected in 2014 as a preferred software program for coordinated and adaptive traffic signal timing, and was implemented along the Sand Hill Road Corridor as the City’s first corridor with adaptive signal timing. The proposed contract provides up to $191,056, which includes two optional tasks that may not be used pending staff resources at the time of implementation. An additional $15,000 is included for contingencies for a total of $206,056. The contract term is through April 30, 2017, by which time the Department anticipates SynchroGreen to be operational with an optimal corridor timing plan for San Antonio Road. Summary of Key Issues The proposed contract will allow TrafficWare to activate, configure, and troubleshoot SynchroGreen adaptive traffic signing timing along San Antonio Road between East Charleston Road and Nita Avenue, as well as at the East Charleston Road and Fabian Way intersection. This will be the second corridor within the City of Palo Alto to utilize adaptive traffic signal coordination. SynchroGreen is one of several adaptive traffic signal timing programs available. However, SynchroGreen was previously selected by Staff as the City’s preferred program due to its integration and compatibility with the City’s new traffic signal system. In addition, SynchroGreen has been in operation along the Sand Hill Corridor since mid-2014, and Staff has observed reduced travel times along the corridor when in operation. For this project, Staff is recommending a contract directly with the product manufacturer, TrafficWare, which was previously selected as the preferred provider through a competitive process. Palo Alto Municipal Code 2.30.360(d) and (e) permit the City to contract without further solicitation if the City has gone through a product standardization process. The City went through this process in 2014 and has been using SynchroGreen software manufactured by TrafficWare on other traffic adaptive projects.TrafficWare has performed satisfactorily throughout the delivery of the capital improvement project, effectively adhering to project budget and schedule. As a result, Staff recommends entering a new contract with TrafficWare to provide the ATMS- compatible SynchroGreen system for the San Antonio Road corridor. This corridor is in need of operational improvements and the mix of land uses and irregular travel patterns are ideal for adaptive traffic signal timing. The tasks included this project are listed below. Staff recommends the inclusion of City of Palo Alto Page 3 Optional Task #1 and Optional Task #2 in the contract in order to allow for flexible allocation of resources.  Vehicle Detection Equipment Installation and Configuration The contract includes specific hardware that will improve vehicle detection and tracking capabilities, configured with the City’s current ATMS, and necessary to operate the adaptive signal timing system. The base contract cost assumes that City staff will install and configure the new video detection equipment and reconfigure the existing vehicle detection system at San Antonio Road and Middlefield Road to comply with SynchroGreen requirements.  SynchroGreen Software Integration SynchroGreen is a proprietary adaptive signal timing and coordination program. This contract includes the initial licensing, activation, and integration of coordinated timing programs along the San Antonio Road corridor for each of the peak periods.  Warranty, Maintenance and Support This contract includes a three-year warranty, maintenance and support period for the SynchroGreen system along the San Antonio Road corridor and integration with the City’s current ATMS.  Optional Task #1 – Vehicle Detection Equipment Installation and Configuration This optional task includes the installation and configuration of the new video detection equipment by TrafficWare or its local vendor, Columbia Electric, Inc. TrafficWare or Columbia Electric, Inc will also reconfigure the existing vehicle detection system at San Antonio Road and Middlefield Road to comply with SynchroGreen requirements. Vehicle detection devices, which include video cameras directed at oncoming travel lanes, will be designed, installed, and operated in conformance with the City’s Policy on Video Management and added to the City’s inventory of video cameras. These vehicle detection devices do not record any captured video, nor are they monitored by staff.  Optional Task #2 – On-Site Training for SynchroGreen This optional task includes the provision of a two-day training session for SynchroGreen as it relates to the City’s ATMS. Training would occur at the City of Palo Alto offices. Resource Impact The Transportation Contingency which has sufficient funding in FY 2016 is recommended to be used to fund this contract ($206,056) for the installation of the SynchroGreen system. It is recommended that funding from the Transportation Contingency be allocated to the Traffic Signal and Intelligent Transportation Systems capital project in the General Capital Improvement Fund (PL-05030). If approved, it is City of Palo Alto Page 4 anticipated that funding will be made available in FY 2017 contingent on City Council approval of a recommended reappropriation depending on the timing of the completion of this transfer and year end closing proceedures. This contract includes a three-year warranty, maintenance and support period for the SynchroGreen system and integration with the City’s existing ATMS. Ongoing operating costs are estimated to be roughly $500 per intersection per year, for a total post- warranty annual cost of $2,000 for this project. These ongoing costs, which are equivalent to the cost to maintain the existing signal system along San Antonio Road, are primarly in staff resources and will be absorbed by the Planning & Community Environment Department and Utilities Department, as part of the regular maintenance and operation of the City’s traffic signal system. Periodic equipment upgrades and replacement will also be required and budgeted as needed, some of which may qualify as capital improvement projects. As additional SynchroGreen systems are added to the City’s inventory, the departmental operating budgets may need additional resources. Timeline The installation and upgrade of vehicle detection capabilities is anticipated to occur during the first two to four weeks of this project. Following the vehicle detection upgrade, City Staff will work with TrafficWare to develop and implement a coordinated corridor timing program that will serve as the basis for the SynchroGreen adaptive timing coordination. Staff anticipates that implementation as well as on-site testing and adjustments should occur after PAUSD is back in session in the fall of 2016. The extended warranty and technical support would continue into mid-2019. Attachments:  Attachment A: Trafficware Contract #C16163554 (PDF) 1 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc CITY OF PALO ALTO CONTRACT NO. C16163554 GENERAL SERVICES AGREEMENT THIS AGREEMENT made and entered into on the 27th day of May, 2016, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and TRAFFICWARE GROUP, INC., a Texas corporation, located at 522 Gillingham, Sugar Land, Texas, 77478, Telephone (281) 240-723 (“CONTRACTOR”). In consideration of their mutual covenants, the parties hereto agree as follows: 1.SERVICES. CONTRACTOR shall provide or furnish the services (the “Services”) described in the Scope of Services, attached at Exhibit A. 2. EXHIBITS. The following exhibits are attached to and made a part of this Agreement: “A” - Scope of Services “B” - Schedule of Performance “C” - Compensation “D” - Insurance Requirements CONTRACT IS NOT COMPLETE UNLESS ALL EXHIBITS ARE ATTACHED. 3. TERM. The term of this Agreement is from May 27, 2016 to June 30, 2017 inclusive, subject to the provisions of Sections Q and V of the General Terms and Conditions. 4. SCHEDULE OF PERFORMANCE. CONTRACTOR shall complete the Services within the term of this Agreement in a reasonably prompt and timely manner based upon the circumstances and direction communicated to CONTRACTOR, and if applicable, in accordance with the schedule set forth in the Schedule of Performance, attached at Exhibit B. Time is of the essence in this Agreement. 5. COMPENSATION FOR ORIGINAL TERM. CITY shall pay and CONTRACTOR agrees to accept as not-to-exceed compensation for the full performance of the Services and reimbursable expenses, if any: A sum calculated in accordance with the fee schedule set forth at Exhibit C, not to exceed a total maximum compensation amount of One Hundred Ninety One Thousand Fifty Six Dollars ($191,056.00). CONTRACTOR agrees that it can perform the Services for an amount not to exceed the total maximum compensation set forth above. Any hours worked or services performed DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C ATTACHMENT A 2 Rev. April 20, 2015 General Services Agreement by CONTRACTOR for which payment would result in a total exceeding the maximum amount of compensation set forth above for performance of the Services shall be at no cost to CITY. CITY has set aside the sum of Fifteen Thousand dollars ($15,000.00) for Additional Services. CONTRACTOR shall provide Additional Services only by advanced, written authorization from the City Manager or designee. CONTRACTOR, at the CITY’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONTRACTOR’s proposed maximum compensation, including reimbursable expense, for such services. Compensation shall be based on the hourly rates set forth above or in Exhibit C (whichever is applicable), or if such rates are not applicable, a negotiated lump sum. CITY shall not authorize and CONTRACTOR shall not perform any Additional Services for which payment would exceed the amount set forth above for Additional Services. Payment for Additional Services is subject to all requirements and restrictions in this Agreement. 6. COMPENSATION DURING ADDITIONAL TERMS. (Not Applicable) 7. INVOICING. Send all invoices to CITY, Attention: Project Manager. The Project Manager is: Rafael Rius, Planning & Community Environment Department, Transportation Division: (650) 329-, Telephone: (650) 329-2305. Invoices shall be submitted in arrears for Services performed. Invoices shall not be submitted more frequently than monthly. Invoices shall provide a detailed statement of Services performed during the invoice period and are subject to verification by CITY. CITY shall pay the undisputed amount of invoices within 30 days of receipt. GENERAL TERMS AND CONDITIONS A. ACCEPTANCE. CONTRACTOR accepts and agrees to all terms and conditions of this Agreement. This Agreement includes and is limited to the terms and conditions set forth in sections 1 through 6 above, these general terms and conditions and the attached exhibits. B. QUALIFICATIONS. CONTRACTOR represents and warrants that it has the expertise and qualifications to complete the services described in Section 1 of this Agreement, entitled “SERVICES,” and that every individual charged with the performance of the services under this Agreement has sufficient skill and experience and is duly licensed or certified, to the extent such licensing or certification is required by law, to perform the Services. CITY expressly relies on CONTRACTOR’s representations regarding its skills, knowledge, and certifications. CONTRACTOR shall perform all work in accordance with generally accepted business practices and performance standards of the industry, including all federal, state, and local operation and safety regulations. C. INDEPENDENT CONTRACTOR. It is understood and agreed that in the performance of this Agreement, CONTRACTOR and any person employed by CONTRACTOR shall at all DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 3 Rev. April 20, 2015 General Services Agreement times be considered an independent CONTRACTOR and not an agent or employee of CITY. CONTRACTOR shall be responsible for employing or engaging all persons necessary to complete the work required under this Agreement. D. SUBCONTRACTORS. CONTRACTOR may not use subcontractors to perform any Services under this Agreement unless CONTRACTOR obtains prior written consent of CITY. CONTRACTOR shall be solely responsible for directing the work of approved subcontractors and for any compensation due to subcontractors. E. TAXES AND CHARGES. CONTRACTOR shall be responsible for payment of all taxes, fees, contributions or charges applicable to the conduct of CONTRACTOR’s business. F. COMPLIANCE WITH LAWS. CONTRACTOR shall in the performance of the Services comply with all applicable federal, state and local laws, ordinances, regulations, and orders. G. DAMAGE TO PUBLIC OR PRIVATE PROPERTY. CONTRACTOR shall, at its sole expense, repair in kind, or as the City Manager or designee shall direct, any damage to public or private property that occurs in connection with CONTRACTOR’s performance of the Services. CITY may decline to approve and may withhold payment in whole or in part to such extent as may be necessary to protect CITY from loss because of defective work not remedied or other damage to the CITY occurring in connection with CONTRACTOR’s performance of the Services. CITY shall submit written documentation in support of such withholding upon CONTRACTOR’s request. When the grounds described above are removed, payment shall be made for amounts withheld because of them. H. WARRANTIES. CONTRACTOR expressly warrants that all services provided under this Agreement shall be performed in a professional and workmanlike manner in accordance with generally accepted business practices and performance standards of the industry and the requirements of this Agreement. CONTRACTOR expressly warrants that all materials, goods and equipment provided by CONTRACTOR under this Agreement shall be fit for the particular purpose intended, shall be free from defects, and shall conform to the requirements of this Agreement. CONTRACTOR agrees to promptly replace or correct any material or service not in compliance with these warranties, including incomplete, inaccurate, or defective material or service, at no further cost to CITY. The warranties set forth in this section shall be in effect for a period of one year from completion of the Services and shall survive the completion of the Services or termination of this Agreement. I. MONITORING OF SERVICES. CITY may monitor the Services performed under this Agreement to determine whether CONTRACTOR’s work is completed in a satisfactory manner and complies with the provisions of this Agreement. J. CITY’S PROPERTY. Any reports, information, data or other material (including copyright interests) developed, collected, assembled, prepared, or caused to be prepared under this Agreement will become the property of CITY without restriction or limitation upon DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 4 Rev. April 20, 2015 General Services Agreement their use and will not be made available to any individual or organization by CONTRACTOR or its subcontractors, if any, without the prior written approval of the City Manager. K. AUDITS. CONTRACTOR agrees to permit CITY and its authorized representatives to audit, at any reasonable time during the term of this Agreement and for three (3) years from the date of final payment, CONTRACTOR’s records pertaining to matters covered by this Agreement. CONTRACTOR agrees to maintain accurate books and records in accordance with generally accepted accounting principles for at least three (3) following the terms of this Agreement. L. NO IMPLIED WAIVER. No payment, partial payment, acceptance, or partial acceptance by CITY shall operate as a waiver on the part of CITY of any of its rights under this Agreement. M. INSURANCE. CONTRACTOR, at its sole cost, shall purchase and maintain in full force during the term of this Agreement, the insurance coverage described at Exhibit D. Insurance must be provided by companies with a Best’s Key Rating of A-:VII or higher and which are otherwise acceptable to CITY’s Risk Manager. The Risk Manager must approve deductibles and self-insured retentions. In addition, all policies, endorsements, certificates and/or binders are subject to approval by the Risk Manager as to form and content. CONTRACTOR shall obtain a policy endorsement naming the City of Palo Alto as an additional insured under any general liability or automobile policy. CONTRACTOR shall obtain an endorsement stating that the insurance is primary coverage and will not be canceled or materially reduced in coverage or limits until after providing 30 days prior written notice of the cancellation or modification to the Risk Manager. CONTRACTOR shall provide certificates of such policies or other evidence of coverage satisfactory to the Risk Manager, together with the required endorsements and evidence of payment of premiums, to CITY concurrently with the execution of this Agreement and shall throughout the term of this Agreement provide current certificates evidencing the required insurance coverages and endorsements to the Risk Manager. CONTRACTOR shall include all subcontractors as insured under its policies or shall obtain and provide to CITY separate certificates and endorsements for each subcontractor that meet all the requirements of this section. The procuring of such required policies of insurance shall not operate to limit CONTRACTOR’s liability or obligation to indemnify CITY under this Agreement. N. HOLD HARMLESS. To the fullest extent permitted by law and without limitation by the provisions of section M relating to insurance, CONTRACTOR shall indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents from and against any and all demands, claims, injuries, losses, or liabilities of any nature, including death or injury to any person, property damage or any other loss and including without limitation all damages, penalties, fines and judgments, associated investigation and administrative expenses and defense costs, including, but not limited to reasonable attorney’s fees, courts costs and costs of alternative dispute resolution), arising out of, or resulting in any way from or in connection with the performance of this Agreement. DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 5 Rev. April 20, 2015 General Services Agreement CONTRACTOR’s obligations under this Section apply regardless of whether or not a liability is caused or contributed to by any negligent (passive or active) act or omission of CITY, except that CONTRACTOR shall not be obligated to indemnify for liability arising from the sole negligence or willful misconduct of CITY. The acceptance of the Services by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section survive the completion of the Services or termination of this Agreement. O. NON-DISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONTRACTOR certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONTRACTOR acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. P. WORKERS' COMPENSATION. CONTRACTOR, by executing this Agreement, certifies that it is aware of the provisions of the Labor Code of the State of California which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that Code, and certifies that it will comply with such provisions, as applicable, before commencing and during the performance of the Services. Q. TERMINATION. The City Manager may terminate this Agreement without cause by giving ten (10) days’ prior written notice thereof to CONTRACTOR. If CONTRACTOR fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided by law, the City Manager may terminate this Agreement immediately upon written notice of termination. Upon receipt of such notice of termination, CONTRACTOR shall immediately discontinue performance. CITY shall pay CONTRACTOR for services satisfactorily performed up to the effective date of termination. If the termination if for cause, CITY may deduct from such payment the amount of actual damage, if any, sustained by CITY due to CONTRACTOR’s failure to perform its material obligations under this Agreement. Upon termination, CONTRACTOR shall immediately deliver to the City Manager any and all copies of studies, sketches, drawings, computations, and other material or products, whether or not completed, prepared by CONTRACTOR or given to CONTRACTOR, in connection with this Agreement. Such materials shall become the property of CITY. R. ASSIGNMENTS/CHANGES. This Agreement binds the parties and their successors and assigns to all covenants of this Agreement. This Agreement shall not be assigned or transferred without the prior written consent of CITY. No amendments, changes or variations of any kind are authorized without the written consent of CITY. S. CONFLICT OF INTEREST. In accepting this Agreement, CONTRACTOR covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 6 Rev. April 20, 2015 General Services Agreement otherwise, which would conflict in any manner or degree with the performance of this Contract. CONTRACTOR further covenants that, in the performance of this Contract, it will not employ any person having such an interest. CONTRACTOR certifies that no CITY Officer, employee, or authorized representative has any financial interest in the business of CONTRACTOR and that no person associated with CONTRACTOR has any interest, direct or indirect, which could conflict with the faithful performance of this Contract. CONTRACTOR agrees to advise CITY if any conflict arises. T. GOVERNING LAW. This contract shall be governed and interpreted by the laws of the State of California. U. ENTIRE AGREEMENT. This Agreement, including all exhibits, represents the entire agreement between the parties with respect to the services that may be the subject of this Agreement. Any variance in the exhibits does not affect the validity of the Agreement and the Agreement itself controls over any conflicting provisions in the exhibits. This Agreement supersedes all prior agreements, representations, statements, negotiations and undertakings whether oral or written. V. NON-APPROPRIATION. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Contract are no longer available. This Section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Contract. W. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONTRACTOR shall comply with CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Division, which are incorporated by reference and may be amended from time to time. CONTRACTOR shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONTRACTOR shall comply with the following zero waste requirements:  All printed materials provided by CONTRACTOR to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post- consumer material and printed with vegetable based inks.  Goods purchased by Contractor on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including, but not limited to, Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office.  Reusable/returnable pallets shall be taken back by CONTRCATOR, at no DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 7 Rev. April 20, 2015 General Services Agreement additional cost to CITY, for reuse or recycling. CONTRACTOR shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. X. AUTHORITY. The individual(s) executing this Agreement on behalf of the parties represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. Y. CONTRACT TERMS: All unchecked boxes do not apply to this Agreement. Z. DIR REGISTRATION. In regard to any public work construction, alteration, demolition, repair or maintenance work, CITY will not accept a bid proposal from or enter into this Agreement with CONTRACTOR without proof that CONTRACTOR and its listed subcontractors are registered with the California Department of Industrial Relations (“DIR”) to perform public work, subject to limited exceptions. City requires CONTRACTOR and its listed subcontractors to comply with the requirements of SB 854. CITY provides notice to CONTRACTOR of the requirements of California Labor Code section 1771.1(a), which reads: “A contractor or subcontractor shall not be qualified to bid on, be listed in a bid proposal, subject to the requirements of Section 4104 of the Public Contract Code, or engage in the performance of any contract for public work, as defined in this chapter, unless currently registered and qualified to perform public work pursuant to Section 1725.5. It is not a violation of this section for an unregistered contractor to submit a bid that is authorized by Section 7029.1 of the Business and Professions Code or Section 10164 or 20103.5 of the Public Contract Code, provided the contractor is registered to perform public work pursuant to Section 1725.5 at the time the contract is awarded.” CITY gives notice to CONTRACTOR and its listed subcontractors that CONTRCATOR is required to post all job site notices prescribed by law or regulation and CONTRACTOR is subject to SB 854-compliance monitoring and enforcement by DIR. CITY requires CONTRACTOR and its listed subcontractors to comply with the requirements of Labor Code section 1776, including: Keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by, respectively, CONTRACTOR and its listed subcontractors, in connection with the Project. The payroll records shall be verified as true and correct and shall be certified and made available for inspection at all reasonable hours at the principal office of CONTRACTOR and its listed subcontractors, respectively. DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 8 Rev. April 20, 2015 General Services Agreement At the request of CITY, acting by its project manager, CONTRACTOR and its listed subcontractors shall make the certified payroll records available for inspection or furnished upon request to the project manager within ten (10) days of receipt of CITY’s request. CITY requests CONTRACTOR and its listed subcontractors to submit the certified payroll records at the end of each week during the Project. If the certified payroll records are not produced to the project manager within the 10- day period, then CONTRACTOR and its listed subcontractors shall be subject to a penalty of one hundred dollars ($100.00) per calendar day, or portion thereof, for each worker, and CITY shall withhold the sum total of penalties from the progress payment(s) then due and payable to CONTRACTOR. Inform the project manager of the location of CONTRACTOR’s and its listed subcontractors’ payroll records (street address, city and county) at the commencement of the Project, and also provide notice to the project manager within five (5) business days of any change of location of those payroll records. IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO TRAFFICWARE GROUP, INC. Approved as to form: DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C CFO 2 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc EXHIBIT A SCOPE OF SERVICES CONTRACTOR shall provide the following for the San Antonio Road SynchroGreen Traffic Adaptive Signal System: Task 1 – SynchroGreen Intersection Software - This contract includes the purchase of Synchro Green Adaptive Intersection Software licenses for five intersections. The five intersections include:  San Antonio Road and Charleston Road  San Antonio Road and Leghorn Street  San Antonio Road and Middlefield Road  Charleston Road and Fabian Way  San Antonio Road and Nita Avenue Task 2 – SynchroGreen Project Integration – This task includes the configuration SynchroGreen Software adaptive timing for the five intersections listed above, and integration into the CITY’s currently operating Advanced Traffic Management System (ATMS). Configuration will include the incorporation of three time-of-day (TOD) signal coordination programs with coordination from City Staff (AM, PM, Off-peak). Task 3 – Database Conversion and Installation: San Antonio Road/Middlefield Road – This task involves converting and configuring the vehicle detection equipment at the intersection of San Antonio Road at Middlefield Road necessary to operate Synchro Green Intersection Software. Task 4 – Detection Equipment for San Antonio/Charleston, San Antonio/Leghorn, San Antonio/Nita, and Charleston/Fabian – This task includes furnishing video detection equipment necessary to operate Synchro Green Intersection Software at the intersections listed above. This task includes equipment only and general product support. Installation of equipment in this task is assumed to be installed by City of Palo Alto Electric Utilities Staff or other contractors. Task 5 – Detection Installation for Charleston, Leghorn, Nita, Middlefield, and Fabian – CONTRACTOR and/or its sub-contractor will provide installation and configuration services for the equipment described previously in Task 4. Task 6 – SynchroGreen Onsite Training – CONTRACTOR and/or its sub-contractor will provide on-site training up to two consecutive days, for City of Palo Alto Staff. Training will be held within the City of Palo Alto. Task 7 – Warranty, Maintenance, and Support (3 years) – This task provides extended project warranty, maintenance (updates), and technical support to City Staff for the operation and maintenance of the Synchro Green Intersection Software for three years from date of implementation. DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 3 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc EXHIBIT B SCHEDULE OF PERFORMANCE CONTRACTOR shall perform the Services so as to complete each task within the time period specified below. The time to complete each task may be increased or decreased by mutual written agreement of the project managers for CONTRACTOR and CITY so long as all work is completed within the term of the Agreement. Task Complete From NTP 1. Task 1 SynchroGreen Intersection Software 1 Day 2. Task 2 SynchroGreen Project Integration 4 Weeks 3. Task 3 Database Conversion and Installation: San Antonio Road/Middlefield Road 1 Day 4. Task 4 Detection Equipment for San Antonio/Charleston, San Antonio/Leghorn, San Antonio/Nita, and Charleston/Fabian 4 Weeks 5. Task 5 Detection Installation for Charleston, Leghorn, Nita, Middlefield, and Fabian 4 Weeks 6. Task 6 SynchroGreen Onsite Training 1 Week DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 8 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc EXHIBIT C SCHEDULE OF FEES CONTRACTOR shall perform the tasks as described and budgeted below. CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for the Services including reimbursable expenses, does not exceed $206,056.00. Any services provided or hours worked for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to CITY. DESCRIPTION OF TASK NOT TO EXCEED COMPENSATION PER TASK INCLUDING REIMBURSABLES Task 1 $67,500.00 SynchroGreen Intersection Software P/N: 97500-0015, 5 EA @ $13,500.00 Task 2 $7,500.00 SynchroGreen Project Integration P/N: 97500-0005 Task 3 $1,000.00 Database Conversion and Installation Task 4 $56,426.00 Detection Equipment for San Antonio/Charleston, San Antonio/Leghorn, San Antonio/Nita, and Charleston/Fabian) Task 5 $36,786.00 Detection Installation for Charleston, Leghorn, Nita, Middlefield, and Fabian Task 6 $5,000.00 SynchroGreen Onsite Training (2 Days) P/N: 97500-0045 Task 5 $5,000.00 Warranty, Maintenance, and Support (3 years) P/N: 97500-0055 Shipping $1,000.00 Taxes $10,844.00 SUBTOTAL $191,056.00 Contingency $15,000.00 TOTAL $206,056.00 DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 12 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc EXHIBIT D INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRED TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 NO PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C 13 Rev. April 20, 2015 C:\ProgramData\activePDF\DC_ENT\Tmp\5dad4f\SandBoxGuestf0f1f6d3-6c34-4551-bfe7-bbcc79f71bed.doc A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE MAILED TO: PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: 38ADEE41-818B-4ADA-BAFB-EEFCE28D511C Certificate Of Completion Envelope Id: 38ADEE41818B4ADABAFBEEFCE28D511C Status: Completed Subject: Please DocuSign this document: C16163554 Trafficware Contract.pdf Source Envelope: Document Pages: 13 Signatures: 1 Envelope Originator: Certificate Pages: 5 Initials: 0 Christopher Anastole AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 chris.anastole@cityofpaloalto.org IP Address: 199.33.32.254 Record Tracking Status: Original 4/20/2016 2:30:41 PM Holder: Christopher Anastole chris.anastole@cityofpaloalto.org Location: DocuSign Signer Events Signature Timestamp Joe Custer JoeCuster@trafficware.com CFO Security Level: Email, Account Authentication (None)Using IP Address: 71.29.218.138 Sent: 4/20/2016 2:39:33 PM Resent: 4/26/2016 8:45:58 AM Resent: 5/2/2016 6:59:55 AM Viewed: 4/26/2016 10:58:52 AM Signed: 5/2/2016 1:21:22 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Robin Ellner robin.ellner@cityofpaloalto.org Admin Associate III City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 4/20/2016 2:39:33 PM Electronic Record and Signature Disclosure: Accepted: 2/11/2015 9:51:24 AM ID: efb775a7-f39e-4c9f-817a-5ec939666ecf Sherry Nikzat Sherry.Nikzat@CityofPaloAlto.org Sr. Management Analyst City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 5/2/2016 1:21:23 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: Carbon Copy Events Status Timestamp Robin Ellner robin.ellner@cityofpaloalto.org Admin Associate III City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 5/2/2016 1:21:24 PM Electronic Record and Signature Disclosure: Accepted: 2/11/2015 9:51:24 AM ID: efb775a7-f39e-4c9f-817a-5ec939666ecf Notary Events Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 5/2/2016 1:21:24 PM Certified Delivered Security Checked 5/2/2016 1:21:24 PM Signing Complete Security Checked 5/2/2016 1:21:24 PM Completed Security Checked 5/2/2016 1:21:24 PM Electronic Record and Signature Disclosure CONSUMER DISCLOSURE From time to time, City of Palo Alto (we, us or Company) may be required by law to provide to you certain written notices or disclosures. 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City of Palo Alto (ID # 6899) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Resolution Vacating Public Service Easement at 3276 Kipling Avenue Title: Adoption of a Resolution Summarily Vacating Public Utility Easement at 3276 Kipling Avenue From: City Manager Lead Department: Administrative Services RECOMMENDATION Staff recommends that Council approve the attached Resolution Summarily Vacating a 10’ wide Public Utilities Easement (PUE) at 3276 Kipling Avenue, Palo Alto, CA (Attachment A). DISCUSSION The owners of the property at 3276 Kipling Avenue have requested that the City vacate a 10’ wide PUE granted on Map of Tract No. 1045, recorded September 23, 1952 in Book 40 of Maps at Pages 38 and 39. There are no utilities in the PUE and it has never been used. Therefore, this PUE is no longer necessary for any future public purpose. Staff has notified AT&T (formerly SBC Communications), the City Utilities, Public Works and Planning Departments of the proposal to vacate the PUE and all concur with the vacation. Therefore, the PUE to be vacated in accordance with Section 8333 of the California Streets and Highways Code. RESOURCE IMPACT The easement vacation processing fee of $1,585.00, as set forth in the Municipal Fee Schedule, has been paid by the owner. POLICY IMPLICATIONS The recommendation does not represent any change to City policies. The Planning Department has determined that the vacation of this easement is in conformity with the Palo Alto Comprehensive Plan. ENVIRONMENTAL REVIEW The proposed summary vacation of the public utilities easements are categorically exempt from the review under the California Environmental Quality Act (CEQA) pursuant to Title 14 California Code of Regulations Section 15305 as a minor alteration in land use limitations. City of Palo Alto Page 2 Attachments:  Attachment A - 3276 Kipling Avenue Summary Vacation (PDF) ATTACHMENT A ATTACHMENT A ATTACHMENT A ATTACHMENT A ATTACHMENT A City of Palo Alto (ID # 6933) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: PAFD Performance Report FY16 Q3 Title: Acceptance of Palo Alto Fire Department Quarterly Performance Report for Third Quarter Fiscal Year 2016 From: City Manager Lead Department: Fire Recommendation Staff recommends City Council review and accept the Palo Alto Fire Department Quarterly Performance Report for the Third Quarter of Fiscal Year 2016. Background and Discussion Last Fiscal Year the Palo Alto Fire Department (PAFD) identified performance reporting as a key initiative, and began reporting on key performance measures quarterly. The report provides overall calls for service information, as well as more detailed information on the key service areas, including Emergency Medical Services, Fire Suppression, Rescue and Hazardous Materials Response, and Fire Prevention. The report also provides information on mutual and automatic aid with our regional public safety partners and internal workforce planning efforts. Performance measures include the following:  Calls for Service: This data provides information on the final outcome of all emergency response calls. The data is tracked in the Fire Department’s Record Management System, and uses standardized call type codes, which are defined by the National Fire Incident Reporting System (NFIRS). The report includes overall call volume by primary category, and a detailed listing of call type in the service type sections.  Response Times: This aspect measures the time it takes from an emergency call or request for response being created in the dispatch center to the arrival of resources to the scene of the emergency. This information is tracked in the Computer Aided Dispatch (CAD) System, and the performance goals, or service City of Palo Alto Page 2 levels, are set by Council in accordance with county and national standards.  Ambulance Transports: The report provides the number of ambulatory transports to hospitals or other medical care facilities, and the proportion of Emergency Medical Calls that included transports. This information is tracked in the Fire Department’s Emergency Medical Record Management System.  Fire Containment: This measures the proportion of building and structure fires that are contained to the area or room of origin within Palo Alto and Stanford Campus.  Mutual and Automatic Aid: This includes the number and proportion of all incidents in which the PAFD provided aid to neighboring communities, as well as the aid received from neighboring Fire Departments. This information is tracked in the CAD System.  Permits: This provides the count of facility, electric vehicle, and solar permits issued by the Fire Prevention Bureau. This information is currently tracked in the Development Center’s Records Management System.  Inspections: A count of the total number of Hazardous Materials and State Mandated inspections is provided. In addition, an estimated number of inspections to be completed for the year is also provided to assess overall workload performance to date.  Fire and Life Safety Plans Reviewed: This provides a total count of all plans reviewed, as well as the proportion of plans that were reviewed within the time guidelines.  Vacancies and Off-Line Employees: This section provides the total number of budgeted full-time equivalent line personnel, current vacancies, and employees that are off line from workers compensation or light duty. This information is obtained from the Fire Department’s Staffing and Scheduling System (TeleStaff), as well as the City’s Personnel Management System.  Succession Planning Metrics: This provides the number and proportion of line personnel that are eligible to retire, or will be eligible within the next five years. This information is tracked in the City’s Personnel Management System. This report also provides the total number of hours line personnel have spent in an acting capacity. Personnel serving in an acting capacity are a key component of the Department’s overall succession planning efforts. Acting capacity allows junior officers to learn the responsibilities of higher ranks with guidance from senior officers. This information is tracked in TeleStaff. City of Palo Alto Page 3  Training hours: The total number of training hours completed by all line personnel is provided, as well as the average number of hours per each line personnel on staff. This information is tracked in the Fire Department’s Record Management System. Local, State and Federal mandates require fire personnel to train a minimum of 20 hours per month. Attachments:  Attachment6.a: ATTACHMENT A_Coverletter (PDF)  Attachment6.b: ATTACHMENT B_FY16 Q3 Peformance Report (DOCX)  Attachment6.c: ATTACHMENT C_Customer Survey (PDF)  Attachment6.d: ATTACHMENT D_Letters of Appreciation (PDF) 1 | P a g e Palo Alto Fire Department Quarterly Performance Report Fiscal Year 2016, Third Quarter Calls for Service The Palo Alto Fire Department (PAFD) responded to a total of 2,133 calls for service in the third quarter of Fiscal Year 2016. This includes responses within Palo Alto, Stanford, and neighboring cities to provide Auto and Mutual Aid. Approximately eighty-three percent (83%) of calls are generated from Palo Alto, twelve percent (12%) from Stanford, and the remainder from neighboring cities or requests for regional fire deployment. The majority of calls were for Emergency Medical Services, making up sixty-three percent (63%) of the responses. Table 1 below shows the main categories of the calls to which PAFD responded. Calls are classified based on the actual event occurred, rather than the initial call request. Table 1. Calls for Service Type FY15 Q3 FY16 Q3 Emergency Medical Service 1303 1348 Good Intent 351 377 False Alarm & False Call 245 206 Service Call 113 102 Rescue & Hazardous Material 37 57 Fire 34 43 Explosion, No Fire 1 0 Grand Total 2084 2133 Good Intent and False Alarm calls make up the second largest types of responses. Most calls for service that may be a true threat of fire, gas or other emergency hazard are actually found to be something else after Firefighters investigate the situation. These calls are coded as Good Intent calls. As well, many fire alarm activations are from causes other than fire or emergency hazard. These situations are categorized as False Alarm calls. Emergency Medical Services Emergency Medical Service (EMS) is the primary service that the Palo Alto Fire Department provides to Palo Alto and Stanford. While this shift toward EMS is being seen across the region, the Palo Alto Fire Department is the only Fire Department in the County that provides ambulance and transport services. Of the 1,348 Emergency Medical Service calls the PAFD responded to in the third quarter of Fiscal Year 2016, the overwhelming majority were for medical, trauma and cardiac calls that did not involve a vehicle accident. There was a twenty-five percent (25%) increase over the same quarter last year for motor vehicle accidents, with most of those occuring with injuries. 2 | P a g e Table 2. EMS Performance Measures Calls for Service FY15 Q3 FY16 Q3 NFIRS Code Description 321 EMS call, excluding vehicle accident with injury 1214 1237 322 Vehicle accident with injuries 64 81 324 Motor vehicle accident with no injuries 14 17 323 Motor vehicle/pedestrian accident 11 10 381 Rescue or EMS standby 0 3 Total 1303 1348 Transports Number of Transports 949 951 Percent of EMS Calls resulting in transport 72.8% 70.5% Response Times Percent of first responder arriving on scene to EMS calls within 8 minutes 91.3% 91.7% Percent of paramedic responder arriving on scene to EMS calls within 12 minutes 99.2% 99.0% Median response time for first responder arriving on scene to EMS calls 05:03 04:56 Most EMS calls (71%) resulted in an ambulance transport to a local hospital or care facility. This is the primary source of revenue generated from emergency medical services, and revenue received in this quarter is on track with budget projections.  Response Time Goal Met: At least 90% of first responder arriving on scene to EMS calls within 8 minutes. This quarter the PAFD first responder arrived on scene to EMS calls within 8 minutes ninety-two percent (92%) of the time.  Response Time Goal Met: At least 99% of paramedic responder arriving on scene to EMS calls within 12 minutes. This quarter the PAFD paramedic responder arrived on scene to EMS calls within 12 minutes ninety-nine percent (99%) of the time. Fire Suppression Very few of the potential fire calls coming into dispatch turn out to be a real fire once PAFD investigates the scene and cause of the concerning elements. This quarter PAFD responded to 43 calls where fire was present, with 7 occurring in neighboring cities. There were six major fire incidents that occurred during this period, and fortunately resulted in minor injuries of residents and no injuries of first responders. In early January, on the 3000 block of Kenneth Drive the PAFD was dispatched to investigate smoke. Upon arrival there was a light haze with no active fire or smoke production showing from an attached, garage. The cause of the fire was burning rags stuffed under the garage door. Firefighters consulted with the Palo Alto Police Department (PAPD) and informed them of the suspicious nature of this fire. After conducting an investigation, it was confirmed the cause of the fire was arson. PAPD quickly followed up and within 24 hours a suspect was arrested and charged with arson on an inhabited building. A small home fire on the 100 block of Hawthorne Ave occurred in February, with smoke and flames showing upon arrival of emergency responders. A second alarm response was called, with a total of 14 units from PAFD, Santa Clara County, Mountain View, and Moffet Field. Crews knocked down the flames 3 | P a g e from the outside and then made entry into the home from the front door. Upon inspection there was no fire found inside the house, and crews extinguished the fire on the exterior of the building. The largest fire this quarter occurred in a home on the 1100 block of Bryant Street. The first crew to arrive on scene reported a two story structure fire with smoke showing from the basement and attic. Ultimately, this three alarm fire required a significant response of 23 units who conducted primary search, fire attack, vertical ventilation, incident command, overhaul, air supply, and safety roles. There were no residents in the home at the time. The fire was controlled in approximately 30 minutes. Caused by an incorrectly installed furnace, the fire started in the basement and burned its way through hidden voids and behind walls up to the attic. It is important to note that nearly all multi-story homes in Palo Alto built before 1945 contain balloon frame construction. The defect with balloon framing is the absence of fire stopping between floors. A fire can burn undetected behind walls and floors and when it is finally discovered, frequently some distance from the point of origin, a great deal of work is needed to expose walls and extinguish the fire. Table 3. Fire Performance Measures Calls for Service FY15 Q3 FY16 Q3 NFIRS Code Description 113 Cooking fire, confined to container 9 12 111 Building fire 7 12 154 Dumpster or other outside trash receptacle fire 3 6 131 Passenger vehicle fire 2 4 100 Fire, other 3 3 140 Natural vegetation fire, other 0 2 142 Brush, or brush and grass mixture fire 1 1 130 Mobile property fire, other 0 1 132 Road freight or transport vehicle fire 0 1 161 Outside storage fire 0 1 150 Outside rubbish fire, other 2 0 114 Chimney or flue fire, confined to chimney or flue 3 0 118 Trash or rubbish fire, contained 1 0 115 Incinerator overload or malfunction, fire confined 1 0 122 Fire in motor home, camper, recreational vehicle 1 0 153 Construction or demolition landfill fire 1 0 Total 34 43 Response Times Percent of first responder arriving on scene to Fire calls within 8 minutes 81.0% 86.8% Median response time for first responder arriving on scene to Fire calls 05:46 05:43 Fire Containment Percent of building and structure fires contained to the room or area of origin 100% 78%  Response Time Goal Not Met: At least 90% of first responder arriving on scene to Fire calls within 8 minutes. This quarter the PAFD first responder arrived on scene to Fire calls within 8 minutes eighty-seven percent (87%) of the time. While, under the goal this is still an improvement from historical performance on this measure, which is typically near eighty-one percent (81%). The Fire Department has begun an operational readiness initiative that includes initiatives to reduce response times. 4 | P a g e  Fire Containment Goal Not Met: At least 90% of building and structure fires contained to the room or area of origin. This quarter there were eight building fires within Palo Alto and one on Stanford. The two fires that were not contained to room or area of origin were both residential fires in Palo Alto. In both cases, the fire spread from the original area despite a response time under 8 minutes. PAFD also responded mutual aid to three building fires in Mountain View. Rescue and Hazardous Materials The Fire Department responded to a total of 57 rescue and hazardous material calls. The most common rescue call is for the removal of victims from a stalled elevator, which accounts for thirty-two percent (32%) of these call types. There was a big increase in the number of stalled elevator calls, many of which were in buildings on Stanford campus that had multiple incidents. Gas leak calls account for the second largest type of call, making up twenty-five percent (25%) of the total. Table 4. Rescue and Hazardous Materials Measures Calls for Service FY15 Q3 FY16 Q3 NFIRS Code Description 353 Removal of victim(s) from stalled elevator 6 18 412 Gas leak (natural gas or LPG) 4 8 400 Hazardous condition, other 4 7 412U Gas leak (natural gas or LPG) - PA Utilities Related 3 4 445 Arcing, shorted electrical equipment 0 4 463 Vehicle accident, general cleanup 2 4 331 Lock-in (if lock out , use 511 ) 1 3 411 Gasoline or other flammable liquid spill 2 2 422 Chemical spill or leak 3 2 413 Oil or other combustible liquid spill 3 1 444U Power line down - PA Utilities Related 0 1 444 Power line down 0 1 442 Overheated motor 1 0 440 Electrical wiring/equipment problem, other 2 0 443 Light ballast breakdown 1 0 350 Extrication, rescue, other 2 0 352 Extrication of victim(s) from vehicle 1 0 360 Water & ice related rescue, other 1 0 410 Flammable gas or liquid condition, other 1 0 Total 37 57 Response Times Median response time for first responder arriving on scene to Rescue & Hazardous Materials calls 06:05 05:19 Mutual and Automatic Aid The Fire Department has automatic aid agreements with five regional Fire Departments, including Mountain View, Menlo Park, Woodside, Los Altos, and Santa Clara County Fire. The PAFD primarily 5 | P a g e provides aid to Mountain View, and the data below shows an increase in the number of calls from the prior fiscal year. This is due to the virtual consolidation effort with the cities of Mountain View and Los Altos, which was completed at in the first quarter of FY15. The Deputy Chief of Operations communicates regularly with the Mountain View Fire Department to review the agreement and ensure Palo Alto’s resources are not overly relied upon. In this quarter, the PAFD provided mutual or automatic aid to three other jurisdictions on a total of 107 incidents. Five agencies provided mutual or automatic aid for calls within Palo Alto or Stanford on a total of 119 incidents. Table 5. Mutual and Automatic Aid Performance Measures Mutual and Auto Aid Provided FY15 Q3 FY16 Q3 Agency Mountain View Fire 81 85 Santa Clara County Fire 1 17 Menlo Park Fire 0 3 Santa Clara City Fire 0 2 San Jose Fire 1 0 All Mutual and Auto Aid Provided 83 107 Mutual and Auto Aid Received Agency Mountain View Fire 50 91 Menlo Park Fire 22 13 Santa Clara County Fire 3 9 Woodside Fire 3 3 Moffet Fire 0 3 All Mutual and Auto Aid Received 78 119 6 | P a g e Fire Prevention The Fire Prevention Bureau ensures compliance with the Fire Code for the safety of occupants and protection of property. Fire Inspectors perform fire sprinkler and fire alarm plan checks, permitting, and field inspections with the goal of ensuring all construction complies with local and national codes. The Bureau completed an in-depth analysis of fees and finalized a revised fee schedule this quarter. Staff continues to refine the records management system, Accela to meet inspection data storage and billing needs. They are currently working on a mobile application for scheduling inspections that should be launched before the end of the fiscal year. In comparison to the first quarter of this year, there was a slight rise in total plans reviewed coinciding with rise in total inspections. We saw an increase in Electric Vehicle and small drops in Solar Permits and in total permits issued. The hazardous material inspections are above the projected total for the year, however, this is due to multiple visits to a single site. This year businesses have been mandated to register on a State Hazardous Materials registry (CERS) and the department has been providing assistance to these sites with the registration process. Table 6. Prevention Bureau Performance Measures Permits FY15 Q3 FY16 Q3 Fire Permits Issued - 135 Electric Vehicle Permits Issued 20 25 Solar Permits Issued 20 24 Inspections Hazardous Material Inspections Completed 106 113 Number of Hazardous Material Inspections for the year 270 207 Percent of Hazardous Material Facilities Inspections Complete to date 87.4% 140% State Mandated Inspections Completed 131 99 Number of State Mandated Inspections for the year 340 340 Percent of State Mandated Facilities Inspections Complete to date 54.1% 87.6% Fire and Life Safety Plan Review Plans Reviewed 348 435 Percent of Reviews Completed On-Time 98.0% 97.0% 7 | P a g e Workforce Planning The Department operates daily emergency response operations with a total of 96.00 FTE line personnel. This includes three battalions of crews that staff six stations in the City and Stanford 24 hours each day. Over the last quarter, the department has operated with 9.0 positions vacant and 4.0 employees off-line creating a total of 13.00 FTE positions that require backfilling. This quarter the Department was able to hire two new firefighter/paramedics, who are in the process of completing the fire academy. Although these hires were expected to provide some relief from the amount of mandatory overtime for our current personnel as well as reduce the total amount of overtime, we had four employees leave for positions in other fire departments. With the current hiring list nearly exhausted, the Department will begin a new entry level testing process within the next six months. Once the position is posted it can take up to 12 months to complete the necessary review, selection and background procedures to create a new list. As additional employees leave or retire, the department may have to continue relying on overtime in the next year. This quarter the department was also able to fill the remaining Fire Captain vacancies, promoting three firefighters to the rank of Captain in January. The number of acting captain hours was reduced to nearly half of last quarter, primarily from the filling of these three positions with promotions. Table 7. Vacancies and Off-Line Employees FY16 Q2 Classification Budgeted FTE Vacancies Off-Line Employees (Workers Comp/Light Duty) Personnel On Line Percent of Personnel On Line Battalion Chief 4.00 0.00 0.00 4.00 100% Fire Captain 22.00 0.00 2.00 20.00 91% Fire Apparatus Operator & Fire Fighters 70.00 11.00 4.00 55.00 79% TOTAL 96.00 11.00 6.00 79.00 82% Table 8. Succession Planning FY15 Q3 FY16 Q3 Number of Line Personnel Currently Eligible to Retire 12 21 Number of Line Personnel Eligible to Retire in Five Years 21 20 Percent of all Line Personnel Eligible to Retire within Five Years 37.9% 46.1% Number of Acting Battalion Chief Hours 252 408 Number of Acting Captain Hours 5,614 1,474 Number of Acting Apparatus Operator Hours 6,517 6,493 Training Hours of Training Completed 7,182 9,617 Average Hours per Line Personnel 87.59 121.73 Number of Your Patients in this ReportYour Score January 1, 2016 to March 31, 2016 EMS System Report Palo Alto, CA 1515 Center Street City of Palo Alto 1 (877) 583-3100 www.EMSSurveyTeam.com Client 9701 service@EMSSurveyTeam.com Lansing, Mi 48096 14395.52 Number of Patients in this Report 17,169 Number of Transport Services in All EMS DB 114 Page 1 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Executive Summary This report contains data from 143 City of Palo Alto patients who returned a questionnaire between 01/01/2016 and 03/31/2016. The overall mean score for the standard questions was 95.52; this is a difference of 3.06 points from the overall EMS database score of 92.46. The current score of 95.52 is a change of 0.02 points from last period's score of 95.50. This was the 7th highest overall score for all companies in the database. You are ranked 1st for comparably sized companies in the system. 85.06% of responses to standard questions had a rating of Very Good, the highest rating. 99.42% of all responses were positive. Page 2 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Demographics — This section provides demographic information about the patients who responded to the survey for the current and the previous periods. The information comes from the data you submitted. Compare this demographic data to your eligible population. Generally, the demographic profile will approximate your service population. Total This PeriodLast Period OtherFemaleMale OtherMaleTotalFemale Under 18 2 0 02 033 0 18 to 30 1 2 03 220 0 31 to 44 2 5 18 341 0 45 to 54 4 6 010 462 0 55 to 64 7 4 011 71811 0 65 and older 31 48 180 6111049 0 Total 47 65 2114 143 66 77 0 Gender Page 3 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Dispatch Analysis This analysis details the section results that concern dispatcher operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. Helpfulness of the person you called for ambulance service 96.03 92.61 3.42 Your Score Total DB Variance1000 Concern shown by the person you called for ambulance service 95.71 92.49 3.22 Your Score Total DB Variance1000 Extent to which you were told what to do until the ambulance arrived 93.56 90.87 2.69 Your Score Total DB Variance1000 Overall Section Score Total DB 3.16 100 91.99 Variance 0 Your Score 95.15 Page 4 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Ambulance Analysis This analysis details the section results that concern ambulance operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. Extent to which the ambulance arrived in a timely manner 95.74 91.94 3.80 Your Score Total DB Variance1000 Cleanliness of the ambulance 96.30 93.94 2.36 Your Score Total DB Variance1000 Comfort of the ride 93.16 87.75 5.41 Your Score Total DB Variance1000 Skill of the person driving the ambulance 96.96 93.47 3.49 Your Score Total DB Variance1000 Overall Section Score Total DB 3.74 100 91.80 Variance 0 Your Score 95.54 Page 5 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Medic Analysis This analysis details the section results that concern medic operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. Care shown by the medics who arrived with the ambulance 97.38 94.18 3.20 Your Score Total DB Variance1000 Degree to which the medics took your problem seriously 97.00 94.01 2.99 Your Score Total DB Variance1000 Degree to which the medics listened to you and/or your family 97.38 93.66 3.72 Your Score Total DB Variance1000 Skill of the medics 97.13 94.05 3.08 Your Score Total DB Variance1000 Extent to which the medics kept you informed about your treatment 96.65 92.50 4.15 Your Score Total DB Variance1000 Extent to which medics included you in the treatment decisions (if applicable) 94.35 92.28 2.07 Your Score Total DB Variance1000 Degree to which the medics relieved your pain or discomfort 95.41 90.70 4.71 Your Score Total DB Variance1000 Page 6 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Medic Analysis This analysis details the section results that concern medic operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. Medics' concern for your privacy 95.58 93.05 2.53 Your Score Total DB Variance1000 Extent to which medics cared for you as a person 97.51 94.14 3.37 Your Score Total DB Variance1000 Overall Section Score Total DB 3.40 100 93.18 Variance 0 Your Score 96.58 Page 7 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Billing Staff Assessment Analysis This analysis details the section results that concern office operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. Professionalism of the staff in our ambulance service billing office 89.02 88.74 Your Score Total DB VarianceVariance1000 Willingness of the staff in our billing office to address your needs 85.49 88.81 Your Score Total DB Variance -3.32 Variance1000 Overall Section Score Total DB Variance 100 -1.39 88.78 0 Your Score 87.39 Page 8 of 28 City of Palo Alto January 01, 2016 to March 31, 2016 Overall Assessment Analysis This analysis details the section results that concern assessment of operations. The analysis contains the mean scores for each survey question. The first column shows the company score and the total database score, the second column is your variance from the database score. How well did our staff work together to care for you 96.37 93.33 3.04 Your Score Total DB Variance1000 Extent to which our staff eased your entry into the medical facility 96.52 93.47 3.05 Your Score Total DB Variance1000 Appropriateness of Emergency Medical Transportation treatment 96.02 93.27 2.75 Your Score Total DB Variance1000 Extent to which the services received were worth the fees charged 88.07 87.70 Your Score Total DB VarianceVariance1000 Overall rating of the care provided by our Emergency Medical Transportation service 96.46 93.42 3.04 Your Score Total DB Variance1000 Likelihood of recommending this ambulance service to others 96.21 93.01 3.20 Your Score Total DB Variance1000 Overall Section Score Total DB 2.81 100 92.38 Variance 0 Your Score 95.19 Page 9 of 28 January 1, 2016 to March 31, 2016 City of Palo Alto Question Analysis This section lists a synopsis of the information about your individual questions and overall scores for this monthly reporting period. The first column shows the company score from the previous period, the second column shows the change, the third column shows your score for this period and the fourth column shows the total Database score. Dispatch Analysis Last Period Change This Period Total DB Helpfulness of the person you called for ambulance service 96.031.49 92.6194.54 Concern shown by the person you called for ambulance service 95.712.85 92.4992.86 Extent to which you were told what to do until the ambulance arrived 93.563.00 90.8790.56 Ambulance Analysis Last Period Change This Period Total DB Extent to which the ambulance arrived in a timely manner 95.740.55 91.9495.19 Cleanliness of the ambulance 96.30-0.04 93.9496.34 Comfort of the ride 93.160.78 87.7592.38 Skill of the person driving the ambulance 96.960.50 93.4796.46 Medic Analysis Last Period Change This Period Total DB Care shown by the medics who arrived with the ambulance 97.380.05 94.1897.33 Degree to which the medics took your problem seriously 97.00-0.12 94.0197.12 Degree to which the medics listened to you and/or your family 97.380.54 93.6696.84 Skill of the medics 97.130.07 94.0597.06 Extent to which the medics kept you informed about your treatment 96.651.17 92.5095.48 Extent to which medics included you in the treatment decisions (if applicable)94.35-0.47 92.2894.82 Degree to which the medics relieved your pain or discomfort 95.410.30 90.7095.11 Medics' concern for your privacy 95.58-1.53 93.0597.11 Extent to which medics cared for you as a person 97.51-0.74 94.1498.25 Billing Staff Assessment Analysis Last Period Change This Period Total DB Professionalism of the staff in our ambulance service billing office 89.02-0.20 88.7489.22 Willingness of the staff in our billing office to address your needs 85.49-2.40 88.8187.89 Page 10 of 28 January 1, 2016 to March 31, 2016 City of Palo Alto Question Analysis (Continued) Overall Assessment Analysis Last Period Change This Period Total DB How well did our staff work together to care for you 96.37-1.10 93.3397.47 Extent to which our staff eased your entry into the medical facility 96.52-1.23 93.4797.75 Appropriateness of Emergency Medical Transportation treatment 96.02-0.98 93.2797.00 Extent to which the services received were worth the fees charged 88.07-1.82 87.7089.89 Overall rating of the care provided by our Emergency Medical Transportation 96.46-1.29 93.4297.75 Likelihood of recommending this ambulance service to others 96.21-0.03 93.0196.24 Page 11 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Mar 2015 Apr 2015 May 2015 Jun 2015 Jul 2015 Aug 2015 Sep 2015 Oct 2015 Nov 2015 Dec 2015 Jan 2016 Feb 2016 Mar 2016 Helpfulness of the person you called for ambulance service 96.09 95.83 92.67 85.71 95.00 93.93 96.51 92.36 100.00 95.83 94.57 97.00 97.22 Concern shown by the person you called for ambulance service 95.16 95.83 91.37 85.71 95.00 94.87 95.35 89.29 91.67 95.65 94.32 96.00 97.22 Extent to which you were told what to do until the ambulance 92.74 95.83 91.67 85.71 91.67 93.42 92.68 89.29 100.00 91.13 93.59 87.50 97.22 Extent to which the ambulance arrived in a timely manner 97.37 96.43 95.56 91.67 100.00 96.88 94.12 95.35 100.00 94.77 94.74 92.31 98.91 Cleanliness of the ambulance 95.83 100.00 96.83 94.44 96.43 96.67 95.74 95.00 80.20 98.73 93.09 96.15 100.00 Comfort of the ride 90.28 95.83 92.74 83.44 94.64 92.44 91.33 89.23 80.20 95.76 90.63 92.31 96.51 Skill of the person driving the ambulance 95.71 95.83 94.35 94.44 100.00 95.35 93.88 93.89 100.00 98.25 95.31 96.00 99.40 Care shown by the medics who arrived with the ambulance 99.31 100.00 95.90 91.67 95.31 97.87 97.50 95.63 100.00 98.28 97.81 93.75 98.84 Degree to which the medics took your problem seriously 99.26 100.00 96.77 91.67 95.00 96.20 97.00 95.12 100.00 98.28 96.05 94.79 99.43 Degree to which the medics listened to you and/or your family 98.53 100.00 95.90 94.44 93.33 96.74 94.79 95.12 100.00 97.81 96.05 95.83 100.00 Skill of the medics 98.48 100.00 96.37 91.67 93.33 95.65 96.88 95.00 95.00 98.68 95.98 96.74 98.84 Extent to which the medics kept you informed about your 97.50 95.00 95.56 91.67 90.00 95.56 90.56 92.11 95.00 98.04 96.00 95.45 98.13 Extent to which medics included you in the treatment decisions 97.83 100.00 95.31 90.63 86.36 95.39 88.12 90.91 100.00 97.22 93.29 94.32 95.83 Degree to which the medics relieved your pain or discomfort 97.00 100.00 94.83 83.33 88.64 95.00 91.46 92.86 100.00 96.43 94.32 92.86 98.48 Medics' concern for your privacy 99.14 95.00 93.42 89.29 92.31 95.83 91.67 95.39 95.00 98.56 94.39 93.18 98.21 Extent to which medics cared for you as a person 100.00 100.00 95.42 96.88 95.00 97.22 94.27 96.88 100.00 99.11 97.64 92.43 100.00 Professionalism of the staff in our ambulance service billing 86.67 91.67 87.88 91.67 90.91 90.79 85.23 89.58 50.50 92.39 89.58 92.50 86.00 Willingness of the staff in our billing office to address your 86.67 83.33 90.63 83.33 92.86 90.28 90.33 85.42 50.50 92.86 83.75 91.67 84.00 How well did our staff work together to care for you 96.77 100.00 94.74 90.63 96.88 95.11 95.10 95.63 100.00 98.61 95.10 96.88 97.62 Extent to which our staff eased your entry into the medical 97.58 85.00 93.86 90.63 96.88 94.44 96.50 96.34 95.00 99.07 94.61 95.83 99.38 Appropriateness of Emergency Medical Transportation treatment 99.17 100.00 94.92 90.63 97.06 96.20 93.37 93.90 100.00 99.07 95.37 95.83 96.98 Extent to which the services received were worth the fees 92.00 93.75 91.50 84.38 83.33 87.18 83.79 89.39 81.25 90.98 86.84 88.80 89.00 Overall rating of the care provided by our Emergency Medical 97.66 95.00 95.61 90.63 95.59 96.11 94.27 95.12 100.00 99.54 95.28 94.79 98.84 Likelihood of recommending this ambulance service to others 97.66 100.00 94.92 90.63 96.88 96.02 92.24 94.87 93.75 97.50 94.27 95.83 98.75 Your Master Score 96.46 96.64 94.38 90.03 94.19 95.10 93.39 93.53 93.73 97.08 94.39 94.30 97.65 Your Total Responses 42 7 66 9 17 48 52 45 5 64 65 29 49 Monthly Breakdown Below are the monthly responses that have been received for your service. It details the individual score for each question as well as the overall company score for that month. Page 12 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Monthly tracking of Overall Survey Score Page 13 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Greatest Increase and Decrease in Scores by Question Increases Last Period This Period Change Total DB Score Extent to which you were told what to do until the ambulance arrived 90.56 3.00 90.8793.56 Concern shown by the person you called for ambulance service 92.86 2.86 92.4995.71 Helpfulness of the person you called for ambulance service 94.54 1.49 92.6196.03 Extent to which the medics kept you informed about your treatment 95.48 1.17 92.5096.65 Comfort of the ride 92.38 0.78 87.7593.16 Extent to which the ambulance arrived in a timely manner 95.19 0.54 91.9495.74 Degree to which the medics listened to you and/or your family 96.84 0.53 93.6697.38 Skill of the person driving the ambulance 96.46 0.49 93.4796.96 Degree to which the medics relieved your pain or discomfort 95.11 0.29 90.7095.41 Skill of the medics 97.06 0.07 94.0597.13 Decreases Last Period This Period Change Total DB Score Willingness of the staff in our billing office to address your needs 87.89 -2.40 88.8185.49 Extent to which the services received were worth the fees charged 89.89 -1.83 87.7088.07 Medics' concern for your privacy 97.11 -1.53 93.0595.58 Overall rating of the care provided by our Emergency Medical Transportation service 97.75 -1.29 93.4296.46 Extent to which our staff eased your entry into the medical facility 97.75 -1.23 93.4796.52 How well did our staff work together to care for you 97.47 -1.11 93.3396.37 Appropriateness of Emergency Medical Transportation treatment 97.00 -0.98 93.2796.02 Extent to which medics cared for you as a person 98.25 -0.74 94.1497.51 Extent to which medics included you in the treatment decisions (if applicable) 94.82 -0.46 92.2894.35 Professionalism of the staff in our ambulance service billing office 89.22 -0.20 88.7489.02 Page 14 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Greatest Scores Above Benchmarks by Question Highest Above Benchmark This Period Variance Total DB Score Extent to which medics cared for you as a person 94.143.3697.51 Care shown by the medics who arrived with the ambulance 94.183.297.38 Degree to which the medics listened to you and/or your family 93.663.7297.38 Skill of the medics 94.053.0897.13 Degree to which the medics took your problem seriously 94.012.9997 Skill of the person driving the ambulance 93.473.4996.96 Extent to which the medics kept you informed about your treatment 92.54.1596.65 Extent to which our staff eased your entry into the medical facility 93.473.0596.52 Overall rating of the care provided by our Emergency Medical Transportation service 93.423.0396.46 How well did our staff work together to care for you 93.333.0496.37 Page 15 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Highest and Lowest Scores Highest Scores Last Period This Period Change Total DB Score Extent to which medics cared for you as a person 97.5198.25 -0.74 94.14 Degree to which the medics listened to you and/or your family 97.3896.84 0.54 93.66 Care shown by the medics who arrived with the ambulance 97.3897.33 0.05 94.18 Skill of the medics 97.1397.06 0.07 94.05 Degree to which the medics took your problem seriously 97.0097.12 -0.12 94.01 Lowest Scores Last Period This Period Change Total DB Score Willingness of the staff in our billing office to address your needs 85.4987.89 -2.40 88.81 Extent to which the services received were worth the fees charged 88.0789.89 -1.82 87.70 Professionalism of the staff in our ambulance service billing office 89.0289.22 -0.20 88.74 Comfort of the ride 93.1692.38 0.78 87.75 Extent to which you were told what to do until the ambulance arrived 93.5690.56 3.00 90.87 Page 16 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Key Drivers — This section shows the relative importance of each question to the respondents' overall satisfaction. The greater the coefficient number, the more important the issue is to your patients' overall satisfaction. The questions are arranged based on their weighted importance value. Question Your Score Correlation Coeffecient Extent to which medics included you in the treatment decisions (if applicable).84740179994.35 Overall rating of the care provided by our Emergency Medical Transportation service .81465575496.46 Skill of the medics .81030955197.13 Likelihood of recommending this ambulance service to others .80804860796.21 Extent to which our staff eased your entry into the medical facility .78952713596.52 Degree to which the medics listened to you and/or your family .78290662897.38 How well did our staff work together to care for you .76314877496.37 Extent to which the medics kept you informed about your treatment .75381578396.65 Extent to which medics cared for you as a person .7494033397.51 Willingness of the staff in our billing office to address your needs .72458343385.49 Degree to which the medics took your problem seriously .7091974597.00 Extent to which the services received were worth the fees charged .70856512688.07 Concern shown by the person you called for ambulance service .67448593995.71 Helpfulness of the person you called for ambulance service .66133806596.03 Care shown by the medics who arrived with the ambulance .65936912697.38 Appropriateness of Emergency Medical Transportation treatment .63533109696.02 Cleanliness of the ambulance .62496510496.30 Degree to which the medics relieved your pain or discomfort .62069813495.41 Skill of the person driving the ambulance .59025937296.96 Professionalism of the staff in our ambulance service billing office .5752494989.02 Comfort of the ride .53571760693.16 Extent to which you were told what to do until the ambulance arrived .52661581693.56 Medics' concern for your privacy .51155196195.58 Extent to which the ambulance arrived in a timely manner .40960483595.74 Page 17 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Company Comparisons — The following chart gives a comparison of the mean score for each question as scored by comparable companies. Your company is highlighted. There is also a green-shaded highlight of the highest score for each question. This will show how you compare to similar companies. Your Company A B C D E F Comparison Companies Helpfulness of the person you called for ambulance service 92.31 89.95 95.77 92.12 90.0291.0696.03 Concern shown by the person you called for ambulance service 92.86 90.14 94.06 91.00 88.3991.2295.71 Extent to which you were told what to do until the ambulance 88.40 88.70 92.83 87.86 86.7990.0693.56 Extent to which the ambulance arrived in a timely manner 91.94 89.24 96.67 90.90 85.0389.8995.74 Cleanliness of the ambulance 93.10 91.49 97.14 91.77 91.5694.4296.30 Comfort of the ride 87.93 77.66 87.63 86.07 82.5988.7893.16 Skill of the person driving the ambulance 93.10 90.73 96.65 91.36 89.0193.6596.96 Care shown by the medics who arrived with the ambulance 94.03 93.44 97.19 93.22 91.1794.4397.38 Degree to which the medics took your problem seriously 93.75 92.51 97.21 92.28 92.4893.1697.00 Degree to which the medics listened to you and/or your family 93.25 91.43 97.97 92.91 92.8793.5497.38 Skill of the medics 93.55 92.36 96.93 93.32 92.2093.8397.13 Extent to which the medics kept you informed about your 91.36 90.70 96.43 90.37 90.6893.1296.65 Extent to which medics included you in the treatment decisions (if 90.91 87.51 97.42 91.61 90.1093.8494.35 Degree to which the medics relieved your pain or discomfort 93.33 89.50 95.52 90.20 85.0091.1795.41 Medics' concern for your privacy 92.27 91.30 96.99 91.62 88.3292.8095.58 Extent to which medics cared for you as a person 93.75 92.54 97.50 92.31 92.0893.4997.51 Professionalism of the staff in our ambulance service billing office 89.71 86.18 90.00 88.57 81.2885.4589.02 Willingness of the staff in our billing office to address your needs 87.90 85.00 85.52 86.80 81.2886.6885.49 How well did our staff work together to care for you 92.74 89.33 97.10 91.03 89.0592.9296.37 Extent to which our staff eased your entry into the medical facility 92.92 90.80 97.22 91.46 88.2995.0096.52 Appropriateness of Emergency Medical Transportation treatment 92.50 89.75 96.47 91.12 90.6494.3096.02 Extent to which the services received were worth the fees charged 86.32 80.93 93.65 88.24 81.6086.4388.07 Overall rating of the care provided by our Emergency Medical 93.46 89.04 96.78 91.47 89.9493.5996.46 Likelihood of recommending this ambulance service to others 92.83 87.80 96.72 92.33 88.8492.1096.21 Overall score 95.52 92.14 92.06 89.40 95.85 91.02 88.63 National Rank 7 44 45 75 6 64 79 Comparable Size (Medium) Company Rank 1 13 25 Page 18 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Yo u r Co m p a n y Total Score Benchmark Comparison 95.52 To t a l D B Si m i l a r S i z e d 92.46 91.8 Helpfulness of the person you called for ambulance service 96.03 92.61 92.44 Concern shown by the person you called for ambulance service 95.71 92.49 92.13 Extent to which you were told what to do until the ambulance 93.56 90.87 90.66 Extent to which the ambulance arrived in a timely manner 95.74 91.94 91.19 Cleanliness of the ambulance 96.30 93.94 93.53 Comfort of the ride 93.16 87.75 88.26 Skill of the person driving the ambulance 96.96 93.47 92.95 Care shown by the medics who arrived with the ambulance 97.38 94.18 93.72 Degree to which the medics took your problem seriously 97.00 94.01 93.47 Degree to which the medics listened to you and/or your family 97.38 93.66 93.28 Skill of the medics 97.13 94.05 93.51 Extent to which the medics kept you informed about your 96.65 92.50 92.05 Extent to which medics included you in the treatment decisions 94.35 92.28 91.72 Degree to which the medics relieved your pain or discomfort 95.41 90.70 90.15 Medics' concern for your privacy 95.58 93.05 92.94 Extent to which medics cared for you as a person 97.51 94.14 93.78 Professionalism of the staff in our ambulance service billing 89.02 88.74 88.47 Willingness of the staff in our billing office to address your 85.49 88.81 88.02 How well did our staff work together to care for you 96.37 93.33 93.05 Extent to which our staff eased your entry into the medical 96.52 93.47 92.90 Appropriateness of Emergency Medical Transportation treatment 96.02 93.27 92.88 Extent to which the services received were worth the fees 88.07 87.70 86.84 Overall rating of the care provided by our Emergency Medical 96.46 93.42 92.89 Likelihood of recommending this ambulance service to others 96.21 93.01 92.40 Number of Surveys for the period 143 Page 19 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Benchmark Trending Graphic - Below are the monthly scores for your service. It details the overall score for each month as well as your subscribed benchmarks for that month. Page 20 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Cumulative Comparisons This section lists a synopsis of the information about your individual questions and overall scores over the entire lifetime of the dataset. The first column shows the company score and the second column details the total database score. Your Score Total DB 91.6794.78Overall Facility Rating Dispatch 94.41 91.46 Helpfulness of the person you called for ambulance service 92.2295.50 Concern shown by the person you called for ambulance service 91.9394.84 Extent to which you were told what to do until the ambulance 90.2292.89 Ambulance 95.3 91.26 Extent to which the ambulance arrived in a timely manner 91.5995.67 Cleanliness of the ambulance 93.7796.64 Comfort of the ride 87.0192.62 Skill of the person driving the ambulance 92.6996.28 Medic 95.91 92.68 Care shown by the medics who arrived with the ambulance 93.7097.18 Degree to which the medics took your problem seriously 93.6096.87 Degree to which the medics listened to you and/or your family 93.3496.50 Skill of the medics 93.7796.78 Extent to which the medics kept you informed about your treatment 91.7995.30 Extent to which medics included you in the treatment decisions (if 91.6094.14 Degree to which the medics relieved your pain or discomfort 90.2194.27 Medics' concern for your privacy 92.5795.24 Page 21 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Cumulative Comparisons (Continued) Your Score Total DB 91.6794.78Overall Facility Rating Medic 95.91 92.68 Extent to which medics cared for you as a person 93.5396.90 Billing Staff Assessment 89.03 88.06 Professionalism of the staff in our ambulance service billing office 88.0488.95 Willingness of the staff in our billing office to address your needs 88.0889.11 Overall Assessment 94.85 91.74 How well did our staff work together to care for you 92.7696.36 Extent to which our staff eased your entry into the medical facility 92.9696.39 Appropriateness of Emergency Medical Transportation treatment 92.7196.11 Extent to which the services received were worth the fees charged 86.6087.88 Overall rating of the care provided by our Emergency Medical 92.8896.51 Likelihood of recommending this ambulance service to others 92.5395.83 Page 22 of 28 The Top Box Analysis displays the number of responses for the entire survey by question and rating. The Top Box itself shows the percentage of "Very Good" responses, the highest rating, for each question. Next to the company rating is the entire EMS DB rating for those same questions. Top Box Comparisons January 1, 2016 to March 31, 2016 City of Palo Alto EMS DB % Very Good Company % Very Good Very GoodGoodFairPoor Very Poor Overall Company Rating 6 9 41 330 75.21%85.06%2198 Dispatch 0 1 4 49 73.95%82.52%255 Helpfulness of the person you called for ambulance service 0 0 1 15 91 85.05%75.54% Concern shown by the person you called for ambulance service 0 0 1 16 88 83.81%75.03% Extent to which you were told what to do until the ambulance arrived 0 1 2 18 76 78.35%71.28% Ambulance 0 1 7 68 73.55%84.03%400 Extent to which the ambulance arrived in a timely manner 0 1 1 17 110 85.27%73.90% Cleanliness of the ambulance 0 0 1 15 99 86.09%78.06% Comfort of the ride 0 0 5 22 90 76.92%64.56% Skill of the person driving the ambulance 0 0 0 14 101 87.83%77.66% Medic 1 4 10 105 78.37%88.36%911 Care shown by the medics who arrived with the ambulance 0 0 1 11 112 90.32%80.86% Degree to which the medics took your problem seriously 0 2 0 9 114 91.20%81.08% Degree to which the medics listened to you and/or your family 0 1 0 10 113 91.13%80.05% Skill of the medics 0 0 1 12 109 89.34%80.26% Extent to which the medics kept you informed about your treatment 0 0 1 13 98 87.50%76.13% Page 23 of 28 Top Box Comparisons January 1, 2016 to March 31, 2016 City of Palo Alto (Continued) EMS DB % Very Good Company % Very Good Very GoodGoodFairPoor Very Poor Overall Company Rating 6 9 41 330 75.21%85.06%2198 Extent to which medics included you in the treatment decisions (if applicable)0 1 4 10 78 83.87%76.29% Degree to which the medics relieved your pain or discomfort 0 0 1 16 81 82.65%72.32% Medics' concern for your privacy 0 0 2 16 95 84.07%76.78% Extent to which medics cared for you as a person 1 0 0 8 111 92.50%81.57% Billing Staff Assessment 2 0 6 27 63.25%62.37%58 Professionalism of the staff in our ambulance service billing office 1 0 2 14 33 66.00%62.89% Willingness of the staff in our billing office to address your needs 1 0 4 13 25 58.14%63.60% Overall Assessment 3 3 14 81 76.20%85.04%574 How well did our staff work together to care for you 0 0 1 15 101 86.32%77.71% Extent to which our staff eased your entry into the medical facility 0 0 1 14 100 86.96%78.11% Appropriateness of Emergency Medical Transportation treatment 1 0 1 13 104 87.39%77.72% Extent to which the services received were worth the fees charged 2 2 9 12 67 72.83%66.14% Overall rating of the care provided by our Emergency Medical Transportation service 0 1 0 14 105 87.50%78.76% Likelihood of recommending this ambulance service to others 0 0 2 13 97 86.61%78.76% Page 24 of 28 January 1, 2016 to March 31, 2016 City of Palo Alto Standard Deviation by Question SD Variance Database Standard Deviation Company Standard Deviation Total DBYour Score Helpfulness of the person you called for ambulance service 96.03 92.61 9.757 14.971 5.21 Concern shown by the person you called for ambulance service 95.71 92.49 10.034 14.859 4.82 Extent to which you were told what to do until the ambulance arrived 93.56 90.87 13.565 16.741 3.18 Extent to which the ambulance arrived in a timely manner 95.74 91.94 11.277 15.667 4.39 Cleanliness of the ambulance 96.30 93.94 9.466 12.39 2.92 Comfort of the ride 93.16 87.75 13.327 19.725 6.40 Skill of the person driving the ambulance 96.96 93.47 8.175 13.83 5.66 Care shown by the medics who arrived with the ambulance 97.38 94.18 8.291 13.756 5.47 Degree to which the medics took your problem seriously 97.00 94.01 11.225 14.484 3.26 Degree to which the medics listened to you and/or your family 97.38 93.66 9.429 14.945 5.52 Skill of the medics 97.13 94.05 8.587 13.763 5.18 Extent to which the medics kept you informed about your 96.65 92.50 9.146 15.539 6.39 Extent to which medics included you in the treatment decisions (if applicable) 94.35 92.28 14.26 16.435 2.17 Degree to which the medics relieved your pain or discomfort 95.41 90.70 10.318 17.926 7.61 Medics' concern for your privacy 95.58 93.05 10.638 14.467 3.83 Extent to which medics cared for you as a person 97.51 94.14 10.823 14.488 3.67 Professionalism of the staff in our ambulance service billing office 89.02 88.74 18.721 17.122 -1.60 Willingness of the staff in our billing office to address your needs 85.49 88.81 20.949 17.328 -3.62 How well did our staff work together to care for you 96.37 93.33 9.397 14.302 4.90 Extent to which our staff eased your entry into the medical facility 96.52 93.47 9.259 14.10 4.84 Appropriateness of Emergency Medical Transportation treatment 96.02 93.27 12.481 14.508 2.03 Extent to which the services received were worth the fees charged 88.07 87.70 22.781 20.796 -1.99 Overall rating of the care provided by our Emergency Medical Transportation service 96.46 93.42 10.356 14.778 4.42 Likelihood of recommending this ambulance service to others 96.21 93.01 10.138 16.191 6.05 Overall Survey Rating 95.52 92.46 11.77 15.55 3.78 Page 25 of 28 City of Palo Alto January 1, 2016 to March 31, 2016 Responses vs Score Histogram — This graph shows the number of responses on the Y axis vs the average score on the X axis. Page 26 of 28 Facilities in Database January 1, 2016 to March 31, 2016 City of Palo Alto Adair EMS Kirksville, MO Air San Juan Island Friday Harbor, WA Alliance Health null Alliance Mobile Health Troy, MI AMT Peoria, IL Bay State Springfield, MA Bay Village Bay Village, OH Bay Village Employee null Beaumont Troy, MI Birmingham Fire Birmingham, MI Bloomfield Township Bloomfield Hills, MI Carilion Clinic Roanoke, VA Cetronia Allentown, PA City of Palo Alto Palo Alto, CA Columbus Connection Cols, OH Community Ambulance Macon, GA Community Care EMS Ashtabula, OH Community Care EMS null Community EMS MI Southfield, MI Community EMS OH Columbus, OH CoxHealth EMS Springfield, MO Cumberland Carlisle, PA Cy-Fair Houston, TX Cypress Creek Spring, TX DMC Care Detroit, MI Edward Naperville, IL Emergent Health Partners Ann Arbor, MI Emergent Health Partners null Employee Survey Emergent null Employee Survey-LifeCare null Emp.Survey Medstar null EMSA Oklahoma City, OK Escalon Ambulance Service Escalon, CA Ferndale Fire and Rescue Ferndale, MI Genesis Community Zanesville, OH Gold Cross Menasha, WI Guilford EMS Greensboro, NC Harris County Emergency Houston, TX Health East St. Paul, MN Health Link Taylor, MI HEMSI Hunsville, AL Hennepin County EMS Minneapolis, MN Hot Springs Hot Springs, AR Hot Springs Village Hot Springs, AR Howard County Nashville, AR Humboldt Winnemucca, NV HVA null Iosco County EMS East Tawas, MI Lassen County Ambulance Susanville, CA LifeCare Ambulance Battle Creek, MI LifeCare Medical EMS Sterling, CO Life EMS Ambulance Grand Rapids, MI LifeNet EMS Texarkana, TX Loyola Medicine Transport Melrose Park, IL Madison Heights Fire Madison Heights, MI Malvern Malvern, AR MCHD Conroe, TX Medcare Ambulance Columbus, OH Medic 1 Ambulance Canton, MI Medic Ambulance Service Vallejo, CA Medic Ambulance Service Vallejo, CA Medic EMS Davenport, IA Medstar Clinton Twp., MI Medstar Mobile Healthcare Fort Worth, TX Medstar Mobile Healthcare null Mercy Flights Medford, OR Mercy Ohio Cincinnati, OH Metro West Hillsboro, OR MMR null Mobile Life Support New Windsor, NY Mobile Life Support New Windsor, NY Mobile Medical Response Saginaw, MI MONOC Neptune, NJ Nature Coast Lecanto, FL North Memorial Robbinsdale, MN Northwell Health Syosset, NY Oceana Hart, MI Patterson District Patterson, CA Pearland EMS Pearland, TX Portage County Stevens Point, WI Pro EMS Cambridge, MA ProMed Muskegon, MI Prompt Ambulance Highland, IN PTS Loveland, OH Puckett Austell, GA Regional EMS Flint, MI REMSA Reno, NV REMSA Air Transport Reno, NV Page 27 of 28 Ridgefield Fire Department Ridgefield, CT Riggs Ambulance Merced, CA Royal Oak Fire Department Royal Oak, MI San Juan Island Friday Harbor, WA San Marcos Hays County San Marcos, TX Scott & White Temple, TX Senior Care Bronx, NY Sioux Land Sioux City, IA SkyHeath Syossett, NY SMCAS Niles, MI Snohomish County Fire Snohomish, WA Southfield Soutthfield, MI St. Charles St. Peters, MO Stillwater Stillwater, OK Suburban Palmer, PA Swartz Flint, MI Texarkana Texarkana, TX Tri-Hospital Port Huron, MI Umpqua Health Alliance null University Medical Center Lubbock, TX Van Buren EMS Paw Paw, MI Waterford Regional Fire Waterford, MI West Bloomfield Fire West Bloomfield, MI WestSide Community Newman, CA York Regional EMS Yoe, PA null null Page 28 of 28 1 Cameron, Amber To:Tognozzi, Brian; Fanchiang, Shaohsuan; Krusing, Jennifer; Conners, Sean; Poarch, Adam Cc:Cameron, Amber; Lee, Frank Subject:Prolific Oven - Februaury 4, 2016 I want to take this opportunity to thank you for your exceptional efforts in serving Philip Schultz February 4, 2016 at Prolific Oven incident. These words of praise will be included in your personnel file to serve as a reminder of your valuable and hard work. I, on behalf of the organization wish to express my gratitude for a job well done.     Sincerely,     Eric Nickel, Fire Chief  Palo Alto Fire Department    From: Fire Sent: Thursday, February 04, 2016 12:13 PM To: Nickel, Eric Subject: Thank you   Hi Chief!    Resident Philip Schultz called to express his gratitude to the crew that assisted him last night at the Prolific Oven.  His  words – “I was impressed with the rather incredible and loving way in which they addressed me.  I truly appreciate  that.  The guy in charge was quite splendid as well.”      This gentleman is 81 years old.  His contact number is 650‐384‐6196.      Incident number 0340026  M61  Brian Tognozzi  Shaohsuan Fanchiang    E61  Jennifer Krusing  Sean Conners  Adam Poarch    Please share as you see fit.    Thanks!    Shannon  City of Palo Alto (ID # 6910) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: On-Call Contracts FY 2017 - FY 2019 Title: Approval of Four Contracts for On-Call Inspection and Plan Review Services in a Combined Amount Not-to- Exceed $7,700,000 Over a Three Year Term Ending June 30, 2019 With: (1) 4Leaf, Inc.; (2) Kutzmann and Associates, Inc.; (3) SAFEbuilt; and (4) Shums Coda Associates From: City Manager Lead Department: Development Services Department Recommendation Staff recommends that Council approve and authorize the City Manager or designee to execute contracts with each of the following four vendors selected through an RFP process to provide on- call contract support staff for processing permit applications, performing plan reviews, and conducting inspections: (1) 4Leaf, Inc.; (2) Kutzmann and Associates, Inc.; (3) SAFEbuilt; and (4) Shums Coda Associates. Staff will administer these four contracts to ensure the total aggregate of compensation paid across all five contracts is an amount not to exceed $7,700,000 over the three year term (through June 30, 2019). Summary Development Services currently holds six contracts for on-call staffing services for inspectors and plan checkers. These contracts were initially authorized in Fiscal Year 2013 for a period of one year with options to extend for two additional one-year terms. The City has exercised its options to extend and these contracts will expire on June 30, 2016. Development Services issued an RFP in February 2016 to identify potential new vendors and is proposing three year contracts with four of the five bidders to begin July 1, 2016. Development Services recommends a single not to exceed compensation pool to be shared among the four contracts, allowing staff to draw on the contract best suited to meet the City’s needs without further amendment of the contracts to shift capacity. Background On-call contracts provide expert service that is efficient, responsive, and cost-effective. Development Services relies on these contracts to provide needed expertise and to meet high demand in processing permit applications, performing plan reviews, and conducting City of Palo Alto Page 2 inspections. In April 2013 (Staff Report 3394), the City Council authorized the City Manager to enter into building and inspection services contracts with six firms to provide on-call services for Development Services, where the contracts have an option to extend agreements for two, one year, additional terms. The combined total capacity of all the contracts was $1.5 million, although each has a different limit based on the expected need at the time the contracts were first awarded. Two of these contracts were amended in February 2014 to adjust to increased workload demands (Staff Report 4393). This amendment brought the total capacity amount needed for fiscal year 2014 services to $2,398,000. In June 2014, the Council authorized the City Manager to exercise the first optional one year extension for all six on-call contracts, as well as amend a third contract to adjust for Capital Improvement initiatives (Staff Report 4824), through June 30, 2015. This extension and amendment resulted in an additional capacity amount of $2,448,000 for contract services utilized throughout fiscal year 2015, bringing the total combined capacity for both years to $4,846,000. In May 2015, the department exercised the second and last option to extend the contracts for an additional one year term (Staff Report 5632), through June 30, 2016. This extension and amendment resulted in an additional capacity amount of $85,000 for Public Works Urban Forestry consultant services, bringing the total annual capacity to $2,533,000, and total combined capacity of all three years to $7,379,000. Discussion Development Services has historically maintained contracts with several firms to provide contract support for processing permit applications, performing plan reviews, and conducting inspections. Contractors provide flexibility necessary to respond to cyclical demands, assist when full-time staff shortages occur, and provide specialized knowledge or training in a particular field when required. This affords the department the ability to quickly change the scale and scope of staffing support levels to correspond to workload needs at any time while maintaining high levels of customer service. On February 22, 2016, staff issued a RFP to seek candidates that provide on-call services. The evaluation panel recommended four out of the five consultants who submitted bids, including two existing consultants (4Leaf Inc., and Kutzmann and Associates, Inc.), and two new consultants (SAFEbuilt, and Shums Coda Associates). The selection was based on the strength of proposal, experience with the work required, understanding of Palo Alto and State Code, ability to provide quality control checks, qualified staff, customer service, and total cost to the City. Staff issued a Notice of Award on April 21, 2016. The negotiated contracts are included as an attachment to this report. Total recommended capacity for all four contracts over three years is $7,700,000. This level of contract capacity is necessary in part to meet the unique requirements associated with the construction of 180 homes for Stanford faculty, per the 2005 Mayfield Development Agreement between the City of Palo Alto and Stanford University. This project will require dedicated full-time inspection services. In addition, the recommended contract capacity will allow the department to adjust staffing as necessary to maintain an City of Palo Alto Page 3 Insurance Services Office (ISO) level 1 rating (the highest), which requires a level of staffing sufficient to provide high quality and timely work. Overall, the approximate $2.2-$2.4 million expended annually on these services equates to as many as 11-12 full-time positions that would otherwise be subject to wide fluctuations in workload and needed skills. Since its inception as a separate department, Development Services has closely monitored workload and demand to ensure that full-time and contract staffing levels are appropriately balanced and the department re-evaluates contract needs annually. As part of the Fiscal Year 2016 budget process, the department converted a vacant position to 1.0 FTE inspector, resulting in 4 full-time inspectors and an entirely contracted Plan Check division. On average the department utilizes 18 contractors at any one time, which fluctuates depending on supply of contractors with required expertise and demand of work. Resource Impact Fiscal Year 2016 contracts are budgeted in the Development Services department. For Fiscal Year 2017, funding for these contracts is subject to the City Council approval of the Fiscal Year 2017 budget. Policy Implications Approval of these contract extensions and amendments will allow Development Services to continue meeting service delivery goals established as part of the Development Center Blueprint initiative. Environmental Review Approval of these contracts is not a project under the California Environmental Quality Act (CEQA) and therefore no environmental review is required. Attachments:  C17162951 4Leaf, Inc. (PDF)  C16164002 Kutzmann and Associates, Inc. (PDF)  C16164004 SAFEbuilt (PDF)  C16164003 Shums Coda Associates (PDF) Professional Services Rev. April 27, 2016 1 CITY OF PALO ALTO CONTRACT NO. C17162951 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND 4LEAF FOR PROFESSIONAL SERVICES This Agreement is entered into on this 1 day of July, 2016, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and 4LEAF, a California Corporation, located at 2110 Rheem Drive, Ste. A, Pleasanton, California, 94588, Telephone (925)462-5959 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to solicit On-Call Permit Processing, Building Plan Check, and Building Inspection Services ("Project") and desires to engage a consultant to provide On-Call services in connection with the Project ("Services"). B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. On-Call Provision Services will be authorized by CITY, as needed, with a Task Order assigned and approved by CITY’s Project Manager. Each Task Order shall be in substantially the same form as Exhibit A- 1. Each Task Order shall designate a CITY Project Manager and shall contain a specific scope of work, a specific schedule of performance and a specific compensation amount. The total price of all Task Orders issued under this Agreement shall not exceed the amount of Compensation set forth in Section 4 of this Agreement. CONSULTANT shall only be compensated for work performed under an authorized Task Order and CITY may elect, but is not required, to authorize work up to the maximum compensation amount set forth in Section 4. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 2 SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through June 30, 2019 unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount; provided however CONSULTANT acknowledges that the compensation paid to it likely will be less than $7,700,000.00, as CITY has appropriated that amount to payments to be made under four contracts, of which this Agreement is one. The four contracts shall be administered by Development Services to ensure that the total aggregate of compensation paid for these four contracts will not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). The applicable rates and schedule of payment are set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C- 1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 3 represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or similar circumstances. SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services. SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions. SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY. SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY. SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the city manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any assignment made without the approval of the city manager will be void. SECTION 12. SUBCONTRACTING. CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of the city manager or designee. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 4 CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Craig Tole as the Project Director to have overall supervisory responsibility for the performance, progress, and execution of the Services. In addition, CONSULTANT staff shall work under the supervision of a contract lead (“Lead”), who shall act as a liaison between CONSULTANT staff and CITY staff and shall represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the project director, Lead, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY's project manager. CONSULTANT, at CITY's request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property. The City's project manager is Peter Pirnejad, Development Services Department Palo Alto, CA 94303, Telephone (650)329-2349, Email peter.pirnejad@cityofpaloalto.org. The project manager will be CONSULTANT's point of contact with respect to performance, progress and execution of the Services. The CITY may designate an alternate project manager from time to time. SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY. 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 5 including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. 16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party. 16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 6 18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY. 19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303 DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 7 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California. 21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements: (a) All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post- DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 8 consumer material and printed with vegetable based inks. (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE. CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code section 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060. SECTION 25. NON-APPROPRIATION 25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS 26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7 if the contract is not a public works contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000. SECTION 27. MISCELLANEOUS PROVISIONS. 27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 9 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties. 27.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 27.7. All exhibits referred to in this Agreement and any addenda, appendices, attachments, and schedules to this Agreement which, from time to time, may be referred to in any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT’s proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City’s express written consent. 27.10 All unchecked boxes do not apply to this agreement. 27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 10 IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO APPROVED AS TO FORM: 4LEAF Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER (for on-call contracts only) EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 President Professional Services Rev. April 27, 2016 11 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT shall provide professional services consisting of Permit Processing, Building Plan Check, Building Inspection services on an as-needed (on-call) basis. CONSULTANT staff shall work under the supervision of a contract lead (“Lead”), as assigned by CONSULTANT in consultation with the Development Services Director or designee. CONSULTANT Lead shall be responsible to act as a project manager and liaison between CONSULTANT staff and CITY staff. When requested to furnish staff, CONSULTANT shall provide resumes (including licenses and other credentials) of all individuals who shall be available to perform requested services. The City retains the right to reject any or all of CONSULTANT’s staff. CONSULTANT shall be responsible for providing CONSULTANT’s staff with equipment necessary to perform the services requested by CITY, except that CITY will provide use of a computer and/or iPad capable of accessing the CITY’s network and use of a CITY landline phone. CONSULTANT shall ensure, at its sole expense that the CONSULTANT’s staff maintain certifications required to perform the services requested by CITY. Training is the responsibility of the CONSULTANT where staff must maintain training and certifications as required by State Regulations and consistent with ISO-level 1 requirements, and training on the City’s local amendments to State codes. CONSULTANT is further responsible for providing IT security, ethics, and harassment training that complies with CITY standards. CONSULTANT will not charge CITY for training, time in training, or any expenses related to training. CONSULTANT shall make contract personnel and resources available for emergency response at the same hourly rates and conditions specified in this Agreement. CONSULTANT shall provide personnel capable of reviewing and providing recommendations to written City inspection guidelines. Permit Processing Services CONSULTANT shall be responsible for providing permit-technician, clerical and/or administrative services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform any combination of the following functions: Enter permit and related data into the Accela permit tracking system; research, compile and prepare various limited reports and presentation graphics; assist the general public at the front counter or by phone/e-mail regarding building, planning, engineering and fire permit requirements, application and permit fees, application filing procedures and processing, and permit status; accept permit and related applications and collect fees; screen plans and application materials for completeness and for conformance with City ordinances, standards, policies and guidelines; review application materials for compliance with conditions of project DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 12 approval; route plans to other city departments/divisions for review; approve and issue minor permits; research and respond to public inquiries; build and maintain positive working relationships with co-workers, City staff and the public using principles of good customer service; and perform related duties as assigned. Building Plan Check Services CONSULTANT shall be responsible for providing building plan check services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Initial plan review of project plans and other related documents submitted in conjunction with applications for Building Permits to determine compliance with the adopted uniform codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation and deferred submittal items. 2. Provide the applicant's designee and the City, a typed list of items needing clarification or change to achieve conformance with the above regulations. 3. Maintain sufficient communication with the applicant's designee(s), either by telephone/e- mail, mail or meeting in CONSULTANT'S office and perform all necessary plan rechecks to achieve conformance to the regulations. 4. Perform plan reviews of revisions to plans that have previously been approved for permit issuance. 5. Provide CONSULTANT Lead with periodic plan review status reports for all projects. Building Inspection Services CONSULTANT shall be responsible for providing building inspection services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Perform all requested inspections and re-inspections for Building Permits to determine compliance with the adopted codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation. 2. Coordinate all inspection and re-inspection requests. 3. Enter all inspection records into the Accela permit tracking system. Maintain all inspection records for all assigned projects as determined necessary by the CITY. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 13 EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER Consultant hereby agrees to perform the work detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into the Agreement by this reference. The Consultant shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below. CONTRACT NO. ISSUE DATE Purchase Requisition No. 1A. MASTER AGREEMENT NUMBER 1B. TASK ORDER NO. 2. CONSULTANT 3. PERIOD OF PERFORMANCE: START: COMPLETION: 4 TOTAL TASK ORDER PRICE: $__________________ BALANCE REMAINING IN MASTER AGREEMENT $__________________________________ 5. BUDGET CODE: _______________ COST CENTER________________COST ELEMENT______________WBS/CIP___ _______PHASE___ 6. CITY PROJECT MANAGER’S NAME/DEPARTMENT_______________________________________ 7. DESCRIPTION OF SCOPE OF SERVICES MUST INCLUDE:  WORK TO BE PERFORMED  SCHEDULE OF WORK  BASIS FOR PAYMENT & FEE SCHEDULE  DELIVERABLES  REIMBURSABLES (with “not to exceed” cost) 8. ATTACHMENTS: A: Scope of Services B: __________________________________ ----------------------------------------------------------------------------------------------------------------------------------- I hereby authorize the performance of I hereby acknowledge receipt and acceptance the work described above in this Task Order. of this Task Order and warrant that I have authority to sign on behalf of Consultant. APPROVED: APPROVED: CITY OF PALO ALTO COMPANY NAME: ______________________ BY:__________________________________ BY:____________________________________ Name ________________________________ Name __________________________________ Title_________________________________ Title___________________________________ Date _________________________________ Date ___________________________________ DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 14 EXHIBIT “B” SCHEDULE OF PERFORMANCE (Not Applicable) DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 15 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services, additional services, and reimbursable expenses shall not exceed the amount(s) stated in Section 4 of this Agreement. CONSULTANT agrees to complete all Services and Additional Services, including reimbursable expenses, within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY. REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: a. Mileage, driven during the course of Palo Alto business will be charged at the IRS Rate + 20% All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $100.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 16 EXHIBIT “C-1” SCHEDULE OF RATES Additional Building Department Services On‐Site Project Manager ........................................................................................$115/hour Senior Combination Building Inspector .................................................................$105/hour Commercial Building Inspector ..............................................................................$97/hour Residential Building Inspector ...............................................................................$87/hour Code Enforcement ..................................................................................................$95/hour On‐Site Plan Review Engineer.................................................................................$125/hour On‐Site Non Structural Plans Examiner ..................................................................$100/hour Permit Technician ...................................................................................................$60/hour On‐site Project Coordinator....................................................................................$70/hour Urban Forestry Technician......................................................................................$55/hour Inspector of Record (including DSA or OSHPD) ......................................................$130/hour Public Works Inspector ...........................................................................................$140/hour Temporary Building Official ....................................................................................$135/hour Deputy Building Official ..........................................................................................$120/hour CASp Inspection ......................................................................................................$180/hour Off‐Site Project Manager ........................................................................................$160/hour Principal‐in‐charge..................................................................................................$195/hour Hourly overtime charge per inspector....................................................................1.5 x hourly rate Mileage (for inspections performed within the City) .............................................IRS Rate + 20% After the first year of service, CONSULTANT may increase the rates annually. Increases may not exceed 3% per year. Increases will require prior CITY approval.  Work is subject to 4‐hour minimum charges unless stated otherwise. Services billed in 4‐ hour increments.  Overtime and Premium time will be charged as follows: Plan Check Service Fee for 1st Review and subsequent rechecks Hourly rate for onsite and/or greater than 3 reviews offsite (with authorization from Director): Life Health Safety, Structural, ADA Requirements and Title 24 Energy Requirements Plan Checks 65% of City fee $125/hour structural $100/hour non‐structural Plumbing/ Mechanical/Electrical Only Plan Checks 40% of City fee $100/hour non‐structural Structural Only Plan Checks 40% of City fee $125/hour structural DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 17 - Regular time (work begun after 5AM or before 4PM) 1 x hourly rate - Night Time (work begun after 4PM or before 5AM) 1.125 x hourly rate - Overtime (over 8 hour M‐F or Saturdays) 1.5 x hourly rate - Overtime (over 8 hours Sat or 1st 8 hour Sun) 2 x hourly rate - Overtime (over 8 hours Sun or Holidays) 3 x hourly rate  Overtime will only be billed with prior authorization of the Chief Building Official, Public Works Director, or other responsible designated City personnel.  Rates are inclusive of City required training obligations. CONSULTANT will pay the time and materials of our scheduled personnel up to 40 hours per prorated year. No credits will be provided. It is assumed all training is available locally.  All training requires written approval from Off‐Site Project Manager.  All work with less than 8 hours rest between shifts will be charged the appropriate overtime rate.  CONSULTANT will provide a company issued vehicle, insurance, and gas card to its inspection personnel on‐site.  CONSULTANT will purchase parking passes one‐time annually per assigned staff member. This assumes passes are available at $500 or less per pass. Should this rate increase, CONSULTANT reserves the right to negotiate the hourly rate to reflect the increase. It also assumes parking passes are transferable.  Mileage, driven during the course of Palo Alto business will be charged at cost plus 20%. DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 18 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRE D TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. B. CROSS LIABILITY DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 19 THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE EMAILED TO: InsuranceCerts@CityofPaloAlto.org PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: F71D465C-65AE-47B3-8B7C-0A3B81CF8205 Professional Services Rev. April 27, 2016 1 CITY OF PALO ALTO CONTRACT NO. C16164002 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND KUTZMANN & ASSOCIATES, INC. FOR PROFESSIONAL SERVICES This Agreement is entered into on this 1st day of July, 2016, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and KUTZMANN & ASSOCIATES, INC. a California corporation, located at 39355 California Street, Ste. 200, Fremont, California, 94538, Telephone (510)796-3003 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to solicit On-Call Permit Processing, Building Plan Check, and Building Inspection Services ("Project") and desires to engage a consultant to provide On-Call services in connection with the Project ("Services"). B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. Optional On-Call Provision Services will be authorized by CITY, as needed, with a Task Order assigned and approved by CITY’s Project Manager. Each Task Order shall be in substantially the same form as Exhibit A- 1. Each Task Order shall designate a CITY Project Manager and shall contain a specific scope of work, a specific schedule of performance and a specific compensation amount. The total price of all Task Orders issued under this Agreement shall not exceed the amount of Compensation set forth in Section 4 of this Agreement. CONSULTANT shall only be compensated for work performed under an authorized Task Order and CITY may elect, but is not required, to authorize work up to the maximum compensation amount set forth in Section 4. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 2 SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through June 30, 2019 unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount; provided however CONSULTANT acknowledges that the compensation paid to it likely will be less than $7,700,000.00, as CITY has appropriated that amount to payments to be made under four contracts, of which this Agreement is one. The four contracts shall be administered by Development Services to ensure that the total aggregate of compensation paid for these four contracts will not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). The applicable rates and schedule of payment are set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C- 1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 3 represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or similar circumstances. SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services. SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions. SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY. SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY. SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the city manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any assignment made without the approval of the city manager will be void. SECTION 12. SUBCONTRACTING. CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of the city manager or designee. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 4 CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Mike Baird as to have supervisory responsibility for the performance, progress, and execution of the Services and to represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the project director, project coordinator, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s project manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property. The City's project manager is Peter Pirnejad, Development Services Department Palo Alto, CA 94303, Telephone (650)329-2349, Email peter.pirnejad@cityofpaloalto.org. The project manager will be CONSULTANT's point of contact with respect to performance, progress and execution of the Services. The CITY may designate an alternate project manager from time to time. SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY. 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorneys fees, experts fees, court DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 5 costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. 16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party. 16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement. 18.4. The procuring of such required policy or policies of insurance will not be DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 6 construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY. 19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303 DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 7 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California. 21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements: (a) All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post- consumer material and printed with vegetable based inks. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 8 (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE. CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code section 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060. SECTION 25. NON-APPROPRIATION 25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS 26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7 if the contract is not a public works contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000. SECTION 27. MISCELLANEOUS PROVISIONS. 27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 9 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties. 27.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 27.7. All exhibits referred to in this Agreement and any addenda, appendices, attachments, and schedules to this Agreement which, from time to time, may be referred to in any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT’s proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City’s express written consent. 27.10 All unchecked boxes do not apply to this agreement. 27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 10 IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO APPROVED AS TO FORM: KUTZMANN & ASSOCIATES, INC. Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER (for on-call contracts only) EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 President Professional Services Rev. April 27, 2016 11 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT shall provide professional services consisting of Permit Processing, Building Plan Check, Building Inspection services on an as-needed (on-call) basis. CONSULTANT staff shall work under the supervision of a contract lead (“Lead”), as assigned by CONSULTANT in consultation with the Development Services Director or designee. CONSULTANT Lead shall be responsible to act as a project manager and liaison between CONSULTANT staff and CITY staff. When requested to furnish staff, CONSULTANT shall provide resumes (including licenses and other credentials) of all individuals who shall be available to perform requested services. The City retains the right to reject any or all of CONSULTANT’s staff. CONSULTANT shall be responsible for providing CONSULTANT’s staff with equipment necessary to perform the services requested by CITY, except that CITY will provide use of a computer and/or iPad capable of accessing the CITY’s network and use of a CITY landline phone. CONSULTANT shall ensure, at its sole expense that the CONSULTANT’s staff maintain certifications required to perform the services requested by CITY. Training is the responsibility of the CONSULTANT where staff must maintain training and certifications as required by State Regulations and consistent with ISO-level 1 requirements, and training on the City’s local amendments to State codes. CONSULTANT is further responsible for providing IT security, ethics, and harassment training that complies with CITY standard. CONSULTANT will not charge CITY for training, time in training, or any expenses related to training. CONSULTANT shall make contract personnel and resources available for emergency response at the same hourly rates and conditions specified in this Agreement. CONSULTANT shall provide personnel capable of reviewing and providing recommendations to written City inspection guidelines. Permit Processing Services CONSULTANT shall be responsible for providing permit-technician, clerical and/or administrative services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform any combination of the following functions: Enter permit and related data into the Accela permit tracking system; research, compile and prepare various limited reports and presentation graphics; assist the general public at the front counter or by phone/e-mail regarding building, planning, engineering and fire permit requirements, application and permit fees, application filing procedures and processing, and permit status; accept permit and related applications and collect fees; screen plans and application materials for completeness and for conformance with City ordinances, standards, policies and guidelines; review application materials for compliance with conditions of project DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 12 approval; route plans to other city departments/divisions for review; approve and issue minor permits; research and respond to public inquiries; build and maintain positive working relationships with co-workers, City staff and the public using principles of good customer service; and perform related duties as assigned. Building Plan Check Services CONSULTANT shall be responsible for providing building plan check services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Initial plan review of project plans and other related documents submitted in conjunction with applications for Building Permits to determine compliance with the adopted uniform codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation and deferred submittal items. 2. Provide the applicant's designee and the City, a typed list of items needing clarification or change to achieve conformance with the above regulations. 3. Maintain sufficient communication with the applicant's designee(s), either by telephone/e- mail, mail or meeting in CONSULTANT'S office and perform all necessary plan rechecks to achieve conformance to the regulations. 4. Perform plan reviews of revisions to plans that have previously been approved for permit issuance. 5. Provide CONSULTANT Lead with periodic plan review status reports for all projects. Building Inspection Services CONSULTANT shall be responsible for providing building inspection services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Perform all requested inspections and re-inspections for Building Permits to determine compliance with the adopted codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation. 2. Coordinate all inspection and re-inspection requests. 3. Enter all inspection records into the Accela permit tracking system. Maintain all inspection records for all assigned projects as determined necessary by the CITY. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 13 EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER Consultant hereby agrees to perform the work detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into the Agreement by this reference. The Consultant shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below. CONTRACT NO. ISSUE DATE Purchase Requisition No. 1A. MASTER AGREEMENT NUMBER 1B. TASK ORDER NO. 2. CONSULTANT 3. PERIOD OF PERFORMANCE: START: COMPLETION: 4 TOTAL TASK ORDER PRICE: $__________________ BALANCE REMAINING IN MASTER AGREEMENT $__________________________________ 5. BUDGET CODE: _______________ COST CENTER_____________COST ELEMENT_________ WBS/CIP___ _______PHASE___ 6. CITY PROJECT MANAGER’S NAME/DEPARTMENT___________________________________ 7. DESCRIPTION OF SCOPE OF SERVICES MUST INCLUDE:  WORK TO BE PERFORMED  SCHEDULE OF WORK  BASIS FOR PAYMENT & FEE SCHEDULE  DELIVERABLES  REIMBURSABLES (with “not to exceed” cost) 8. ATTACHMENTS: A: Scope of Services B: __________________________________ ----------------------------------------------------------------------------------------------------------------------------------- I hereby authorize the performance of I hereby acknowledge receipt and acceptance the work described above in this Task Order. of this Task Order and warrant that I have authority to sign on behalf of Consultant. APPROVED: APPROVED: CITY OF PALO ALTO COMPANY NAME: ______________________ BY:__________________________________ BY:____________________________________ Name ________________________________ Name __________________________________ Title_________________________________ Title___________________________________ Date _________________________________ Date ___________________________________ DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 14 EXHIBIT “B” SCHEDULE OF PERFORMANCE (Not Applicable) DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 15 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services, additional services, and reimbursable expenses shall not exceed the amount(s) stated in Section 4 of this Agreement. CONSULTANT agrees to complete all Services and Additional Services, including reimbursable expenses, within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY. REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: a. Printing and copying costs are based on fifteen cents ($0.20) per sheet (8 ½ x 11). b. Mileage, driven during the course of Palo Alto business will be charged at .48 cents per mile All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $100.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 16 EXHIBIT “C-1” SCHEDULE OF RATES Permit Processing: Permit Processing, Building Technician Hourly rates to be negotiated with the City based on the individuals’ qualifications, experience and additional special knowledge and skills required by the City. Clerical Staff For general clerical duties that do not involve permit processing: $50.00 per hour Method of Invoicing Permit processing personnel work hours are billed on bi-monthly basis at the end of each CONSULTANT’S pay period. Plan Check: Full Plan Checks: Standard fee for a full plan check (including structural and non-structural, disabled access, energy conservation, mechanical, electrical and plumbing) is based on a percentage of the Building Division’s plan check fee. Additional rechecks are billed on a time & materials basis. This fee includes the initial review and the two rechecks. 65 percent Structural Only Plan Checks CONSULTANT’S fee for a structural only plan check is based on a percentage fo the Building Division’s plan check fee. This fee includes the initial review and the two rechecks. 45 percent Elective (3rd Party) Plan Check There is no cost to the City of Palo Alto for this service. Billing and payments are handled directly between CONSULTANT and the permit applicants. Expedited Plan Check Fees Expedited fees are typically 1.5 times our standard fee but may be negotiable dependent on the size and complexity of the project. Hourly Rates Additional rechecks, non-standard plan checks (such as for revisions to existing permits) as well as consultation and in-house plan checking services, are billed on a time & materials basis. Current rate: $100 per hour Method of Invoicing Our plan check services are invoiced monthly and are due within 30 days unless other arrangements are made. Invoices will be fully itemized and provide sufficient information for approving payment and audit purposes. Plan check jobs are invoiced after the initial plan check has been completed. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 17 Building Inspection: Building Inspector $100.00 per hour New Inspection Personnel Hourly rates to be negotiated with the City based on individuals’ qualifications, experience and any additional special knowledge or skills required by the City. Method of Invoicing Building inspector work hours are billed on bi-monthly basis at the end of each CONSULTANT’S pay period. Fire Prevention: Senior Fire Inspector/Plan Checker $125.00 per hour Fire Inspector/Plan Checker $99.00 per hour Miscellaneous Charges: Note: Personnel charges are not billed for general secretarial services, office management, accounting and maintenance; these items are included in overhead. Printing and copying costs are based on fifteen cents ($0.20) per sheet (8 ½ x 11). Mileage rate is $0.48 per mile. Any other outside services are billed based on the actual cost plus ten percent (10%). Overtime charges are 1.5 times the regular rate. DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 18 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRE D TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. B. CROSS LIABILITY DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 19 THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE EMAILED TO: InsuranceCerts@CityofPaloAlto.org PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: 773E1B38-A94C-4C31-BBFC-53CAFE08DBC4 Professional Services Rev. April 27, 2016 1 CITY OF PALO ALTO CONTRACT NO. C16164004 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND SAFEBUILT, LLC FOR PROFESSIONAL SERVICES This Agreement is entered into on this 1st day of July, 2016, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SAFEBUILT, LLC, a Limited Liability Company, located at 3755 Precision Drive, Suite 140, Loveland, Colorado, 80538 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to solicit On-Call Permit Processing, Building Plan Check, and Building Inspection Services ("Project") and desires to engage a consultant to provide On-Call services in connection with the Project ("Services"). B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. Optional On-Call Provision Services will be authorized by CITY, as needed, with a Task Order assigned and approved by CITY’s Project Manager. Each Task Order shall be in substantially the same form as Exhibit A- 1. Each Task Order shall designate a CITY Project Manager and shall contain a specific scope of work, a specific schedule of performance and a specific compensation amount. The total price of all Task Orders issued under this Agreement shall not exceed the amount of Compensation set forth in Section 4 of this Agreement. CONSULTANT shall only be compensated for work performed under an authorized Task Order and CITY may elect, but is not required, to authorize work up to the maximum compensation amount set forth in Section 4. DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 2 SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through June 30, 2019 unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount; provided however CONSULTANT acknowledges that the compensation paid to it likely will be less than $7,700,000.00, as CITY has appropriated that amount to payments to be made under four contracts, of which this Agreement is one. The four contracts shall be administered by Development Services to ensure that the total aggregate of compensation paid for these four contracts will not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). The applicable rates and schedule of payment are set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C- 1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 3 represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or similar circumstances. SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services. SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions. SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY. SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY. SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the city manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any assignment made without the approval of the city manager will be void. SECTION 12. SUBCONTRACTING. CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of the city manager or designee. DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 4 CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Matt Royer as the Program Manger to have supervisory responsibility for the performance, progress, and execution of the Services and Eric Pendley & Pamela Muse as the project managers to represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the project director, project coordinator, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s project manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property. The City's project manager is Peter Pirnejad, Development Services Department Palo Alto, CA 94303, Telephone (650)329-2349, Email peter.pirnejad@cityofpaloalto.org. The project manager will be CONSULTANT's point of contact with respect to performance, progress and execution of the Services. The CITY may designate an alternate project manager from time to time. SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY. 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 5 including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. 16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party. 16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement. DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 6 18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY. 19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303 DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 7 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California. 21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements: (a) All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post- DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 8 consumer material and printed with vegetable based inks. (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE. CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code section 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060. SECTION 25. NON-APPROPRIATION 25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS 26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7 if the contract is not a public works contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000. SECTION 27. MISCELLANEOUS PROVISIONS. 27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 9 State of California. 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties. 27.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 27.7. All exhibits referred to in this Agreement and any addenda, appendices, attachments, and schedules to this Agreement which, from time to time, may be referred to in any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT’s proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City’s express written consent. 27.10 All unchecked boxes do not apply to this agreement. 27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 10 IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO APPROVED AS TO FORM: SAFEBUILT, LLC Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER (for on-call contracts only) EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Chief Operating Officer Professional Services Rev. April 27, 2016 11 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT shall provide professional services consisting of Permit Processing, Building Plan Check, Building Inspection services on an as-needed (on-call) basis. CONSULTANT staff shall work under the supervision of a contract lead (“Lead”), as assigned by CONSULTANT in consultation with the Development Services Director or designee. CONSULTANT Lead shall be responsible to act as a project manager and liaison between CONSULTANT staff and CITY staff. When requested to furnish staff, CONSULTANT shall provide resumes (including licenses and other credentials) of all individuals who shall be available to perform requested services. The City retains the right to reject any or all of CONSULTANT’s staff. CONSULTANT shall be responsible for providing CONSULTANT’s staff with equipment necessary to perform the services requested by CITY, except that CITY will provide use of a computer and/or iPad capable of accessing the CITY’s network and use of a CITY landline phone. CONSULTANT shall ensure, at its sole expense that the CONSULTANT’s staff maintain certifications required to perform the services requested by CITY. Training is the responsibility of the CONSULTANT where staff must maintain training and certifications as required by State Regulations and consistent with ISO-level 1 requirements, and training on the City’s local amendments to State codes. CONSULTANT is further responsible for providing IT security, ethics, and harassment training that complies with CITY standard. CONSULTANT will not charge CITY for training, time in training, or any expenses related to training. CONSULTANT shall make contract personnel and resources available for emergency response at the same hourly rates and conditions specified in this Agreement. CONSULTANT shall provide personnel capable of reviewing and providing recommendations to written City inspection guidelines. Permit Processing Services CONSULTANT shall be responsible for providing permit-technician, clerical and/or administrative services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform any combination of the following functions: Enter permit and related data into the Accela permit tracking system; research, compile and prepare various limited reports and presentation graphics; assist the general public at the front counter or by phone/e-mail regarding building, planning, engineering and fire permit requirements, application and permit fees, application filing procedures and processing, and permit status; accept permit and related applications and collect fees; screen plans and application materials for completeness and for conformance with City ordinances, standards, policies and guidelines; review application materials for compliance with conditions of project DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 12 approval; route plans to other city departments/divisions for review; approve and issue minor permits; research and respond to public inquiries; build and maintain positive working relationships with co-workers, City staff and the public using principles of good customer service; and perform related duties as assigned. Building Plan Check Services CONSULTANT shall be responsible for providing building plan check services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Initial plan review of project plans and other related documents submitted in conjunction with applications for Building Permits to determine compliance with the adopted uniform codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation and deferred submittal items. 2. Provide the applicant's designee and the City, a typed list of items needing clarification or change to achieve conformance with the above regulations. 3. Maintain sufficient communication with the applicant's designee(s), either by telephone/e- mail, mail or meeting in CONSULTANT'S office and perform all necessary plan rechecks to achieve conformance to the regulations. 4. Perform plan reviews of revisions to plans that have previously been approved for permit issuance. 5. Provide CONSULTANT Lead with periodic plan review status reports for all projects. Building Inspection Services CONSULTANT shall be responsible for providing building inspection services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Perform all requested inspections and re-inspections for Building Permits to determine compliance with the adopted codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation. 2. Coordinate all inspection and re-inspection requests. 3. Enter all inspection records into the Accela permit tracking system. Maintain all inspection records for all assigned projects as determined necessary by the CITY. DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 13 EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER Consultant hereby agrees to perform the work detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into the Agreement by this reference. The Consultant shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below. CONTRACT NO. ISSUE DATE Purchase Requisition No. 1A. MASTER AGREEMENT NUMBER 1B. TASK ORDER NO. 2. CONSULTANT 3. PERIOD OF PERFORMANCE: START: COMPLETION: 4 TOTAL TASK ORDER PRICE: $__________________ BALANCE REMAINING IN MASTER AGREEMENT $__________________________________ 5. BUDGET CODE: _______________ COST CENTER________________COST ELEMENT______________WBS/CIP___ _______PHASE___ 6. CITY PROJECT MANAGER’S NAME/DEPARTMENT________________________________________ 7. DESCRIPTION OF SCOPE OF SERVICES MUST INCLUDE:  WORK TO BE PERFORMED  SCHEDULE OF WORK  BASIS FOR PAYMENT & FEE SCHEDULE  DELIVERABLES  REIMBURSABLES (with “not to exceed” cost) 8. ATTACHMENTS: A: Scope of Services B: __________________________________ ----------------------------------------------------------------------------------------------------------------------------------- I hereby authorize the performance of I hereby acknowledge receipt and acceptance the work described above in this Task Order. of this Task Order and warrant that I have authority to sign on behalf of Consultant. APPROVED: APPROVED: CITY OF PALO ALTO COMPANY NAME: ______________________ BY:__________________________________ BY:____________________________________ Name ________________________________ Name __________________________________ Title_________________________________ Title___________________________________ Date _________________________________ Date ___________________________________ DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 14 EXHIBIT “B” SCHEDULE OF PERFORMANCE (Not Applicable) DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 15 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services, additional services, and reimbursable expenses shall not exceed the amount(s) stated in Section 4 of this Agreement. CONSULTANT agrees to complete all Services and Additional Services, including reimbursable expenses, within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY. REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost. All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $100.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 16 EXHIBIT “C-1” SCHEDULE OF RATES CONSULTANT shall provide services to the City of Palo Alto according to the specifications, terms, conditions, and instructions listed below. CONSULTANT’S Overhead Rate is 10%. For a list of the overhead breakdown, please see the following. The fees will apply as follows: Title Duties Hourly Rate Plan Check Services Basic Plan Review and revision services for the City of Palo Alto $85 per hour Inspection Services Basic Inspection and compliancy services for the City of Palo Alto $75 per hour Building Official Building Official Plan Review and Revision, Inspection and compliancy oversight for the City of Palo Alto $142 per hour Time tracked will not include travel time. CONSULTANT’S time starts when checked in at the Building Department to receive inspections. There are no reimbursable expenses to be included. The following is a breakdown of the overhead elements CONSULTANT shall provide for the City of Palo Alto. IT Setup/Ongoing Software Set up/Ongoing Acquisition of necessary tools and materials Acela Optimization Initial & Ongoing Human Resource Team Initial & Ongoing OPERATION & MAINTENANCE Regulatory Ordinance Review & Recommendations. Initial & Ongoing Website Review & Recommendations/Modifications On Line Permitting Portal-Initial & Ongoing Application Process Strategy Development/Deployment & Customer Service Survey Development/Deployment with ongoing oversight Disaster Response Plan Review/Modification/Development (As required) TRAINING Staff Training Strategy/Development/Implementation with ongoing review and modification Homeowners, Builders, Developers (HBD) Workshop /Open House Plan and Materials Profit Salaries & Benefits ICC Certified Building Officials (Master Code Professional(MCP) Project Manager) Additional MCP resources in state and Nationally DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 17 ICC Certified Combo Plan Reviewers ICC Certified Combo Building Inspectors Certified Permit Techs If Applicable Laptops and IPad with current Codes downloaded for field review with HBD Vehicles with Fuel & Insurance DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 18 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRE D TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. B. CROSS LIABILITY DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 19 THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE EMAILED TO: InsuranceCerts@CityofPaloAlto.org PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: 5BB8FD0C-848C-4996-B7E6-1864AE13289B Professional Services Rev. April 27, 2016 1 CITY OF PALO ALTO CONTRACT NO. C16164003 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND SHUMS CODA ASSOCIATES, INC. FOR PROFESSIONAL SERVICES This Agreement is entered into on this 1ST day of July, 2016, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SHUMS CODA ASSOCIATES, INC., a California corporation, located at 5776 Stoneridge Mall Road, Suite 150, Pleasanton, California, 94588 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. A. CITY intends to solicit On-Call Permit Processing, Building Plan Check, and Building Inspection Services ("Project") and desires to engage a consultant to provide On-Call services in connection with the Project ("Services"). B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. Optional On-Call Provision Services will be authorized by CITY, as needed, with a Task Order assigned and approved by CITY’s Project Manager. Each Task Order shall be in substantially the same form as Exhibit A- 1. Each Task Order shall designate a CITY Project Manager and shall contain a specific scope of work, a specific schedule of performance and a specific compensation amount. The total price of all Task Orders issued under this Agreement shall not exceed the amount of Compensation set forth in Section 4 of this Agreement. CONSULTANT shall only be compensated for work performed under an authorized Task Order and CITY may elect, but is not required, to authorize work up to the maximum compensation amount set forth in Section 4. DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 2 SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through June 30, 2019 unless terminated earlier pursuant to Section 19 of this Agreement. SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount; provided however CONSULTANT acknowledges that the compensation paid to it likely will be less than $7,700,000.00, as CITY has appropriated that amount to payments to be made under four contracts, of which this Agreement is one. The four contracts shall be administered by Development Services to ensure that the total aggregate of compensation paid for these four contracts will not exceed Seven Million Seven Hundred Thousand Dollars ($7,700,000.00). The applicable rates and schedule of payment are set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C- 1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 3 performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or similar circumstances. SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services. SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions. SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY. SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY. SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the city manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any assignment made without the approval of the city manager will be void. SECTION 12. SUBCONTRACTING. CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of the city DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 4 manager or designee. CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign David Basinger as the Principal to have supervisory responsibility for the performance, progress, and execution of the Services and task specific staff to provide project management to represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the project director, project coordinator, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s project manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property. The City's project manager is Peter Pirnejad, Development Services Department Palo Alto, CA 94303, Telephone (650)329-2349, Email peter.pirnejad@cityofpaloalto.org. The project manager will be CONSULTANT's point of contact with respect to performance, progress and execution of the Services. The CITY may designate an alternate project manager from time to time. SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY. 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 5 agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. 16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party. 16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 6 Procurement Officer during the entire term of this Agreement. 18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY. 19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 7 Post Office Box 10250 Palo Alto, CA 94303 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California. 21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements: (a) All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 8 otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post-consumer material and printed with vegetable based inks. (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE. CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code section 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060. SECTION 25. NON-APPROPRIATION 25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS 26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7 if the contract is not a public works contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000. SECTION 27. MISCELLANEOUS PROVISIONS. 27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 9 action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California. 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties. 27.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 27.7. All exhibits referred to in this Agreement and any addenda, appendices, attachments, and schedules to this Agreement which, from time to time, may be referred to in any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT’s proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City’s express written consent. 27.10 All unchecked boxes do not apply to this agreement. 27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 10 IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO APPROVED AS TO FORM: SHUMS CODA ASSOCIATES, INC Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER (for on-call contracts only) EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Principal Professional Services Rev. April 27, 2016 11 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT shall provide professional services consisting of Permit Processing, Building Plan Check, Building Inspection services on an as-needed (on-call) basis. CONSULTANT staff shall work under the supervision of a contract lead (“Lead”), as assigned by CONSULTANT in consultation with the Development Services Director or designee. CONSULTANT Lead shall be responsible to act as a project manager and liaison between CONSULTANT staff and CITY staff. When requested to furnish staff, CONSULTANT shall provide resumes (including licenses and other credentials) of all individuals who shall be available to perform requested services. The City retains the right to reject any or all of CONSULTANT’s staff. CONSULTANT shall be responsible for providing CONSULTANT’s staff with equipment necessary to perform the services requested by CITY, except that CITY will provide use of a computer and/or iPad capable of accessing the CITY’s network and use of a CITY landline phone. CONSULTANT shall ensure, at its sole expense that the CONSULTANT’s staff maintain certifications required to perform the services requested by CITY. Training is the responsibility of the CONSULTANT where staff must maintain training and certifications as required by State Regulations and consistent with ISO-level 1 requirements, and training on the City’s local amendments to State codes. CONSULTANT is further responsible for providing IT security, ethics, and harassment training that complies with CITY standard. CONSULTANT will not charge CITY for training, time in training, or any expenses related to training. CONSULTANT shall make contract personnel and resources available for emergency response at the same hourly rates and conditions specified in this Agreement. CONSULTANT shall provide personnel capable of reviewing and providing recommendations to written City inspection guidelines. Permit Processing Services CONSULTANT shall be responsible for providing permit-technician, clerical and/or administrative services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform any combination of the following functions: Enter permit and related data into the Accela permit tracking system; research, compile and prepare various limited reports and presentation graphics; assist the general public at the front counter or by phone/e-mail regarding building, planning, engineering and fire permit requirements, application and permit fees, application filing procedures and processing, and permit status; accept permit and related applications and collect fees; screen plans and application materials for completeness and for conformance with City ordinances, standards, policies and guidelines; review application materials for compliance with conditions of project DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 12 approval; route plans to other city departments/divisions for review; approve and issue minor permits; research and respond to public inquiries; build and maintain positive working relationships with co-workers, City staff and the public using principles of good customer service; and perform related duties as assigned. Building Plan Check Services CONSULTANT shall be responsible for providing building plan check services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Initial plan review of project plans and other related documents submitted in conjunction with applications for Building Permits to determine compliance with the adopted uniform codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation and deferred submittal items. 2. Provide the applicant's designee and the City, a typed list of items needing clarification or change to achieve conformance with the above regulations. 3. Maintain sufficient communication with the applicant's designee(s), either by telephone/e- mail, mail or meeting in CONSULTANT'S office and perform all necessary plan rechecks to achieve conformance to the regulations. 4. Perform plan reviews of revisions to plans that have previously been approved for permit issuance. 5. Provide CONSULTANT Lead with periodic plan review status reports for all projects. Building Inspection Services CONSULTANT shall be responsible for providing building inspection services as requested by the City on an as needed basis with the knowledge, skills and abilities to perform the following services: 1. Perform all requested inspections and re-inspections for Building Permits to determine compliance with the adopted codes, applicable laws, regulations, local ordinances, and City policies. The services shall include, but not be limited to, review of the following, as applicable to each project: Architectural, Structural, Electrical, Mechanical and Plumbing plans, structural calculations, accessibility compliance, fire and life safety components, geotechnical reports related to structure design, Green Building and Energy Code compliance documentation. 2. Coordinate all inspection and re-inspection requests. 3. Enter all inspection records into the Accela permit tracking system. Maintain all inspection records for all assigned projects as determined necessary by the CITY. DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 13 EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER Consultant hereby agrees to perform the work detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into the Agreement by this reference. The Consultant shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below. CONTRACT NO. ISSUE DATE Purchase Requisition No. 1A. MASTER AGREEMENT NUMBER 1B. TASK ORDER NO. 2. CONSULTANT 3. PERIOD OF PERFORMANCE: START: COMPLETION: 4 TOTAL TASK ORDER PRICE: $__________________ BALANCE REMAINING IN MASTER AGREEMENT $________________________ 5. BUDGET CODE: ____________ COST CENTER________ COST ELEMENT____________WBS/CIP___ _______PHASE___ 6. CITY PROJECT MANAGER’S NAME/DEPARTMENT_______________________________________ 7. DESCRIPTION OF SCOPE OF SERVICES MUST INCLUDE:  WORK TO BE PERFORMED  SCHEDULE OF WORK  BASIS FOR PAYMENT & FEE SCHEDULE  DELIVERABLES  REIMBURSABLES (with “not to exceed” cost) 8. ATTACHMENTS: A: Scope of Services B: __________________________________ ----------------------------------------------------------------------------------------------------------------------------------- I hereby authorize the performance of I hereby acknowledge receipt a acceptance the work described above in this Task Order. of this Task Order and warrant that I have authority to sign on behalf of Consultant. APPROVED: APPROVED: CITY OF PALO ALTO COMPANY NAME: ______________________ BY:__________________________________ BY:____________________________________ Name ________________________________ Name __________________________________ Title_________________________________ Title___________________________________ Date _________________________________ Date ___________________________________ DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 14 EXHIBIT “B” SCHEDULE OF PERFORMANCE (Not Applicable) DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 15 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services, additional services, and reimbursable expenses shall not exceed the amount(s) stated in Section 4 of this Agreement. CONSULTANT agrees to complete all Services and Additional Services, including reimbursable expenses, within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY. REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: A. Mileage, driven during the course of Palo Alto business will be charged at the IRS Rate B. Printing, graphics, photography, and reproduction C. Rental or purchase of special equipment and materials All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $100.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 16 EXHIBIT “C-1” SCHEDULE OF RATES Building Plan & Check Fees Fees for comprehensive plan reviews, performed at CONSULTANT’S offices, will be equal to Sixty- Five percent (65%) of the plan review fees as calculated per the jurisdiction. The City will provide CONSULTANT with jurisdiction plan review fees (project-by-project) for use in calculating CONSULTANT’S fees. In return, invoicing will be done on a monthly basis with detailed description of each project. The above fee covers all services associated with the typical plan review, including:  Pick – up and delivery of design documents to the jurisdiction.  First, second and quick third reviews to approve projects. Extensive plan reviews (longer third reviews or more) that may be required to be charged on an hourly rate shown below. Further, smaller projects that take one or more reviews may also be charged at an hourly rate when agreed upon with the Chief Building Official. Pre-application, pre-construction, or additional meeting attendance that is necessary for unusual or complex projects shall also be charged at the same hourly rate schedule. When expedited plan reviews are requested, we will perform the plan review as quickly as possible at no additional charge. Inspection invoicing will done on a monthly basis on the same cycle as the building plan review based on hourly rates described below. If plan review staff is required to provide support in City offices they will be charged hourly per the schedule below. Hourly Rates The scope of inspection services to be provided will be defined uniquely for each project or as determined mutually by CONSULTANT’S project manager and the Chief Building Official. Inspector(s) provided to the City will report directly to the Chief Building Official or other person designated by the City for all project-related work. Fees for inspection services shall be billed at an hourly rate. Title Duties Hourly Rates In-House/Counter Plan Review Engineer/Architect  Plan reviews to cover one or more of the following disciplines - Building: architectural (fire/life safety), structural, mechanical, electrical, plumbing, accessibility, green building, energy conservation, and geotechnical in conformance with the 2013 (or most current) California Building Codes (all as modified or amended by the jurisdiction) $110 Senior Plan Review Engineer/Architect $120 Plan Review Engineer/Architect $110 DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 17 Senior Plans Examiner - Fire: fire/life safety, fire suppression, and hazardous materials to the 2013 (or most current) California Building Codes (all as modified or amended by the jurisdiction) - Public Works: grading, drainage, geotechnical, onsite\right-of-way improvements, construction management and inspection for public infrastructure projects, and FEMA Flood Insurance Program.  Create typed lists of comments which refer to specific details and drawings, and reference applicable code sections.  Correspond with applicant/designers directly to resolve issues $100 Plans Examiner $90 Title Duties Hourly Rate Permit Technician  Assists with permit applicants and others by phone and in person,  Calculates and processes permit fees,  Reviews, logs, coordinates and routes various plans and permits,  Processes and reviews building permit applications, documents and plan submittals to assure accuracy and compliance with the jurisdiction  Provides information to the public relating to the status of projects and permits. $55 Clerical Support  Greets public and responds to inquiries  Performs administrative support in answering telephones, providing customer assistance, data processing, and record keeping $45 Senior Inspector (Combination Certified)  Review of all approved plans, specifications and documents,  Review and respond to all inspection requests and reports,  Attend mandatory meetings, including safety $ 90-$95 Inspector II $ 80-$90 DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 18 Inspector I training and project management,  Perform inspections for compliance to applicable State of California Building, Mechanical, Electrical, Plumbing, Fire codes, as well as State energy efficiency and accessibility standards as amended by the jurisdiction. Our services may include a State of California registered Fire Protection Engineer, to complete all Fire Code inspection services requested by the jurisdiction. $70-80 CASp Specialist  Administers and coordinates a program to implement legislative requirements on access to buildings for people with disabilities.  Monitors plan review and inspection activities and procedures to ensure conformance with legal requirements  Monitors changes and additions to governing codes and regulations and develops or modifies compliance procedures. $450 Overtime will be not be charged for any plan review services billed at the hourly rate, while inspection services will be charged at 150% of the standard hourly rates, with prior authorization from the client. Reimbursable expenses shall include, but not be limited to, the following: Mileage Per current IRS rate Other Direct Project Expenses (at cost plus 15%) including:  Printing, graphics, photography, and reproduction  Rental or purchase of special equipment and materials DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 19 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRE D TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 20 B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE EMAILED TO: InsuranceCerts@CityofPaloAlto.org PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 21 EXHIBIT “E” DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS This Exhibit shall apply only to a contract for public works construction, alteration, demolition, repair or maintenance work, CITY will not accept a bid proposal from or enter into this Agreement with CONSULTANT without proof that CONSULTANT and its listed subcontractors are registered with the California Department of Industrial Relations (“DIR”) to perform public work, subject to limited exceptions. City requires CONSULTANT and its listed subcontractors to comply with the requirements of SB 854. CITY provides notice to CONSULTANT of the requirements of California Labor Code section 1771.1(a), which reads: “A contractor or subcontractor shall not be qualified to bid on, be listed in a bid proposal, subject to the requirements of Section 4104 of the Public Contract Code, or engage in the performance of any contract for public work, as defined in this chapter, unless currently registered and qualified to perform public work pursuant to Section 1725.5. It is not a violation of this section for an unregistered contractor to submit a bid that is authorized by Section 7029.1 of the Business and Professions Code or Section 10164 or 20103.5 of the Public Contract Code, provided the contractor is registered to perform public work pursuant to Section 1725.5 at the time the contract is awarded.” CITY gives notice to CONSULTANT and its listed subcontractors that CONSULTANT is required to post all job site notices prescribed by law or regulation and CONSULTANT is subject to SB 854-compliance monitoring and enforcement by DIR. CITY requires CONSULTANT and its listed subcontractors to comply with the requirements of Labor Code section 1776, including: Keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by, respectively, CONSULTANT and its listed subcontractors, in connection with the Project. The payroll records shall be verified as true and correct and shall be certified and made available for inspection at all reasonable hours at the principal office of CONSULTANT and its listed subcontractors, respectively. At the request of CITY, acting by its project manager, CONSULTANT and its listed subcontractors shall make the certified payroll records available for inspection or furnished upon request to the project manager within ten (10) days of receipt of CITY’s request. CITY requests CONSULTANT and its listed subcontractors to submit the certified payroll records to the project manager at the end of each week during the Project. If the certified payroll records are not produced to the project manager within the 10-day period, DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 Professional Services Rev. April 27, 2016 22 then CONSULTANT and its listed subcontractors shall be subject to a penalty of one hundred dollars ($100.00) per calendar day, or portion thereof, for each worker, and CITY shall withhold the sum total of penalties from the progress payment(s) then due and payable to CONSULTANT. Inform the project manager of the location of CONSULTANT’s and its listed subcontractors’ payroll records (street address, city and county) at the commencement of the Project, and also provide notice to the project manager within five (5) business days of any change of location of those payroll records. DocuSign Envelope ID: 431BB1F8-4E82-42E4-8344-919C79619750 City of Palo Alto (ID # 6671) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Council Priority: Land Use and Transportation Planning Summary Title: Airport Planning and Consulting Services Title: Approval of a Contract With Airport Management Consulting Group in the Amount of $183,008 for Planning and Consulting Services at Palo Alto Airport, including Evaluation of Options in Managing the Office Spaces and Hangars, Development of Primary Management and Compliance Documents Including the Airport Rules and Regulations, Minimum Business Standards and Leasing/Rents and Fees Policies, and Related Matters; and Approval of Budget Amendments in the General Fund and Airport Fund From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council: 1. Approve and authorize the City Manager or his designee to execute the attached contract with Aviation Management Consulting Group, Inc. (Attachment A) in the amount of $183,008 for Airport Consulting Services, including evaluation of uses, assistance in developing primary management and compliance documents (Airport Rules and Regulations, Minimum Business Standards and Leasing/Rents and Fees Policies) and related matters; and 2. Amend the Fiscal Year 2016 Budget Appropriation for a. the Airport Fund by: i. increasing the transfer from the General Fund in the amount of $208,008 ii. increasing the Airport Fund operations expense in the amount of $208,008; b. the General Fund by: City of Palo Alto Page 2 i. increasing the transfer to the Airport Fund in the amount of $208,008 ii. decreasing the Budget Stabilization Reserve in the amount of $208,008. Background On August 11, 2014, City Council approved the transfer of the Palo Alto Airport operations from the County of Santa Clara to the City of Palo Alto. The City adopted several resolutions to authorize the transfer and creation of the Public Works Department’s Airport Division to manage the Airport. (CMR: 4723). City Council approved and adopted the county’s fees and charges, Airport Rules and Regulations, and General Aviation Aircraft License Agreement (tie-down application) until the City was able to develop its own. Although the Federal Aviation Administration (FAA) recommends minimum requirements for airport service providers, none existed and the transfer deadline did not allow for new ones to be adopted. On November 16, 2015, Council adopted a resolution amending the fee schedule to reflect the single airport system as opposed to the county’s multiple airport system. At the same meeting, interim minimum standards consistent with best practices set forth by FAA Advisory Circular 150/5190-7 (CMR: 6278) were adopted. As part of the transfer of the airport, the City agreed to perform the executory portions of all contracts assigned by the county, including the Lease Agreements with Roy-Aero Enterprises, LLC and Airport Management Group, Inc. These two leases expire in April 2017, at which time the City can enter into one or more new leases with the current aviation businesses operating under these master leases. The City also has the option of managing the leases or adopting a hybrid model of self-management and outsourcing. Bid Process In December 2015, a request for proposals (RFP) for consultant assistance to evaluate operational and leasing options; existing rules, regulations, policies and minimum standards; to provide guidance addressing the areas needed and City of Palo Alto Page 3 develop an Airport Business Plan (Attachment B) was posted for qualified consultant firms. Discussion Proposals were received from two consultants on December 23, 2015. The disparity in the two proposals was clearly identified by the evaluation panel as a discrepancy in depth and detail of the deliverables; Airport Business Solutions (ABS) submitted a proposal for $85,000 and Aviation Management Consulting Group, Inc. (AMCG) submitted a proposal for $270,036. The AMCG proposal included a team of experienced consultants to meet the project criteria set forth in the RFP. Staff recommends hiring AMCG to perform needed planning and evaluation tasks (Exhibit A of the attached Agreement) prior to the April 2017 expiration of the two lease agreements with Roy-Aero Enterprises, LLC and Airport Management Group, Inc. and prior to the incumbent lessees returning tenant improvements (e.g., buildings and hangars) and property management responsibilities to the City. A highest and best use analysis for the Airport will provide Council with options for managing the office/retail spaces and land and hangars prior to the expiration of the existing lease agreements. The consultant will consider the two previous studies, Palo Alto Working Group Study and R.A. Weidemann & Associates Report, in their evaluation and include recommendations on implementing best industry standards; compliance with local, state and federal requirements; and delineating actions necessary for meeting FAA “Sponsor Assurance” requirements that are imposed on airports as a condition for receiving federal funding. Staff expects to meet with Council in fall 2016 with the results of the study and recommendations on management models and the primary management and compliance documents. The airport primary management and compliance documents include: Rules and Regulations, Minimum Standards, Leasing/Rents and Fees Policy, and related documents (i.e., General Aviation Operator and Lessee Application, General Aviation Operator Permit, and a General Aviation Self-Fueling Permit). The goals are to establish effective property management practices and update fees and rents that will ensure the airport is financially self- sufficient and well-run. AMCG will study and make recommendations for the City of Palo Alto Page 4 Rates & Fee Structure and develop comprehensive Rules and Regulations, Minimum Standards and Leasing Policies to define the operational and leasing options using the latest industry standards and technology. Outreach with the pilots, businesses, and the community will be conducted to ensure stakeholder input and program success. To reduce proposed costs, staff determined that a building condition and appraisal could be completed internally with help from the Real Property Division and its consultant ($25,000). Additionally, staff negotiated with AMCG to expedite the highest and best use analysis, for completion in the next 12 months ($183,008). Exhibit A of the attached Agreement also includes an optional scope of work for an Airport Business Plan that would need to follow the outcome of Council’s direction for management of the tenant improvements. At the end of Fiscal Year 2017, Staff will return to Council for consideration to amend the agreement to include the optional Airport Business Plan, which will be initiated in Fiscal Year 2018. Resource Impact The General Fund has loaned about $2.0 million dollars to the Airport Enterprise Fund to support operations and provide seed money for capital improvement projects between Fiscal Years 2011 and 2016 (Table 1). Table 1. Fiscal Year Loan Amount 2011 $300,000 2013 $310,000 2014 $325,000 2015 $760,000 2016* $304,000 Total** $1,999,000 * When adjusted for the recommended $208,008 additional funding in this report, the FY2016 contribution from the General Fund would be approximately $511,637. **This total does not reflect the anticipated loan necessary in FY 2017. Currently it is anticipated that General Fund support of $700,000 will be needed. Should this materialize, the total would be approximately $2.9 million from FY11 through FY17 in General Fund support. City of Palo Alto Page 5 Funding for the Airport planning work and management document assistance will be appropriated from the General Fund in a budget amendment and will include $25,000 for the Real Property Division’s consultant, Valbridge Property Advisors, to complete appraisal consulting services; increasing the Fiscal Year 2016 Airport Operations appropriation by $208,008 and decreasing the Budget Stabilization Reserve by $208,008 (CR-2017-736). Funding for the optional Airport Business Plan will be contingent upon funding and Council approval. The Airport will need General Fund augmentation through FY 2017. The resulting AMCG recommendations and creation of management documents will allow Council to choose the most beneficial management option when the two leases expire in April 2017, establishing effective property management practices and updated fees and rents to ensure the airport is well-run and financially self- sufficient. The airport is scheduled to initiate repayment of loans in Fiscal Year 2018. Policy Implications This recommendation does not represent any change to existing City policies. Environmental Review Approval of a consulting contract to evaluate options for providing FBO services, review and update rules and regulations and minimum standards, and evaluate fees, is not a project subject to review under the California Environmental Quality Act (CEQA). Attachments:  Attachment A_Contract Available 06-02-2016 (PDF)  Attachment B_Hyperlink to RFP 162180 (PDF) Attachment A Contract Contract will be available in City Council's packet of June 2, 2016. Attachment B REQUEST FOR PROPOSAL (RFP) NUMBER 162180FOR PROFESSIONAL SERVICESTitle: Palo Alto Airport Business Plan and Guiding Documents(Hard copies for City Council Only) http://www.cityofpaloalto.org/civicax/filebank/documents/52560 • CITY OF PALO ALTO TO: FROM: AGENDA DATE: SUBJECT: CITY OF PALO ALTO MEMORANDUM HONORABLE CITY COUNCIL PUBLIC WORKS DEPARTMENT JUNE 6, 2016 CONSENT ITEM NUMBER 8 -Approval of a Contract With Airport Management Consulting Group in the Amount of $183,008 for Planning and Consulting Services at Palo Alto Airport, including Evaluation of Options in Managing the Office Spaces and Hangars, Development of Primary Management and Compliance Documents Including the Airport Rules and Regulations, Minimum Business Standards and Leasing/Rents and Fees Policies, and Related Matters; and Approval of Budget Amendments in the General Fund and Airport Fund Last week, the contract was not included as Attachment A, however, it is now attached for the above subject-referenced staff report #6671 which is Item 8 on Council's agenda for June 6, 2016 Professional Services Rev. March 31, 2015 1 CITY OF PALO ALTO CONTRACT NO. C16162180 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND AVIATION MANAGEMENT CONSULTING GROUP, INC. FOR PROFESSIONAL SERVICES This Agreement is entered into on this 6th day of June, 2016, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and AVIATION MANAGEMENT CONSULTING GROUP, INC., a Colorado corporation, located at 9085 East Mineral Circle, Suite 315, Centennial, Colorado 80112 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to evaluate and update existing rules, regulations, policies and minimum standards and the operational and leasing options for the Palo Alto Airport (PAO) (“Project Phase 1”) and desires to engage a consultant to provide the evaluation in connection with the Project Phase 1 (“Services”). If later approved by the City Council, this Agreement will be amended to include Phase 2: preparation of an Airport Business Plan. B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Phase 1 Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement. However, unless or until the City Council approves amendment(s) to this Agreement to include Phase 2, this Agreement applies only to Phase 1 services. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through completion of the services in accordance with the Schedule of Performance attached at Exhibit “B” unless terminated earlier pursuant to Section 19 of this Agreement. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 1 SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A”, including both payment for professional services and reimbursable expenses, shall not exceed One Hundred Sixty Six Thousand Three Hundred Seventy One Dollars ($166,371.00). In the event Additional Services are authorized, the total compensation for Services, Additional Services and reimbursable expenses shall not exceed One Hundred Eighty Three Thousand Eight Dollars ($183,008.10). The applicable rates and schedule of payment are set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C-1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 3 similar knowledge and skill engaged in related work throughout California under the same or similar circumstances. SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services. SECTION 8. ERRORS/OMISSIONS. CONSULTANT shall correct, at no cost to CITY, any and all errors, omissions, or ambiguities in the work product submitted to CITY, provided CITY gives notice to CONSULTANT. If CONSULTANT has prepared plans and specifications or other design documents to construct the Project, CONSULTANT shall be obligated to correct any and all errors, omissions or ambiguities discovered prior to and during the course of construction of the Project. This obligation shall survive termination of the Agreement. SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent (10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY. SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY. SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the city manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any assignment made without the approval of the city manager will be void. SECTION 12. SUBCONTRACTING. Subcontracts Authorized: Notwithstanding Section 11 above, CITY agrees that subconsultants may be used to complete the Services. The subconsultants authorized by CITY to perform work on this Project are: Mead & Hunt CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 4 of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Jeff Kohlman as the Project Supervisor to have supervisory responsibility for the performance, progress, and execution of the Services to represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the project director, project coordinator, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s project manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property. CITY’s project manager is James Wadleigh, Public Works Department, Airport Division, 250 Hamilton Avenue, Palo Alto, CA 94303, Telephone: (650) 329-2687. The project manager will be CONSULTANT’s point of contact with respect to performance, progress and execution of the Services. CITY may designate an alternate project manager from time to time. SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY. 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 5 16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party. 16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE. 18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies. 18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement. 18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 6 including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY. 19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i.e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement: 14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 7 SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California. 21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act. SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements:  All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post- consumer material and printed with vegetable based inks.  Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 8  Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed. SECTION 24. NON-APPROPRIATION 24.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 25. MISCELLANEOUS PROVISIONS. 25.1. This Agreement will be governed by the laws of the State of California. 25.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California. 25.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 25.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 25.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties. 25.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 25.7. All exhibits referred to in this Agreement and any addenda, appendices, attachments, and schedules to this Agreement which, from time to time, may be referred to in any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 25.8 If, pursuant to this contract with CONSULTANT, CITY shares with DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 9 CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City’s express written consent. 25.9 All unchecked boxes do not apply to this agreement. 25.10 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 25.11 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement on the date first above written. CITY OF PALO ALTO ____________________________ City Manager APPROVED AS TO FORM: __________________________ City Attorney AVIATION MANAGEMENT CONSULTING GROUP, INC. By:___________________________ Name:_________________________ Title:________________________ Attachments: EXHIBIT “A”: SCOPE OF WORK EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Paul Meyers Professional Services Rev. March 31, 2015 2 EXHIBIT “A” SCOPE OF WORK Scope of Work In accordance with the proposal submitted by CONSULTANT to CITY of Palo Alto (CITY), Public Works Department, Palo Alto Airport Division, Request for Proposal (RFP) Number 162180, Professional Services, Palo Alto Airport, dated December 23, 2015, CONSULTANT shall accomplish the scope of work for the following selected and optional elements which have been identified by CITY: 1-D (1): Highest and Best Use Analysis City Requirement Develop a highest and best use analysis and market assessment for the real estate assets at the Airport to develop recommendations to manage the future FBO leases. Scope of Work CONSULTANT shall conduct a highest and best use analysis of the real estate assets at the Airport. Highest and best use is defined as "The reasonable probable and legal use of property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value." In estimating highest and best use of the real estate assets, the uses will be submitted to four different analyses (i.e., physically possible, legally permissible, financially feasible, and most profitable). CONSULTANT shall ascertain the level of demand in the market and the level of capacity at the Airport (for aviation products, services, and facilities – including hangars) and identify any existing deficiencies. CONSULTANT shall provide recommendations for managing future FBO leases, consistent with federal, state, and local law including City Council policy regarding protecting resident quality of life and the environment. NOTE: CONSULTANT will not ascertain the level of demand in the market and the level of capacity at the Airport for non-aviation or non-aeronautical products, services, and facilities nor identify any deficiencies that exist. NOTE: CONSULTANT will not review any lease agreements (other than the existing FBO lease agreements) nor provide recommendations for managing any other future leases (other than the future FBO lease agreement). Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation on the community, market, Airport, FBOs, SASOs, and non-commercial aeronautical entities located at the Airport shall be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 3 Task 2: Field Visit (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) tour of the Airport, FBOs, SASOs, and non-commercial leased premises, (3) meetings with the Task Force (to be appointed by the City Manager), the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget, and (4) a public meeting (open forum or open house) that can be attended by the larger community, Airport users, and other interested parties. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 8 hours (or 3 people for 0.33 days) for this task. Task 3: Draft Document (First) CONSULTANT shall prepare the first draft of the analysis (based on the information, data, and documentation provided/obtained and the input provided by CITY). CONSULTANT shall provide the first draft of the analysis to CITY for review. CITY shall review first draft of the analysis. Task 4: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the analysis and solicit input. The working session will be approximately one hour. Task 5: Draft Document (Second) CONSULTANT shall revise the first draft of the analysis (based on the input provided by CITY during the first working session) and provide the second draft of the analysis to CITY. CITY shall provide the analysis to other CITY departments for review and comment. Other CITY departments shall review the second draft of the analysis. Task 6: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the analysis and solicit input. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (second field visit) based on available time and budget. Task 7: Final Document CONSULTANT shall revise the second draft of the analysis (based on the input provided by CITY and other CITY departments during the second working session) and provide the final analysis to CITY. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by all sources (by document and section). If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, the CITY, in its discretion, may authorize additional services on an hourly basis. Deliverable CONSULTANT shall provide a written summary of the analysis to CITY. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 4 1-D (2): FBO Options Analysis Scope of Work CONSULTANT shall identify the potential options that exist with regard to the future development, operation, and management of the FBOs at the Airport. CONSULTANT shall discuss each of the options with CITY during the first field visit. CONSULTANT anticipates that the potential options will include FBO Lease Agreement, FBO Management Option, and Sponsor Operated FBO. Under the Lessee Operated FBO option (the current situation at the Airport), a private entity would operate the FBO under a lease with CITY (i.e., CITY would lease land and/or improvements to a private entity for the operation and management of the FBO). The private entity would own the FBO and the entity’s employees would operate and manage all aspects of the FBO utilizing the land and/or improvements leased from CITY and the entity’s assets (i.e., facilities, vehicles, and equipment) and resources. Under the FBO Management Contract option, a private entity would operate and manage all aspects of the FBO under a management contact with CITY using the CITY's FBO assets (i.e., facilities, vehicles, and equipment). Under the Sponsor Operated FBO option, CITY would operate the FBO. CITY would own the FBO and CITY’s employees would operate and manage all aspects of the FBO using CITY’s assets (i.e., facilities, vehicles, and equipment) and resources. As part of this analysis, CONSULTANT shall: (1) outline the advantages and disadvantages of the options from CITY and consumer (customer) perspective, (2) identify comparable airports and solicit input regarding the actual and perceived advantages and disadvantages associated with each option, and (3) evaluate the options from an operational, managerial, and financial perspective. The operational and managerial portions of the analysis shall be conducted from an airport sponsor and customer perspective. From CITY perspective, the analysis shall encompass the following areas: FBO control and responsibility, FBO financial contribution, FBO capital requirements, FBO risk/liability (exposure), FBO administration, and the potential opportunity for complementary products, services, and/or facilities to be provided at the Airport. From a customer perspective, the analysis shall encompass the following areas: FBO products, services, and facilities; FBO pricing; FBO vehicles, equipment and facilities; FBO personnel; FBO customer service; and the potential for competition. The financial portion of the analysis shall be conducted from CITY’s perspective. Within this context, CONSULTANT shall estimate the financial performance of the subject FBO(s) under each option based on a number of key underlying assumptions. To achieve this objective, CONSULTANT shall analyze historical and current activity indicators (e.g., aircraft operations, based aircraft, and fuel volumes), existing lease agreements, historical operational information pertaining to the subject FBO(s), the Airport’s Primary Management and Compliance Documents (as applicable), and the Airport’s Master DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 5 Plan/Airport Layout Plan. Additionally, the observations made by CONSULTANT during the field visit will be considered. Through this analysis and observation, CONSULTANT shall identify key correlations and formulate an opinion regarding the type, range, and level of FBO products, services, and facilities that will be required to meet the needs of FBO customers at the Airport. With consideration given to best practices, CONSULTANT shall project the revenues, costs, expenses, capital expenditures, and the financial performance of the subject FBO(s) under each option. Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation on the community, market, Airport, FBOs, SASOs, and non-commercial aeronautical entities located at the Airport shall be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. Task 2: Field Visit (Third) CONSULTANT shall conduct a field visit (third field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY and (2) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 4 hours (or 1 person for 0.50 days) for this task. Task 3: Draft Document (First) CONSULTANT shall prepare the first draft of the analysis (based on the information, data, and documentation provided/obtained and the input provided by CITY) and provide the first draft of the analysis to CITY for review. CITY shall review the first draft of the analysis. Task 4: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the analysis and solicit input. The working session will be approximately one hour. Task 5: Draft Document (Second) CONSULTANT shall revise the first draft of the analysis (based on the input provided by CITY during the first working session) and provide the second draft of the analysis to CITY. CITY shall provide the second draft of the analysis to other CITY departments for review and comment. Other CITY departments shall review the second draft of the analysis. Task 6: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the analysis and solicit input. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (fourth field visit) based on available time and budget. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 6 Task 7: Final Document CONSULTANT shall revise the second draft of the analysis (based on the input provided by CITY and other CITY departments during the second working session) and provide the final analysis to CITY. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by all sources (by document and section). If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, the CITY, in its discretion, may authorize additional services on an hourly basis. Deliverable CONSULTANT shall provide a written summary of the analysis to CITY. 1-D (X): FBO Interim Plan City Requirement The City needs an interim plan that will carry the City through possibly a year or more, or until such a time when the City knows what the Airport will look like after the many Airport Capital Improvement Projects. Scope of Work CONSULTANT shall prepare an FBO Interim Plan that can serve as a stop-gap measure until the planned Airport Capital Improvement Projects (ACIP) can be completed and CITY makes a decision regarding the future development, operation, and management of the FBO. Planned ACIP projects include rehabilitating the existing ramp/apron area(s) at the Airport and/or changing the layout of the ramp/apron area(s) at the Airport. The FBO Interim Plan shall cover a period of one to three years. Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation on the community, market, Airport, FBOs, SASOs, and non-commercial aeronautical entities located at the Airport shall be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. Task 2: Field Visit (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) tour of the Airport, FBOs, SASOs, and non-commercial leased premises, (3) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget, and (4) a public meeting (open forum or open house) that can be attended by the larger community, Airport users, and other interested parties. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 4 hours (or 2 people for 0.25 DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 7 days) for this task. Task 3: Draft Document (First) CONSULTANT shall prepare the first draft of the plan (based on the information, data, and documentation provided/obtained and the input provided by CITY) and provide the first draft of the plan to CITY for review. CITY shall review the first draft of the plan. Task 4: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the plan and solicit input. The working session will be approximately one hour. Task 5: Draft Document (Second) CONSULTANT shall revise the first draft of the plan (based on the input provided by CITY during the first working session) and provide the second draft of the plan to CITY. CITY shall provide the second draft of the plan to other CITY departments for review and comment. Other CITY departments shall review the second draft of the plan. Task 6: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the plan and solicit input. The working session will be approximately one hour. Task 7: Final Document CONSULTANT shall revise the second draft of the plan (based on the input provided by CITY and other CITY departments during the second working session) and provide the final plan to CITY. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by all sources (by document and section). If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, the CITY, in its discretion, may authorize additional services on an hourly basis. Deliverable CONSULTANT shall provide a written summary of the plan to CITY. 1-G: FBO Lease Agreement City Requirement Develop lease agreements for FBOs. Scope of Work CONSULTANT shall develop an interim FBO lease agreement to facilitate the leasing of Airport land and/or improvements for the operation and management of an FBO(s). This interim FBO lease agreement can also be used as a template for the Lessee Operated FBO Option if City Council selects this management option. An FBO lease agreement: (1) allows the use of airport property for a specified period of time (term) for specific consideration (payment of rent) and subject to various terms and DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 8 conditions; (2) conveys privileges to engage in FBO activities; (3) requires that certain obligations be met (in exchange for the privileges granted); and, (4) protects the sponsor, the public, and the lessee. CITY will be able to utilize the new FBO lease agreement to educate (and/or negotiate with) existing and/or prospective FBOs. As such, the new FBO lease agreement will convey the requirements and obligations (and related terms and conditions) associated with leasing land and/or improvements for the operation and management of an FBO. Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation on the community, market, Airport, FBOs, SASOs, and non-commercial aeronautical entities located at the Airport shall be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. Task 2: Field Visit (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) tour of the Airport, FBOs, SASOs, and non-commercial leased premises, (3) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget, and (4) a public meeting (open forum or open house) that can be attended by the larger community, Airport users, and other interested parties. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 4 hours (or 2 people for 0.25 days) for this task. Task 3: Draft Document (First) CONSULTANT shall prepare the first draft of the FBO lease agreement (based on the information, data, and documentation provided/obtained and the input provided by CITY) and provide the first draft of the FBO lease agreement to CITY. CITY shall review the first draft of the FBO lease agreement. Task 4: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the FBO lease agreement and solicit input. The working session will be approximately one hour. Task 5: Draft Document (Second) CONSULTANT shall revise the first draft of the FBO lease agreement (based on the input provided by CITY during the first working session) and provide the second draft of the FBO lease agreement to CITY. CITY shall provide the second draft of the FBO lease agreement to other CITY departments for review and comment. Other CITY departments shall review the second draft of the FBO lease agreement. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 9 Task 6: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the FBO lease agreement and solicit input. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (second field visit) based on available time and budget. Task 7: Final Document CONSULTANT shall revise the second draft of the FBO lease agreement (based on the input provided by CITY and other CITY departments during the second working session) and provide the final FBO lease agreement to CITY. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by all sources (by document and section). If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, CITY, in its discretion, may authorize additional services on an hourly basis. Deliverable CONSULTANT shall provide a written FBO lease agreement to CITY. 1-J (1): Rate (Fee) Study City Requirement Prepare a rate study and recommend the adoption of a new fee structure. Scope of Work CONSULTANT shall conduct an Airport Fee Study (fee study) – consisting of two phases – to establish fees to help recover the costs that have been incurred (and/or are anticipated to be incurred) by CITY relating to the (non-AIP or other grant funded) planning, development, operation (including maintenance and repair), and management of the Airport. Under Phase I, CONSULTANT shall review the current fee program for the Airport. More specifically, CONSULTANT shall review the types of fees currently being charged at the Airport, the methodologies currently being utilized to establish the fees, and the basis (or the unit measure) currently being deployed for charging fees. CONSULTANT shall also identify current industry practices for establishing fees including summarizing the types of fees generally being charged, the methodologies generally being utilized, and the measures generally being deployed in the industry (in general) and at comparable airports (in particular). CONSULTANT shall provide recommendations regarding the “types” of fees that could be charged, the “methodology” for establishing such fees, and the “basis” (or the unit measure) for charging such fees. CONSULTANT’s findings and recommendations (under Phase I) shall be conveyed to CITY in a written summary report. Under Phase II, once the “types” of fees, the “methodologies”, and the “basis” for charging fees DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 10 have been selected by CITY, CONSULTANT shall conduct a "cost recovery" financial analysis (of revenue and expenses at the Airport) and calculate fees (dollar amounts for each fee) for the Airport. Note: The fee study will not encompass air carrier (or related) fees or non-aviation or non-aeronautical (or related) fees. Additionally, it is important to note that CONSULTANT believes that fees should be cost-recovery based – not market based (like rents). Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation shall be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze the information, data, and documentation provided/obtained and conduct research. Task 2: Field Visit (Second) CONSULTANT shall conduct a field visit (second field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY and (2) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 4 hours (or 1 person for 0.50 days) for this task. Task 3: Airport Profile CONSULTANT shall develop a profile of the Airport based on the information, data, and documentation provided/obtained. Task 4: Comparable and Competitive Airport Identification CONSULTANT shall identify comparable and competitive airports based on the Airport profile. CONSULTANT shall develop a preliminary list of comparable and competitive airports and provide the list to CITY for review. CITY shall review the preliminary list of comparable and competitive airports. Task 5: Comparative Analysis CONSULTANT shall (1) identify current industry practices for establishing general aviation fees (including the types of fees typically being charged in the industry, the methodologies typically being utilized in the industry to establish fees, and the basis typically being deployed in the industry for charging fees) and (2) compare the current general aviation fee program at the Airport to the current general aviation fee programs at comparable and competitive airports. CONSULTANT shall obtain and/or validate pertinent/relevant information/data from comparable and competitive airports using CONSULTANT’s proprietary database, reference library, and/or directly from the airports identified. Task 6: Draft Document – Phase I (First) CONSULTANT shall prepare the first draft of the Airport Fee Study – Phase I (based on the information, data, and documentation provided/obtained and the input provided by CITY) and provide the first draft of the Airport Fee Study – Phase I to CITY for review. CITY shall review DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 11 the first draft of the Airport Fee Study – Phase I. Task 7: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the Airport Fee Study – Phase I findings and identify the types, methodologies, and basis selected. The working session will be approximately one hour. Task 8: Cost Recovery Analysis Based on the types of fees, the methodologies, and the basis selected by CITY, CONSULTANT shall conduct a cost recovery analysis. Task 9: Draft Document – Phase II (Second) Predicated on the findings of the cost recovery analysis, CONSULTANT shall calculate fees (i.e., the dollar amounts for each fee) for the Airport. CONSULTANT shall provide the first draft of the Airport Fee Study – Phase II (including a written schedule of fees for the Airport) to CITY for review. CITY shall review the first draft of the Airport Fee Study – Phase II (including the written schedule of fees for the Airport). Task 10: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY to review the results of the “cost recovery” analysis, the fee calculations, and the schedule of fees. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (third field visit) based on available time and budget. Task 11: Draft Document – Phase II (Third) CONSULTANT shall revise the fee calculations, the schedule of fees, and provide the second draft of the Airport Fee Study – Phase II to CITY for review. CITY shall review the second draft of the Airport Fee Study – Phase II. Task 12: Working Session (Third) CONSULTANT shall conduct a “working session” (by telephone) with CITY to review the revised calculations and the schedule of fees. The review session will be approximately one-half hour. Task 13: Final Document CONSULTANT shall finalize the Airport Fee Study – Phase II (including the fee calculations and the schedule of fees) and provide the final Airport Fee Study – Phase II to CITY. Deliverables Upon completion of Task 6: Draft Document – Phase I (First), CONSULTANT shall convey the findings of the comparative analysis and its best practices recommendations (regarding the “types” of fees, the “methodologies” to establish fees, and the “basis” for charging fees) to CITY in a written summary report. Upon completion of Task 13: Final Document, CONSULTANT shall provide a written schedule of general aviation fees for the Airport to CITY. The schedule shall convey the results of the calculations performed by CONSULTANT. 1-J (2): Airport Rent Study DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 12 Scope of Work CONSULTANT shall conduct an Airport Rent Study (rent study) to derive an opinion of the wholesale market rent for certain land and improvements (identified in the table that follows) located at the Airport (hereinafter referred to as the “subject properties”). CONSULTANT will "not" provide an opinion of the retail market rent (i.e., the rental rate that a sublessee would pay to a lessee of the City or the rental rate an end user would pay to the City) - Valbridge Property Advisors, a City Real Property consultant, will be providing this opinion to the City (through a separate engagement). Valbridge Property Advisors will inventory, measure, and provide general descriptions (and photographs) of certain land and improvements (identified in the table) to Consultant for inclusion in Consultant's deliverable (i.e., written summary report). Improvement Size Self-Serve Fueling Station Area to be determined Fuel Storage Facilities Capacity Varies In essence, a rent study is a streamlined approach that is used to derive an opinion of market rent for airport properties (land and/or improvements) being used for general aviation purposes without conducting an appraisal. This approach is consistent with the FAA’s policy which gives airport sponsors the flexibility to establish market rents for airport properties being used for general aviation purposes using any reasonable, justified, and consistently applied method. To achieve this objective, CONSULTANT shall analyze rental rates (on a comparative basis) for similar land and improvements at comparable and competitive airports (and rental rates at national and regional airports) to derive an appropriate market based and supported rental rate for each component of the subject properties. If fees are being charged in lieu of rent, CONSULTANT shall take that into account. The selection of comparable airports and the assimilation and analysis of data for similar properties (including, but not limited to, type, use, and attributes) at comparable airports is essential to the Rent Study process. Building Use Component Size Building 1 Non-Commercial T-Hangar 11,000 Building 2 Non-Commercial T-Hangar 10,000 Building 3 Non-Commercial T-Hangar 10,000 Building 4 Non-Commercial T-Hangar 11,000 Building 5 Non-Commercial T-Hangar 10,000 Building 6 Commercial Community Hangar 24,000 Building 7 Non-Commercial Executive Hangars 22,000 Building 8 Non-Commercial T-Hangar 7,000 Building 9 Commercial Executive Hangars Asphalt Vehicle Parking 10,000 Building 10 Commercial Office Executive Hangar Shop Asphalt Vehicle Parking 20,000 Building 11 Commercial Executive Hangar Office Asphalt Vehicle Parking 6,000 CAP Building Non-Commercial Office 1,000 142,000 Land Commercial Improved Land Variable Total Subject Properties (Aeronautical) All figures are approximate DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 13 CONSULTANT maintains an extensive database of approximately 700 airports located throughout the United States and approximately 2,850 data points specifically for this purpose. Identification and Selection of Comparable Airports (Criteria) CONSULTANT shall consider a number of variables when identifying and selecting comparable airports, including, but not limited to, the following:  Infrastructure (number, configuration, and capacity of runways and taxiways)  Approaches (precision versus non-precision)  Presence or absence of a control tower  Number and type of aviation businesses located at the airport (including the number of fuel providers)  Amount of land that is available for aviation development (and related land use considerations)  Type of market  Number and type of airports in the market  Activity levels (based aircraft, aircraft operations, and fuel volumes). Consideration of Regional and National Airport Data As a supplement to the comparable airport data, the rental rates being charged at airports within the FAA’s Western-Pacific Region as well as those being charged at airports located throughout the United States – as maintained within CONSULTANT’s proprietary database – shall be considered by CONSULTANT. Identification and Selection of Similar Properties (Criteria) CONSULTANT shall consider the following factors when identifying and selecting similar improvements at comparable airports, including, but not limited to, the following:  Use (commercial versus non-commercial)  Size (usable versus unusable)  Location and access (landside and airside) to/from the subject properties, infrastructure, and utilities  Lease terms and conditions  Type, quality, condition, and functional utility or limitations of the subject properties (this includes, but is not necessarily limited to, any restrictions on the development of the land, the availability of utilities, and the ability of the land to support the aircraft that normally frequent the subject airport). The rental rates being charged for similar properties at competitive airports shall be considered as well (as appropriate). Marketplace Considerations General conditions, trends, and demographics in the market shall be considered by CONSULTANT (as appropriate). Other Considerations CONSULTANT shall assume that the highest and best use of the subject properties is aviation DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 14 related (aeronautical use), that the subject properties will continue to be part of an operating airport, and that access to the infrastructure and amenities of the airport will be available. Determining Market Rents Based on an analysis of the data compiled, CONSULTANT shall derive a market based and supported rental rate for each component of the subject properties. A written summary report will be provided to CITY as the final work product or deliverable. In addition to conveying CONSULTANT’s opinion of the market rental rate for the subject properties, the summary report will describe the data, reasoning, and analysis (and identify the method/approach used by CONSULTANT) to develop CONSULTANT’s opinion. Unless otherwise noted, market rental rates will be conveyed on a “per square foot per year” and a “triple net” basis. As part of rent study process, CONSULTANT shall evaluate the market rental rates for reasonableness to ensure compliance with federal mandates. Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation will be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. Task 2: Field Visit (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) a tour of the subject properties, (3) photographs of the subject properties, and (4) meetings with select stakeholders – budget and schedule permitting. While on-site, CONSULTANT shall review the location of (and access to) each property and work with representatives of CITY to verify/confirm (as necessary) the type, use, and attributes of each property. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained and conduct additional research. CONSULTANT time on-site shall be limited to 8 hours (or 2 people for 0.50 days) for this task. Task 3: Airport Profile CONSULTANT shall develop a profile of the Airport based on the information provided/obtained. Task 4: Comparable and Competitive Airport Identification CONSULTANT shall identify comparable and competitive airports based on the Airport profile. CONSULTANT shall develop a preliminary list of comparable and competitive airports and provide the list to CITY for review. CITY shall review the preliminary list of comparable and competitive airports. Task 5: Regional Airport Identification CONSULTANT shall identify regional airports. Task 6: Comparative Analysis CONSULTANT shall obtain and/or validate pertinent/relevant information/data from comparable, competitive, regional, and national airports using CONSULTANT’s proprietary database, reference library, and/or directly from the airports identified. CONSULTANT shall DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 15 analyze the information, data, and documentation obtained on a comparative basis. CONSULTANT shall derive the market rental rate for the subject properties (by component). Task 7: Draft (First) CONSULTANT shall prepare the first draft of the summary report (based on the comparative analysis) conveying the market rental rate for the subject properties (by component) and provide to CITY for review. CITY shall review the first draft of the summary report. Task 8: Review Session (First) CONSULTANT shall conduct a “review session” (by telephone) with CITY to review the first draft of the summary report. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (second field visit) based on available time and budget. Task 9: Final Document CONSULTANT shall finalize the summary report and provide the final report to CITY. Deliverable CONSULTANT shall provide a written summary of the study to CITY. 2: Rules and Regulations, Minimum Standards, and Leasing Policy (Airport Primary Management and Compliance Documents) City Requirements The selected consultant will be responsible for evaluating existing Rules and Regulations and Minimum Standards and Leasing Policies, conditions and current practices. As described more fully below, assist the Airport in a community-involved process of developing comprehensive new Rules & Regulations and Minimum Standards and Leasing Policies, culminating in approval by the City Council and the FAA. Scope of Work CONSULTANT shall develop Airport Primary Management and Compliance Documents (PMCDs) including: Rules and Regulations, Minimum Standards, Leasing/Rents and Fees Policy, and related documents (i.e., General Aviation Operator and Lessee Application, General Aviation Operator Permit, and if desired, a General Aviation Self-Fueling Permit). In essence, PMCDs are a compendium of documents that govern the operation, management, and development of an airport. In combination, these documents: (1) contribute to the financial health of an airport; (2) facilitate (foster) orderly development; (3) promote the provision of quality products, services, and facilities; (4) protect the health, safety, interest, and general welfare of the public; (5) reduce the potential for conflict with lessees, consumers, and users; and, (6) reduce the potential for (and provide a platform for the resolution of) complaints. Within this context, PMCDs set the stage (parameters) for the way an airport does business. While PMCDs are interrelated, each document functions independently of the other. Beyond serving the intended purpose, PMCDs need to be consistent with (not duplicate) the Airport Sponsor Assurances, applicable regulatory measures, and other the compliance related directives issued by the FAA. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 16 An overview of each PMCD deliverable is provided in this section and an outline of the proposed content is provided at the end of this section – under Primary Management and Compliance Document Outlines. When developing the PMCD deliverables, CONSULTANT shall ensure that its recommendations are:  Consistent with the Airport Sponsor (Grant) Assurances  Consistent with all other applicable airport compliance-related directives issued by the FAA including:  Advisory Circular No. 150/5100-16A (AIP, Grant Assurance Number One – General Federal Requirements)  Advisory Circular No. 150/5150-2B (Federal Surplus Personal Property for Public Airport Purposes)  Advisory Circular No. 150/5190-6 (Exclusive Rights at Federally Obligated Airports)  Advisory Circular No. 150/5190-7 (Minimum Standards for Commercial Aeronautical Activities)  Policy Regarding Airport Rates and Charges  Policy and Procedures Concerning the Use of Airport Revenue, FAA Order 5100.38A (Airport Improvement Program Handbook)  Order 5190.6B (Airports Compliance Manual)  Appropriate, reasonable, and relevant for the Airport, the market, and the activities taking place (or reasonably anticipated to take place) at the Airport As such, the unique characteristics of the Airport, the market, and the activities (as conveyed to CONSULTANT by CITY) shall be considered by CONSULTANT when developing the PMCD deliverables. In addition to being clear, concise, and well organized (structured), the PMCD deliverables will complement (not duplicate) the other governing documents for the Airport. Each PMCD deliverable will be a separate (standalone) document (i.e., the documents will not be combined with other documents or consolidated) and each PMCD deliverable or portions thereof will not be integrated into other documents or vice versa. Rules and Regulations By definition, this document sets forth the rules and regulations for the safe, orderly, and efficient operation and use of an airport. The purpose of rules and regulations is to protect the public health, safety, interest, and welfare on an airport (and to restrict any activity or action that would interfere with the safe, orderly, and efficient operation and use of an airport). CITY shall be able to utilize Rules and Regulations to educate and inform all airport users about the regulatory measures that apply to the use of the Airport and/or engaging in activities at the Airport. In addition to being relevant, reasonable, and appropriate for the Airport, the market, and the activities, CITY should only establish rules and regulations that CITY is ready, willing, or able to enforce. The Rules and Regulations shall also contain general provisions that are common to all PMCDs. General provisions eliminate redundancy (as opposed to being restated in each DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 17 PMCD). Key words (and acronyms) will also be defined in Rules and Regulations as well. Minimum Standards By definition, this document sets forth the minimum requirements (or criteria) that need to be met (by an entity) as a condition for conducting commercial general aviation aeronautical activities at an airport. The purpose of minimum standards is to provide a fair and reasonable opportunity, without unjust discrimination, to applicants to qualify, or otherwise compete, to occupy available airport land and/or improvements and engage in authorized commercial general aviation aeronautical activities at an airport. In essence, by providing consistent threshold requirements for engaging in such activities at an airport, minimum standards “level the playing field” and promote “fair competition” among operators. Beyond providing the basis for the uniform treatment of operators, minimum standards reduce the potential for (and provide a platform for resolving) conflicts, complaints (informal and formal), and disputes. Consistent with the objectives established by the FAA, minimum standards should (1) promote safety, (2) protect airport users, (3) maintain and enhance the availability of services, (4) promote the orderly development of an airport, and (5) ensure operational efficiency. To accomplish this objective (and ensure that Minimum Standards are relevant, reasonable, and appropriate for the Airport, the market, and the activities), CONSULTANT shall utilize a comprehensive approach that will consider the: (1) aeronautical activities occurring at the Airport (including the land and improvements being leased/used, the type, level, and quality of aeronautical products, services, and facilities being provided, and the vehicles, equipment, and personnel being deployed), (2) the aeronautical activities occurring at comparable airports, and (3) the requirements of airport customers (or consumers). Leasing/Rents and Fees Policy By definition, this policy sets forth the parameters for leasing airport land and improvements for general aviation purposes and outlines the process for establishing and adjusting general aviation rents and fees at an airport. The purpose of the policy is to convey an airport’s general aviation leasing (and rents and fees) practices. CITY shall be able to utilize this policy to educate existing and prospective operators/aviation businesses and lessees about the process CITY shall utilize to lease airport land and/or improvements for general aviation purposes. As such, this policy will provide the structure for ensuring that the leasing process is consistent (uniformly applied) and not unjustly discriminatory. Additionally, this policy will identify the key terms and conditions that should be included in a lease agreement and this policy will convey the approach (i.e., methodology, frequency, etc.) for establishing and adjusting general aviation rents and fees in a timely manner without undue influence. Other Related Documents CONSULTANT shall develop a General Aviation Operator and Lessee Application (Application), a General Aviation Operator Permit, and if desired, a General Aviation Self-fueling Permit (Permits). DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 18 CITY shall be able to use the Application to obtain information, data, and documentation (for review and evaluation by CITY) from parties who are interested in leasing land and/or improvements and/or engaging in commercial or non-commercial general aviation aeronautical activities at the Airport. CITY shall be able to use the Permits to convey permission to parties (who have completed an Application and been approved by CITY) to engage in commercial general aviation activities and if desired, self-fueling at the Airport. CONSULTANT shall assist CITY in refining a public engagement (stakeholder outreach) approach for seeking input regarding the development of comprehensive Rules and Regulations, Minimum Standards, and Leasing Policies for the Airport culminating in the approval (of such documents) by CITY. NOTE: While the FAA may be willing to review these documents and provide comments, it is the understanding of CONSULTANT that the FAA will not approve these documents. If CITY elects to include the FAA in the review and comment process, the schedule will need to be modified accordingly (i.e., the scheduled will need to be extended based on the amount of time the FAA takes to review these documents and provide comments). Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation on the community, market, Airport, FBOs, SASOs, and non-commercial aeronautical entities located at the Airport shall be compiled by CITY. This will include an inventory of the land and improvements (by leasehold, by component) currently being leased/used, the products, services, and facilities currently being provided, and the vehicles, equipment, and personnel currently being deployed by the aviation businesses at the Airport. CONSULTANT shall provide a written information request and a sample worksheet to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained (including the existing PMCDs and related information, data, and documentation) and conduct initial research. Task 2: Field Visit (First) and Stakeholder Meetings (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) tour of the Airport, FBOs, SASOs, and non-commercial leased premises, (3) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBO, SASOs, and/or non- commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget, and (4) a public meeting (open forum or open house) that can be attended by the larger community, Airport users, and other interested parties. Additionally, CONSULTANT shall conduct a short course (or mini-workshop) on PMCDs for representatives of CITY (including City Council members) during the first field visit. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 30 hours (or 3 people for 1.25 days) for this task. The purpose of the first field visit will be to gain a better understanding of: (1) the current DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 19 operating environment at the Airport, (2) the goals that have been established by CITY for the Airport (in general) and PMCDs (in particular), and (3) the key issues, problems, and/or challenges relating to (associated with) this element of the proposed scope of work. Task 3: Prepare Documents (Expanded Outline and/or Sample Formats) CONSULTANT shall prepare an expanded outline and/or sample formats of the PMCDs and provide the expanded outline and/or sample formats to CITY for review. CITY shall review the expanded outline and/or sample formats of the PMCDs. Task 4: Working Session (Expanded Outline and/or Sample Formats) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the expanded outline and/or sample formats of the PMCDs and solicit comments, input, and direction. The working session will be approximately one hour. Task 5: Draft Documents (First) CONSULTANT shall prepare the first draft of the PMCDs (based on the information, data, and documentation provided/obtained and the comments, input, and direction provided by CITY) and provide the first draft of the PMCDs to CITY for review. CITY shall review the first draft of the PMCDS. Task 6: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the PMCDs and solicit comments, input, and direction. The working session will be approximately two hours. NOTE: CONSULTANT may be able to conduct the working session in person (third field visit) based on available time and budget. Task 7: Draft Documents (Second) CONSULTANT shall revise the first draft of the PMCDs (based on the input and direction provided by CITY during the first working session) and provide the second draft of the PMCDs to CITY. CITY shall provide the second draft of the PMCDs to other CITY departments for review. CITY and other CITY departments shall review the second draft of the PMCDs. Task 8: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the PMCDs and solicit comments, input, and direction. The working session will be approximately two hours. Task 9: Draft Documents (Third) CONSULTANT shall revise the second draft of the PMCDs (based on the input and direction provided by CITY and other CITY departments during the second working session) and provide the third draft of the PMCDs to CITY. CITY shall provide the third draft of the PMCDs to stakeholders. CITY and stakeholders will review the third draft of the PMCDs. Task 10: Field Visit and Public Meeting (Fourth) and Working Session (Third) During the third field visit, CONSULTANT shall facilitate a public meeting (open forum or open house) to discuss comments (and obtain input) from the stakeholders. CONSULTANT shall discuss (in person) the comments and input from the stakeholders with (and solicit input and direction from) CITY. CONSULTANT time on-site shall be limited to 12 hours (or 3 people for 0.50 days) for this DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 20 task. Task 11: Draft Documents (Fourth) CONSULTANT shall revise the third draft of the PMCDs (based on the input and direction provided by CITY during the third working session) and provide the fourth draft of the PMCDs to CITY. CITY shall provide the fourth draft of the PMCDs to other CITY departments for review. CITY and other CITY departments will review the fourth draft of the PMCDs. Task 12: Working Session (Fourth) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to review the fourth draft of the PMCDs and solicit comments, input, and direction. The working session will be approximately one hour. Task 13: Draft Documents (Fifth) CONSULTANT shall revise the fourth draft of the PMCDs (based on the input and direction provided by CITY during the fourth working session) and provide the fifth draft of the PMCDs to CITY. CITY shall provide the documents to other CITY departments. CITY and other CITY departments will review the fifth draft of the PMCDs. Task 14: Working Session (Fifth) and Final Documents CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to review the fifth draft of the PMCDs and solicit comments, input, and direction. The working session will be approximately one hour. CONSULTANT shall revise the fifth draft of the PMCDs (based on the input and direction provided by CITY and other CITY departments during the fifth working session) and provide the final PMCDs to CITY for approval and adoption. CITY shall approve and adopt the final PMCDs. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by sources, document, and section and CITY shall respond to the comments provided by indicating that: (1) change is not merited/will not be made, (2) change is merited/will be made (as formulated by CITY), and (3) change is merited/will be made (as formulated by CITY working in collaboration with CONSULTANT). With regard to item 3, CONSULTANT shall work with CITY to formulate changes in those specific areas identified (accordingly) by CITY. If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, City, in its discretion, may authorize additional services on an hourly basis. It is the experience of CONSULTANT that when a change is not merited/will not be made, it is helpful (from a stakeholder perspective) to provide an explanation and/or the rationale for not making a change. Deliverable CONSULTANT shall provide written Rules and Regulations, Minimum Standards, and Leasing Policy (and other related documents) to CITY. 2-A: Define Current and Potential Uses and Services at the Airport City Requirement DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 21 Define current and potential future uses and services at the Airport. Scope of Work CONSULTANT shall define current and potential future uses and services at the Airport. Work Plan (Tasking) Task 1: Information Gathering Relevant and pertinent information, data, and documentation will be compiled by CITY. CONSULTANT shall provide a written information request to CITY to help facilitate this process. CONSULTANT shall review and analyze initial information, data, and documentation provided/obtained and conduct initial research. Task 2: Field Visit (First) CONSULTANT shall conduct a field visit (first field visit) to include: (1) a project “kick-off” (initialization) meeting with representatives of CITY, (2) tour of the Airport, FBOs, SASOs, and non-commercial leased premises, (3) meetings with the Task Force, the Palo Alto Airport Pilot’s Association, and other stakeholders (i.e., representatives of the FBOs, SASOs, and/or non-commercial entities) – as determined by CITY working in collaboration with CONSULTANT and based on available time and budget, and (4) a public meeting (open forum or open house) that can be attended by the larger community, Airport users, and other interested parties. CONSULTANT shall review and analyze additional information, data, and documentation provided/obtained. CONSULTANT time on-site shall be limited to 6 hours (or 3 people for 0.25 days) for this task. Task 3: Draft Document (First) CONSULTANT shall prepare the first draft of the analysis (based on the information, data, and documentation provided/obtained and the input provided by CITY) and provide the first draft of the analysis to CITY for review. CITY shall review the first draft of the analysis. Task 4: Working Session (First) CONSULTANT shall conduct a “working session” (by telephone) with CITY to discuss the first draft of the analysis and solicit input. The working session will be approximately one hour. NOTE: CONSULTANT may be able to conduct the working session in person (second field visit) based on available time and budget. Task 5: Draft Document (Second) CONSULTANT shall revise the first draft of the analysis (based on the input provided by CITY during the first working session) and provide the second draft of the analysis to CITY. CITY shall provide the second draft of the analysis to other CITY departments. CITY and other CITY departments will review the second draft of the analysis. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 22 Task 6: Working Session (Second) CONSULTANT shall conduct a “working session” (by telephone) with CITY and other CITY departments to discuss the second draft of the analysis and solicit input. The working session will be approximately one hour. Task 7: Final Document CONSULTANT shall revise the second draft of the analysis (based on the input provided by CITY and other CITY departments during the second working session) and provide the final analysis to CITY. NOTE: Comment Compilation and Response. Upon conclusion of the review periods, CITY shall prepare a compilation of all comments provided by all sources (by document and section). If CITY, in consultation with CONSULTANT, determines that the magnitude or complexity of the work (time) required by CONSULTANT (to formulate a response) is excessive, CITY, in its discretion, may authorize additional services on an hourly basis. Deliverable CONSULTANT shall provide written summary report to CITY. 3: Public Outreach and Participation City Requirements It is expected that the study will be the focus of a series of public meetings over a 6-month period. It is also expected that the public participation process will be guided by the formation and periodic meeting of an Airport Stakeholders Task Force. Public outreach may include, at a minimum: A. Lead a public engagement process and promote meaningful dialogue between all stakeholders, including recreational and commercial users of the Airport, Palo Alto residents, City officials and local, state and federal agencies. B. Develop a strategic framework and guidelines to address the broad range of concerns and issues that will be identified in the public engagement process. For Example: noise impacts, infrastructure building conditions and needs, wildlife hazards, and environmental and sustainability opportunities... C. Periodic meetings with the Airport Stakeholder Task Force. The City Manager will compose the Stakeholder Task Force, comprised of pilots, business owners, residents and other interested individuals or organizations. It is expected that there would be 11-15 committee members and they would meet approximately 3 times during the study. D. 1-2 Larger community meetings with the surrounding communities, including businesses, residents, and others. E. At least 1-2 meetings with the Palo Alto Airport Pilots Association and users. F. At least 2-3 meetings with the City Council. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 23 An early scoping meeting with the City should be used to refine the desired public outreach approach. Scope of Work A series of public meetings will be held during the project and the City Manager will designate an Airport Stakeholders Task Force to provide input to staff throughout the process. CONSULTANT shall: 3-A Lead a public engagement process and promote meaningful dialogue between stakeholders. 3-B Develop a strategic framework and guidelines that can be used by CITY to address the concerns and/or issues identified during the public engagement process. 3-C Meet with the Airport Stakeholder Task Force (consisting of 11 to 15 members) on a periodic basis (a maximum of three times during the project). 3-D Meet with the larger community (a maximum of two times during the project). 3-E Meet with the Palo Alto Airport Pilots Association and Airport users (a maximum of two times during the project). 3-F Meet with City Council (a maximum of three times during the project). NOTE: While the proposed budget includes four field visits (and multiple meetings with each group identified), CONSULTANT’s project manager will meet with CITY (early on) to refine the desired public engagement approach. Once the approach has been refined, a revised budget (if necessary) will be provided to CITY. Work Plan (Tasking) Public outreach and participation is included in the work plans (tasking) for the other selected elements identified herein. Deliverable CONSULTANT shall provide a written summary of a strategic framework and guidelines (to address the concerns and/or issues identified during the public engagement process) to CITY. Scope of Work This is a future phase. On completion of Phase 1 Services, the City intends to evaluate and make a determination whether to amend this Agreement to authorize Phase 2. If authorized, Phase 2 will consist of development of an Airport Business Plan (ABP). An ABP is a document that uses a logical and disciplined structure to set out goals, objectives, and actions plans that drive the day-to-day operation and management of the airport. It includes mission, vision and values statements, goals (driven by a strengths, weaknesses, opportunities and threats analysis), objectives and action plans. DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 24 EXHIBIT “B” SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed. Phase 1 Milestones/Tasks Completion No. of Days/Weeks/Years From NTP Highest and Best Use Analysis TBD FBO Options Analysis TBD FBO Interim Plan one to three years FBO Lease Agreements TBD Rate (Fee) Study TBD Airport Rent Study TBD Rules and Regulations, Minimum Standards, and Leasing Policy TBD Define Current and Potential Uses and Services at the Airport TBD Public Outreach and Participation on-going Phase 2 Milestones/Tasks (if authorized) Completion No. of Days/Weeks/Years From NTP Airport Business Plan TBD DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation for Phase 1 Services shall be paid by the CITY to CONSULTANT on a fixed fee basis in accordance with the Budget Schedule - Phase 1. Compensation for Additional Services shall be paid by the City to CONSULTANT based on the hourly rate schedule attached as exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services described in Exhibit “A” (Scope of Work – Phase 1) and reimbursable expenses shall not exceed $166,371.00. CONSULTANT agrees to complete all Phase 1 Services, including reimbursable expenses, within this amount. In the event CITY authorizes any Additional Services, the maximum compensation for all Phase 1 Services including reimbursable expenses and Additional Services shall not exceed $183,008.10. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. The CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, does not exceed $166,371.00 and the total compensation for Additional Services does not exceed $16,637.10. BUDGET SCHEDULE – Phase 1 NOT TO EXCEED AMOUNT Element Budget 1-D (1): Highest and Best Use Analysis $18,368 1-D (2): FBO Options Analysis $19,920 1-D (X): FBO Interim Plan $7,360 1-G: FBO Lease Agreements $8,740 1-J (1): Rate (Fee) Study $17,980 1-J (2): Airport Rent Study $15,040 2: Rules and Regulations, Minimum Standards, and Leasing Policy $72,953 2-A: Define Current and Potential Uses and Services at the Airport $6,010 3: Public Outreach and Participation Included Total $166,371 DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 Sub-total Phase 1 Services $166,371.00 Total Phase 1 Services and Reimbursable expenses $166,371.00 Additional Services (Not to Exceed) $16,637.10 Maximum Total Compensation $183,008.10 BUDGET SCHEDULE – Phase 2 NOT TO EXCEED AMOUNT TBD REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: A. Travel, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost. All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $500 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expense, for such services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 EXHIBIT “C-1” HOURLY RATE SCHEDULE CONSULTANT Position Hourly Billing Rate Staff $80 Project Analyst $140 Consultant $200 Principal $260 SUBCONSULTANT Position Hourly Billing Rate Administrative $95 Project Planner III $144 Project Planner $177 Senior Project Planner $216 DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 EXHIBIT “D” INSURANCE REQUIREMENTS CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW: REQUIRED TYPE OF COVERAGE REQUIREMENT MINIMUM LIMITS EACH OCCURRENCE AGGREGATE YES YES WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED. $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. B. CROSS LIABILITY DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 Professional Services Rev. March 31, 2015 THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. NOTICES SHALL BE MAILED TO: PURCHASING AND CONTRACT ADMINISTRATION CITY OF PALO ALTO P.O. BOX 10250 PALO ALTO, CA 94303 DocuSign Envelope ID: 075E4C1B-ABEA-40EB-B18F-8DFC1F087C33 City of Palo Alto (ID # 6968) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Amendment to Current Purchase Order with BoundTree Medical Title: Approval to Amend the Current Purchase Order to Include Equipment for new Ambulance Purchase From: City Manager Lead Department: Fire Recommendation Staff recommends that Council approve an increase to existing Blanket Purchase Order (BPO) with BoundTree for the purchase of medical equipment to stock a new ambulance purchased in FY2015. Approve an increase to the BPO of $12,000 for FY 2016 to cover costs of putting the ambulance in service. Executive Summary The Palo Alto Fire Department has a BPO for $120,000 per year for medical equipment, medications and disposable supplies to treat and transport patients. This contract was based on three ambulances in operation daily and one spare ambulance. As of May 10, 2016, there is $9,000 left in the BPO to purchase the daily use medical equipment until June 30, 2016. Approximately $5,000 worth of medical supplies are used every two weeks. Due to the increase in emergency medical services (EMS) call volumes over the past four years, the BPO was able to cover the increased usage, but there is insufficient budget to stock the new ambulance without an increase of the approved limits to the current annual contract. The new ambulance buildout money was approved by council in full but the department didn’t consider the amount of the equipment, once ordered, to exceed the annual medical equipment budget of $120,000 (One hundred twenty thousand dollars and zero cents). City of Palo Alto Page 2 This FY Budget will cover the added expense. Background In FY2015 the fleet of ambulances increased from four to five due to an increase in EMS calls and a strategic reorganization towards EMS to meet community demands. Although the medical equipment was included in the purchase of the ambulances, it wasn’t purchased at the time of approval for the new ambulances. The current agreement (BPO) will not cover the costs of the equipment to stock one new ambulance. Ordering new disposable and other items will exceed the current BPO. The current contract with BoundTree Medical is budgeted for the smaller fleet and annual patient transport numbers. It does not cover the cost of an additional ambulance. The current agreement also didn’t include the increased pricing of medications and other medical supply increases over the past four years. Although the BPO was able to absorb the costs in previous years, the account will be at or near zero by June 30, 2016, without the increase requested. It is important to remember that the costs of medical supplies are billed to insurance companies and individuals who are transported in a Palo Alto Fire Department Ambulance. Costs are not recovered for patients who are treated and released at the scene, or who secure alternate transportation to the hospital. Staff will be going out for a new bid in 2017 to include the increase of call volume and the addition of the new ambulance. At that time the overall medical equipment budget will be updated and submitted with the new RFQ. Resource Impact The current FY EMS Budget will absorb the extra costs. There will be no additional funding at this time. Attachments:  Attachment A: BPO Boundtree 2015 (PDF)  Attachment B: Ambulance Equipment Quote (PDF) City of Palo Alto - Cover Letter Blankets City of Palo Alto Administrative Services Department Contract Administration Mezzanine Floor, Civic Center 250 Hamilton Avenue P.O. Box 10250 Palo Alto, CA 94303 (650) 329-2271 BLANKET ORDERS July 1, 2015 To all vendors for the City of Palo Alto: The attached blanket order has been issued with the intent to conduct business with your company for a period of one year. The products or services listed are based on our needs, and the total of the order is an estimated not-to-exceed amount to cover our annual requirements. The City makes no guarantee of actual or minimum purchases during the term of this order. Do not accept requests for materials or services without valid City of Palo identification AND a valid purchase order number. Without these items, the City of Palo Alto will not be responsible for payment for these items. Please update your records to reflect the billing address, the contact, and invoicing person as noted. Any references to rates, costs, or quotes are based on the most current information we have or attained from your company. If any corrections are required – please contact me at the number below as soon as possible. Purchasing and Contract Administration: (650) 329-2271 fax (650) 329-2302 Attachment A 1 *** BLANKET PURCHASE AGREEMENT *** 0010 FY15-16 Medical Supplies for EMS 120,000 USD 1.00 120,000.00 **Supersedes Blanket Order 4615000006** Blanket service order for Emergency Medical Supplies and Services. The City of Palo Alto, Fire Department, will procure items as required. Pricing established from RFQ:152490. This blanket purchase agreement is for an amount not-to-exceed $120,000.00. . Term Pricing: . 2nd year of a three year Blanket - July 1, 2015 - June 30, 2016 . July 1, 2015 - June 30, 2016 - Contract allows up to a 5% annually increase for the first and second optional 12 month extension of the contract. Actual increased applied for the duration of the second year term is 4.92%. Products shall be shipped to the following locations: a. Station 1 at 301 Alma Street, Palo Alto, California 94301. b. Station 2 at 2675 Hanover Drive, Palo Alto, California 94304. c. Station 6 at 711 Serra Street, Stanford, California 94305. . Vendor Address BOUND TREE MEDICAL LLC PO Box 300 GALLOWAY OH 43119 Tel: 614-878-8581 Fax: 800-257-5713 Bill To: City of Palo Alto Account Payable P.O.Box 10250 Palo Alto, CA 94303 Ship To: Fire Department Administration City of Palo Alto 250 Hamilton Ave., 6th Floor Palo Alto CA 94301 Item Material/Description Quantity UM Unit Price Target $ Value ______________________________________ Interim Manager, Purchasing/Contract Administration THIS P.O. IS SUBJECT TO THE TERMS AND CONDITIONS STATED BELOW AND ON THE LAST PAGESPECIFICATIONS - Any specification and /or drawings referred to and/or attached hereto are expressly made a part of this Purchase Order.DELIVERY - Please notify the City promptly if delivery cannot be made on or before the date specified. If partial shipment is authorized, so indicate on all documents. Complete packing lists must accompany each shipment. INVOICE - A separate invoice is required for each order. Send to address indicated above. City of Palo Alto Purchasing and Contract Administration P.O.Box 10250 Palo Alto CA 94303 Tel:(650)329-2271 Fax:(650)329-2468 Blanket Order P.O. NUMBER MUST APPEAR ON ALL INVOICES, PACKAGES, SHIPPING PAPERS AND CORRESPONDENCE PERTAINING TO THIS ORDER PO Number 4616000112 Date 07/16/2015 Vendor No.102109 Payment Terms Payment Due 30 days FOB Point F.O.B. Palo Alto Ship via Ship BestWay Term 07/01/2015 - 06/30/2016 Buyer/Phone Gloria Jimenez / 650-329-2178 Email gloria.jimenez@cityofpaloalto.org DELIVERIES ACCEPTED ONLY BETWEEN 7:00 AM & 3:00 PM UNLESS OTHER ARRANGEMENTS ARE INDICATED HEREIN Page 1 of 2 Attachment A 2 City contact for invoices, all invoices to be submited to: Irene Evans, telephone: 650-329-2674 . Project Manager Kim Roderick . The City makes no guarantee of actual or minimum purchases during the term of this agreement. ------------------------- Sub-Total 120,000.00 Vendor Address BOUND TREE MEDICAL LLC PO Box 300 GALLOWAY OH 43119 Tel: 614-878-8581 Fax: 800-257-5713 Bill To: City of Palo Alto Account Payable P.O.Box 10250 Palo Alto, CA 94303 Ship To: Fire Department Administration City of Palo Alto 250 Hamilton Ave., 6th Floor Palo Alto CA 94301 Item Material/Description Quantity UM Unit Price Target $ Value ______________________________________ Interim Manager, Purchasing/Contract Administration Total 120,000.00 THIS P.O. IS SUBJECT TO THE TERMS AND CONDITIONS STATED BELOW AND ON THE LAST PAGESPECIFICATIONS - Any specification and /or drawings referred to and/or attached hereto are expressly made a part of this Purchase Order.DELIVERY - Please notify the City promptly if delivery cannot be made on or before the date specified. If partial shipment is authorized, so indicate on all documents. Complete packing lists must accompany each shipment. INVOICE - A separate invoice is required for each order. Send to address indicated above. City of Palo Alto Purchasing and Contract Administration P.O.Box 10250 Palo Alto CA 94303 Tel:(650)329-2271 Fax:(650)329-2468 Blanket Order P.O. NUMBER MUST APPEAR ON ALL INVOICES, PACKAGES, SHIPPING PAPERS AND CORRESPONDENCE PERTAINING TO THIS ORDER PO Number 4616000112 Date 07/16/2015 Vendor No.102109 Payment Terms Payment Due 30 days FOB Point F.O.B. Palo Alto Ship via Ship BestWay Term 07/01/2015 - 06/30/2016 Buyer/Phone Gloria Jimenez / 650-329-2178 Email gloria.jimenez@cityofpaloalto.org DELIVERIES ACCEPTED ONLY BETWEEN 7:00 AM & 3:00 PM UNLESS OTHER ARRANGEMENTS ARE INDICATED HEREIN Page 2 of 2 Attachment A 3 CITY OF PALO ALTO GDS Rev. 09/28/2012 TERMS AND CONDITIONS OF PURCHASE PAGE 1 OF 3 ACCEPTANCE/AGREEMENT: City of Palo Alto (City) reserves the right to reject any and all quotations, to waive any informalities, and, unless otherwise specified by Seller, to accept any item in a quotation. By accepting or filing this Purchase Order (P.O.), Seller agrees to the terms and conditions herein which shall prevail over any inconsistent provision in any form or other paper submitted by Seller. All shipments or services performed shall be deemed to have been made pursuant hereto. No other terms are acceptable. This P.O., including all specifications and drawings, shall constitute the entire agreement between the parties unless modified in writing by City. CITY'S PROPERTY: Seller agrees that the information, tools, jigs, dies, or materials, and drawings, patterns, and specification supplied or paid for by City shall be and remain City property and shall be held by Seller for City unless directed otherwise. Seller shall account for such items and keep them protected, insured, and in good working conditions without expense to City. DELIVERY: The terms of delivery are as stated on the reverse side hereof. The obligation of Seller to meet the delivery dates, specifications, and quantities set forth herein is of the essence of this P.O. No boxing, packing, or cartage charge will be allowed unless authorized by this P.O. Deliveries are to be made both in quantities and at times specified herein or, if not, such quantities and times are specified pursuant to City's written instruction. Items not delivered may be canceled without penalty to City. Shipments in greater or lesser quantity that ordered may be returned at Seller's expense unless written authorization is issued by City. PRICES: The price which Seller charges in filling this P.O. shall not be higher than Seller's most recent quote or charge to City for such materials, supplies, services and/or installations unless City expressly agrees otherwise in writing. Notwithstanding the prices set forth the P.O. City shall receive the benefit of any general reduction in the price of any item(s) listed herein which may be made by Seller at any time prior to the last delivery of goods or services covered by this P.O. TERMINATION: City shall have the right to terminate this P.O. or any part thereof upon ten (10) days notice in writing to Seller. (1) Without Cause. City may terminate all or any part of this P.O. without cause. Any claim by Seller for damages due to termination without cause must be submitted to City within thirty (30) days after effective date of termination. (2) For Cause. If Seller fails to make any delivery in accordance with the agreed delivery date, delivery schedule, or otherwise fails to observe or comply with any of the other instructions, terms, conditions or warranties applicable to this P.O., City may, in addition to any other right or remedy provided by this P.O. or by law, terminate all or any part of this P.O. in writing without any liability of City with respect to Seller at any time during the term of this P.O. In the event of termination for cause, City may purchase supplies or services elsewhere on such terms or in such manner as City may deem appropriate and Seller shall be liable to City for any cost and other expenses incurred by City, which is charged to City. CHANGES: City shall have the right at any time by written notice via P.O. Change Order to Seller to make changes in the specifications, the quantity of items called for, delivery schedules, and requirements covering testing, packaging, or destination. Any claim by Seller for adjustment under this clause shall be deemed waived unless made in writing with then (10) days after receipt by Seller of notice of such change. Price increases or extensions of time for delivery shall not be binding on City unless evidenced by a P.O. Change Order issued by City's Purchasing Manager. INSPECTION: City shall have the right to inspect and approve or reject any materials, supplies, services and/or installations upon arrival of notice of completion prior to payment without regard to the manner of shipment, completion, or any shipping or price terms contained in this P.O. All materials, supplies, services and/or installations must be furnished as specified. (1) Defective, damaged, and nonconforming materials and/or supplies may be returned for credit or refund, at Seller's expense. City may charge Seller for all expenses of unpacking, examining, repacking and reshipping of such materials and/or supplies. (2) Defective, incorrect and nonconforming services and/or installations may be returned for credit or refund, at Seller's expense. All of the above notwithstanding prior payment by City. WARRANTY: Seller expressly warrants that all materials, supplies, services and/or installations covered by this P.O. shall: (1) conform to the specifications, drawings, samples, or other descriptions specified by City or if none are so specified, to Seller's standard specification or the standards of the ASTM or ANSI or other national standard organizations; (2) be new and unless specified to the contrary on the face hereof, will be free from defects in material and workmanship and will be free of all liens and encumbrances and will conform to any affirmation of facts made on the container or label; (3) be adequately contained, packaged, marked, labeled and/or provided in compliance with all applicable federal and state laws and regulations (including materials deemed hazardous); (4) be performed within the rules and regulations of the Occupational Safety and Health Act of 1970 (as amended); (5) be produced or transferred or disposed of as required by federal and state laws and regulation under the conditions of the Toxic Substances Control Act; the Hazardous Materials Control and Hazardous Waste Regulations; and other toxic laws and programs. Seller further expressly agrees to protect, indemnify, and hold harmless City, its employees and agents for any loss, damage, fine, liability, fee (including reasonable charges and fees) or expense arising in connection with or resulting from Seller's failure to furnish materials or supplies or perform services that conform with any warranty contained herein. (6) have good marketable title. GOVERNING LAW: This P.O. shall be governed by the laws of the State of California. INDEPENDENT CONTRACTOR, INSURANCE: Seller certifies, by acceptance, that he/she is an independent contractor. Seller shall protect, defend, and indemnify and hold City harmless against all damages, liability, claims, losses and expenses (including attorney's fees) arising out of , or resulting in any way from Seller's negligence in providing the goods or services purchased hereunder or from any act or omission of Seller, its agents, employees, or subcontractors, Seller shall maintain such public liability insurance, including contractual liability, automobile and general public liability, (including non-owned automobile liability) Worker's Compensation, and employer's liability insurance as well adequately protect City against such damage, liabilities, claims, losses, and expenses (including attorney's fees). Seller agrees to submit certificates of insurance, evidencing its insurance coverage when requested by City. EQUAL OPPORTUNITY CLAUSE: By acceptance of this P.O., Seller certifies it is in compliance with the Equal Opportunity Clause required by Executive Order 11246, as amended, and the Palo Alto Municipal Code, as amended, including Affirmative Action Compliance Programs for Veterans; Handicapped; and Minority Business, and other equal opportunity programs. FORCE MAJEURE: City may delay delivery or acceptance occasioned by causes beyond its control. Seller shall hold such materials, supplies, services and or installations at the direction of City and shall deliver them when the cause affecting the delay has been removed. City shall be responsible only for Seller's direct additional costs in holding the goods or delaying performance of this P.O. and City's request. Seller shall also be excused if delivery is delayed by unforeseen events beyond its reasonable control, provided Seller notifies City as soon as they occur. City may cancel this P.O. if such delay exceeds thirty (30) days from the original delivery date. Seller shall use its best efforts to grant preference to this P.O. over those of other customers, which were placed after this P.O. AUTHORITY OF AGENT OR FACTOR: Seller represents that, whenever it executes this P.O. on behalf of a third party as an agent or factor, it shall disclose the existence of the agency or factor relationship to City. Seller shall be deemed to have the legal authority to enter into this P.O. with City on behalf of the third party. INTERPRETATION OF CONTRACT DOCUMENTS: In the event of a conflict between the terms of this P.O. and the attached specification with respect to any obligation of Seller, the provision which impose the greater obligations upon Seller shall prevail. Attachment A 4 CITY OF PALO ALTO GDS Rev. 09/28/2012 TERMS AND CONDITIONS OF PURCHASE PAGE 2 OF 3 ENVIRONMENTALLY PREFERRED PURCHASING REQUIREMENTS: Seller agrees to comply with the City's Environmentally Preferred Purchasing Requirements. (1) Hazardous Waste: Seller shall take-back all spent or otherwise discarded hazardous products sold to the City by the Seller if the spent or discarded products are classified as hazardous or universal wastes by State or Federal regulations. Seller shall provide convenient collection and recycling services (or disposal services if recycling technology is unavailable) for all universal wastes, which originate from the Vendor. Hazardous waste manifests or bills of lading must be provided to City staff upon request. Recycling and reuse of hazardous wastes must occur within the United States. Universal waste lists and information are available www.dtsc.ca.gov/HazardousWaste/UniversalWaste/. A hazardous waste list is available at http://www.calrecycle.ca.gov/LEA/Training/wasteclass/yep.htm. Additional information can be obtained by contacting the City of Palo Alto Hazardous Waste Department at (650) 496-6980. (2) Zero Waste: Seller shall comply with the waste reduction, reuse and recycling requirements of the City's Zero Waste Program. Seller acknowledges and agrees that if Seller fails to fully and satisfactorily comply with these requirements, the City will suffer, as a result of Seller's failure, substantial damages which are both extremely difficult and impracticable to ascertain. Therefore, the Seller agrees that in addition to all other damages to which the City may be entitled, in the event Seller fails to comply with the below requirements Seller shall pay City as liquidated damages the amounts specified below. The liquidated damage amount is not a penalty but considered to be a reasonable estimate of the amount of damages City will suffer as a result of such non-compliance. Sellers shall adhere to the standard that all printed materials provided to the City that are generated from a personal computer and printer including, proposals, quotes, invoices, reports, and public education materials shall be double-sided, printed on a minimum of 30% post-consumer content paper or greater unless otherwise approved by the City's Environmental Services Division (650) 329-2117. Materials printed by a professional printing company shall be a minimum of 30% post-consumer material or greater and printed with vegetable based inks. Liquidated damages of $30 per document will be assessed by City for failure to adhere to this requirement. All secondary and shipping (tertiary) packaging generated shall first be minimized/reduced to the maximum extent feasible while protecting the product shipped. All paper packaging must be Forest Stewardship Council (FSC) Certified. Expanded plastics (e.g., foam or cushion blocks, trays, packing 'peanuts'), such as but not limited to polystyrene (aka Styrofoam[tm]), polypropylene, or polyurethane shall not be used as secondary or tertiary/shipping packaging. Liquidated damages of $235 or a minimum of $50 if the combined product and shipping cost is $235 or less will be assessed by City for failure to adhere to this requirement. All secondary and shipping packaging shall be recyclable in the City's recycling program. A complete list of items accepted for recycling are found at www.zerowastepaloalto.org or by calling (650) 496-5910. If any portion is received that does not meet this requirement, liquidated damages of $235 or a minimum of $50 if the combined product and shipping cost is $235 or less will be assessed by City for failure to adhere to this requirement. If approved by the City's Environmental Services Division and Administrative Services Department, a packaging takeback program may be proposed by the vendor or manufacturer for City use if the service is provided at no additional cost to the City. Staff will review proposed takeback programs to ensure the program meets City needs. If approved by the City's Environmental Services Division, a packaging requirement may be waived if no other viable alternative exists and not using the current packaging presents the likelihood of product damage. Reusable/returnable pallets shall be used and taken back by the Seller, at no additional cost to the City. Seller shall provide documentation upon request ensuring reuse of pallets and/or recycling of broken pallets. Liquidated damages of $262 or a minimum of $50 if the combined product and shipping cost is $262 or less will be assessed by City for failure to adhere to this requirement. (3) Energy and Water Efficiency: Seller shall provide products with an ENERGY STAR, Water Sense or State of California standard rating, whichever is more efficient, when ratings exist for those products. A life cycle cost analysis shall be provided to the City upon request and shall at minimum include: first cost, operating costs, maintenance costs, and disposal costs. Contacts for additional information about City of Palo Alto Hazardous Waste, Zero Waste and Utilities programs: Hazardous Waste Program (Public Works) (650) 496-6980 Zero Waste Program (Public Works) (650) 496-5910 Watershed Protection (650) 329-2117 Energy Efficiency (650) 496-2244 (4) Liquidated Damages: Seller agrees that failure to comply with the City's Environmentally Preferred Purchasing Requirements will result in Liquidated Damages, according to the table marked Liquidated Damages on page 3 of this P.O. Attachment A 5 Event of Non-Performance Recycled Paper Use Failure to use 30% recycled content paper Recyclable Packaging Materials Failure of Seller to use secondary and shipping packaging that is recyclable in the City's recycling program. Expanded Foam Plastics Unapproved use of expanded foam plastics for secondary or shipping packaging Pallet Use Failure of Seller to take-back and reuse pallets, recycling only broken pallets, at no additional cost to the City. Acceptable Performance Level (Allowed events per Fiscal Year) 1 1 0 1 Liquidated Damage Amount $30 per each document $235 or a minimum of $50 if the combined product and shipping cost is $250 or less will be incurred if this is not adhered to. $235 or a minimum of $50 if the combined product and shipping cost is $235 or less $262 or a minimum of $50 if the combined product and shipping cost is $2 or less CITY OF PALO ALTO GDS Rev. 09/28/2012 TERMS AND CONDITIONS OF PURCHASE NONCOMPLIANCE WITH EVIRONMENTALLY PREFERRED PURCHASING REQUIREMENTS, LIQUIDATED DAMAGES: The following table lists the events that constitute breaches of the Agreement's standard of performance warranting the imposition of liquidated damages; the acceptable performance level, and the amount of liquidated damages for failure to meet the contractually required standards of performance. PAGE 3 OF 3 Attachment A 6 EMS Order Station One Page 1 of 5 5000 Tuttle Crossing Blvd Date:5/6/2016 Dublin, OH 43016 Phone: 800-533-0523 Fax: 800-257-5713 Account Name:Palo Alto Fire Department 114086 BILL TO:250 Hamilton Avenue Palo Alto, California 94301 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 001:301 Alma Street Palo Alto, California 94301 xxxxxxxxxxxx Attn: Sunny Gutter Johnson (650) 329-2102 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 003:2675 Hanover Drive Palo Alto, California 94301 Attn: Adam King (650) 329-2256 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 011:250 Hamilton Avenue Palo Alto, California 94301 Contact: EMS Chief Kim Roderick (650) 329-2102 Acct. Manager:Brian Hartley (925) 719-0139 Ship Method Payment Terms bhartley@boundtree.com Item Number BTM's Description U/M Price Quantity Extended Price EMS SUPPLIES 901003 ACTIVATED CHARCOAL ACTIDOSE AQUA 25GM/120ML BOTTLE 12/CS EA 17.18$ 6 103.08$ 301-04 Adenosine 12mg, 4ml Vial, 10ea/bx EA 12.99$ 10 129.90$ 0542-02 Adenosine 6mg, 2ml Vial 10ea/bx EA 5.99$ 5 29.95$ 379501 ALBUTEROL 2.5MG, 0.83MG/ML, 3ML UNIT DOSE, INDIVIDUALLY WRAPPED 30/BX BX 5.69$ 1 5.69$ 911316 Aspirin 81mg Chewable, Orange Flavor 36/Bottle BT 0.89$ 6 5.34$ 6006-10 Atropine 8 mg 20 ml Vial 10ea/bx EA 42.29$ 3 126.87$ 371006 ATROPINE 1MG 10ML LUER JET 1006B 10EA/PK EA 11.06$ 10 110.60$ 170775 BLOOD PRESSURE CUFF NAVY SIZE 11 ADULT 20/CS PROSPHYG 775 EA 11.84$ 1 11.84$ 170775C BLOOD PRESSURE CUFF NAVY SIZE 10 SMALL ADULT PROSPHYG 775 EA 11.84$ 1 11.84$ 170775X BLOOD PRESSURE CUFF NAVY SIZE 12 LARGE ADULT PROSPHYG 775 EA 11.84$ 1 11.84$ 170775I BLOOD PRESSURE CUFF NAVY SIZE 9 CHILD PROSPHYG 775 EA 11.84$ 1 11.84$ 373304 CALCIUM CHLORIDE 1GM, 10 ML LUER JET 1010B EA 11.25$ 4 45.00$ Free Freight Net 30 Account Number: EMS Order Station One Page 2 of 5 Attn: Sunny Gutter Johnson (650) 329-2102 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 003:2675 Hanover Drive Palo Alto, California 94301 Attn: Adam King (650) 329-2256 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 011:250 Hamilton Avenue Palo Alto, California 94301 Contact: EMS Chief Kim Roderick (650) 329-2102 Acct. Manager:Brian Hartley (925) 719-0139 Ship Method Payment Terms bhartley@boundtree.com Item Number BTM's Description U/M Price Quantity Extended Price Free Freight Net 30 D250 CARPUJECT HOLDER 2024 EA 0.50$ 2 1.00$ 488512 CLIPBOARD BOX OVER ANOTHER BOX 8.5 IN X 12 IN CRUISER MATE 6EA/CS EA 22.99$ 1 22.99$ 179662 Clipper Charger Stand, for 3M 9661 Rechargeable Surgical Clippers EA 56.84$ 1 56.84$ 177432 CONTROL SOLUTION 1 LOW 1 HIGH FOR OPTIUM OR PRECISION XTRA 6/CS EA 10.15$ 1 10.15$ 1071-36013 Convenience Bag, Yack Sack Personal Access Bag, For Vomit or Urine Disposal 240ea/cs EA 1.28$ 50 64.00$ D5101 CURAPLEX RESUSCITATOR COMPACT MANUAL ADULT, BVM 16/CS EA 11.99$ 2 23.98$ D5102 CURAPLEX RESUSCITATOR COMPACT MANUAL CHILD, BVM 16/CS EA 13.99$ 2 27.98$ D5103 CURAPLEX RESUSCITATOR COMPACT MANUAL INFANT, BVM 16/CS EA 13.99$ 2 27.98$ 230107 DEFIB/PACING/ECG PADS PEDI W/ QUIK-COMBO CONNECTOR FOR LP12 & LP10 & LP5 11996-000093 PR 28.95$ 10 289.50$ 373301 DEXTROSE 50% 25GM 50ML LUER JET 1013B EA 11.96$ 5 59.80$ 0376-25 DIPHENHYDRAMINE 50MG/ML 1ML SDV 2035 - BENADRYL 25 VIALS/PK EA 1.10$ 25 27.50$ 118-2B0842EA Dopamine, 400 mg, 5% Dextrose, injection, 250 ml 18ea/cs EA $ 14.28 4 57.12$ 620-01 DUODOTE AUTO-INJECTOR, 30EA/CS EA 49.85$ 4 199.40$ 238497 ELECTRODES ADULT REDI-PAK PRECONNECT SYSTEM QUIK-COMBO PACE/DEFIB/ECG LP500, LP1000, LP12, LP15 11996-000017 PR 25.85$ 5 129.25$ 533-MS-SH005R EMS shears, red, 7 1/4 in., safety bandage tip, fully autoclavable, surgical stainless steel blades EA 1.29$ 10 12.90$ 0641142035 EPINEPHRINE 1:1000 1MG 1ML AMPULE 2043 EA 3.72$ 10 37.20$ 373316 EPINEPHRINE 1:10000 1 MG 10 ML LUER JET 1019B EA 5.89$ 6 35.34$ 2142-84101 EQUIPLITE LARYNGOSCOPE BLADE, MAC 1, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ EMS Order Station One Page 3 of 5 Attn: Sunny Gutter Johnson (650) 329-2102 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 003:2675 Hanover Drive Palo Alto, California 94301 Attn: Adam King (650) 329-2256 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 011:250 Hamilton Avenue Palo Alto, California 94301 Contact: EMS Chief Kim Roderick (650) 329-2102 Acct. Manager:Brian Hartley (925) 719-0139 Ship Method Payment Terms bhartley@boundtree.com Item Number BTM's Description U/M Price Quantity Extended Price Free Freight Net 30 2142-84202 EQUIPLITE LARYNGOSCOPE BLADE, MAC 2, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-84303 EQUIPLITE LARYNGOSCOPE BLADE, MAC 3, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-84404 EQUIPLITE LARYNGOSCOPE BLADE, MAC 4, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-82000 EQUIPLITE LARYNGOSCOPE BLADE, MILLER 0, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-82101 EQUIPLITE LARYNGOSCOPE BLADE, MILLER 1, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-82202 EQUIPLITE LARYNGOSCOPE BLADE, MILLER 2, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-82303 EQUIPLITE LARYNGOSCOPE BLADE, MILLER 3, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ 2142-82404 EQUIPLITE LARYNGOSCOPE BLADE, MILLER 4, DISPOSABLE, LED, STAINLESS STEEL, FITS STANDARD HANDLES EA 4.99$ 3 14.97$ F0208 EXTRICATION COLLAR CARRY CASE ALLIANCE 24X 10 X 5.5 EA 15.89$ 4 63.56$ 15329 Extrication device, green, for immobilizing and extricating patients, carry case EA 69.85$ 1 69.85$ 470065 FERNO WASHINGTON XCEL SCOOP STRETCHER EA 839.85$ 2 1,679.70$ 0129 forceps, Magill, adult EA 3.75$ 2 7.50$ 0128 forceps, Magill, child EA 3.75$ 2 7.50$ 2761-71181 FreeStyle Precision H Meter 50ea/cs EA 0.01$ 3 0.03$ 0260-10 Glucagen Kit 1 mg Inj EA 214.85$ 2 429.70$ 264840 IMMOBILIZATION BOARD WITHOUT CARRY CASE; BROSELOW READY PEDIATRIC EA 217.40$ 1 217.40$ 464631 INSTA-GLUCOSE 31GM 2064 EA 3.60$ 6 21.60$ 028620 LARYNGOSCOPE HANDLE RUSCH PEDIATRIC EA 13.99$ 2 27.98$ EMS Order Station One Page 4 of 5 Attn: Sunny Gutter Johnson (650) 329-2102 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 003:2675 Hanover Drive Palo Alto, California 94301 Attn: Adam King (650) 329-2256 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 011:250 Hamilton Avenue Palo Alto, California 94301 Contact: EMS Chief Kim Roderick (650) 329-2102 Acct. Manager:Brian Hartley (925) 719-0139 Ship Method Payment Terms bhartley@boundtree.com Item Number BTM's Description U/M Price Quantity Extended Price Free Freight Net 30 028621 LARYNGOSCOPE HANDLE RUSCH STANDARD EA 13.99$ 2 27.98$ 373390 LIDOCAINE 2% 100MG 5ML LUER JET 1026B 10EA/PK EA 3.80$ 5 19.00$ 2B0973 LIDOCAINE 2GM IN DEXTROSE 5% 500ML BAG 18BG/CS 3029 EA 7.70$ 2 15.40$ 373369 NALOXONE 2MG 2ML LUER JET 1029B 10EA/CS EA 39.85$ 6 239.10$ 0418-13 NITROSTAT 0.4MG TABS SL 25/BT 4BT/BX BT 16.99$ 4 67.96$ J2234 OB KIT DISPOSABLE 10/CS 1703 EA 6.29$ 3 18.87$ 5265-64 ONDANSETRON 4MG DISSOLVE TABS 30UD/BX BX 10.25$ 4 41.00$ 1120-12 Ondansetron Injection, 4 mg, 2 ml iSecure v2 10ea/bx 10bx/cs EA 1.59$ 4 6.36$ 354010 PRESSURE INFUSER W/BULB & GAUGE 1000ML DISPOSABLE 25/CS EA 17.85$ 2 35.70$ 400010 RING CUTTER, MAGNUM MEDICAL EA 8.10$ 2 16.20$ 298507SA SHARPS CONTAINER IN ROOM RED 5 QUART 12.5 IN X 5.5 IN X10.75 IN 20/CS EA 4.99$ 2 9.98$ 295489 SHARPS CONTAINER RED 6.9 QUART 11.5 IN X 8.75 IN X 5.5 IN 12/CS EA 6.74$ 2 13.48$ 371035 SODIUM BICARBONATE 8.4% 50ML LUER JET 1035B 10EA/PK EA 12.37$ 2 24.74$ 660202 SPLINT, TRACTION ADULT OR CHILD 6 YEARS AND UP SAGER TOTAL CONCEPT SUPER BILATERAL S-304 EA 348.95$ 1 348.95$ 592109 S-SCORT 9 SUCTION UNIT EA 699.85$ 1 699.85$ 1034RE StatPacks G1 Perfusion Pack Red/Gray EA 203.90$ 1 203.90$ 1037RE STATPACKS G2 TIDAL VOLUME PACK RED/GRAY 4/PK EA 123.10$ 1 123.10$ 2523-02818 STATPACKS INTUBATION KIT RED/GRAY EA 38.50$ 1 38.50$ EMS Order Station One Page 5 of 5 Attn: Sunny Gutter Johnson (650) 329-2102 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 003:2675 Hanover Drive Palo Alto, California 94301 Attn: Adam King (650) 329-2256 Account Name:Palo Alto Fire Department MARK SHIP TO ADDRESS FOR ORDER: SHIP 011:250 Hamilton Avenue Palo Alto, California 94301 Contact: EMS Chief Kim Roderick (650) 329-2102 Acct. Manager:Brian Hartley (925) 719-0139 Ship Method Payment Terms bhartley@boundtree.com Item Number BTM's Description U/M Price Quantity Extended Price Free Freight Net 30 1028TK STATPACKS INTUBATION KIT TACTICAL BLACK EA 38.50$ 1 38.50$ 598066 SUCTION UNIT DC CABLE ASSEMBLY CIGARETTE LIGHTER ADAPTER FOR S- SCORT EA 13.55$ 1 13.55$ 477-KLTSD415EA Supraglottic airway kit, KING LTS-D, purple, size 5, adult over 6 ft, 60cc syringe, lube 5ea/cs EA 36.99$ 2 73.98$ 477-KLTSD414EA Supraglottic airway kit, KING LTS-D, red, size 4, adult 5-6 ft, 60cc syringe, lube jelly 5ea/cs EA 36.99$ 2 73.98$ 477-KLTSD413EA Supraglottic airway kit, KING LTS-D, yellow, size 3, adult 4-5 ft, double lumen tube 5ea/cs EA 36.99$ 2 73.98$ J2260 Surgical Clipper Starter Kit, incl Clipper Body 9661 and Charger 9662, No Blade Assembly KT 112.24$ 1 112.24$ 684015RB TRAUMA BAG ADVANCED LIFE SUPPORT (ALS) PEDIATRIC PACK ROYAL BLUE 20 IN X 18 IN X 6 IN EA 215.63$ 1 215.63$ SUB 6,898.20$ TAX 638.08$ TOTAL 7,536.28$ City of Palo Alto (ID # 7014) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Approval of First Amended San Francisquito Creek JPA Funding Agreement Title: Approval of the First Amended Agreement with the San Francisquito Creek Joint Powers Authority and its Member Agencies for Funding of Construction of the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council approve, and authorize the City Manager or his designee to execute, the attached First Amended Agreement with the San Francisquito Creek Joint Powers Authority (JPA) and its member agencies, funding construction of the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, from San Francisco Bay to Highway 101 (Attachment A). Background San Francisquito Creek is the dividing line between San Mateo and Santa Clara Counties and is bordered by the cities of Palo Alto, Menlo Park, and East Palo Alto. The creek can cause severe flood damage with very little warning and has overflowed seven times since 1910. During the February 1998 El Niño event (approximately a 45-year event), record flooding caused an estimated $28 million in damages in Palo Alto, East Palo Alto, and Menlo Park. More than 1,100 homes were flooded in Palo Alto and numerous roadways closed, including Highway 101. Prior to the 1998 event, the largest flood on record occurred in December 1955, when the creek overtopped its banks in several locations resulting in approximately 1,200 acres of commercial and residential property being flooded and damages estimated at nearly $2 million. Total damages from a one percent City of Palo Alto Page 2 (100-year) flood event are estimated at $300 million in Santa Clara and San Mateo Counties, as calculated by the United States Army Corps of Engineers (USACE) in 2011. Following the historic flood event of 1998, the cities of Palo Alto, Menlo Park, and East Palo Alto, the San Mateo County Flood Control District, and the Santa Clara Valley Water District joined together to create the San Francisquito Creek Joint Powers Authority (JPA). The JPA and its member agencies have been working cooperatively to implement a series of projects to provide flood protection for local residents. The JPA’s first major capital improvement project will provide one percent flood protection from creek flooding for the communities of East Palo Alto and Palo Alto along San Francisquito Creek between San Francisco Bay and Highway 101. This portion of the creek is at a high risk of severe flooding from flows coming down the creek from the hills, with the extent of flooding influenced significantly by concurrent tide levels in the Bay. The San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 (Project) is the necessary first step in an overall plan to provide protection to properties located within the flood-prone areas of the San Francisquito Creek watershed. Work upstream of Highway 101 cannot be undertaken until the downstream reaches of the creek are expanded to accommodate higher flow rates and increase capacity. The scope of this project will include construction of setback levees and floodwalls from San Francisco Bay to Highway 101 that will provide one percent flood protection. Implementation of the Project has been delayed for several years while the JPA sought the necessary regulatory permits from state and federal resource agencies, including the United States Army Corps of Engineers, California Department of Fish and Wildlife, San Francisco Bay Regional Water Quality Control Board and Bay Conservation and Development Commission. All required permits have now been secured and work is authorized to proceed. In June 2014, the JPA and its member agencies agreed on the terms of a funding plan to pay for the construction of the Project based on estimated costs for the construction and related costs for construction administration, utility relocation and Project environmental mitigation. Discussion The Santa Clara Valley Water District (Water District), with its extensive workforce City of Palo Alto Page 3 resources and flood management project expertise, is serving as the JPA’s construction manager for the Project. The Water District advertised the Project for construction bids on February 26, 2016 and received bids on April 28. The Water District received eight bids from qualified contractors for the Project, with prices ranging from $26.4 million to $38.9 million. The low bid, which is approximately 12.8% above the final engineer’s estimate of $23.4 million, is valid for a period of 45 days, expiring on June 14, 2016. The bidding conditions were likely influenced by the recent discovery of Ridgway’s rails, an endangered bird species, unexpectedly nesting in the creek upstream of the Friendship Bridge. The presence of the birds necessitated a construction scheduling restriction that resulted in the Project timetable being extended from two construction seasons to three, with work scheduled for completion in December 2018. The cost of labor and equipment for an additional construction season likely drove contractor costs and resulting bid prices higher. Higher than expected construction bids, along with other cost escalations for utility relocations and permit mitigation measures, have increased the total Project construction cost beyond the funding sources identified in the 2014 funding agreement. Executive staff from the JPA and its member agencies have been meeting over the past several weeks on a regular basis to identify supplemental funding sources to close the Project funding gap. Each of the agencies has now given a tentative commitment, subject to approval by each governing body, to contribute a sum of money that will fully fund the Project and allow the Water District to award the construction contract to the low bidder. The revised funding plan will be enacted through the approval of the attached Amended Agreement. Changes to the original 2014 agreement are highlighted in the attached annotated version (Attachment B). Assuming the JPA Board and each member agency’s governing body approves the Amended Agreement, the Water District plans to award a construction contract before the bids expire on June 14, 2016 so work on the Project can begin this construction season. The original 2014 and the revised 2016 Project construction costs and proposed funding sources included in the Amended Agreement are listed in the following tables. San Francisco Bay to Hwy 101 Project - Estimated Construction Costs (2014 vs. 2016) Cost Item 2014 Amount 2016 Amount City of Palo Alto Page 4 Project construction cost $28.2M $29.0M SCVWD construction management $2.8M $3.6M DWR Grant administration $0.15M $0.15M Palo Alto Golf Course mitigation $3.0M $3.0M PG&E electric and gas utility relocation $2.7M $4.4M EPASD sanitary sewer relocation $0.4M $0.85M Right-of-way acquisition $0.1M $0.1M Project mitigation costs $0.05M $0.3M Total Project Funding $37.4M $41.4M San Francisco Bay to Hwy 101 Project - Construction Funding Sources (2014 vs. 2016) Funding Sources 2014 Amount 2016 Amount Palo Alto --- $0.4M Menlo Park --- $0.8M East Palo Alto $0.8M $1.3M San Mateo County $0.8M $2.1M SCVWD $27.95M $28.0M State of California DWR Grants $7.85M $8.9M Total Project Funding $37.4M $41.4M Under the terms of the Amended Agreement, Palo Alto’s financial contribution to the Project would be $400,000, payable over three fiscal years. The initial payment due in FY 2017 would be $133,334, with additional payments of $133,333 each payable in FY 2018 and 2019. Timeline The JPA Board and the governing body of each of the JPA member agencies are scheduled to approve the Amended Agreement between May 26 and June 14, 2016. Assuming that the Amended Agreement is approved by all parties, the City of Palo Alto Page 5 Water District intends to award a construction contract for the Project on June 14. Construction work will commence in July 2016 and continue through December 2018. The full flood protection benefits of the Project will be in place for the 2018-19 storm season. Resource Impact Funds for Palo Alto’s FY 2017 contribution to the Project are available from existing appropriated funds in Capital Improvement Program Project, OS-09001, Off-Road Pathway Resurfacing and Repair. This payment would be used to offset the Project cost of resurfacing the portion of the creek levee that serves as a segment of the regional Bay Trail. The remaining payments in FY 2018 and 2019 would be paid from the Infrastructure Reserve. Policy Implications The recommendation does not represent any changes to existing City policies. Environmental Review The San Francisquito Creek Joint Powers Authority certified the Final Environmental Impact Report (EIR) for the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 as the Lead Agency under the California Environmental Quality Act (CEQA) in October 2012. Attachments:  A - First Amended Funding Agreement (PDF)  B - First Amended Funding Agreement (Redline/Strikeout Version) (PDF) First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 1 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 This First Amended Agreement (“Agreement”) amends the terms and conditions of the original Agreement dated August 11, 2014, is made and entered into as of the date it is fully executed by and between the SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY (“Authority”), a California joint powers authority, the SANTA CLARA VALLEY WATER DISTRICT (“Water District”), a special district of the State of California, the San Mateo County Flood Control District, a special district of the State of California (“Flood District”), the CITY OF PALO ALTO (“Palo Alto”), the CITY OF EAST PALO ALTO (“East Palo Alto”), and the CITY OF MENLO PARK (“Menlo Park”), collectively referred to as “the Parties” or individually as “Party.” The effective date of this Agreement will be the last date that this Agreement is executed by the Parties. The purpose of this Agreement is to define the roles and responsibilities of the Parties for funding construction and mitigation activities of the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 (“Project”). R E C I T A L S A. San Francisquito Creek (“Creek”) has a history of flooding the communities in and around East Palo Alto, Menlo Park and Palo Alto, most recently in December 2012, impacting residential properties adjacent to the Creek. B. Following the severe flood in February 1998, East Palo Alto, Menlo Park, and Palo Alto along with the Flood District and the Water District formed the Authority on May 18, 1999. These entities are all full members of the Authority. The Authority was authorized to represent its member agencies as the local sponsor for a U.S. Army Corps of Engineers’ (“USACE”) San Francisquito Creek flood control project on May 23, 2002. C. In March 2005 the USACE, working with the Authority, completed a reconnaissance study for the Creek. The reconnaissance study results indicated a Federal Interest in developing a flood control project for San Francisquito Creek. Therefore, the USACE has engaged in the feasibility study (“Study”) phase of the San Francisquito Creek Flood Damage Reduction and Ecosystem Restoration Project (“FDRER”) which requires a Feasibility Cost Share Agreement with a local sponsor. D. The Authority entered into a Feasibility Cost Share Agreement (“FCSA”) with the San Francisco District of the USACE for the Study on the Creek. The USACE, pursuant to the FCSA, is developing a project to evaluate flood protection and ecosystem restoration opportunities within the San Francisquito Creek Watershed in Santa Clara and San Mateo Counties. At the conclusion of the Study, the USACE will issue a Federally First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 2 of 16 Preferred Plan, which will detail the pre-design actions to be taken to complete the FDRER. E. The USACE’s ability to complete the Study has been impacted by unanticipated delays due to federal funding constraints and USACE’s processes. F. Due to the USACE’s delay in completing the Feasibility Study and the Member Agencies’ desire to begin addressing the risk of flooding in their jurisdictions, the Authority and Member Agency staff conducted a process of evaluating alternatives for an initial capital project and recommended a preferred alternative with conceptual design drawings to the Authority Board of Directors for consideration. G. On July 23, 2009, the Authority’s Board of Directors unanimously approved the staff’s recommended Project and authorized its Executive Director to pursue funding opportunities and to contract with qualified consultants to perform 1) planning and design services and 2) environmental impact assessment and planning for the Project. H. The Authority, the Water District, and the Flood District entered into an agreement on November 3, 2009 to fund the design and environmental documentation of the Project. I. The Authority hired a design engineering firm and an environmental consulting firm to prepare design documents and an Environmental Impact Report (“EIR”) for the Project. J. On October 25, 2012, the final EIR was certified by the Authority. The Notice of Determination (NOD) was filed by the Authority with the County of Santa Clara, Office of the Clerk/Recorder and by the County of San Mateo Office of the Recorder, on July 30, 2013. K. In November 2012, the voters of Santa Clara County approved Measure B, the Water District’s Safe, Clean Water special tax initiative which will provide significant funding toward the Project costs. The District will contribute approximately $28 million toward Project costs from its Safe, Clean Water program and other sources. L. On January 9, 2013, the Authority entered into an agreement with the State of California, Department of Water Resources (DWR) for $8 million in Proposition 1E (Prop 1E) grant funding from DWR’s Stormwater Flood Management Program to be applied towards Project costs. Of the amount awarded, $7,875,000 is available for reimbursement of Project costs. M. On January 13, 2016, DWR awarded $1,044,351 in Proposition 84 (Prop 84) funds to the Project as part of the Association of Bay Area Governments Shoreline Resiliency/Sea Level Rise Proposal to be administered by the State Coastal Conservancy. Of the amount awarded, $953,351 is available for reimbursement of Project costs. N. The Flood District will contribute $2,060,000 toward Project costs. The Flood District’s financial contribution will be in an amount equal to the combined financial contributions made by East Palo Alto and Menlo Park. O. The City of East Palo Alto will contribute $1,260,000 towards Project costs. First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 3 of 16 P. The City of Menlo Park will contribute $800,000 towards Project costs. Q. The City of Palo Alto will contribute $400,000 towards Project costs. R. The Project directly benefits the City of Menlo Park as its completion is necessary to accommodate future flood protection measures located in Menlo Park, upstream of the Project, which may be constructed in the future. In addition, Palo Alto is impacted by the Project because realignment of a portion of its municipal golf course is necessary to accommodate various flood protection construction elements of this Project. S. For the purpose of this Agreement, funding from Menlo Park, East Palo Alto, Palo Alto, the Flood District, the Authority, and any future funds from grants or other sources, contributed toward Project costs, shall be referred to as “Non Water District Funds.” T. On December 22, 2015, the Water District and the Authority entered into a Construction Management Agreement designating the Water District as the entity responsible for managing construction of the Project. U. The Parties desire to enter into this Agreement to provide for reimbursement of Water District expenditures towards construction of the Project from funding that may become available through Non Water District Funds. NOW, THEREFORE, in consideration of the foregoing recitals, and the covenants and conditions in the paragraphs contained herein below, the Parties agree as follows: P R O V I S I O N S 1. Project Purposes The Project’s purposes are to improve flood protection, restore the ecosystem, and provide recreational opportunities within the Project’s reach, with the following specific objectives: 1) protect properties and infrastructure between Highway 101 and the San Francisco Bay from San Francisquito Creek flows resulting from 100 year flood events in conjunction with a 100-year tide, including projected Sea Level Rise; 2) accommodate future flood protection measures upstream of the Project that may be constructed; 3) enhance habitat along the Project reach, particularly habitat for threatened and endangered species; 4) enhance recreational uses; and 5) minimize operational and maintenance requirements. 2. Identified Project Costs and Funding Amounts Construction of the Project, including finalization of the design, is currently estimated to cost approximately $41.32 million (Table 1), not including internal Project management costs incurred by the Water District or contingency costs for utility relocation expenses above the stated contract estimates. (remainder of page intentionally left blank) First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 4 of 16 Table 1 Identified Project Costs Costs Current Palo Alto Golf Course mitigation $3,000,000 Other mitigation activities $300,000 Pacific Gas & Electric Company (without contingency) Electric Relocation $1,267,000 Gas Relocation $3,141,000 East Palo Alto Sanitary District (without contingency Sewer Relocation $848,000 East Palo Alto real estate acquisition $85,000 Construction Management (Hatch Mott MacDonald) $2,565,000 Construction Support Services (HDR) $853,000 Completed design services (HDR) $230,000 Construction contract with 10% contingency $29,026,800 Total Identified Project Costs $41,315,800 Based on the Total Identified Project Costs as stated in Table 1 above, the Parties agree to contribute the following amounts toward these costs (Table 2). Table 2 Funding Funding Sources Original Funding Agreement Funds shifted from upstream project Newly identified funding Total contribution Water District Funds $28,000,000 $0 $0 $28,000,000 Non Water District Funds Authority Prop 1E Grant $7,875,000 $0 $0 $7,875,000 Prop 84 Grant $0 $0 $953,351 $953,351 Flood District $800,000 $700,000 $560,000 $2,060,000 East Palo Alto $800,000 $200,000 $260,000 $1,260,000 Menlo Park $0 $500,000 $300,000 $800,000 Palo Alto $0 $0 $400,000 $400,000 Total Funding $37,475,000 $1,400,000 $2,473,351 $41,348,351 3. Payment of Project Costs A. Through use of DWR Prop 1E and Prop 84 grant funds, along with agreements that provide additional funding to the Authority, including a cost sharing agreement whereby the Water District will fund the discrepancy between the available grant funding and anticipated expenses, the Authority agrees to pay the currently estimated Project costs as stated below. If the Authority receives additional grant or other funding for this project, such funds shall be applied first towards costs that are the responsibility of the Authority, itemized in paragraph #3. A. a) through g), with any remaining funds remitted to the Water District and applied toward Project Costs. The Authority will provide to the Water District documentation of all listed expenses incurred and paid for by the Authority. First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 5 of 16 a) $3,000,000 to the City of Palo Alto to mitigate for impacts to the City of Palo Alto Municipal Golf Course; b) $300,000 for other mitigation activities; c) $4,408,000 to Pacific Gas and Electric Company to relocate gas and electric transmission lines; d) $848,000 to the East Palo Alto Sanitary District to relocate a sewer line; e) $85,000 for property acquisition within East Palo Alto; f) $230,000 to HDR for completed design services; and g) $853,000 to HDR for construction support services. B. Flood District agrees to fund $2,060,000 of Project costs, payable to the Water District during three consecutive years. The payments will be made as follows: $800,000 (Year 1); $630,000 (Year 2); and $630,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded. The Year 2 and Year 3 payments will be remitted to the Water District within 180 days of the beginning of each respective fiscal year. C. East Palo Alto agrees to fund $1,260,000 of Project costs, payable to the Water District during three consecutive years. The payments will be made as follows: $420,000 (Year 1); $420,000 (Year 2); and $420,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year. D. Menlo Park agrees to fund $800,000 of Project costs, payable to the Water District during three consecutive years. The payments will be made as follows: $300,000 (Year 1); $250,000 (Year 2); and $250,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year. E. Palo Alto agrees to fund $400,000 of Project costs, payable to the Water District during three consecutive years. The payments will be made as follows: $133,334 (Year 1); $133,333 (Year 2); and $133,333 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year. F. Through Water District funds and funds remitted to the Water District by Palo Alto, Flood District, East Palo Alto and Menlo Park, the Water District agrees to pay the currently estimated Project costs as stated below. a) $2,565,000 for Construction Management Consultant; and b) $26,388,000 for construction contract and a separate encumbrance of 10% of the construction contract amount ($2,638,800) for contingent expenses. 4. Unidentified Project Costs and/or Surplus Funds A. The Parties agree to apply any surplus funds toward unidentified Project costs which exceed the current estimated Identified Project Costs (Table 1). If there are First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 6 of 16 no surplus funds, the Parties agree to determine an appropriate cost sharing allocation to pay for any unidentified Project costs or costs which exceed the current estimated Identified Project Costs. B. If there are any surplus funds after paying all identified or unidentified Project costs, the Water District shall retain those funds which shall be reallocated toward construction of the San Francisquito Creek local-state-funding-only project, upstream of Highway 101. 5. Method and Timing of Transactions A. Water District shall prepare and submit quarterly invoice packages to the Authority. Water District’s Quarterly invoice packages will include Project progress reports and all other documentation required by DWR and the State Coastal Conservancy sufficient to enable the Authority to submit subsequent funding requests to DWR for grant funding reimbursement. B. Authority shall submit a request for grant fund reimbursement to DWR and the State Coastal Conservancy within 15 days of receipt of invoice packages from Water District, provided all DWR and the State Coastal Conservancy-related invoicing requirements are met. To the extent funds are available, the Authority will pay for all costs itemized in paragraph #3. A. a) through g). C. Non Water District Funds contributed by Flood District, East Palo Alto, Menlo Park, and Palo Alto will be remitted to the Water District as set forth in paragraph #3, Payment of Project Costs, subparagraphs B.-E. 6. Indemnification A. 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 a Party shall not be shared pro rata but, instead, the Member Agencies 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 Agreement. 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 another party hereto, its officers, board members, employees, or agents, under or in connection with or arising out of any work, authority or jurisdiction delegated to such other Party under this Agreement. The obligations set forth in this paragraph will survive termination and expiration of this Agreement. B. In the event of concurrent intentional or unintentional misconduct, negligent acts or omissions by any one of the Parties (or each of their respective officers, directors and/or employees), then the liability for any and all claims for injuries or First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 7 of 16 damages to persons and/or property which arise out of each and any of their performance of the terms and conditions of this Agreement shall be apportioned according to the California law of comparative negligence. The Parties hereto are not jointly and severally liable on any liability, claim, or lawsuit. C. The Water District’s construction contract will require the construction contractor to secure and maintain in full force and effect all times during construction of the Project and until the Project is accepted by the Parties, general liability and property damage insurance, business automobile insurance and such other insurance as the Parties deem appropriate, in forms and limits of liability acceptable to the Parties, naming Water District, Authority and each of its Member Agencies and their respective directors, council members, officers, employees and agents as additional insureds from and against all damages and claims, losses, liabilities, costs or expenses arising out of or in any way connected to the construction of the Project. D. The duties and obligations of paragraph #6. Indemnification, will survive and continue in full force and effect after the termination, completion, suspension, and expiration of this Agreement. 7. Retention of Records, Right to Monitor and Audit Unless a longer period of time is required by law or federal or state grant funding agreements, the Parties shall maintain all financial records related to this Agreement and/or the Project for five (5) years after the Agreement expires or is terminated earlier pursuant to paragraph #9. Termination, of this Agreement. The records shall be subject to the examination and/or audit of either Party. 8. Agreement Term This Agreement shall commence on the Effective Date and remain in place until the construction of the Project is completed and accepted by the Parties, or this Agreement is terminated earlier by the Parties in the manner authorized by paragraph #9. Termination. 9. Termination A. If any Party fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided by law, any other Party may terminate this Agreement but only after giving written notice of the failure of performance to the Party committing the failure with a copy of such notice given to all other Parties. Such notice shall explain the alleged failure of performance and provide a reasonable opportunity for the failure to be cured which in no case will be less than 30 days. If the failure of performance is not satisfactorily cured within the cure period, the Agreement may be terminated upon the delivery of a written notice of termination to all of the Parties. B. A final notice of termination may be given only after completion of the notice and cure process described in paragraph #9.A. and only with the approval of the governing body of the Party terminating the Agreement. First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 8 of 16 C. In event of termination, each Party shall deliver to all of the other Parties, upon request, copies of reports, documents, and other work performed by any Party under this Agreement. The cost of work performed under this Agreement to the date of termination shall be due and payable in accordance with the provisions of this Construction Funding Agreement to be executed by the Parties prior to Water District’s commencement of the bid process for award of a construction contract for the Project. D. Notwithstanding the foregoing, after the Water District awards a construction contract for the Project, this Agreement may only be terminated by the mutual written agreement of all of the Parties as approved by the governing body of each Party or pursuant to a delegation of such authority. 10. Notices Any notice or other communication required or permitted to be given hereunder shall not be effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail, postage prepaid, return receipt requested, or (c) by a commercial overnight courier that guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses stated below, or at such other address as either party may hereafter notify the other parties in writing: Authority: San Francisquito Creek Joint Powers Authority 615-B Menlo Avenue Menlo Park, California 94025 Attention: Len Materman, Executive Director len@sfcjpa.org Water District: Santa Clara Valley Water District 5750 Almaden Expressway San Jose, California 95118 Attention: Norma Camacho, Interim Chief Executive Officer ncamacho@valleywater.org Palo Alto City of Palo Alto 250 Hamilton Avenue P.O. Box 10250 Palo Alto, CA 94303 Attention: James Keene, City Manager james.keene@cityofpaloalto.org East Palo Alto City of East Palo Alto 2415 University Avenue East Palo Alto, CA 94303 Attn: Carlos Martinez, City Manager cmartinez@cityofepa.org First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 9 of 16 Menlo Park City of Menlo Park 701 Laurel Street Menlo Park, CA 94025 Attention: Alex McIntyre, City Manager admcintyre@menlopark.org Flood Control District Department of Public Works 555 County Center, 5th Floor Redwood City, CA 94063 Attention: James Porter, Director jporter@smcgov.org Service of any such notice or other communications so made shall be deemed effective on the day of actual delivery (whether accepted or refused) as evidenced by: a) confirmed in-person delivery by the addressee or other representative of the Party authorized to accept delivery on behalf of the addressee, b) as shown by the addressee’s return receipt if by certified mail, or c) as confirmed by the courier service if by courier; provided, however, that if such actual delivery occurs after 5:00 p.m. (local time where received) or on a non-business day, then such notice or demand so made shall be deemed effective on the first business day immediately following the day of actual delivery. No communications via electronic mail shall be effective to give any notice, request, direction, demand, consent, waiver, approval or other communications hereunder. 11. Severability In the event any portion of this Agreement is declared by any court of competent jurisdiction to be invalid, illegal or unenforceable, such portion shall be severed from this Agreement and the remaining parts hereof shall remain in full force and effect as fully as though such invalid, illegal or unenforceable portion had never been part of this Agreement. 12. Governing Law and Compliance with Laws The parties agree that California law governs this Agreement. In the performance of this Agreement each Party will comply with all applicable laws, ordinances, codes and regulations of the federal, state, and applicable local government. 13. Venue In the event that suit shall be brought by any party to this contract, the parties agree that venue shall be exclusively vested in the state courts of either the County of Santa Clara, or the County of San Mateo or where otherwise appropriate, exclusively in the United States District Court, Northern District of California. 14. Assignability and Subcontracting Parties shall not assign this Agreement or any portion thereof to a third party or subcontract with a third party to provide services required under this Agreement without the prior written consent of the other parties. Any unauthorized attempt by any Party to so assign or transfer shall be void and of no effect. Notwithstanding the foregoing, First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 10 of 16 a Party may hire a consultant to fulfill its obligations as described above in paragraph #5. Method and Timing of Transactions. 15. Ownership of Materials All reports, documents, or other materials developed or discovered by any Party or any other person engaged directly or indirectly by any Party to perform the services required hereunder shall be and remain the mutual property of Authority and Water District without restriction or limitation upon their use. 16. Entire Agreement This First Amended Agreement constitutes the entire Agreement between the Parties with respect to the subject matter hereof and supersedes all prior offers and negotiations, oral and written, including but not limited to the original Agreement dated August 11, 2014. This First Amended Agreement may not be amended or modified in any respect whatsoever except by an instrument in writing signed by authorized representatives of all Parties. 17. Further Actions The Authority and Water District agree to execute all instruments and documents, and to take all actions, as may be reasonably required to consummate the transactions contemplated by this Agreement. 18. Counterparts This Agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, taken together, shall be deemed to be one and the same instrument. 19. Non Waiver A Party’s waiver of any term, condition, or covenant, or breach of any term, condition or covenant will not be construed as a waiver of any other term, condition or covenant. 20. Third Parties This Agreement is entered into only for the benefit of the Parties executing this Agreement and not for the benefit of any other individual, entity, or person. (remainder of page intentionally left blank) Signatures follow on next pages First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 11 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the San Francisquito Creek Joint Powers Authority has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: San Francisquito Creek Joint Powers Authority By: ______________________________ By: ______________________________ Greg Stepanicich Len Materman SFCJPA General Counsel Executive Director Date: ____________________________ Date: ____________________________ First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 12 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the Santa Clara Valley Water District has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: Santa Clara Valley Water District By: ___________________________ By: ____________________________ Leslie Orta Barbara Keegan Senior Assistant District Counsel Chair/Board of Directors Office of the District Counsel Date: __________________________ Date: ___________________________ ATTEST: MICHELE L. KING, CMC __________________________________ Clerk/Board of Directors First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 13 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of Palo Alto has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of Palo Alto By: ___________________________ By: ____________________________ Molly Stump James Keene City Attorney City Manager Date: __________________________ Date: ___________________________ First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 14 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of East Palo Alto has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of East Palo Alto By: ___________________________ By: ____________________________ Print Name:______________________ Print Name:______________________ Title: ___________________________ Title: ___________________________ Date: __________________________ Date: ___________________________ First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 15 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of Menlo Park has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of Menlo Park By: _____________________________ By: ______________________________ William L. McClure Alex D. McIntyre City Attorney City Manager Date: _________________________ Date:______________________________ First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement May 24, 2016 Page 16 of 16 FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the San Mateo Flood Control District has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: San Mateo County Flood Control District By: ___________________________ By: ______________________________ John Beiers Warren Slocum County Counsel President, Board of Supervisors, San Mateo Date: __________________________ Date: _____________________________ First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement February 4May 172034, 2016 Page 1 of 1516 AMENDMENT NO. 1 TO THE FIRST AMENDED AGREEMENT AMONG AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR FUNDING CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 This First Amended Agreement (“Agreement”) amends the terms and conditions of the original Agreement dated August 11June 10, 2014, is made and entered into as of the date it is fully executed by and between the SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY (“Authority”), a California joint powers authority, the SANTA CLARA VALLEY WATER DISTRICT (“Water District”), a special district of the State of California, the San Mateo County Flood Control District, a special district of the State of California (“Flood District”), the CITY OF PALO ALTO (“Palo Alto”), the CITY OF EAST PALO ALTO (“East Palo Alto”), and the CITY OF MENLO PARK (“Menlo Park”), collectively referred to as “the Parties” or individually as “Party.” The effective date of this Agreement will be the last date that this Agreement is executed by the Parties. The purpose of this Agreement is to define the roles and responsibilities of the Parties for funding construction and mitigation activities of the San Francisquito Creek Flood Reduction, Ecosystem Restoration, and Recreation Project, San Francisco Bay to Highway 101 (“Project”). R E C I T A L S A. San Francisquito Creek (“Creek”) has a history of flooding the communities in and around East Palo Alto, Menlo Park and Palo Alto, most recently in December 2012, impacting residential properties adjacent to the Creek. B. Following the severe flood in February 1998, East Palo Alto, Menlo Park, and Palo Alto along with the Flood District and the Water District formed the Authority on May 18, 1999. These entities are all full members of the Authority. The Authority was authorized to represent its member agencies as the local sponsor for a U.S. Army Corps of Engineers’ (“CorpsUSACEUSACE”) San Francisquito Creek flood control project on May 23, 2002. C. In March 2005 the CorpsUSACE, working with the Authority, completed a reconnaissance study for the Creek. The reconnaissance study results indicated a Federal Interest in developing a flood control project for San Francisquito Creek. Therefore, the CorpsUSACE has engaged in the feasibility study (“Study”) phase of the San Francisquito Creek Flood Damage Reduction and Ecosystem Restoration Project (“FDRER”) which requires a Feasibility Cost Share Agreement with a local sponsor. D. The Authority entered into a Feasibility Cost Share Agreement (“FCSA”) with the San Francisco District of the CorpsUSACE for the Study on the Creek. The CorpsUSACE, Formatted: Space After: 0 pt First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 2 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt pursuant to the FCSA, is developing a project to evaluate flood protection and ecosystem restoration opportunities within the San Francisquito Creek Watershed in Santa Clara and San Mateo Counties. At the conclusion of the Study, the CorpsUSACE will issue a Federally Preferred Plan, which will detail the pre-design actions to be taken to complete the FDRER. E. The CorpsUSACE’ ability to complete the Study has been impacted by unanticipated delays due to federal funding constraints and CorpsUSACE’ processes. F. Due to the Corp’sUSACE’s delay in completing the Feasibility Study and the Member Agencies’ desire to begin addressing the risk of flooding in their jurisdictions, the Authority and Member Agency staff conducted a process of evaluating alternatives for an initial capital project and recommended a preferred alternative with conceptual design drawings to the Authority Board of Directors for consideration. G. On July 23, 2009, the Authority’s Board of Directors unanimously approved the staff’s recommended Project and authorized its Executive Director to pursue funding opportunities and to contract with qualified consultants to perform 1) planning and design services and 2) environmental impact assessment and planning for the Project. H. The Authority, the Water District, and the Flood District entered into an agreement on November 3, 2009 to fund the design and environmental documentation of the Project. I. The Authority hired a design engineering firm and an environmental consulting firm to prepare design documents and an Environmental Impact Report (“EIR”) for the Project. J. On October 25, 2012, tThe final EIR was certified by the Authority on October 25, 2012. The Notice of Determination (NOD) was filed by the Authority with the County of Santa Clara, Office of the Clerk/Recorder and by the County of San Mateo Office of the Recorder, on July 30, 2013. K. In November 2012, the voters of Santa Clara County approved Measure B, the Water District’s Safe, Clean Water special tax initiative which will provide significant funding toward the Project costs. The District will contribute approximately $28 million toward Project construction costs from its Safe, Clean Water program and other sources. ML. On January 9, 2013, the Authority entered into an Agreement agreement with the State of California, Department of Water Resources (DWR) for $8 million in Proposition 1E (Prop 1E) grant funding from DWR’s Stormwater Flood Management Program to be applied towards Project construction costs. Of the amount awarded, $7,875,000 is available for reimbursement of Project costs. NM. On January 13, 2016, DWR awarded $1,044,351 in Proposition 84 (Prop 84) funds to the Project as part of the Association of Bay Area Governments (ABAG) sShoreline Rresiliency/Ssea Llevel Rrise Pproposal to be administered by the State Coastal Conservancy. Of the amount awarded, $953,351 will beis available for paymentreimbursement of construction fundingProject costs. First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 3 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt NON. The Flood District will contribute $800,0002,06100,000 toward Project construction costs. The Flood District’s financial contribution will be in an amount equal to the combined financial contributions made by East Palo Alto and Menlo Park. ONO. The City of East Palo Alto will contribute $1,30260,000 towards Project construction costs. OPOP. The City of Menlo Park will contribute $800,000 towards Project construction costs. QPQ. The City of Palo Alto isare not directlyfinancially contributing toward the Project costs at this time, but is considered to be a contributor through the Safe, Clean Water tax initiative.will contribute $400,000 towards Project construction costs. RQR. , however, construction of tThe Project directly benefits the City of Menlo Park as its completion is necessary to accommodate future flood protection measures located in Menlo Park, upstream of the Project, which may be constructed in the future. In addition, Palo Alto is impacted by the Project because realignment of a portion of its municipal golf course may beis necessary to accommodate various flood protection construction elements of this Project. PQRS. For the purpose of this Agreement, funding from Menlo Park, East Palo Alto, Palo Alto, the Flood District, the Authority, and any future funds from grants or other sources, contributed toward Project construction costs, shall be referred to as “Non Water District Funds.” QRST. On December 232, 2015, tThe Water District and the Authority intend to enterentered into a Construction Management Agreement designating the Water District as the entity responsible for managing construction of the Project. RSTU. The Parties desire to enter into this Agreement to provide for reimbursement of Water District expenditures towards construction of the Project from funding that may become available through Non Water District Funds. NOW, THEREFORE, in consideration of the foregoing recitals, and the covenants and conditions in the sections paragraphs contained herein below, the Parties agree as follows: P R O V I S I O N S 1. Project Purposes The Project’s purposes are to improve flood protection, restore the ecosystem, and provide recreational opportunities within the Project’s reach, with the following specific objectives: 1) protect properties and infrastructure between Highway 101 and the San Francisco Bay from San Francisquito Creek flows resulting from 100 year flood events in conjunction with a 100-year tide, including projected Sea Level Rise; 2) accommodate future flood protection measures upstream of the Project that may be constructed; 3) enhance habitat along the Project reach, particularly habitat for threatened and endangered species; 4) enhance recreational uses; and 5) minimize operational and maintenance requirements. First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 4 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt 2. Identified ConstructionProject Costs and Funding Amounts Construction of the Project, including finalization of the design, is currently estimated to cost approximately $37.4541.4432 million (Table 1), not including internal projectconstructionPproject management costs incurred by the Water District or contingency costs for utility relocation expenses above the stated contract estimates with the utility providerss. (remainder of page intentionally left blank) Table 1 Identified Construction Project Costs Costs Current Palo Alto Golf Course mitigation $3,000,000 Other mitigation activities $300,000 Pacific Gas & Electric Company (without contingency) Electric Relocation $1,267,000 Gas Relocation $3,141,000 East Palo Alto Sanitary District (without contingency Sewer Relocation $848,000 East Palo Alto real estate acquisition $85,000 Prop 1E Grant Administration by Authority $125,000 Prop 84 Grant Administration by ABAG $91,000 Construction Management (Hatch Mott MacDonald) $2,565,000 Construction Support Services (HDR) $853,000 Costs to complete design (HDR) $230,000 Construction contract with 10% contingency $29,026,800 Total Identified Construction Project Costs $41,440531,800 Table 1 Identified Project Costs Costs Current Palo Alto Golf Course mitigation $3,000,000 Other mitigation activities $300,000 Pacific Gas & Electric Company (without contingency) Electric Relocation $1,267,000 Gas Relocation $3,141,000 East Palo Alto Sanitary District (without contingency Sewer Relocation $848,000 East Palo Alto real estate acquisition $85,000 Construction Management (Hatch Mott MacDonald)$2,565,000 Formatted: Font: (Default) Arial Formatted: Font: (Default) Arial Formatted: Font: (Default) Arial, 11 pt Formatted: Font: (Default) Arial Formatted: Font: (Default) Arial, 11 pt Formatted Table Formatted: Font: (Default) Arial First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 5 of 22 Formatted: Font: 10.5 pt Formatted ... [1] Construction Support Services (HDR) $853,000 Completed osts to complete design services (HDR) $230,000 Construction contract with 10% contingency $29,026,800 Total Identified Project Costs $41,315,800 Based on this estimatethe Total Identified Project Costs as stated in Table 1 above,, the Parties agree to contribute the following amounts toward these costs (Table 2). Table 2 Funding Funding Sources Original Funding Agreement Funds shifted from upstream project Newly identified funding Total contribution Water District Funds $28,000,000 $0 $0 $28,000,000 Non Water District Funds Authority Prop 1E Grant $7,875,000 $0 $0 $7,875,000 Prop 84 Grant $0 $0 $953,351 $953,351 Flood District $800,000 $700,000 $560,000 $2,060,000 East Palo Alto $800,000 $200,000 $260,000 $1,260,000 Menlo Park $0 $500,000 $300,000 $800,000 Palo Alto $0 $0 $400,000 $400,000 Total Funding $37,475,000 $1,400,000 $2,473,351 $41,348,351 Table 2 Funding Funding Sources Original Funding Agreement Funds shifted from upstream project Newly identified funding Total contribution Water District Funds $28,000,000 $0 $0 $28,0400,00 0 Non Water District Funds Authority Prop 1E Grant $8,000,000 $0 $0 $8,000,000 Prop 84 Grant $0$953,351 $0 $1,044,351 953,351$0 $1,044,3519 53,351 Flood District $800,000 $700,000 $66705600,0 00 $2,12100060 ,000 East Palo Alto $800,000 $200,000 $300260,000 $1,300260,0 00 Menlo Park $0 $53500,000 $34300,000 $87800,000 Palo Alto $0 $0 $400,000 $400,000 Total Funding $38,553,351 7,600,000 $1,42400,000 $1,600,0002, 57553473,35 1564,351 $41,553473, 351564,351 3. Payment of ConstructionProject Costs Formatted: Indent: Left: 0" Formatted Table Formatted: Font: (Default) Arial Formatted: Font: (Default) Arial Formatted: Font: (Default) Arial Formatted Table Formatted ... [2] Formatted ... [3] Formatted ... [4] Formatted ... [5] Formatted ... [6] Formatted ... [7] Formatted ... [8] Formatted ... [9] Formatted ... [10] Formatted ... [11] Formatted ... [12] Formatted ... [13] Formatted ... [14] Formatted ... [15] Formatted ... [16] Formatted ... [17] Formatted: Font: (Default) Arial, 11 pt Formatted ... [18] Formatted ... [19] Formatted ... [20] Formatted: Font: 11 pt Formatted: Font: 11 pt Formatted: Font: 11 pt Formatted: Font: 11 pt Formatted: Font: 11 pt Formatted ... [21] Formatted ... [22] Formatted ... [23] Formatted ... [24] Formatted ... [25] First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 6 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt A. Through a cost-share agreement with the Water District and use of DWR $1,000,000 contribution from Water District funds through a cost-share agreement, along with Prop 1E and Prop 84 grant funds, along with agreements that provide additional funding to the Authority, including a cost- shareing agreement with thewhereby the Water District will fund the discrepancy between the available grant funding and anticipated expenses for approximately $900,000, the Authority agrees to pay the will provide Project funding in the currently estimated constructionProject costs amounts as stated below. If the Authority receives additional grant or other funding for this project, such funds shall be applied first towards costs that are the responsibility of the Authority, itemized in paragraph #3. A. a) through g), with any remaining funds remitted to the Water District and applied toward Project Costs. The Authority will provide to the Water District documentation of all listed expenses incurred and paid for by the Authority. a) $3,000,000 to the City of Palo Alto to mitigate for impacts to the City of Palo Alto Municipal Golf Course; b) $50245300,000 for other mitigation activities; c) $2,700,0004,408,000 to Pacific Gas and Electric Company to relocate gas and electric transmission lines; d) $400,000848,000 to the East Palo Alto Sanitary District to relocate a sewer line; e) $10085,000 for property acquisition within East Palo Alto; $150125,000 DWR Prop 1E grant administration costs incurred by the Authority; $91,000 Prop 84 grant administration costs incurred by ABAG; $ 91,000 Prop 84 grant administration costs incurred by the Authority; f) $230,000 to HDR to completefor completed Plans & Specificationsdesign services; and $853,000 to HDR for construction support services. g) B. Flood District agrees to payfund $2,061100,000 of Project costs, payable to the Water District over the course ofduring three consecutive years for theirits contribution to the identified construction costsProject costs. The payments will be dividedmade as follows: $800,000 (Year 1); $630,000 (Year 2); and $630,000 (Year 3). The firstYear 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded by the Water District. The twoYear 2 and Year 3 following payments will be remittedThe payment will be remitted to the Water District to the Water District within 180 days of the beginning of each respective each respective fiscal year. fiscal year. in the amount of $800,000 in the first year and $xx650,000 a year over the next two years after a construction contract is awarded by the Water District. The payment will be remitted to the Water District in the amount of $xx700,000 a year over the course of xxthree years after a construction contract is awarded by the Water District.: $800,000 (matching East Palo Alto’s contribution of $800,000 currently identified from Non Water District Funds). 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[26] Formatted: Not Highlight Formatted: Normal (Web), Indent: Left: 1.5" Formatted: Not Highlight Formatted ... [27] First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 7 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt C. East Palo Alto agrees to payfund $1,32600,000 of Project costs, payable to the Water District over the course ofduring three consecutive years for its for their contribution to the identified construction costsProject costsyears. The payments will be dividedmade as follows: $420,000 (Year 1); $420,000 (Year 2); and $420,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded by the Water District. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year. The payment will be remitted to the Water District in the amount of $1,00420,000 in the first year and $xx100,000 a year over the course of xxthe next three years after a construction contract is awarded by the Water District. B. . D. Menlo Park agrees to payfund $800,000 toof Project costs, payable to the Water District over the course ofduring three consecutive years for its for their contribution to the identified constructionProject costs years. The payments will be dividedmade as follows: $300,000 (Year 1); $250,000 (Year 2); and $250,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded by the Water District. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year. The payment will be remitted to the Water District in the amount of $3200,000 in the first year and $25300,000xx a year over tthe course of threenext two years after a construction contract is awarded by the Water District. xx years. C. : $800,000 (matching East Palo Alto’s contribution of $800,000 currently identified from Non Water District Funds). E. Palo Alto agrees to payfund $400,000 of Project costs, payable to the Water District to the Water District over the course ofduring three consecutive years for its contribution to Project costs.for their contribution to the identified construction costs. The payments will be dividedmade as follows: $200,000133,334 (Year 1); $100,000133,333 (Year 2); and $133,333 100,000 (Year 3). The Year 1 payment will be remitted to the Water District within 180 days after a construction contract is awarded by the Water District. The Year 2 and Year 3 payments will be remitted within 180 days of the beginning of each respective fiscal year.The payment will be remitted to the Water District in the amount of $100,000 in the first year and $150,000 a year over the next two years after $xx a year over the course of three years after a construction contract is awarded by the Water District. xx years. Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Normal (Web), Indent: Left: 1", No bullets or numbering Formatted: Normal (Web), Indent: Left: 1", No bullets or numbering Formatted: Not Highlight Formatted: Not Highlight Formatted: Font: (Default) Arial, 11 pt, NotHighlight Formatted: Font: (Default) Arial, 11 pt, NotHighlight First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 8 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Through Water District funds and funds remitted to the Water District by Palo Alto, Flood District, East Palo Alto and Menlo Park, the Water District agrees to pay the currently estimated constructionProject costs as stated below. o F. A. BThrough Water District funds and funds remitted to thehe Water District by Palo Alto, Flood District, East Palo Alto and Menlo Park, the Water District will agrees to pay the currently estimated construction costs as stated below. expend an amount not to exceed $28,000,000 for expenditures incurred in constructing the Project. $1,000,000 cost-share agreement with Authority for HDR construction support services; a) $2,565,000 for Construction Management Consultant; and 3. $29,026,80026,388,000 for construction contract and a separate encumbrance of 10% of the construction contract amount ($2,638,800) for contingent expenses. with 10% contingency. b) 4. Unidentified Construction Project Costs and/or Surplus Funds and Funding Amounts A. The Parties agree to apply any surplus funds toward unidentified Project costs which exceed the current estimated Identified Project Costs (Table 1). If there are no surplus funds, tThe Parties agree to determine an appropriate cost sharing allocation to pay for any unidentified Project costs or costs which exceed the current estimated Identified Project Costs, such as utility relocation and construction costs that exceed the stated contract amounts plus a 10% contingency already allocated. . B. If there are any surplus funds after paying all identified or unidentified Project costs, the Parties agree to applyreimburse those funds to the Water District so thatWater District shall retain those funds maywhich shall be reallocated through the Safe, Clean Water Program toward construction of the San Francisquito Creek local-state-funding- only project, upstream of Highway 101. For utility relocation contingency costs and any additional construction contingency costs not currently identified, or increases to identified Project cost estimates, the Parties agree to to split the costs equally, not to exceed a total cost increase of $2,5000,000. Flood District, East Palo Alto, Menlo Park, and Palo Alto will each remit its portion of theThese unidentified cost reimbursements will be remitted to the Water District within three years of incurrence of these costsmeet and confer to determine a cost-share to cover the shortfall. Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Font: (Default) Arial, 11 pt, NotHighlight Formatted: Font: (Default) Arial, 11 pt Formatted: Style After: 12 pt, Indent: Left: 0.5", Hanging: 0.5", Numbered + Level: 1 +Numbering Style: A, B, C, … + Start at: 2 +Alignment: Left + Aligned at: 1.25" + Indentat: 1.5" Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Not Highlight Formatted: Font: (Default) Arial, 11 pt, NotHighlight Formatted: Not Highlight Formatted: Space After: 0 pt, Numbered +Level: 1 + Numbering Style: a, b, c, … + Start at: 1 + Alignment: Left + Aligned at: 1.25" +Indent at: 1.5", Don't keep with next Formatted: Not Highlight Formatted: Not Highlight Formatted: Font: (Default) Arial, 11 pt, Not Highlight Formatted: Indent: Left: 1.5", Space After: 0pt, Don't keep with next Formatted: Indent: Left: 1.5", Space After: 0pt Formatted: Indent: Left: 1.5", Space After: 0pt, No bullets or numbering, Don't keep withnext Formatted: Indent: Hanging: 0.5", Numbered+ Level: 1 + Numbering Style: A, B, C, … + Start at: 1 + Alignment: Left + Aligned at: 0.75" + Indent at: 1" Formatted: Indent: Left: 0.5", No bullets ornumbering Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 9 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt 4. . 5. Method and Timing of Transactions A. Water District shall prepare and submit quarterly invoice packages to the Authority. Water District’s Quarterly invoice packages will include Project progress reports and all other documentation required by DWR and the State Coastal Conservancy sufficient to enable the Authority to submit subsequent funding requests to DWR for grant funding reimbursement. B. Authority shall submit a request for grant fund reimbursement to DWR and the ABAG State Coastal Conservancy within 15 days of receipt of invoice packages from Water District, provided all DWR and ABAGthe State Coastal Conservancy- related invoicing requirements are met. To the extent funds are available, after the Authority will pays for all costs itemized in paragraph #23. A. a) through fhig) above, the Authority will issue payment to the Water District for Project costs of construction managed by the Water District within thirty days of receipt of grant funds) from DWR and Prop. 84 Bay Area IRMP. C. Non Water District Funds contributed by Flood District, East Palo Alto, Menlo Park, and Palo Alto and the Flood District will be remitted to the Water District as within one hundred and eighty days (180) after a construction contract is awarded by the Water District’s Board of Directorsas set forth in paragraph #3, Payment of Project Costs, s . Sub-paragraphsSections B.-E. 46. Mutual Hold HarmlessIndemnification Mutual Hold Harmless and Indemnification Obligations A. 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 a Party shall not be shared pro rata but, instead, the Member Agencies 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 Agreement. 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 another party hereto, its officers, board members, employees, or agents, under or in connection with or arising out of any work, authority or jurisdiction delegated to such other Party under this Agreement. The obligations set forth in this paragraph will survive termination and expiration of this Agreement. Formatted: No underline Formatted: Indent: Left: 0.5", No bullets ornumbering, Keep with next First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 10 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt B. In the event of concurrent intentional or unintentional misconduct, negligent acts or omissions by any one of the Parties (or each of their respective officers, directors and/or employees), then the liability for any and all claims for injuries or damages to persons and/or property which arise out of each and any of their performance of the terms and conditions of this Agreement shall be apportioned according to the California law of comparative negligence. The Parties hereto are not jointly and severally liable on any liability, claim, or lawsuit. C. The Water District’s construction contract and bid documents will require the construction contractor to agree to appropriate indemnity provisions allowable by law to protect the Parties, and to secure and maintain in full force and effect all times during construction of the Project and until the Project is accepted by the Parties, general liability and property damage insurance, business automobile insurance and such other insurance as the Parties deem appropriate, in forms and limits of liability acceptable to the Parties, naming Water District, Authority and each of its Member Agencies and their respective directors, council members, officers, employees and agents as additional insureds from and against all damages and claims, losses, liabilities, costs or expenses arising out of or in any way connected to the construction of the Project. D. The duties and obligations of paragraph #6. Indemnification, this Section will survive and continue in full force and effect after the termination, completion, suspension, or and expiration of this Agreement. 57. Retention of Records, Right to Monitor and Audit Unless a longer period of time is required by law or federal or state grant funding agreements, the Parties shall maintain all financial records related to this Agreement and/or the Project for five (5) years after the Agreement expires or is terminated earlier pursuant to Section paragraph #7 9. Termination, of this Agreement. The records shall be subject to the examination and/or audit of either Party. 68. Agreement Term This Agreement shall commence on the Effective Date and remain in place until the construction of the Project is completed and accepted by the Parties, or this Agreement is terminated earlier by the Parties in the manner authorized by Section paragraph #79. Termination. 79. Termination A. If any Party fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided by law, any other Party may terminate this Agreement but only after giving written notice of the failure of performance to the Party committing the failure with a copy of such notice given to all other Parties. Such notice shall explain the alleged failure of performance and provide a reasonable opportunity for the failure to be cured which in no case will be less than 30 days. If the failure of performance is not satisfactorily cured within the Formatted: Font: (Default) Arial, 11 pt First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 11 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt cure period, the Agreement may be terminated upon the delivery of a written notice of termination to all of the Parties. B. A final notice of termination may be given only after completion of the notice and cure process described in Section paragraph #79.A. and only with the approval of the governing body of the Party terminating the Agreement. C. In event of termination, each Party shall deliver to all of the other Parties, upon request, copies of reports, documents, and other work performed by any Party under this Agreement. The cost of work performed under this Agreement to the date of termination shall be due and payable in accordance with the provisions of this Construction Funding Agreement to be executed by the Parties prior to Water District’s commencement of the bid process for award of a construction contract for the Project. D. Notwithstanding the foregoing, after the Water District awards a construction contract for the Project, this Agreement may only be terminated by the mutual written agreement of all of the Parties as approved by the governing body of each Party or pursuant to a delegation of such authority. E. The Chief Executive Officer of the Water District and the Executive Director of Authority are empowered to terminate this Agreement on behalf of their respective agencies in accordance with the provisions of this Agreement. 810. Notices Any notice or other communication required or permitted to be given hereunder shall not be effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail, postage prepaid, return receipt requested, or (c) by a commercial overnight courier that guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses stated below, or at such other address as either party may hereafter notify the other parties in writing: Authority: San Francisquito Creek Joint Powers Authority 615-B Menlo Avenue Menlo Park, California 94025 Attention: Len Materman, Executive Director len@sfcjpa.org Water District: Santa Clara Valley Water District 5750 Almaden Expressway San Jose, California 95118 Attention: Norma Camacho, ActingInterim Chief Executive Officer ncamacho@valleywater.org Formatted: Right: 0", Don't keep with next,Don't keep lines together Formatted: Indent: Left: 0", First line: 0" Formatted: Normal, Right: -0.15" Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 12 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Palo Alto City of Palo Alto 250 Hamilton Avenue P.O. Box 10250 Palo Alto, CA 94303 Attention: James Keene, City Manager james.keene@cityofpaloalto.org East Palo Alto City of East Palo Alto East Palo Alto 2415 University Avenue East Palo Alto, CA 94303 Attn: Carlos Martinez, City Manager cmartinez@cityofepa.org Menlo Park City of Menlo Park 701 Laurel Street Menlo Park, CA 94025 Attention: Alex McIntyre, City Manager admcintyre@menlopark.org Flood Control District Department of Public Works 555 County Center, 5th Floor Redwood City, CA 94063 Attention: James Porter, Director jporter@smcgov.org Service of any such notice or other communications so made shall be deemed effective on the day of actual delivery (whether accepted or refused) as evidenced by: a) confirmed in-person delivery by the addressee or other representative of the Party authorized to accept delivery on behalf of the addressee, b) as shown by the addressee’s return receipt if by certified mail, or c) as confirmed by the courier service if by courier; provided, however, that if such actual delivery occurs after 5:00 p.m. (local time where received) or on a non- business day, then such notice or demand so made shall be deemed effective on the first business day immediately following the day of actual delivery. No communications via electronic mail shall be effective to give any Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 13 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt notice, request, direction, demand, consent, waiver, approval or other communications hereunder. 911. Severability In the event any portion of this Agreement is declared by any court of competent jurisdiction to be invalid, illegal or unenforceable, such portion shall be severed from this Agreement and the remaining parts hereof shall remain in full force and effect as fully as though such invalid, illegal or unenforceable portion had never been part of this Agreement. 1012. Governing Law and Compliance with Laws The parties agree that California law governs this Agreement. In the performance of this Agreement each Party will comply with all applicable laws, ordinances, codes and regulations of the federal, state, and applicable local government. 1113. Venue In the event that suit shall be brought by any party to this contract, the parties agree that venue shall be exclusively vested in the state courts of either the County of Santa Clara, or the County of San Mateo or where otherwise appropriate, exclusively in the United States District Court, Northern District of California. 1214. Assignability and Subcontracting Parties shall not assign this Agreement or any portion thereof to a third party or subcontract with a third party to provide services required under this Agreement without the prior written consent of the other parties. Any unauthorized attempt by any Party to so assign or transfer shall be void and of no effect. Notwithstanding the foregoing, a Party may hire a consultant to fulfill its obligations as described above in paragraph #under Section 35. Method and Timing of Transactions of this Agreement. 1315. Ownership of Materials All reports, documents, or other materials developed or discovered by any Party or any other person engaged directly or indirectly by any Party to perform the services required hereunder shall be and remain the mutual property of Authority and Water District without restriction or limitation upon their use. 1416. Entire Agreement Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Times New Roman,12 pt Formatted: Normal (Web), Indent: Left: 0" Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 14 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt This First Amended Agreement constitutes the entire Agreement between the Authority and the Water District Parties with respect to the subject matter hereof and supersedes all prior offers and negotiations, oral and written, including but not limited to the original Agreement dated August 11, 2014. This First Amended Agreement may not be amended or modified in any respect whatsoever except by an instrument in writing signed by authorized representatives of the Authority and Water District.eachall Partiesy. 1517. Further Actions The Authority and Water District agree to execute all instruments and documents, and to take all actions, as may be reasonably required to consummate the transactions contemplated by this Agreement. 1618. Counterparts This Agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, taken together, shall be deemed to be one and the same instrument. 1719. Non Waiver A Party’s waiver of any term, condition, or covenant, or breach of any term, condition or covenant will not be construed as a waiver of any other term, condition or covenant. 1820. Third Parties This Agreement is entered into only for the benefit of the Parties executing this Agreement and not for the benefit of any other individual, entity, or person. (remainder of page intentionally left blank) Signatures follow on next pages Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt Formatted: Normal (Web), Indent: Left: 0" Formatted: Normal (Web), Centered, Indent:Left: 0" Formatted: Normal (Web), Indent: Left: 0" Formatted: Font: (Default) Arial, 11 pt Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: Normal (Web), Centered, Indent:Left: 0" Formatted: Font: (Default) Arial, 11 pt Formatted: Normal (Web), Indent: Left: 0" First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 15 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND Formatted: Font: (Default) Arial, 11 pt Formatted: Font: (Default) Arial, 11 pt Formatted: Font: (Default) Arial, 11 pt Formatted: No underline, Font color: Auto Formatted: Space After: 0 pt Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 16 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the San Francisquito Creek Joint Powers Authority has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: San Francisquito Creek Joint Powers Authority By: ______________________________ By: ______________________________ Greg Stepanicich Len Materman Title: SFCJPA General Counsel Title: Executive Director Date: ____________________________ Date: ____________________________ Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 17 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the Santa Clara Valley Water District has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: Santa Clara Valley Water District By: ___________________________ By: ____________________________ Leslie Orta Tony EstremeraBarbara Keegan Title: Senior Assistant District Counsel Title: Chair/Board of Directors Office of the District Counsel Date: __________________________ Date: ___________________________ ATTEST: MICHELE L. KING, CMC __________________________________ Clerk/Board of Directors Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 18 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: No underline, Font color: AutoI <--------------------------------------------------------------------~L_ ____ _ /;II----~ " ,~( t L. ____________ -.J _____________________________________________________ J u,' '" " ____________ L ________ L ___________________________ J I <--------------------------------------------------------------------~L_ ____________________ ~ /,;I~====:::j , " L ____________ _ f ,(,' _________________________ ..1 Ilf " U ____________ L ________ L ___________________________ J First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 19 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of Palo Alto has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of Palo Alto By: ___________________________ By: ____________________________ Molly Stump James Keene City Attorney City Manager Print Name:_____________________ Print Name:______________________ Title: __________________________ Title: ___________________________ Date: __________________________ Date: ___________________________ Formatted: Space After: 0 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 20 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of East Palo Alto has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of East Palo Alto By: ___________________________ By: ____________________________ John Nagel Print Name:______________________ Print Name:______________________ Title: ___________________________Title: City Attorney Title: ___________________________ Date: __________________________ Date: ___________________________ Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, No underline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt, Nounderline, Font color: Auto Formatted: Font: (Default) Arial, 11 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 21 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the City of Menlo Park has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: City of Menlo Park By: _____________________________ By: ______________________________ Print Name: ____________________William L. McClure Print Name:________________________ Title: ___________________________ Title: City Attorney Title: ______________________________William L. McClure Alex D. McIntyre City Attorney City Manager Date: _________________________ Date:______________________________ Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Space After: 0 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Normal, Right: 0" Formatted: No underline, Font color: Auto Formatted: Font: Not Bold, No underline, Fontcolor: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto First Amended SFC San Francisco Bay to Highway 101 Construction Funding Agreement March 4May 1224307, 2016 Page 22 of 22 Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt Formatted: Font: 10.5 pt FIRST AMENDED AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 AGREEMENT AMONG THE SAN FRANCISQUITO CREEK JOINT POWERS AUTHORITY, THE SANTA CLARA VALLEY WATER DISTRICT, THE SAN MATEO COUNTY FLOOD CONTROL DISTRICT, THE CITY OF PALO ALTO, THE CITY OF MENLO PARK, AND THE CITY OF EAST PALO ALTO FOR THE FUNDING OF CONSTRUCTION OF THE SAN FRANCISQUITO CREEK FLOOD REDUCTION, ECOSYSTEM RESTORATION, AND RECREATION PROJECT SAN FRANCISCO BAY TO HIGHWAY 101 IN WITNESS WHEREOF, the San Mateo Flood Control District has executed this Funding Agreement as of the date and year stated below. Each Party has executed a separate signature page. APPROVED AS TO FORM: San Mateo County Flood Control District By: ___________________________ By: ______________________________ John Beiers Warren Slocum County Counsel President, Board of Supervisors, San Mateo Print Name: ____________________ Print Name: ________________________ Title: __________________________ Title: _____________________________ Date: __________________________ Date: _____________________________ Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Space After: 0 pt Formatted: No underline, Font color: Auto Formatted: No underline, Font color: Auto Formatted: Normal, Right: 0" Formatted: No underline, Font color: Auto Formatted: Font: Not Bold, No underline, Fontcolor: Auto Formatted: No underline, Font color: Auto Page 1: [1] Formatted Author 5/12/2016 4:28:00 PM Font: 10.5 pt Page 1: [1] Formatted Author 5/12/2016 4:28:00 PM Font: 10.5 pt 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[23] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 5: [24] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 5: [24] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 5: [25] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 5: [25] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 5: [25] Formatted Author 5/12/2016 4:12:00 PM Font: (Default) Arial Page 6: [26] Formatted Author 5/12/2016 4:29:00 PM Normal (Web), Numbered + Level: 1 + Numbering Style: a, b, c, … + Start at: 1 + Alignment: Left + Aligned at: 1.25" + Indent at: 1.5" Page 6: [27] Formatted Author 5/12/2016 4:05:00 PM Normal (Web), No bullets or numbering CITY OF PALO ALTO OFFICE OF THE CITY CLERK June 6, 2016 The Honorable City Council Palo Alto, California SECOND READING: Adopt an Ordinance Repealing Ordinance Number 4936, the Council's Prior Authorization for Natural Gas Purchases (FIRST READING: May 16, 2016 PASSED: 9-0) This was first heard by the City Council on May 16, 2016 and was passed unanimously, without changes. It is now before the Council for second reading. ATTACHMENTS:  Attachment A: Repealing Ordinance (PDF) Department Head: Beth Minor, City Clerk Page 2 NOT YET APPROVED 160414 jb 6053732 1 Ordinance No. ____ Ordinance of the Council of the City of Palo Alto Repealing Ordinance No. 4936, Which Authorized the City Manager to Purchase a Portion of the City’s Natural Gas Requirements from Certain Prequalified Natural Gas Suppliers Under Specified Terms and Conditions During Calendar Years 2007-2022, Inclusive The City Council finds and declares as follows: A. On March 12, 2007, the City Council adopted an ordinance authorizing the City Manager to purchase a portion of the City’s natural gas requirements from certain prequalified natural gas suppliers under specified terms and conditions during calendar years 2007-2022, inclusive, with a maximum expenditure limit of $65 million in for each Master Agreement. B. Since Council’s approval of Ordinance No. 4936, two counterparties, Shell Energy North America (U.S.) L.P., and Mercuria Energy Gas Trading L.L.C., have been active bidders for the City’s index-based gas purchases, and only $7.5 million of the approved $65 million expenditure limit remains for Mercuria Energy Gas Trading L.L.C. as of February 29, 2016. An increase in the maximum expenditure limit is needed to continue to purchase natural gas for the City’s retail load. C. The Council intends to adopt a resolution authorizing the City Manager to purchase natural gas from one or more pre-qualified suppliers for delivery during calendar years 2016 through 2022, inclusive, so long as the supplier with whom the City negotiates a specific purchase transaction continues to be qualified and otherwise eligible to transact with the City. Increasing the expenditure limit will provide for an estimated five years of gas purchases. D. Implementing this change via Council’s approval of a resolution rather than an ordinance, as was done in prior years, will streamline the City’s administrative processes. Therefore, staff recommends that Council repeal Ordinance 4936, and instead adopt a resolution to be recommended for Council approval on May 16, 2016, outlining the terms and conditions under which the City Manager can purchase a portion of the City’s natural gas requirements. NOW, THEREFORE, the Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Ordinance 4936, Authorizing the City Manager to Purchase a Portion of the City's Natural Gas Requirements from Certain Prequalified Natural Gas Suppliers under Specified Terms and Conditions During Calendar Years 2007 Through 2022, Inclusive is repealed in its entirety. ATTACHMENT A NOT YET APPROVED 160414 jb 6053732 2 SECTION 2. The Council hereby finds and determines that the repeal of this Ordinance does not constitute a project under Public Resources Code Section 21065, thus no California Environmental Quality Act assessment is required. SECTION 3. This ordinance shall be effective on the 31st day after its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ City Attorney City Manager ____________________________ Director of Administrative Services CITY OF PALO ALTO OFFICE OF THE CITY CLERK June 6, 2016 The Honorable City Council Palo Alto, California SECOND READING: Adopt an Ordinance Amending Municipal Code Sections 12.32.010 (Water Use Restrictions) and 12.32.020 (Enforcement) (FIRST READING: May 16, 2016 PASSED: 9-0) This was first heard by the City Council on May 16, 2016 and was passed unanimously, without changes. It is now before the Council for second reading. ATTACHMENTS:  Attachment A: Water Restriction Ordinance (PDF) Department Head: Beth Minor, City Clerk Page 2 NOT YET APPROVED 1 160301 jb 6053690 Ordinance No. _____ Ordinance of the Council of the City Of Palo Alto Amending Section 12.32.010, Water Use Restrictions and Section 12.32.020, Enforcement R E C I T A L S A. Article 10, Section 2 of the California Constitution declares that waters of the State are to be put to beneficial use, that waste, unreasonable use, or unreasonable method of use of water be prevented, and that water be conserved for the public welfare. B. The State of California is prone to drought conditions which result in water supply shortages. C. The City of Palo Alto recognizes the continuing need to manage water resources under its jurisdiction and control in a constitutionally compliant manner. D. Section 12.32.010 of the Palo Alto Municipal Code sets forth permanent water use restrictions applicable to all City water customers, in order to responsibly manage the City’s water resources. E. The Council wishes to adopt additional permanent water use restrictions in order to continue to responsibly manage this limited resource. F. City regulation of the time and manner of water use, rate design, the method of application of water for certain uses, and establishment of enforcement procedures in support of water use management is an effective and immediately available means of conserving water, and is authorized by Palo Alto Municipal Code Section 12.20.010. G. On September 15, 2014, the Council adopted Resolution 9460, establishing the enforcement process for violations of the three outdoor water use restrictions adopted by Council on August 4, 2014 (Resolution 9449). H. The Council now wishes to clarify the enforcement process for the water use regulations set forth in Chapter 12.32 of the Municipal Code. The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. The Council hereby modifies Section 12.32.010 of the Palo Alto Municipal Code to add the following four water use restrictions to Section 12.32.010, as subsections (e) through (h): e.The irrigation of turf or ornamental landscapes, which serve purely decorative purposes, and are distinguished from trees, edible gardens or ATTACHMENT C 2 160302 syn 6053690 landscapes that provide more than a purely aesthetic function, with potable water shall not be allowed between 10:00 a.m. and 6:00 p.m., except via hand watering with a bucket or a hose with an operating shut-off valve. f. The use of potable water in a fountain or other decorative water feature is prohibited, except where the water is part of a recirculating system. g. The use of potable water for street sweepers and washers is prohibited if non-potable water is available, as determined by the Director of Utilities, or his or her designee. h. Commercial car washes must use recycled water systems, if recycled water is available, as determined by the Director of Utilities, or his or her designee, and economically feasible. SECTION 2. The Council hereby modifies Section 12.32.020 of the Palo Alto Municipal Code as follows: 12.32.020 Enforcement. In addition to enforcing the provisions of this chapter against any person as a misdemeanor, an infraction, or via the imposition of administrative fines or penalties, the city manager and his designated employees are authorized to enforce the provisions of this chapter against customers and water purchasers of the utility as follows: (a) Reports of alleged misuse of water in a manner contrary to the provisions of this chapter shall be called to the attention of the party responsible for the service connection misused and shall be investigated by the utilities department personnel to the extent possible. (b) Utilities department personnel shall issue a written warning to the responsible party or parties. (c) If a second or third incident of misuse of water in a manner contrary to the provisions of this chapter is established to the satisfaction of the utilities department personnel, up to two additional written warnings shall be issued to the responsible party or parties, advising that the City may opt to pursue available enforcement remedies, including the issuance of administrative citations, fines, infractions punishable by penalties, misdemeanors, flow restrictors, and termination of water service. (d) For any subsequent incident by the same party, customer, or water purchaser, or for any willful violation of this Chapter, the city manager or his designee may, in addition to the pursuit of any available enforcement remedies, elect to install a flow restrictor upon the service connection of the purchaser or customer at the purchaser's or customer's expense. 3 160302 syn 6053690 (i) Prior to installation of the water restrictor, the director of utilities shall give written notice to the person responsible for the service connection, which is to be restricted, of his intention to install a restrictor. The person or persons to whom notice is to be given shall have five business days from the date of service of the notice to request a hearing before the city manager or his designee in order to present any and all evidence they may have as to why a restrictor should not be installed or under what conditions it might be installed. (ii) If a hearing is requested, the city manager or his designee shall schedule a date and time for said hearing as soon as possible after the request is filed, but not later than five business days after the filing or such request for hearing. (iii) At the hearing, the person whose service connection is to be restricted may offer evidence as to why the restrictor should not be installed or under what conditions it might be installed. (iv) Utilities personnel shall also be allowed to offer whatever evidence they may have as to why the restrictor should be allowed and under what conditions. The city manager or his designees shall make a determination as to whether the restrictor shall or shall not be installed and what conditions, if any, should pertain. (v) Upon a determination to install a restrictor after hearing, or the failure of the affected party to request a hearing, the director of utilities, under whatever conditions, if any, he may deem advisable under the circumstances, may install a flow restrictor on the service connection of the customer or purchaser of water whose service connection was used in the violations observed or established and bill the costs of such installation to said customer or purchaser in accordance with the following conditions: (1) The first installation shall be for a period of three days; (2) Subsequent installations shall be for a period to be determined by the director of utilities, in an amount sufficient to accomplish the purposes of this chapter. Flow restrictors shall be installed in accordance with water utility rules and regulations. (e) Records shall be kept by the department of utilities of the city of Palo Alto of all enforcement actions taken under subsection (d) of this Section, and such records may be subject to disclosure as required by the California Public Records Act. SECTION 3. The Council hereby finds that this ordinance is categorically exempt from the provisions of the California Environmental Quality Act pursuant to Section 15307 and 4 160302 syn 6053690 15308 of the California Environmental Quality Act Guidelines (actions taken by regulatory agencies for the protection of natural resources and the environment). SECTION 4. This ordinance shall be effective on the thirty-first day after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: _____________________________ _____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: _____________________________ ______________________________ Senior Deputy City Attorney City Manager ______________________________ Director of Administrative Services ______________________________ Director of Utilities City of Palo Alto (ID # 7037) City Council Staff Report Report Type: Consent Calendar Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Authorization for the Mayor to Sign a Letter Responding to the CHRSA Title: Approval and Authorization for the Mayor to Sign a Letter Responding to the California High Speed Rail Authority's Notice of Intent/Notice of Preparation From: City Manager Lead Department: Planning and Community Environment Recommendation: Staff recommends that the City Council approve and authorize the Mayor to sign the City’s response to the California High Speed Rail Authority’s (CAHSRA’s) Notice of Intent/Notice of Preparation (NOI/NOP) of an Environmental Impact Statement/Environmental Impact Report (EIS/EIR) for the San Francisco to San Jose segment of their blended system project. The draft letter has been reviewed and recommended by the Council’s Rail Committee. Executive Summary: The CAHSRA is proceeding with environmental review of the segment of the high speed rail project proposed from San Francisco to San Jose and is seeking input on the scope of the environmental document. (A copy of the CAHSRA’s NOI and NOP are included as Attachments A & B.) A draft comment letter was reviewed by the Rail Committee on May 31, 2016 and the proposed response in Attachment C reflects their direction. The City’s written response is due June 10, 2016. Attachments:  Attachment A: HSR NOP May 2016 (PDF)  Attachment B: Notice of Intent HSR May 2016 (PDF)  Attachment C: Response to HSR NOI-NOP June 2016_with RC Comments_Clean (DOCX) Attachment A This site displays a prototype of a “Web 2.0” version of the daily Federal Register. It is not an official legal edition of the Federal Register, and does not replace the official print version or the official electronic version on GPO’s Federal Digital System (FDsys.gov). The documents posted on this site are XML renditions of published Federal Register documents. Each document posted on the site includes a link to the corresponding official PDF file on FDsys.gov. This prototype edition of the daily Federal Register on FederalRegister.gov will remain an unofficial informational resource until the Administrative Committee of the Federal Register (ACFR) issues a regulation granting it official legal status. For complete information about, and access to, our official publications and services, go to the OFR.gov website. The OFR/GPO partnership is committed to presenting accurate and reliable regulatory information on FederalRegister.gov with the objective of establishing the XML-based Federal Register as an ACFR-sanctioned publication in the future. While every effort has been made to ensure that the material on FederalRegister.gov is accurately displayed, consistent with the official SGML-based PDF version on FDsys.gov, those relying on it for legal research should verify their results against an official edition of the Federal Register. Until the ACFR grants it official status, the XML rendition of the daily Federal Register on FederalRegister.gov does not provide legal notice to the public or judicial notice to the courts. The Federal Register The Daily Journal of the United States Government Notice Environmental Impact Statement for the California High Speed Rail System San Francisco to San Jose Section, CA A Notice by the Federal Railroad Administration on 05/09/2016 This document has a comment period that ends in 12 days (06/08/2016) Submit a formal comment Read the 22 submitted public comments Action Notice Of Intent (Noi) To Prepare An Environmental Impact Statement (Eis). Summary Through this NOI, FRA announces its intent to jointly prepare an Environmental Impact Report (EIR) and Environmental Impact Statement (EIS) with the California High-Speed Rail Authority (Authority) for the San Francisco to San Jose Section of the California High-Speed Rail (HSR) Page 1 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... Attachment B System, Blended System Project (Blended System Project or Project). FRA invites the public and all interested parties to provide comments on the scope of the EIR/EIS, including the proposed purpose and need, the alternatives to consider, potential environmental impacts of concern, and methodologies for analysis of impacts. Through this NOI, FRA also rescinds its December 2008 NOI for the San Francisco to San Jose Section. FRA and the Authority will develop the EIR/EIS in compliance with the California Environmental Quality Act (CEQA) and the National Environmental Policy Act of 1969 (NEPA). FRA and the Authority will hold scoping meetings and outreach activities as part of the NEPA/CEQA process. Federal cooperating agencies for the EIR/EIS are the Surface Transportation Board (STB) and the U.S. Army Corps of Engineers (USACE). Table of Contents •DATES: •ADDRESSES: •FOR FURTHER INFORMATION CONTACT: •SUPPLEMENTARY INFORMATION: •Purpose and Need •Alternatives •No Action Alternative •HSR Blended System Alternative(s) •Probable Effects •Scoping and Comments DATES: Written comments on the scope of the San Francisco to San Jose Section EIR/EIS must be provided to the Authority by June 8, 2016. Public scoping meetings are scheduled in May 2016: FRA and the Authority will hold the scoping meetings between 5:00 p.m. and 8:00 p.m. at the following dates: •San Francisco:Monday, May 23, 2016. •San Mateo:Tuesday, May 24, 2016. •Mountain View:Wednesday, May 25, 2016. Page 2 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... The Authority will make scoping materials and information concerning the scoping meetings available on the Authority's Web site: http://hsr.ca.gov/Programs/Statewide_Rail_Modernization/project_sections/sanfrancisco_sanjose.html. ADDRESSES: You can send written comments on the scope to Mr. Mark McLoughlin, Director of Environmental Services, Attention: San Francisco to San Jose Section EIR/EIS, California High-Speed Rail Authority, 770 L Street, Suite 1160, Sacramento, CA 95814, or via email with subject line “San Francisco to San Jose Section EIR/EIS” to: comments@hsr.ca.gov. You may provide comments orally or in writing at scoping meetings. FRA and the Authority will hold the scoping meetings between 5:00 p.m. and 8:00 p.m. at the following locations: •San Francisco:University of California, San Francisco Mission Bay, 11500 Owens Street, San Francisco, CA 94158. •San Mateo:San Mateo Marriott, 1770 South Amphlett Boulevard, San Mateo, CA 94402. •Mountain View:SFV Lodge, 361 Villa Street, Mountain View, CA 94041. FOR FURTHER INFORMATION CONTACT: Ms. Stephanie Perez, Environmental Protection Specialist, Office of Program Delivery, Federal Railroad Administration, 1200 New Jersey Avenue SE., (Mail Stop 20), Washington, DC 20590; Telephone: (202) 493-0388, email: stephanie.perez@dot.gov,or Mr. Guy Preston, Regional Delivery Manager, California High Speed Rail Authority, 100 Paseo de San Antonio, San Jose, CA 95113, Telephone: (408) 277-1091 or sanfrancisco_sanjose@hsr.ca.gov. SUPPLEMENTARY INFORMATION: FRA is an operating administration of the U.S. Department of Transportation and is responsible for overseeing the safety of railroad operations, including the safety of any proposed high-speed ground transportation system. FRA is also authorized to provide, subject to appropriations, funding for high -speed and intercity passenger rail projects and is also authorized to provide loans and other financial support for railroad investments. FRA is conducting this review under NEPA because it may provide funding or financing for this project in the future. STB and USACE are Federal cooperating agencies on the EIS. STB has approval authority under 49 U.S.C. 10901 over the construction and operation of the proposed California HSR System. USACE has jurisdiction under Section 404 of the Clean Water Act. The Authority was established in 1996 and is authorized and directed by statute to undertake the planning and development of a proposed statewide HSR network fully coordinated with other public Page 3 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... transportation services. In 2005, the Authority and FRA completed a Final Program EIR/EIS for the Proposed California HSR System (Statewide Program EIR/EIS), as the first phase of a tiered environmental review process. The Statewide Program EIR/EIS analyzed a No Project/No Action Alternative; a Modal Alternative involving expanding freeways, airports, and conventional rail systems; and a HSR alternative using electric propulsion and steel-wheel-on-steel-rail vehicles capable of operating speeds of 220 mph on fully grade separated rail alignments with state-of-the-art safety, signaling, and communication systems. The Authority certified the Statewide Program EIR under CEQA and approved the proposed HSR System, and FRA issued a Record of Decision under NEPA on the Statewide Program EIS. In approving the Statewide Program EIR/EIS, FRA and the Authority selected the HSR Alternative for intercity travel in California between the major metropolitan centers of Sacramento and the San Francisco Bay Area in the north, through the Central Valley, to Los Angeles and San Diego in the south. The Authority and FRA also selected certain corridors/general alignments and general station locations for further study; committed to mitigation strategies and design practices; and specified further measures to guide the development of the HSR system at the site-specific project level of environmental review to avoid and minimize potential adverse environmental impacts. FRA and the Authority did not select corridors or station locations between the Central Valley and the Bay Area in 2005. Rather, they decided to prepare a second program EIR/EIS for that area. In 2008, the Authority and FRA further evaluated alignments and station locations within the broad corridor between and including the Altamont Pass and the Pacheco Pass to connect the Bay Area and Central Valley portions of the HSR system in the Bay Area to the Central Valley High-Speed Train Program EIR/EIS. Based on that EIR/EIS, the Authority and FRA selected the Pacheco Pass—San Francisco and San Jose termini network alternative, including corridor alignments and station location options. The selected corridor alignment uses the Caltrain rail right-of-way, between San Francisco and San Jose along the San Francisco Peninsula, and the Pacheco Pass via Henry Miller Road, between San Jose and the Central Valley. In December 2008, the Authority and FRA respectively issued a notice of preparation and notice of intent to prepare an EIR/EIS for the project-level San Francisco to San Jose Section of the proposed California HSR System. In 2009, the Authority and FRA completed project scoping and provided the public with alternatives screening documents. These alternatives screening documents were for a rail corridor based on an entirely grade separated a four-track system between San Francisco and San Jose where HSR would share tracks with Caltrain express commuter trains. Communities along the Caltrain corridor expressed concerns with this proposal because of the perceived magnitude of impacts to environmental and community resources. In response to these concerns, the Authority suspended further work on the EIR/EIS in mid-2011 to consider blending the HSR and Caltrain operations within a smaller project footprint. In November 2011, the Authority proposed blended operations for the HSR section between San Francisco and San Jose, Page 4 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... which would still provide HSR and Caltrain service between the two cities without requiring a four- track system for the Project. The San Francisco to San Jose Section EIR/EIS will describe the Blended System Project in detail, identify site-specific environmental impacts from construction, operation, and maintenance of the Blended System Project; identify specific mitigation measures to address those impacts; and incorporate appropriate design practices to avoid and minimize potential adverse environmental impacts. The EIR/EIS will describe the site characteristics, size, nature, and timing of the proposed action as a basis for determining whether the impacts are potentially significant and whether impacts can be avoided, minimized, or mitigated. The Authority will provide information and documents regarding this EIR/EIS on the Authority's Web site: http://www.hsr.ca.gov. The San Francisco to San Jose Section EIR/EIS will tier from, and build upon, the Statewide Program EIR/EIS and the Bay Area to Central Valley HSR Program EIR/EIS consistent with Council on Environmental Quality (CEQ) regulations, (40 CFR 1508.28) and State CEQA Guidelines (14 California Code of Regulations 15168(b)). In addition to the NEPA and CEQA process, the Authority is required by law to publish a Business Plan, updated every two years, which includes a description of service type, chronology of statewide construction, estimate of capital costs per segment, operating and maintenance costs, environmental review schedule, and discussion of public and private funding availability. The Draft 2016 Business Plan, which the Authority released in February, describes a phased implementation of the statewide HSR system. The Draft 2016 Plan prioritizes construction between San Jose and the Central Valley, but also emphasizes the importance of extending HSR service from San Francisco to San Jose as soon as possible. Purpose and Need The purpose of the proposed HSR system is to provide a new mode of high-speed intercity travel that would link major metropolitan areas of the state; interface with international airports, mass transit, and highways; and provide added capacity to meet increases in intercity travel demand in California in a manner sensitive to and protective of California's unique natural resources. The need for a HSR system is directly related to the expected growth in population, and increases in intercity travel demand in California over the next twenty years and beyond. With the growth in travel demand, there will be an increase in travel delays arising from the growing congestion on California's highways and at airports. In addition, there will be negative effects on the economy, quality of life, and air quality in and around California's metropolitan areas from a transportation system that will become less reliable as travel demand increases. The intercity highway system, commercial airports, and conventional passenger rail serving the intercity travel market are currently operating at or near capacity, and will require large public investments for maintenance and expansion to meet existing Page 5 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... demand and future growth. The proposed HSR System is designed to address some of the social, economic, and environmental problems associated with transportation congestion in California. The San Francisco to San Jose Section meets this purpose and need by: • Connecting the San Francisco Bay Area to the rest of the statewide HSR system, including the Central Valley and Southern California; • Incorporating HSR into the intermodal hubs at San Francisco, Millbrae and San Jose, thereby providing interfaces with airports (San Francisco International Airport and Norman J. Mineta San Jose International Airport), mass transit (BART, Caltrain, Capitol Corridor, Amtrak, and light-rail and bus services), and highways, resulting in local and regional transportation hubs; • Serving a large base of riders in the densely populated San Francisco and San Jose metropolitan areas; and • Reaching station locations with existing and planned transit oriented development potential. Alternatives The San Francisco to San Jose Section EIR/EIS will consider a No Action or No Project Alternative and one or more HSR Alternatives for the San Francisco to San Jose corridor. The San Francisco to San Jose Section of the HSR system would connect to the San Jose to Merced Section at Diridon Station, which would extend HSR service from the San Francisco Bay Area to the Central Valley and Southern California. No Action Alternative The No Action Alternative (No Project or No Build) represents conditions in the San Francisco to San Jose corridor as they exist in 2016, and as they would exist in future years based on projected growth, programmed and funded improvements to the intercity transportation system, and other reasonably foreseeable projects through the implementation of Phase 1 operations in 2029, and a future year of operation in 2040. The No Action alternative takes into account the following sources of information: State Transportation Improvement Program; Regional Transportation Plans for all modes of travel; airport plans; intercity passenger rail plans; and city and county plans. HSR Blended System Alternative(s) The Blended System Project would follow the Caltrain right-of-way from San Francisco to San Jose. It would utilize existing and in-progress infrastructure Caltrain developed for its electrification project, but require construction in addition to electrification. The Blended System Project is anticipated to include the following, subject to continued planning and engineering following the scoping/outreach process: Page 6 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... New and/or Upgraded Infrastructure • Track improvements to support higher speeds, including upgrades of tracks, trackbeds, ties, interlockings, and possible curve straightening; • At least one passing track, with potential alternative locations for the passing track; • One terminal storage maintenance facility, with potential alternative locations; • Improvements to existing bridges necessary to accommodate mixed traffic; • Potential grade separations necessary to support blended operations; and • Installation of quad gates at remaining grade crossings. Proposed Operations • High-speed rail vehicles operating over mostly the same tracks between San Francisco and San Jose; • Speeds of up to 110 miles per hour; and • Operations plan that would allow for up to 4 HSR vehicles per hour/per direction in the peak period. Upgrades to Existing Stations • Raised and straightened platforms, platform screens (or other safety features) and passenger facilities at 4th & King, Millbrae and Diridon stations. Transbay Transit Center (TTC) and Downtown Extension DTX projects • The Authority proposes its Blended System Project will reach the TTC in San Francisco via the planned 1.3-mile extension of passenger rail track from the current terminus at the Caltrain 4th and King station. • The Transbay Joint Powers Authority is the state lead agency for both projects, which have been the subject of separate environmental review. • The TTC is currently under construction. The DTX is not yet under construction. • Both projects will be addressed in the San Francisco to San Jose Section EIR/EIS. During the Programmatic review phase, FRA and the Authority selected the Transbay Transit Center as the station location in the city of San Francisco. However, the Authority anticipates that the 4th and King Station would operate as an interim station until completion of the Transbay Transit Center which the Transbay Joint Powers Authority is constructing and funding. Other HSR stations would be located in the city of Millbrae at the existing Millbrae BART/Caltrain Station, and in the city of San Jose at the existing Diridon Station. FRA and Authority selected these locations through the Bay Area to Central Valley HSR Final Program EIR/EIS. Probable Effects Page 7 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... The EIR/EIS will evaluate and document the effects of the proposed project on the physical, human, and natural environment. FRA and the Authority will continue the tiered evaluation of all potentially significant environmental, social, and economic impacts of the construction and operation of the HSR system. The San Francisco to San Jose EIR/EIS will address appropriate resource areas including: Transportation, including impacts on existing passenger and freight rail tenants; safety and security; land use and zoning; land acquisition, displacements, and relocations; cumulative and secondary impacts; cultural resource impacts, including impacts on historical and archaeological resources; parklands/recreation areas; neighborhood compatibility and environmental justice; geology and paleontology impacts; natural resource impacts including air quality, wetlands, water resources, noise and vibration, energy, wildlife and ecosystems, including endangered species, energy and hazardous materials. The EIR/EIS will also identify and evaluate measures to avoid, minimize, and mitigate adverse impacts. The San Francisco to San Jose Section EIR/EIS will be prepared consistent with FRA's Procedures for Considering Environmental Impacts (64 FR 28545, May 26, 1999) and the CEQ's regulations implementing NEPA at 40 CFR parts 1500-1508. The San Francisco to San Jose Section EIR/EIS also will address, as necessary, other applicable statutes, regulations, and executive orders, including the Clean Air Act, Section 106 of the National Historic Preservation Act (Section 106) of 1966, Section 4(f) of the Department of Transportation Act, the Endangered Species Act, and Executive Order 12898 on Environmental Justice. FRA funding or approval of the San Francisco to San Jose Section would be a Federal undertaking with the potential to affect historic properties. As such, it is subject to the requirements of Section 106. Consistent with the Advisory Council on Historic Preservation's (ACHP) regulations implementing Section 106, FRA intends to coordinate compliance with Section 106 of this Act with the preparation of the San Francisco to San Jose Section EIR/EIS, beginning with the identification of consulting parties in a manner consistent with the standards set out in 36 CFR 800.8. Under the Programmatic Agreement among FRA, ACHP, the California State Historic Preservation Officer, and the Authority, FRA and the Authority will conduct a phased review of effects on historic properties consistent with 36 CFR 800.4(b)(2). FRA invites the public and interested parties to provide comments on the potential effects of the proposed alternatives on historic properties within the San Francisco to San Jose Section. In response to this NOI, a member of the public or other interested party may also request to participate in the Section 106 process as a consulting party under 36 CFR part 800. Scoping and Comments FRA encourages broad participation in the EIS process during scoping and review of the resulting environmental documents. FRA invites Native American Tribes, interested agencies, and the public at large to participate in the scoping process to ensure the EIR/EIS addresses the full range of Page 8 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... issues related to the proposed action and reasonable alternatives, and that all significant issues are identified. FRA requests that any public agency having jurisdiction over an aspect of the Project identify the applicable permit and environmental review requirements of the agency and the scope and content of the environmental information germane to the agency's jurisdiction over the Project. Public agencies are requested to advise FRA if they anticipate taking a major action in connection with the proposed project and if they wish to participate as a cooperating agency for the San Francisco to San Jose Section EIR/EIS. FRA and the Authority have scheduled public scoping meetings which are an important component of the scoping process for both the State and Federal environmental review. The Authority will advertise the scoping meetings described in this NOI locally and be included with any additional public notification. Issued in Washington, DC, on May 4, 2016. Jamie Rennert, Director, Office of Program Delivery. [FR Doc. 2016-10959 Filed 5-6-16; 8:45 am] BILLING CODE 4910-06-P Page 9 of 9Federal Register | Environmental Impact Statement for the California High Speed Rail Sy... 5/27/2016https://www.federalregister.gov/articles/2016/05/09/2016-10959/environmental-impact-sta... DRAFT June 7, 2016 Mark A. McLoughlin Ms. Stephanie Perez Director of Environmental Services Environmental Protection Specialist ATTN: San Francisco to San Jose Secton EIR/EIS Office of Program Delivery California High Speed Rail Authority Federal Rail Administration 100 Paseo de San Antonio 1200 New Jersey Avenue SE San Jose, CA 95113 Washington, D.C. 20590 RE: San Francisco to San Jose Section EIR/EIS – Response to NOI/NOP Dear Mr. McLoughlin & Ms. Perez: Thank you for the opportunity to comment on the scope of the California High Speed Rail Authority’s environmental analysis of the San Francisco to San Jose Section pursuant to the National Environmental Policy Act (NEPA) and the California Environmental Quality Act (CEQA). The City of Palo Alto has been an active participant in planning for the rail corridor that bisects this community for many years, and would like to offer the comments included in this letter to the California High Speed Rail Authority (CHSRA) and its partners at the Federal Railroad Administration (FRA). Please use these comments to inform your environmental review process and consider the suggested modifications to your overall planning process/schedule, particularly as it relates to community engagement. The Planning Process 1. We would like to request that the comment period for responding to the Notice of Intent/Notice of Preparation (NOI/NOP) be extended by 30 days to permit other agencies, organizations, and members of our community ample time to provide their input. 2. We would like to request that the NOI/NOP be re-issued for additional comments once basic parameters of the alternatives and the possible locations of critical project features are better known. For example, the NOI/NOP does not identify the locations of passing tracks or the planned maintenance facility, and does not specify which grade crossings will be separated as part of the project, and which will simply receive quad gates. These parameters should be worked out with the affected local agencies in advance of issuing a supplemental NOI/NOP. 3. As indicated in correspondence earlier this year, the City believes that the CHSRA’s objective of completing the environmental clearance work for the CHSRA’s SF to SJ project segment by the end of 2017 will result in a process that is unnecessarily rushed, and that does not allow adequate time for a community engagement process regarding project design and implementation. Please see the City’s letter of January 25, 2016, which is attached, and consider revising the planning process/schedule to permit additional community engagement. We have not received a response to this letter. Attachment C June 7, 2016 Page 2 Also, recent events call into question the CHSRA’s stated rationale for proceeding with the San Francisco to San Jose segment, which was to secure third party funding. We understand that third party investors and cap and trade funding have failed to materialize as anticipated by CHSRA and again question whether a more inclusive community engagement process and a more realistic schedule should be adopted. 4. As we indicated in our earlier letter, the City believes that the Context Sensitive Solutions (CSS) process or an equivalent stakeholder process should be undertaken immediately. This kind of community engagement effort has been shown to result in a better suite of project alternatives, to better recognize competing interests, and ultimately to result in better projects, that are less likely to be subject to delays due to legal challenges. 5. We understand from a May 25, 2016 presentation by Mr. Tripousis to our City Council’s Rail Committee that the CHSRA is considering establishment of “working groups” to help shape a preferred alternative while the Draft EIS/EIR is being prepared. The membership and purview of these working groups should be clearly specified so that the City may understand how it can participate and provide input. We recommend regional topics be addressed by all of the working groups, that web conferencing be provided as an option for participants, and that the meetings be facilitated by a third party, with HSR participating as stakeholders rather than facilitators. All local agencies and transit/transportation agencies should be include as participants. The CHSRA’s overall outreach and communication process should be structured to ensure that operational assumptions integral to the system and the identification of CHSRA preferences are not made without community awareness and input. 6. We question whether the CHSRA and the FRA should identify a Preferred Alternative before a Draft EIS/EIR is circulated for agency and public review. We understand that a NEPA analysis requires all alternatives to be considered at an equal level of detail, and we are concerned that stating a “preference” in advance of the Draft EIS/EIR may give one alternative higher standing or more emphasis than the others. Also, reserving a decision about which alternative is preferred until after the comment period on the Draft EIS/EIR will allow comments on the draft to inform that decision. 7. We understand the desire to “tier” from the Statewide Program EIS/EIR and from the Bay Area to Central Valley HR Program EIS/EIR, however the NOI/NOP is unclear what this means for the upcoming analysis. We would appreciate clarification as to what information or analysis from the earlier environmental documents will be relied upon. 8. We understand that the Metropolitan Transportation Commission (MTC) has been approached to fund a high level study of all 42 grade crossings along the Caltrain corridor, identifying issues and opportunities associated with grade separations and a framework for advancing them in advance of HSR. We applaud the goal of regional collaboration based on a scope of work developed in conjunction with the Local Policy Maker Group (LPMG), and initiation of a study that will proceed with their oversight. The nine-party MOU signed in 2012 anticipated early investments in “selected” grade separations and engaging local agencies in a strategy for funding and sequencing grade separations at all 42 grade crossings is long overdue. The EIS/EIR should assess the cost and time needed to complete these grade separations, as well as the resulting impacts and benefits. June 7, 2016 Page 3 The Alternatives Description 9. The proposed project is not sufficiently defined to allow meaningful comments on the scope of the environmental document. For example, the NOP does not identify the location of passing tracks or the planned maintenance facility in the project alternatives. Local agencies are thus prevented from commenting on site specific analyses that would be required if these facilities were located within their borders. 10. The CHSRA should include grade separations as an essential part of the project description to be evaluated pursuant to NEPA and CEQA. Failure to include grade separations as an element of the project would not only result in more significant impacts to be mitigated by CHRSA and other agencies, but would also effectively segment the cumulative effects of high speed rail operation and subsequent localized construction projects necessary for the CHSRA project to safely and effectively operate. Within Palo Alto, the alternatives should include and the EIS/EIR should analyze grade separations at all of the rail crossings in Palo Alto: Charleston, Meadow, Churchill and Palo Alto Avenue/Alma. Please include the 2% trench option for Charleston and Meadow developed for the City by Hatch Mott Macdonald (HMA). This approach is detailed in a HMA memo available at http://www.cityofpaloalto.org/civicax/filebank/documents/44297. (Please contact City staff for the accompanying concept drawings.) The EIR/EIS analysis should also consider any necessary accommodations or changes by freight operators to permit the 2% grade option suggested by HMA. 11. Please consider the impacts of freight on the corridor and consider alternatives with a modified or no freight option. These options should be considered in conjunction with the grade separation options described above. 12. Please assess and disclose the impact on Caltrain and HSR schedule quality, travel time, and reliability with and without level boarding at all Caltrain stops (not only HSR stations). We are concerned that lack of level boarding at Caltrain stations will cause delays at those stations that will in turn affect both Caltrain and HSR service. 13. The City is not supportive of adding passing tracks within Palo Alto, and does not see how this could occur without significant right of way (and cost) implications as well as impacts that would be unacceptable to our community. Please disclose physical right of way, cost, and visual impacts of passing track options. 14. Please also disclose the impacts of various passing track options on Caltrain service quality and reliability. We are concerned that some passing track options will result in bunching of trains. The service quality evaluation should include an assessment of the ability to offer “clockface” type service at regular intervals. 15. The No Project alternative should assess the benefits of expanded Caltrain service that will be possible in the corridor after electrification if HSR did not proceed. We expect that more vehicle trips would be eliminated and transit ridership would increase if Caltrain was able to use the additional capacity created by their system modernization, rather than sharing that capacity with HRS. June 7, 2016 Page 4 16. An alternatives analysis under CEQA should include consideration of an off-site alternative. The CHSRA has clearly reconsidered the original sequencing of project segments, and in an off-site alternative, it could similarly reconsider the decision to access San Francisco by using the Caltrain alignment. A reasonable alternative could include using an East Bay alignment with a connection to BART. 17. Please include the Downtown Extension to the Transbay Terminal as an alternative or in a detailed cumulative impacts analysis. The HSR EIS/EIR should disclose the environmental outcomes of this option with respect to ridership, VMT, and GHG, including displaced air travel. Impacts on Caltrain ridership and capacity should also be disclosed, and mitigation should be provided. 18. Please include the approach to Diridon Station in this EIS/EIR, including the potential impacts of alternatives on Caltrain service as well as other passenger services utilizing the segment (ACE, Capital Corridor). Any impacts identified should be fully mitigated. 19. For safety improvements at grade crossings remaining after HSR implementation, please consider automated intrusion detection technology to detect barriers on tracks and automated enforcement to enforce vehicle code prohibition against stopping on tracks. Environmental Impacts & Mitigation 20. Please see the May 16, 2016 correspondence from the City’s transportation staff to Mr. Tripousis for a list of intersections we believe should be included in the CHSRA’s analysis. Please also note that intersection and grade crossing evaluations should account for and fully consider pedestrian and bicycle safety and convenience. The existing at-grade crossings function as designated active transportation school commute corridors and principle linkages in the Citywide bicycle transportation network. 21. The City of Palo Alto’s Comprehensive Plan (its general plan) is currently being updated and is expected to include policies to ensure acceptable Levels of Service (LOS) at signalized intersections throughout the City. The EIS/EIR should provide a quantitative analysis of intersection LOS at affected intersections in Palo Alto, as well as an analysis of pedestrian and bicycle impacts with and without grade separations. 22. The City’s ongoing Comprehensive Plan Update will also consider elimination of Program T-39, which restricts the addition of traffic signals on Alma Street. Please do not consider the current program a constraint when evaluating impacts and necessary mitigation. 23. Palo Alto’s current Comprehensive Plan contains policies that are not generally supportive of road widening and if mitigation measures are needed to address delay/congestion at intersections, please consider signal timing, signal location, and barrier design, and improvements to multi-modal transportation to address the impacts before suggesting road widening. 24. Please provide a robust analysis of potential noise increases associated with the project alternatives, including noise associated with trains, train horns, quad gate operations, station announcements, and increased traffic congestion at grade crossings. Establishment of quiet zones should be included June 7, 2016 Page 5 as mitigation. The City recognizes that the rail corridor is in active use today, but expects an analysis that clearly demonstrates the additional volume and duration of noise generating activities within the corridor with the advent of HSR. The analysis should assess compliance with the City’s noise compatibility guidelines and related policies in addition to using the FTA’s methodology and thresholds. The City’s guidelines and relevant policies can be found in the Natural Environment Element of the City’s Comprehensive Plan (Policy N-39 through N-43). 25. Please provide specific information about all right of way requirements for construction and operation of the proposed alternatives, including grade separations implemented as part of the project or as part of subsequent projects necessitated to address safety and congestion impacts of the project. The NEPA analysis should include an estimated value of right of way acquisitions and estimate property tax impacts from direct and indirect property takings for the life of the project. 26. Please provide a cumulative impact analysis that considers Caltrain modernization, HSR options, and grade separating all 42 crossings in this segment of the project. If grade separations happen concurrent with Caltrain modernization and/or HSR, their construction will likely impact the schedule for project delivery. However, if grade separations happen after Caltrain modernization and/or HSR, their construction will impact planned rail service. Either way, the cumulative construction impacts on affected communities should be fully evaluated. 27. Palo Alto is a community rich in historic and cultural resources and both the EIS/EIR and the associated Section 4(f) analysis must identify those likely to be impacted by construction and operation of the proposed alternatives. Please be sure to include impacts on residential properties and districts (neighborhoods) adjacent to the rail corridor from changes in their setting associated with the removal of vegetative screening and the addition of high speed trains. Also consider potential impacts on station-area resources, the City’s urban tree canopy and individual heritage trees, including but not limited to El Palo Alto, the City’s namesake Redwood Tree and California Historical Landmark Number 2 (Portola Journey’s End). 28. The analysis of aesthetic impacts and biological resources should also consider impacts to the City’s urban tree canopy, as well as the loss of other vegetation along the rail corridor. The potential loss of visual screening, important landscape features, bird habitat, and sequestered carbon should be fully assessed. 29. Please also assess potential growth inducing impacts of the project, including the potential for distant housing and job growth as long commutes become easier. Please also assess the extent to which there will be additional demand for parking, transit, and paratransit (including rideshare services) at HSR stops throughout the system once the San Francisco to San Jose segment is completed. The City of Palo Alto has a long-standing relationship with Citizens for Responsible Rail Design and the Friends of Caltrain. While the short timeframe for submitting comments to the NOI/NOP did not allow for adequate coordination of the City's letter and incorporation of input from these community organizations, we support their analytical and methodical identification of key issues. As such, we incorporate by reference comments submitted by CARRD and Friends of CalTrain. We request that their comments be considered a part of the City of Palo Alto's comments on the necessary scope of your environmental analysis. June 7, 2016 Page 6 Once again, thank you for the opportunity to provide these comments. The City is in the process of hiring a rail program manager who will be the City’s primary point of contact for the EIS/EIR and this project. Until that person/firm is retained, please use the following contact for all correspondence: Hillary Gitelman, Director of Planning & Community Environment City of Palo Alto 250 Hamilton Ave Palo Alto, CA 94301 Hillary.gitelman@cityofpaloalto.org If you have any questions or comments, please contact Palo Alto City Manager James Keene at (650) 329- 2563 or by email at james.keene@cityofpaloalto.org. Sincerely, Patrick Burt Mayor, City of Palo Alto cc: Palo Alto City Council Palo Alto City Manager Congresswoman Anna Eshoo Senator Jerry Hill Assemblymember Rich Gordon City of Palo Alto (ID # 6810) City Council Staff Report Report Type: Action Items Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: BID Re-Authorization Title: PUBLIC HEARING: to Hear Objections to the Levy of Proposed Assessments on the Palo Alto Downtown Business Improvement District and Adoption of a Resolution Confirming the Report of the Advisory Board and Levying Assessment for Fiscal Year 2017 on the Downtown Palo Alto Business Improvement District From: City Manager Lead Department: City Manager Recommendation 1. Hold a public hearing on the levy of proposed assessments in Fiscal Year 2017 in connection with the Downtown Palo Alto Business Improvement District; and 2. Approve a resolution confirming the report of the Advisory Board and levying an assessment for Fiscal Year 2017 on the Downtown Palo Alto Business Improvement District (Attachment 2). Background The Palo Alto Downtown Business Improvement District (BID) was established by the City Council in 2004 pursuant to the California Parking and Business Improvement Area Law to promote the economic revitalization and physical maintenance of the Palo Alto Downtown business district. The Council appointed the Board of Directors of the Palo Alto Downtown Business and Professional Association (PADBPA), a non-profit corporation, as the Advisory Board for the BID. The Board’s purpose is to advise the Council on the method and basis for levy of assessments in the BID and the expenditure of revenues derived from the assessments. Pursuant to BID law, the Advisory Board must annually submit to the Council a report that proposes a budget for the upcoming Fiscal Year for the BID. The report must: 1) propose any boundary changes in the BID; 2) list the improvements and activities to be provided in the Fiscal Year; 3) estimate the cost to provide the improvements and activities; 4) set forth the method and basis for levy of assessments; 5) identify surplus or deficit revenues carried over from the prior Fiscal Year; and 6) identify amounts of contributions from sources other than assessments. City of Palo Alto Page 2 The City Council is required to annually hold a public hearing, approve the Advisory Board Annual report, and determine whether or not to levy the annual assessment for the Palo Alto Downtown Business Improvement District (BID). The BID is required by State law to be authorized annually. As such, it is not possible under state BID law to implement capital projects that extend longer than one year. Traditionally, funds generated from Business Improvement Districts are used for marketing, promotions, maintenance, and beautification of business districts. Although the BID is an active participant in many issues related to downtown businesses (i.e. transportation, parking, improvements), their legal limitations and budget restrict their ability to fund infrastructure such as parking structures or streetscape improvements. The assessments levied on businesses in the BID are based on the size, type, and location of downtown businesses. Based on a cost-benefit analysis, retailers and restaurants pay a larger assessment because they receive more benefit from the activities undertaken in the business district. For example, a small-large retailer/ restaurant would pay $225 to $450, while a small- large professional business (architect, accountant, etc) pay in the $50 to $225 range. Professional businesses pay the least since they receive less benefit from the BID. On May 16, 2016, the City Council:  Adopted a resolution preliminarily approving the report filed by the Palo Alto Downtown Business Improvement District Advisory Board for the Fiscal Year 2017;  Adopted a resolution of intention to levy the annual assessment for 2016-2017; and  Set June 6, 2016 at 7:00pm, or soon thereafter, as the date and time for the public hearing on the levy of the proposed assessments. Discussion Absent a majority protest at the public hearing, the Council may adopt a resolution approving the report for Fiscal Year 2017 as filed or as modified by the Council at the conclusion of the public hearing. The adoption of the resolution constitutes the levying of the BID assessments for Fiscal Year 2017. The May 16, 2016 staff report describes the actions related to the BID re-authorization, and includes report of the Palo Alto Downtown Business and Professional Association (PADBPA) to the City Council (included separately as an attachment). Also, attached is the Council Resolution approving the BID for Fiscal Year 2017 including required exhibits As per the agreement that the City and PADBPA have entered, the City has certain responsibilities as it pertains to the invoicing and collection of BID revenues. In prior years, staff from the Planning & Community Environment and Administrative Services Departments have been involved in the collection of BID assessments by setting fees, creating and sending invoices, and managing payment collections for the first 60 days of July. City of Palo Alto Page 3 To streamline the process, reduce the staff time involved, and minimize the possibility for errors to occur, staff partnered with an outside firm to handle invoicing and collection activity to occur. If the Council moves forward with the re-authorization of the BID in FY 2017, staff recommends that the City continue to use outside firm that can handle all aspects of the City’s responsibilities to the BID in terms of invoicing, billing, and collections. Resource Impacts Adoption of the proposed BID budget does not impact City revenue. BID assessments are restricted for use exclusively by the BID. It is anticipated that a strong BID will encourage vitality in the retail community and consequently result in additional sales tax revenue for the City. Staff time is expended annually to administer the collection of BID revenues, but will be reduced by the new process outlined above. An informal solicitation process identified Muni Services, LLC as the vendor for billing and invoicing responsibilities at ongoing annual cost of $8,500. The cost and collection of BID assessments past 60 days is borne by the BID. The Attorney's Office will continue to provide legal oversight to the BID during the annual reauthorization process. The Economic Development Manager will continue to provide oversight to the BID and will prepare the annual reauthorization. Attachments:  Attachment A: PAD Annual Report FY2017 (PDF)  Attachment B: Resolution Confirming Report of BID for FY2017 (PDF)  Attachment C: Staff Report ID# 6798 (PDF) Palo Alto Downtown Business Improvement District 2016 -1 7 Annual Report Prepared  for:  Palo  Alto  City  Council               Prepared  by:  Russ  Cohen,  Executive  Director,   Palo  Alto  Downtown  Business  and  Professional  Association     “Keeping Downtown Palo Alto Safe, Spotless and Successful. Introduction This report from the Advisory Board of the Palo Alto Downtown Business & Professional Association (“PAd”) was prepared for City Council to review for the annual reauthorization of the Downtown Palo Alto Business Improvement District (“BID”) pursuant to Section 36533 of the Parking and Business Improvement Law of 1989 (Section 36500 and following of the California Streets and Highways code) (the “Law”). This report is for the proposed fiscal year for the BID commencing July 1, 2016 and ending June 30, 2017. (“Fiscal Year 2016-17”). As required by the Law, this report contains the following information: I. Any proposed changes in BID boundaries and benefit zones within the BID; II. The improvements and activities to be provided for Fiscal Year 2016-17; III. An estimate of the cost of providing the improvements and the activities for Fiscal Year 2016-17; IV. The method and basis of levying the assessment in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his or her business for Fiscal Year 2016-17. V. The amount of any surplus or deficit revenues to be carried over from a previous fiscal year. VI. The amount of any contributions to be made from sources other than assessments levied pursuant to the Law. Submitted by Brad Ehikian, Chair, and Russ Cohen, Executive Director on behalf of the Advisory Board (“Advisory Board”) of the Palo Alto Downtown Business & Professional Association (“PAd”). The Advisory Board approved this report on April XX, 2016. Received on file in the Office of the City Clerk of the City of Palo Alto on April XX, 2016. Section I: BID boundaries and Benefit Zones There have been no changes in the BID boundaries or benefit zones within the BID and no changes are proposed. The current boundaries are depicted on the map below. The area of the BID is referred to as “Downtown.” 934- 9 4 4 927 932 233 281 933 - 9 3 7 943 327 1001 942 469 475 744 459 832 801 A P T 1 - 5 427-453 920912 362 370 900 838 846 471 459 835 - 8 5 5 460 815 840836 834 845 400 803 928930 931933 835 - 8 3 7 831- 8 3 3 451453 802800 810 - 8 1 6 818 - 8 2 0 828 - 8 3 0 817- 8 1 9 823 - 8 2 5 567-569 559563 536 526 100 1 101 1 - 540 483 904 912 468 918 926 537 965-971505-507 519-521 939-945 931-935 923-925518-520 539541543 515-517 809811 420 1001 1011 1010 376 370 980960 990 34 354 326 426 4 1000 448 944 471 483948952 959947925 915 933 935 425-443 451449 463-465 936-940 458 460 440 428426 527-533 543 551 510520 558-560 903 825 837 581 575940934 813-823 501-509 511-519 521-529 531-539 541-547 556 596 904 926 561-567 569 845 580 574 566 991- 997 136 610 116-122 150 535529525 542516140 102 116124 163 145 566556 167 528 643635 635 645- 685 660- 666 620 180 164 158156 624628632636 640644 617621 151-165 171-195 203 642640636 200 151 115 125 135 514 101 440 444 436432 427 425 117119 630616 208 228220 240-248 575 530- 534536540 552 177 156 201209215225 595 229231 611-623 180 508500 625-631 170 172-174 542544 538-542 552548546 541-547 230-238 734 723 721 702- 730220-244 744 701 731 755757 771 200 160 728-732 762-776740-746 250 275 270 255741 265 724 730 651 221-225227 668 707 205 201203451449 209 219 221 233235450460470 442444 400 420 430 411 425 429 185 165 181 412 250 420 245 171-169 441- 445 435-439 346344 333335 342 344 431 460 450 235530 220 220 B 222 240 514278 274270 250 545 540 251485255 271 281 300310301 581 259-267 533535537 261267 518-526 532- 536 520-526 530-536 271 281 252 270 240-248202-216 228226234238 244242 210-216 228- 234 223-229 209215 247-259 240 232230 311-317 251 344 326 340 337339 323317 400 420 332330 314 353 355 367 305 347 265272-278 418 319 321- 341 328 330 300- 310 431401 366 436 426 #1-7 369 335 319 390 301 315 375 307-311 325330 332 1&2330 1-3 324 326316 318 373-377 416- 424 361 338 340 560 345 321325 315 529 285 555 650636 628 1-12 628 A-E 385 365 375380 345 664 325650-654 661635300 690 675 555541-549533 535-539 318-324326 352 425 439-441 435429425 415-419 405403453 461 383460 502 510 526 520 540 499 467 459 439 425 555 400 436-452 456 379 370-374376380-382 384-396 550-552 364 360 431 440-444 423 499 475 421-423 431-433 432428 460-476 450 635 446 430 400 745 720706 385744734 724-730 720712704 360 351 315737 332 300 653-681 683685 512 501619 609605 518 482486496 610 630 455 400 651-687 543-545 532534 542544 550 552 554556 558560562564 635-6 643-6 470 313 334 333 325326 342 303301 229 336 308 310 312 316 318 311 331 315 319 317 321 335 228220 356-360 347-367 351 357 369-379360 258-296 350 210 204 302- 316 379310 320 328 332 340 437 412 311 A-B 404 313 325 327 333 407 401385 411 452 378-390 360 - 1A - 1C360 - 2A - 2C360 - 3A - 3C360 - 4A - 4C360 - 5A - 5C360 - 6A 344-348 418420 482 328 456 321 325 330204218 236 240 250-252 477 475 467 457 453249235225221 201 60 275 505-509 239-243209-213 210-214 513-519 460 474472228- 230 535 558 201 1612 20 209 215 223 231 521 80 239-245 530-540 544-554 212- 216 218-222 333 335-337 351 457451 465463 489-499360 530 480 420 430 480 463 451443437411405 419405401 441 480-498 347 351 355 359 525 430 473 332- 342 425415 400 570568 556 550 543 327321315305 343 515 525 551 555 328 309-311 518-528 536-540 552-554 558-562 573 A-E 591-599 557-571 330-332 318-320 406-418 417 542548568 524 550 500-528 578 564 550 546 540 530 531-535 541 505 525 537 555 565 571530 619-6 520 440-446 579 567 523610 600 555 581 420-438 437 566 224 228 A-F 244 579 575 565 559 251 355 A-J 335329604 576 566 345-347 243245 25725920921922723502 505 610-616 727 678 676 674672 642 636-638 567 555 711 701705 725 525 759 730718 734 738-740 760 746-750 701 721-7 600 827 835 899 850 530 609 759 7517537737-62611 601 600 1013 10041000 1006 1001 623 137 145 700 780 790 744 111700 753100 825805 33 51 75 63 841 44 675 49 41 711 799 703 100 101 139654 625 160 1001 1005 1009 1010 1004 930 975945929931 948 181 940 960 145900 955 999875 853 925 81 855 901-907 909 87 98 917 921 925 735 849 707 847 842828 820248 230-232 212 825 829833 839 800 812818 882 165831 801 815 809801 841 791153 718 774 761 795745 201 209 834836 845 895 926 190 934 942 948 203 209 219 225 929200 240 904 910 926 270 935 904 909909A 217 222 148 171 421 130 312 318 324 317 301 186 192 323 329 151 325 329 334 131 129 355301 235 258 212 163 115 291247 210 201 207 64 202 235 251249 252 247 244250 177220 261 251-257 205245 231225213205 70 2206 234240 183 251 270 241-247 215- 237 210-216 219 235 62 202 245 54 52 50 203 215 221 313-317318 220- 224 238 542-550 531-539 532 759 223-239 905 911-917907 188190 251- 293 202 206208 210 212 216 220 1008 275 539 201 400 27 168 865857 302 324 340 795 848 918 903903A 408412 440 483A - F 435 751 735 745 532 210 727 733 335 328 330 345 214 350 800 806 441441A 230302306308312316 301 303 305 307 309 325 251 807 821 829 801 818-824 420 424 430 832A 832 842A 842 852A 852 862A 862 872A 872 351A 351 355A 355 359A 359 363A 363 367A 367 425 911 943 951 918 936 940 944 271 253 241 301 319 919A919 935 949 928 936 940-946 353 264 367 361 310 1005 1010 423425413 - 419 457-467 469-471473-481 454 729 A-D 733-743 734-740 724-732 936 824-828 920 949 943941 715 95 445 324 328 545 590 425447 827 565585595 904 315 507 561 706 536 200 100 280-290 150 158164 276 516 698 161 159 157777 132 127 180 528 120 247 372 524 548550 538 152 345 336 515 658 227 27 29 539 115 135 321 558 #200-202 558 #C & D 965 140 350 808 915 461 435433 945 1012 421 727 A-C 218 255 206 739 260 840 650 642 351 451 551 375 530 643 415 12 700 802 99 89 87 901 560564568572576580584588592594 906908 910912914 916918920 922924 548 423 668 901 305 -313 423 405 352354 611 320322 346 323 471 484 528 426 264 430 1001 508 756 -760 940 930 544546 515 7 745 7 549 211213 151 160 257 433-457 482 330 349 401 539 440 691 755 67 312 202 651 443445 447 716 218 398 998 262 335 218 640-646506 327 469 303 401 403 254 401 91 40 101 819 301 725 595 705 541 Quarry Road Homer Avenue Lane 8 West Medical Foundation Way Lane 7 West Lane 7 East Encina Avenue El Camino Real Urban Lane Wells Avenue Forest Avenue High Street Emerson Street Ch a n n i n g A v e n u e Alma Street El Camino Real Mitchell Lane Everett Avenue Lytton Avenue Lane 15 E High Street Alma Street Bryant Street Lane 6 E Lane 11 W Lane 21 High Street Gilman Street Hamilton Avenue University Avenue Bryant Court Lane 30 Florence Street Kipling Street Tasso Street Cowper Street Everett Avenue Waverley Street Cowper Street Webster Street Everett Court Lytton Avenue Lane A West L L La Addison Avenue Forest Avenue Downing Lane Homer Avenue La Lane 39 Lane 56 Hamilton Avenue Webster Street Waverley Street Kipling Street Bryant Street Ramona Street Addison Avenue Scott Street Webster Street Cowper Street Addison Avenue Channing Avenue Ramona Street Paulsen Ln Lane 15 E Lane 20 W Lane 20 E University Avenue CalTrain ROW Emerson Street Waverley Street Kipling Street Bryant Street Ramona Street Palo Road ay Pear Lane Lane 12 W Lane 5 E Everett Avenue Homer Avenue Emerson Street talm Dr iv e Alma Street Lytton Avenue This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend abc Zone A (Ground Floor) - Zone B (Upper Floors) abc Zone B 0' 500' Downtown Palo AltoBusiness ImprovementDistrictArea Map CITY O F PALO A L TO INC OR P ORATE D C ALIFORN I A P a l o A l t oT h e C i t y o f AP RIL 16 1894 The City of Palo Alto assumes no responsibility for any errors ©1989 to 2012 City of Palo Alto rrivera, 2012-04-30 16:57:54CPA BID (\\cc-maps\gis$\gis\admin\Personal\rrivera.mdb) Overview: Today’s Downtown Palo Alto is a far different place than it was when the organization was founded in 2004. The downtown is now a dynamic, youthful, entrepreneurial neighborhood that boasts clean and safe walkable streets, a well balanced confluence of small, medium and large businesses and an almost even balance of independently owned retail and restaurants operating along side national chains. It is a globally recognized mecca for innovating the social and the technical. Without hyperbole, it is not only a valuable asset to the City of Palo Alto; it has become a valuable asset for the rest of the country if not the world. At a glance, there are approximately 88 restaurants and 72 retail establishments. 13 national chain restaurants or franchises exist amongst 75 privately owned restaurants. Amongst retail, there are approximately 21 national retailers and 51 independently owned stores. * The commonly held perception of downtown being dominated by chains and restaurants is simply that, a myth. It is the second largest generator of sales tax revenue for the City of Palo Alto. Strategic partnerships, execution and outcomes Real estate investments in the past decade have drawn the spotlight to the area and paved the way for growth. While some nearby cities have emulated Downtown Palo Alto’s live/work/play environment, this growth has not surprisingly resulted in a variety of challenges. To maximize our efforts to address those new and ongoing challenges we brought together partners to facilitate dialogue and develop programs between business, government and non- profits that have resulted in positive outcomes. In no particular order: • Collaborated with City of Palo Alto Public Works Division and the Public Arts Commission on the systematic replacement of downtown benches to both enhance the esthetics of downtown and inhibit loitering. A combination of a more utilitarian bench design along with a small variety of artful benches will be installed in late Spring 2016. • Collaborated with Zero Waste and the Pubic Arts Division to identify replacement trash receptacles that inhibit illegal and unsavory reclaiming of refuse and update the decades old current receptacles. Scheduled to be installed in late Spring 2016. • Initiated programs with non-profits Food Runners, Go Box and others in order to reduce food waste and divert edible food to resources that help feed the needy as well as recycle to-go containers. • Partnered with the Palo Alto Chamber of Commerce to develop a walking and interactive map promoting Downtown Palo Alto. • Offered recommendations as a member of the City of Palo Alto’s Parking Technology Working Group, identifying systems that will ease the search for available parking spaces in both downtown garages and surface lots. • Provided guidance as a member of the Parking Way-finding Task Force helping to develop graphic and electronic smart signage helping to inform and direct drivers to available parking options. • Supported the newly formed Transportation Management Association as a member of its 15-month long Steering Committee with resulting development of association bylaws, missions statement, goals and non-profit status. • Major member outreach efforts promoting American Express’s “Shop Small” annual event helping to promote locally owned retail in downtown Palo Alto including the development of social, web and print campaign. • Designed and managed the downtown Lamppost banner program which provided Holiday, Spring and Summer banners and now has complied a library of banner designs that can be used in years to come. • Developed, managed and promoted the 6 week long Summer concert series, “Music On the Plaza” including the development and design of social media, web and print efforts as well as raising the $40K in sponsorships needed to execute the series. The results were an increase in attendees well over that of the previous year’s “Concerts at Cogswell.” • Initiated dialog with City of Palo Alto Engineering Department to audit existing conditions and possible consolidation and removal of downtown news racks. Program expected to begin Summer 2016 with the majority of the tasks executed by the Palo Alto Downtown Business and Professional Association. • Engaged with Sa Jose State University Professor K. Rohrmeir and SFSU students on the “Activate the Alleys” project with the intent to identify ways to make downtown Palo A lot’s alleyways more efficient, clean and attractive. • Partnered with the Friends of Lytton Plaza to add umbrellas, foliage, public art and banners to the plaza to enliven and soften the hardscape of the plaza. • Sponsored, participated and promoted the annual Holiday Tree Lighting ceremony that resulted in hundreds of attendees in a family friendly atmosphere benefiting the downtown merchants and restaurants and highlighting Lytton Plaza . • Participated a s the Master of Ceremonies for the annual Avenidas New Year’s Holiday Brunch and Auction. • Partnered with Green Waste on an educational program directed towards restaurants regarding the importance of alleyway cleanliness and maintenance. • Helped develop and launch the first “Meet the Street” event including logo map and advertising design as well as the design and installation of lamp post banners that highlight the side streets of downtown Palo Alto including Emerson, Bryant, Ramona and Waverely. • Provided outreach to members of the downtown district regarding advertising opportunities on the newly developed walking and interactive map. • Promoted the City of Palo Altos’ Business Registry in order to help that program become more robust and successful with data collection. • Worked with Green Waste/Zero Waste o educating district members about newly created composting regulations. • Met with the Palo Alto Police Department leaders to discuss homeless and panhandling issues. Letter submitted to council regarding these ongoing concerns. As a result, parking garage issues have decreased dramatically. • Worked with Santa Clara County Small Business Administration to educate restaurants about the county’ new health inspection regulations and placard program. • Participated in the development of the Public Arts Commission Downtown Public Art master Plan. • Developed relationship with Hertz Rental Car to provide a Downtown Palo Alto Discount Program available to all downtown district members. • Participated in the Palo Alto Chamber of Commerce regular Public Policy Forum meetings. • Engaged in annual new board member recruitment and nomination process including the development and execution of election materials. • Built upon the downtown brand and welcomed new business to Downtown Palo Alto with the presentation fo the “Downtown Crown” at grand openings including Hana House, Opa, Coupa Café on Lytton and more. • Provided administrative oversight of the Palo Alto Downtown parking Assessment District subcommittee. • Worked with MuniServices LLC to provide invoicing, database management, reporting and collections. • Suppoted the Downtown Streets Team. * Methodology: Ratio estimates based on one time data collection through quick probability samplings considered a “windshield survey.” Margin of error is estimated to be 10-15%. With the addition of the City’s Business Registry data, this summary is expected to become even more accurate in the future. Section II: Ongoing and Planned Activites for Fiscal Year 2016-2017 Summary: Creating a spotless downtown. The sidewalks downtown are steam cleaned once per month with powerful equipment that helps remove stubborn stains like chewing gum. (For the record, individual businesses can sweep but are prohibited from using water to “hose down” the sidewalks, as that debris will flow directly to the bay. Steam cleaning is the most effective and the most environmentally responsible method.) These increases in frequency along with better equipment and the help of the Downtown Streets Team, (founded by The Palo Alto Downtown Business and Professional Association in 2004) help to keep downtown Palo Alto “spotless.” Creating a safe downtown. The Palo Alto Downtown Business and Improvement Association also administers the standing committee known as the Downtown Parking Assessment District Subcommittee, a committee charged with oversight of the funds and activities associated with the garages. As a reminder, in addition to the association fees, many merchants in the downtown district also contribute fees to the downtown parking district, which helped fund the building of the parking garages downtown and fund the ongoing maintenance of the garages at an approximate cost of $1million each year. The garages are patrolled by the Palo Alto Police Department and outreach efforts by the Downtown Streets Team—both are currently funded by these fees. The return of dedicated patrols downtown with two officers assigned to the beat also ensure a presence downtown that helps deter crime and provides rapid response to downtown incidents was initiated three years ago and last year, the number of dedicated officers was increased to four. Creating a destination. Keeping downtown a great place to do business, whether you are a retailer, restaurant, start-up or a one- person office is our mission. Making certain that downtown is its own unique brand, one that differentiates itself from any other downtown, is an area of focus for The Palo Alto Downtown Business and Professional Association. Creating this brand comes from not only ensuring an attractive downtown, but also a downtown that prides itself on the reputation it has earned as a center of innovation. Photos above: City Hall announcement of “Meet the Street event. Graphics deigned by The PADB&PA. Fashion runway showcasing local downtown boutiques and street musicians celebrating Bell’s Books anniversary as part of the Meet the Street festivities. Dancing crowds enjoying “Music on the Plaza” Summer Concert series. Photos below: Adding umbrellas, foliage and banners have added to the experience of relaxing in Lytton Plaza making it a better destination than ever before. Holiday banners and the Holiday Tree Lighting Ceremony give downtown a festive atmosphere, just right for shopping and dining. Creating an environment that is business friendly. The Palo Alto Downtown Business and Professional Association provides a conduit to leaders and staff at city hall for its dues paying members We don’t work for the city of Palo Alto; we work with it on behalf of all the business located downtown. From helping to develop public policy to helping find funding sources for events, the Downtown Association plays a vital role with the best interests of the business community in mind. The “Downtown Crown” as presented to each business that chooses to open downtown. Section III. Budget for 2016-17 The total funds available for activities for this fiscal year are estimated to be $197,721. The budget for providing the activities is set forth as follows: BID 2016/17 Budget INCOME Total Non-Assessment Sources Assessments $130,000 Allowance for Uncollectible Assessments ($25,000) Other Revenue $54,000 $54,000 15-16 Surplus Carryover $13,721 TOTAL INCOME $197,721 EXPENSES Operating Expenses Staff Salaries Executive Director Salary $74,600 Payroll taxes and expense $7,460 Office Supplies & Expenses $150 Internet/Website/ Phone Maintenance $861 Rent $7,200 Reauthorization Advertising $2,650 Audit-Tax Returns $5,700 Legal $1,000 $1,000 Insurance - Liability $2,300 Workman's Comp $800 Nominating $1,500 Invoicing $16,500 Contingencies $3000 Subtotal -- Operating Expenses $123,721 $1,000 Programs, Marketing and Events Banners $16,000 $8,000 Location Specific Banners $1000 Summer Concert Series $40,000 $40,000 Events $5000 $5000 Outreach & Communication $3000 Downtown Streets Team $5000 District Opportunity Reserve $4000 Subtotal --Programs, Marketing & Events $74,000 $54,000 TOTAL EXPENSES $197,721 Section IV: Method and Basis of Levying the Assessment Cost Benefit Analysis / Bid Assessments The method and basis of levying the assessment is provided in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his or her business for Fiscal Year 2016-17 and is not changed from the FY 2015-16 assessment. There have been no changes made to the Cost-Benefit Analysis or to the BID Assessments since they were approved by City Council on February 2, 2004. The method of calculation used to determine the cost and benefit to each business located in the BID is described below. The BID assessments are based on three criteria: the type of business, the location of the business and the size of the business. It has been consistently demonstrated that the typical BID program places a higher priority on activities such as commercial marketing. As a result, the retail and restaurant establishments in the BID are assessed more than service and professional businesses in the district. While service-oriented businesses benefit from a BID less than retailers and restaurateurs, they benefit more than professional businesses such as medical, dental, architectural, consultant and legal offices with their minimal advertising and promotion needs. For these reasons, various business types are assessed according to the benefit that they receive from the BID, as follows: Ø Retail and Restaurant 100% of base amount Ø Service 75% of base amount Ø Professional 50% of base amount Exceptions to this rule include financial institutions that are traditionally charged a flat rate regardless of location or size and lodging businesses that are typically charged by total rooms. The location of a business also determines the degree of benefit that accrues to that business. Centrally located businesses tend to benefit more, as do businesses located on the ground floor. For this reason, A and B benefit zones have been identified for the BID. In Palo Alto, Zone A benefit businesses are assessed 100% of the base benefit assessment while Zone B businesses are assessed 75%. A third criterion is used in the BID to determine benefit. This criterion, the size of the business, takes into consideration the number of full time employees employed by the business. Please refer to Attachment 1 for a more complete understanding of the application of these three variables to establish BID benefit. Attachment 2 is the BID assessment for each business located within the BID boundaries. Applying the criteria identified in Attachment 1, a summary of the assessment that applies to each business by size, type and location is outlined. In addition to the Cost-Benefit Analysis, the assessments include the following criteria: Ø An exemption for “single person professional businesses” that have 25% or fewer full time equivalent (“FTE”), including the business owner. This covers employees who work less than 10 hours a week (based on a 40 hour work week; an FTE equals approximately 2000 hours annually) Ø An assessment specifically for “single person businesses” that have 26% FTE to 1 FTE in the professional business category of the BID (An FTE equals approximately 2000 hours annually) Ø The tiering of other professional businesses by size based (according to benefit) on the “single person business” criteria This outline provides information by which a business can determine its annual assessment based on objective criteria. Except where otherwise defined, all terms shall have the meanings identified below: Definitions of Business Types in the Downtown Business Improvement District Retailers and Restaurants: Businesses that buy or resell goods such as clothing stores, shoe stores, office supplies as well as businesses that sell prepared food and drink. Service Businesses: Businesses that sell services such as beauty or barber shops, repair shops, most automotive businesses, dry cleaners, art and dance studios, printing firms, film processing companies, travel agencies, entertainment businesses such as theatres, etc. Hotel and Lodging: These include businesses that have as their main business the lodging of customers. This is restricted to residential businesses that provide lodging services to customers for less than 30 days. Professional Businesses: Businesses that require advanced and/or specialized licenses or academic degrees such as architects, engineers, attorneys, chiropractors, dentists, doctors, accountants, optometrists, realtors, insurance brokers, venture capital firms, consultants, advertising and marketing professionals and mortgage brokers and similar professions. Financial Institutions: Includes banking, savings and loan institutions and credit unions. Additional clarification on business definitions will be defined according to Section 18.04.030 (Definitions) of the Palo Alto Municipal Code. The Advisory Board recommends that the following businesses be exempt from the BID assessment: Ø New businesses established in the BID area following the annual assessment for the year in which they locate in the BID area Ø Non-profit organizations Ø Newspapers Ø “Single person professional businesses” that have 25% or less FTE, including the business owner The Assessment calculated shall be paid to the City no later 30 days after receipt of the invoice with the amount of the annual assessment sent by the City. A second notice will be mailed as a reminder to businesses that have not remitted payment by that date. Late payment will be subject to a 10% late fee. Section V: Revenue Surplus or Deficit The Assessment calculated shall be paid to the City no later 30 days after receipt of the invoice with the amount of the annual assessment sent by the City. A second notice will be mailed as a reminder to businesses that have not remitted payment by that date. Late payment will be subject to a 10% late fee. Section V: Revenue Surplus or Deficit Based on the revenue balance on 3/27/16 of $82,644, the PAd expects a surplus carryover of $13,721. Expected expenses for the remainder of FY 16-17 are as follows: Current Revenue Balance $82,644 Expected expenses for remaining FYE6/30/2016 Staff Salaries $36,300 Payroll Taxes $3,300 Banners $2,302 Downtown Streets Team $2,500 Rent $3,600 Workers Comp $350.50 Audit & Tax Return $6,900 District Opportunity Reserve $0 Nominating/elections $0 Invoicing $8500 Office Expense $0 Internet maintenance $0 Reauthorization advertising $1370 Contingencies $2000 Outreach & Communication $0 Total Expected Expense $68,923 Expected Carryover $13,721 Section VI: Non-assessment Income It is estimated that $54,000.00 will be raised in fundraising, and sponsor support. Additionally, we anticipate in kind contribution towards expenses for fiscal year 2016-17. Projected Income for Fiscal Year 2016-17 Legal (donation) $1,000 Banners $8,000 Summer Concert Series $40,000 Events $5,000 Total $54,000 Section VI: PAd Board of Directors by Business Type Retailers and Restaurants   Georgie Gleim, Gleim the Jeweler Alex Giovanotto, Joya Travis Nichols, Keen Garage Susan Graf, Susan Graf Mistie Cohen, Oren’s Hummus Service Businesses Robert Peterson, Peterson Architects Hospitality Barbara Gross, Garden Court Hotel Financial Institutions Patricia Behoumonde, Boston Private Bank & Trust Company* Katie Seedman, Presidio Private Bank and Trust Professional Organizations Brad Ehikian, Premier Properties Patty McGuigan, Cornish & Carey Commercial Sheila Liskar, Palo Alto Laser Skin Care Mila Zelkha, Palintir* Carlie Factor, Salesforce/RelateIQ* Non Profit Organizations Chris Richardson, Downtown Streets Team Zia MacWilliams, Downtown Street Team* Phil Carter, Palo Alto Farmer’s Market COMMUNITY PARTNERS Palo Alto Chamber of Commerce Judy Kleinberg, President & CEO Downtown Streets Team Eileen Richardson, Executive Director City Of Palo Alto Eric Filseth, Palo Alto City Council Liaison Thomas Fehrenbach, Manager of Economic Development *nominated ATTACHMENT 1 A General Statement Regarding Cost-Benefit Analysis For BID Businesses Using The Traditional Three Criteria Formula Criteria 1) Type of Business: Statement Concerning Cost-Benefit Formula For BID Businesses Regarding Type Of Business: In a review of 200 California Business Improvement Districts, it is consistently demonstrated that the typical BID Program places a higher priority on Commercial Marketing Programs than on Civic Beautification and Commercial Recruitment Programs. With that trend in mind, retail and restaurant businesses, with their emphasis on, and need for, commercial marketing, are traditionally assessed more than less marketing-sensitive service-oriented or professional-oriented businesses. However, while service-oriented businesses benefit from a BID less than retailers and restaurateurs, they benefit more, (from commercial marketing programs), than professional businesses such as medical, dental and legal offices with their minimal advertising and promotion needs. Therefore, set forth below, is an example of how various business types might be considered regarding the computation of the annual benefit assessment. • Retail and Restaurant: 100% of base amount • Service: 75% of base amount • Professional: 50% of base amount Exceptions to this rule include financial institutions that are traditionally charged a flat rate regardless of location or size and lodging businesses that are typically charged by total rooms. Lodging businesses are assessed based on the total number of rooms because it is a more equitable manner of determining size. Many lodging businesses have many part time employees, but revenues are based on the room occupancies of the hotel, not the goods sold or serviced provided by employees. Criteria 2) Location of Business: Statement Concerning Cost-Benefit Formula For BID Businesses Regarding Location of Business: It has also been consistently demonstrated that the more centrally located businesses tend to benefit from BID activities and services to a greater degree than businesses located toward the periphery of the proposed BID boundaries. Events and activities tend to originate in the central core of the Downtown area and spread benefit to the outer areas with diminishing energy and impact, much like the ripple effect of a stone tossed into a body of calm water. Furthermore, ground floor businesses tend to benefit to a greater degree than businesses located in upper floors. Therefore, in some cases, a new BID's annual benefit assessment formula also takes these street level criteria into account. As mentioned above, special events, fairs, festivals and other activities tend to take place within, or along, the Main Street core rather than in the areas at the periphery of the Downtown core. Additionally, Attachment 2 BID-sponsored seasonal decorations, public art projects, street banners and street furniture tend to be located within the immediate core area. Therefore, businesses located within the most central area of the proposed BID are considered to be within "Zone A" which should be considered the primary benefit zone. There is typically a "secondary zone" or "Zone B" within most proposed BID areas. This area receives less benefit than Zone A and should be assessed accordingly. An example of how different zones might be treated regarding the computation of the annual benefit assessment is as follows. • Zone A: 100% of base benefit assessment • Zone B: 75% of base benefit assessment In the case of Downtown Palo Alto, it is recommended that all Zone A upper floor businesses, as well as any other businesses located at the periphery of the proposed BID, be considered as Zone B businesses. Please refer to the map in Attachment I. Criteria 3) Size of Business: Statement Concerning Cost-Benefit Formula For BID Businesses Regarding Size of Business: In approximately 50% of newly established BIDs, a third assessment criterion is used. This criterion involves the size of each individual business that is based upon the businesses’ total number of full-time employees. Full-time employees are those working a total of 2,000 hours per year. Part-time employees are grouped into full-time job positions, i.e., two half-time employees total one full-time. Fractions are rounded down to the nearest whole number with no less than one person as a minimum for business. An example of how various business sizes might be treated regarding the computation of the annual benefit assessment is as follows: Retail/Restaurants Service Businesses Small 50% of base amount Under 6 FTE* Under 4 FTE Medium 75% of base amount 6 to under 11 FTE 4 to under 7 FTE Large 100% of base amount 11 or more FTE 7 or more FTE * FTE = full time employees Additionally, an exemption was established for “single person professional businesses” that have 25% or less FTE, including the business owner. This covers employees who work less 10 hours a week (based on a 40 hour work week) Since “single person businesses” that have 26% FTE to 1 FTE in the professional business category of the BID benefit the very least from the assessment, their assessments have been tiered by size based (according to benefit) on the new “single person business” criteria. Attachment 2 ATTACHMENT 2 Downtown Palo Alto Business Improvement District Annual BID Assessments ZONE A ZONE B (75% of Zone A amount) Restaurants & Retailers Under 6 FTE (50% of base amount) $225 $170 6 to under 11 FTE (75% of base amount) $340 $260 11 or more FTE (100% of base amount) $450 $340 Service Businesses Under 4 FTE (50% of base amount) $170 $130 4 to under 7 FTE (75% of base amount) $260 $200 Over 7 FTE (100% of base amount) $340 $260 Professional Businesses 25% or fewer FTE, including owner (0% of base amount) Exempt Exempt 26% FTE to under 1 FTE (25% of base amount) $60 $50 2 to 4 FTE (50% of base amount) $110 $90 5 to 9 FTE (75% of base amount) $170 $130 10+ FTE (100% of base amount) $225 $170 Lodging Businesses Up to 20 rooms (50% of base amount) $2258 $170 21 to 40 rooms (75% of base amount) $340 $260 41+ rooms (100% of base amount) $450 $340 Financial Institutions $500 $500 Note 1: For retail, restaurant, service, and professional businesses, size will be determined by number of employees either full-time or equivalent (FTE) made up of multiples of part-time employees. A full FTE equals approximately 2000 hours annually. Lodging facilities will be charged by number of rooms available and financial institutions will be charged a flat fee. Note 2: Second floor (and higher) businesses located within Zone A will be assessed the same as similar street-level businesses located within Zone B. Note 3: Assessment amounts are rounded to the nearest ten dollars. The minimum assessment will be $50.00. Not Yet Approved 160517 jb 0131522 1 Resolution No. _____ Resolution of the Council of the City of Palo Alto Confirming the Report of the Advisory Board and Levying an Assessment for Fiscal Year 2017 on the Downtown Palo Alto Business Improvement District THE CITY COUNCIL OF THE CITY OF PALO ALTO HEREBY FINDS, DECLARES, AND ORDERS AS FOLLOWS: SECTION 1. The Parking and Business Improvement Area Law of 1989, California Streets and Highways Code Sections 36500 et seq. (the “Law”), authorizes the City Council to levy an assessment against businesses within a parking and business improvement area which is in addition to any assessments, fees, charges, or taxes imposed in the City. SECTION 2. Pursuant to the Law, the City Council adopted Ordinance No. 4819 establishing the Downtown Palo Alto Business Improvement District (the "District") in the City of Palo Alto. SECTION 3. The City Council, by Resolution No. 8416, appointed the Board of Directors of the Palo Alto Downtown Business & Professional Association, a California nonprofit mutual benefit corporation, to serve as the Advisory Board for the District (the "Advisory Board"). SECTION 4. In accordance with Section 36533 of the law, the Advisory Board prepared and filed with the City Clerk a report entitled "Downtown Palo Alto Business Improvement District, Annual Report 2016-2017” (the "Report”), and, by previous resolution, the City Council preliminarily approved such report as filed. SECTION 5. The boundaries of the District are within the City limits of the City of Palo Alto (the "City") and encompass the greater downtown area of the City, generally extending from El Camino Real to the West, Webster Street to the East, Lytton Avenue to the North and Addison Avenue to the South (east of Emerson Street, the boundaries extend only to Forest Avenue to the South). Reference is hereby made to the map of the District attached hereto as Exhibit "A" and incorporated herein by reference for a complete description of the boundaries of the District. SECTION 6. The City Council has adopted a Resolution of Intention, Resolution No. 9588 declaring its intention to levy and collect an assessment for fiscal year 2017 against the businesses in the District. SECTION 7. Following notice duly given pursuant to law, the City Council has held a full and fair public hearing regarding the levy and collection of an assessment within the District for fiscal year 2017. All interested persons were afforded the Not Yet Approved 160517 jb 0131522 2 opportunity to hear and be heard regarding protests and objections to the levy and collection of the assessment for fiscal year 2017. The City Council finds that there was no majority protest within the meaning of the Law. All protests and objections to the levy and collection of the assessment and any and all protests and objections are hereby overruled by the City Council. SECTION 8. Based on its review of the Report, a copy of which has been presented to the City Council and has been filed with the City Clerk, and other reports and information, the City Council hereby finds and determines that (i) the businesses in the District will be benefited by the expenditure of funds raised by the assessment (ii) the District includes all of the businesses so benefited; and (iii) the net amount of the assessment levied within the district for the 2017 fiscal year in accordance with the Report is apportioned by a formula and method which fairly distributes the net amount in proportion to the estimated benefits to be received by each such business. SECTION 9. The City Council hereby confirms the Report as originally filed by the Advisory Board. New businesses established in the District after the beginning of any fiscal year shall be exempt from the levy of the assessment for that fiscal year. In addition, non-profit organizations, newspapers and professional "single-person businesses," defined as those businesses which have 25% or less full time equivalent employees, including the business owner, shall be exempt from the assessment. SECTION 10. The Adoption of this resolution constitutes a levy of an assessment for the fiscal year 2017 (commencing July 1, 2016, and ending June 30, 2017). The assessment formula, including the method and basis of levying the assessment, is set forth Exhibit “B” attached hereto and incorporated herein by reference. New businesses established in the District after the beginning of any fiscal year shall be exempt from the levy of the assessment for that fiscal year. In addition, non-profit organizations, newspapers and professional "single-person businesses," defined as those businesses which have 25% or less full time equivalent employees, including the business owner, shall be exempt from the assessment. SECTION 11. The City Council hereby declares that the proposed uses of the revenues derived from the assessments levied against the businesses in the District are for the following facilities and activities: The types of improvements to be funded by the levy of an assessment against businesses within the District are the acquisition, construction, installation or maintenance of any tangible property with an estimated useful life of five years or more. The types of activities to be funded by the levy of an assessment against businesses within the District are the promotion of public events which benefit businesses in the area and which take place on or in public places within the District; the furnishings of music in any public place in the District; and activities which benefit businesses locating and operating in the District. Not Yet Approved 160517 jb 0131522 3 SECTION 12. The Council finds that the adoption of this resolution does not meet the definition of a project under Section 21065 of the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: __________________________ _____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: __________________________ _____________________________ Senior Assistant City Attorney City Manager _____________________________ Director of Administrative Services 934 - 9 4 4 927 932 233 281 933 - 9 3 7 943 327 1001 94 2 469 475 74 4 459 832 801 A P T 1 - 5 427-453 920 912 362 370 900 838 846 471 459 835 - 8 5 5 460 81 5 840 836 834 845 400 803 928930 931 933 835 - 8 3 7 831 - 8 3 3 451453 802800 81 0 - 8 1 6 81 8 - 8 2 0 82 8 - 8 3 0 817 - 8 1 9 82 3 - 8 2 5 567-569 559563 536 526 100 1 101 1 - 540 483 904 912 468 918 926 537 965-971505-507 519-521 939-945 931-935 923-925 518-520 539541543 515-517 809 811 420 1001 1011 1010 376 370 980960 990 34 354 326 426 4 1000 448 944 471 483948952 959947925 915 933 935 425-443 451449 463-465 936-940 458 460 440 428426 527-533 543 551 510520 558-560 903 825 837 581 575 940934 813-823 501-509 511-519 521-529 531-539 541-547 556 596 904 926 561-567 569 845 580 574 566 991- 997 136 610 116-122 150 535529 525 542516140 102 116 124 163 145 566 556 167 528 643635 635 645- 685 660- 666 620 180 164 158156 624628 632 636 640 644 617 621 151-165 171-195 203 642640 636 200 151 115 125 135 514 101 440 444 436432 427 425 117119 630616 208 228220 240-248 575 530- 534 536 540 552 177 156 201 209215 225 595 229231 611-623 180 508500 625-631 170 172-174 542544 538- 542 552 548 546 541- 547 230-238 734 723 721 702- 730220-244 744 701 731 755757 771 200 160 728-732 762- 776740-746 250 275 270 255 741 265 724 730 651 221-225 227 668 707 205 201203 451449 209 219 221 233 235450 460 470 442 444 400 420 430 411 425 429 185 165 181 412 250 420 245 171-169 441- 445 435- 439 346344 333 335 342 344 431 460 450 235530 220 220 B 222 240 514278 274270 250 545 540 251485255 271 281 300 310 301 581 259-267 533535537 261 267 518-526 532- 536 520-526 530-536 271 281 252 270 240-248 202- 216 228226 234238 244 242 210- 216 228- 234 223- 229 209215 247-259 240 232230 311-317 251 344 326 340 337339 323317 400 420 332330 314 353 355 367 305 347 265272-278 418 319 321- 341 328 330 300- 310 431401 366 436 426 #1-7 369 335 319 390 301 315 375 307- 311 325330 332 1&2330 1-3 324 326316 318 373- 377 416- 424 361 338 340 560 345 321325 315 529 285 555 650636 628 1-12 628 A-E 385 365 375380 345 664 325650-654 661635300 690 675 555541-549533 535- 539 318-324 326 352 425 439-441 435429425 415-419 405403453 461 383460 502 510 526 520 540 499 467 459 439 425 555 400 436-452 456 379 370-374 376 380-382 384-396 550-552 364 360 431 440-444 423 499 475 421-423 431-433 432428 460-476 450 635 446 430 400 745 720706 385744 734 724-730 720 712 704 360 351 315737 332 300 653 -681 683 685 512 501619 609605 518 482486 496 610 630 455 400 651-687 543-545 532534 542544 550 552 554556 558560562564 635-6 643-6 470 313 334 333 325326 342 303301 229 336 308 310 312 316 318 311 331 315 319 317 321 335 228220 356-360 347-367 351357 369-379360 258- 296 350 210 204 302- 316 379310 320 328 332 340 437 412 311 A-B 404 313 325 327 333 407 401385 411 452 378-390 360 - 1A - 1C360 - 2A - 2C360 - 3A - 3C360 - 4A - 4C360 - 5A - 5C360 - 6A 344-348 418420 482 328 456 321 325 330204 218 236 240 250- 252 477 475 467 457 453249235225221 201 60 275 505-509 239- 243 209- 213 210- 214 513-519 460 474472228- 230 535 558 201 16 12 20 209 215 223 231 521 80 239-245 530-540 544-554 212- 216 218-222 333 335- 337 351 457451 465463 489-499360 530 480 420 430 480 463 451443437411 405 419405401 441 480-498 347 351 355 359 525 430 473 332- 342 425415 400 570568 556 550 543 327321315305 343 515 525 551 555 328 309-311 518-528 536-540 552-554 558-562 573 A-E 591-599 557-571 330-332 318-320 406-418 417 542 548568 524 550 500-528 578 564 550 546 540 530 531-535 541 505 525 537 555 565 571 530 619-6 520 440-446 579 567 523610 600 555 581 420-438 437 566 224 228 A-F 244 579 575 565 559 251 355 A-J 335329 604 576 566 345-347 243245 25725920921922723502 505 610-616 727 678 676 674672 642 636-638 567 555 711 701705 725 525 759 730 718 734 738-740 760 746-750 701 721-7 600 827 835 899 850 530 609 759 751753 7 737-62611 601 600 1013 10041000 1006 1001 623 137 145 700 780 790 744 111700 753100 825805 33 51 75 63 841 44 675 49 41 711 799 703 100 101 139654 625 160 1001 1005 1009 1010 1004 930 975 945929931 948 181 940 960 145900 955 999875 853 925 81 855 901-907 909 87 98 917 921 925 735 849 707 847 842828 820248 230-232 212 825 829 833 839 800 812 818 882 165831 801 815 809801 841 791153 718 774 761 795745 201 209 834836 845 895 926 190 934 942 948 203 209 219 225 929200 240 904 910 926 270 935 904 909 909A 217 222 148 171 421 130 312 318 324 317 301 186 192 323 329 151 325 329 334 131 129 355301 235 258 212 163 115 291247 210 201 207 64 202 235 251 249 252 247 244250 177220 261 251-257 205245 231225213205 70 2 206 234240 183 251 270 241-247 215- 237 210- 216 219 235 62 202 245 54 52 50 203 215 221 313-317318 220- 224 238 542-550 531-539 532 759 223-239 905 911-917907 188 190 251- 293 202 206 208 210 212 216 220 1008 275 539 201 400 27 168 865857 302 324 340 795 848 918 903 903A 408 412 440 483A - F 435 751 735 745 532 210 727 733 335 328 330 345 214 350 800 806 441 441A 230302 306 308 312 316 301 303 305 307 309 325 251 807 821 829 801 818-824 420 424 430 832A 832 842A 842 852A 852 862A 862 872A 872 351A 351 355A 355 359A 359 363A 363 367A 367 425 911 943 951 918 936 940 944 271 253 241 301 319 919A 919 935 949 928 936 940-946 353 264 367 361 310 1005 1010 423425413 - 419 457-467 469-471473-481 454 729 A-D 733-743 734-740 724-732 936 824-828 920 949 943941 715 95 445 324 328 545 590 425447 827 565 585 595 904 315 507 561 706 536 200 100 280-290 150 158164 276 516 698 161 159 157777 132 127 180 528 120 247 372 524 548550 538 152 345 336 515 658 227 27 29 539 115 135 321 558 #200-202 558 #C & D 965 140 350 808 915 461 435433 945 1012 421 727 A-C 218 255 206 739 260 840 650 642 351 451 551 375 530 643 415 12 700 802 99 89 87 901 560564568572576580584588592594 906 908 910 912 914 916 918920 922 924 548 423 668 901 305 -313 423 405 352354 611 320322 346 323 471 484 528 426 264 430 1001 508 756 - 760 940 930 544546 515 7 745 7 549 211 213 151 160 257 433-457 482 330 349 401 539 440 691 755 67 312 202 651 443 445 447 716 218 398 998 262 335 218 640-646506 327 469 303 401 403 254 401 91 40 101 819 301 725 595 705 541 Quarry Road Homer Avenue Lane 8 West Medical Foundation Way Lane 7 West Lane 7 East Encina Avenue El Camino Real Urban Lane Wells Avenue Forest Avenue High Street Emerson Street Ch a n n i n g A v e n u e Alma Street El Camino Real Mitchell Lane Everett Avenue Lytton Avenue Lane 15 E High Street Alma Street Bryant Street Lane 6 E Lane 11 W Lane 21 High Street Gilman Street Hamilton Avenue University Avenue Bryant Court Lane 30 Florence Street Kipling Street Tasso Street Cowper Street Everett Avenue Waverley Street Cowper Street Webster Street Everett Court Lytton Avenue Lane A West L L La Addison Avenue Forest Avenue Downing Lane Homer Avenue La Lane 39 Lane 56 Hamilton Avenue Webster Street Waverley Street Kipling Street Bryant Street Ramona Street Addison Avenue Scott Street Webster Street Cowper Street Addison Avenue Channing Avenue Ramona Street Paulsen Ln Lane 15 E Lane 20 W Lane 20 E University Avenue CalTrain ROW Emerson Street Waverley Street Kipling Street Bryant Street Ramona Street Palo Road ay Pear Lane Lane 12 W Lane 5 E Everett Avenue Homer Avenue Emerson Street tal m D r iv e Alma Street Lytton Avenue This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend abc Zone A (Ground Floor) - Zone B (Upper Floors) abc Zone B 0' 500' Downtown Palo Alto Business ImprovementDistrict Area Map CITY O F PALO A L TO IN C O R P O RATE D C ALIFOR N IA P a l o A l t oT h e C i t y o f A P RIL 16 1894 The City of Palo Alto assumes no responsibility for any errors ©1989 to 2012 City of Palo Alto rrivera, 2012-04-30 16:57:54CPA BID (\\cc-maps\gis$\gis\admin\Personal\rrivera.mdb) City of Palo Alto (ID # 6798) City Council Staff Report Report Type: Consent Calendar Meeting Date: 5/16/2016 City of Palo Alto Page 1 Summary Title: BID Preliminary Re-Authorization Title: Preliminary Approval of the Report of the Advisory Board for Fiscal Year 2016 in Connection With the Palo Alto Downtown Business Improvement District and Adoption of Resolution Declaring its Intention to Levy an Assessment Against Businesses Within the Downtown Palo Alto Business Improvement District for Fiscal Year 2017 and Setting a Time and Place for a Public Hearing on June 6, at 6:00 PM or Thereafter, in the City Council Chambers From: City Manager Lead Department: City Manager Recommendation Staff recommends that City Council: (a) Preliminarily approve the Business Improvement District (BID) Advisory Board’s 2017 Budget Report for the BID (Attachment A) and; (b) Adopt a Resolution of Intention to Levy Assessments in the Palo Alto Downtown Business Improvement District for Fiscal Year 2017 (Attachment B), setting a date and time for the public hearing on the levy of the proposed assessments for June 6, 2016, at 7:00 PM, or thereafter, in the City Council Chambers. Executive Summary This Council action includes a preliminary approval of the BID Board’s annual report, and sets a time and place for a public hearing for the staff presentation, and to determine any objections to the assessments. Since the BID inception in 2004, a number of activities consistent with State BID law have been accomplished by the Palo Alto Downtown Business and Professional Association (PADBPA), the entity with which the City contracts to provide services to the nearly 800 businesses assessed in the Downtown. These include addressing the three main issues facing downtown businesses: cleanliness, safety, and attractiveness, as well as participation in zoning, transportation, and other matters affecting downtown businesses. City of Palo Alto Page 2 Assessments for BID businesses are based on the size, type and location of the business. Assessments range from $50 for individually owned professional businesses to $500 annually for financial institutions. The PADBPA has monthly open meetings governed by the Ralph M. Brown Act which any business or individual can attend. Background The Palo Alto Downtown Business Improvement District (BID) was established by the City Council in 2004 pursuant to the California Parking and Business Improvement Area Law to maintain economic vitality and physical maintenance of the Palo Alto Downtown business district. The Council appointed the Palo Alto Downtown Business and Professional Association (PADBPA), a non-profit corporation, as the Advisory Board for the BID. PADBPA (acting through its independent Board of Directors) advises the Council on the method and basis for levy of assessments in the BID and the expenditure of revenues derived from the assessments. Pursuant to BID law, the Advisory Board must annually submit to the Council a report that proposes a budget for the upcoming Fiscal Year for the BID. The report must: 1) propose any boundary changes in the BID; 2) list the improvements and activities to be provided in the Fiscal Year; 3) estimate the cost to provide the improvements and activities; 4) set forth the method and basis for levy of assessments; 5) identify surplus or deficit revenues carried over from the prior Fiscal Year; and 6) identify amounts of contributions from sources other than assessments. The Council needs to: 1) review the report and preliminarily approve it as proposed or as changed by the Council; 2) adopt a resolution of intention to levy the assessments for the upcoming Fiscal Year; and 3) set a date and time for the public hearing on the levy of assessments in the BID. Absent a majority protest at the public hearing on June 6, 2016, at the conclusion of the public hearing, the Council may adopt a resolution confirming the report for Fiscal Year 2017 as filed or as modified by the Council. The adoption of the resolution constitutes the levying of the BID assessments for Fiscal Year 2017. Discussion The Advisory Board has prepared a report for the Council’s consideration which includes the proposed budget for the Palo Alto Downtown BID for Fiscal Year 2017. As required by BID law, the report has been filed with the City Clerk and contains a list of the improvements, activities, and associated costs proposed in the BID for Fiscal Year 2017. The Advisory Board has recommended no change in the BID boundaries or the method and basis for levying assessments. A map of the BID and the proposed assessment schedule is attached. The proposed assessments in the BID for Fiscal Year 2017 are the same as the assessments in Fiscal Year 2015. The budget report for Fiscal Year 2017 was reviewed and approved by the Palo Alto Downtown Business and Professional Association board in April 2016. As per the agreement that the City and PADBPA have entered, the City has certain responsibilities as it pertains to the invoicing City of Palo Alto Page 3 and collection of BID revenues. In prior years, staff from the Planning & Community Environment and Administrative Services Departments have been involved in the collection of BID assessments by setting fees, creating and sending invoices, and managing payment collections for the first 60 days of July. As of last year, staff has enlisted the services of an outside firm, MuniServices, to handle all aspects of the City’s responsibilities to the BID in terms of invoicing, billing, and collections. If Council moves forward with the assessment for 2017, staff will continue to employ MuniServices as the administering agent. Resource Impact Adoption of the proposed BID budget does not impact City revenue. BID assessments are restricted for use exclusively by the BID. It is anticipated that a healthy BID will encourage vitality in the retail community and consequently result in additional sales tax revenue for the City. Staff time from the City Manager’s Office is expended annually to provide oversight to the BID, administer the contract with MuniServices, liaise with stakeholders and prepare the annual reauthorization. The cost and collection of BID assessments, including those past 60 days is borne by the BID assessment revenues. The Attorney's Office will continue to provide legal oversight to the BID during the annual reauthorization process. Attachments:  Attachment A: PAD Annual Report FY 2017 (PDF)  Attachment B: Resolution Declaring Intention to Levy BID for FY17 (PDF) City of Palo Alto (ID # 6935) City Council Staff Report Report Type: Action Items Meeting Date: 6/6/2016 City of Palo Alto Page 1 Council Priority: City Finances Summary Title: Blue Ribbon Storm Drain Committee Recommendations Report Title: Review of Recommendations From the Storm Drain Blue Ribbon Committee Regarding Future Storm Water Management Funding and Request for Council Direction on Whether to Proceed With a Proposition 218 Hearing and Property Owner Ballot-by-Mail to Approve Future Storm Water Management Rates From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council: 1. Review and accept a report from the Storm Drain Blue Ribbon Committee on its recommendations for future storm water management funding; and 2. Provide guidance to staff on whether to proceed with a Proposition 218 protest hearing and property owner ballot-by-mail to approve future storm water management rates. Executive Summary The City’s storm drain programs are funded through the Storm Drainage Fund, an enterprise fund established by Council in 1989. Revenue to fund the Storm Drainage Fund’s programs and projects is currently generated by a Storm Drainage Fee assessed to all developed properties in Palo Alto on monthly utility bills. Council traditionally had the authority to set the Storm Drainage rates as part of the annual City budget approval process. In November 1996, however, City of Palo Alto Page 2 California voters passed Proposition 218, a comprehensive constitutional amendment that set substantive and procedural requirements for property- related fees. As a result, the City must obtain property owner or voter approval before increasing Storm Drainage fees. In April 2005, Palo Alto property owners approved a ballot-by-mail measure increasing the Storm Drainage Fee to for a typical single-family residential parcel to $10.00 per month, with provision for annual inflationary increases through FY 2017. If no action is taken to approve updated fees, the fee structure approved in 2005 will sunset in June 2017, and the fee will revert back to its pre-2005 level of $4.25 per month. Revenue from the post-sunset rate will not support current operational costs for storm drain system maintenance and State-mandated storm water quality protection programs and will provide no funding for continuation of a storm drain capital improvement program. On October 19, 2015, Council approved staff’s recommended conceptual strategy for identifying a funding mechanism for future storm drain improvements and enhanced storm water quality protection programs, including the appointment by the city manager of a Blue Ribbon Committee (Committee) of residents to review storm drain funding needs. The city manager appointed ten community leaders from neighborhoods throughout Palo Alto. The Committee had its first meeting on February 4, 2016 and met for two hours on a weekly or bi-weekly basis through early May. At their final meeting on May 5, 2016, the Committee voted on and approved a summary report containing their findings and recommendations to the city manager for future storm drain funding. The Committee recommends a renamed Storm Water Management Fee of $13.65 per month for FY 2018, with a provision for annual inflationary increases and a partial 15-year sunset horizon. The fee revenue would support construction of a set of high-priority storm drain capital improvements, preparation and implementation of a green stormwater infrastructure plan, as well as ongoing storm drain system maintenance and storm water quality protection programs. The Committee recommends that a portion of the new fee not be subject to the sunset provision in order to provide a stable funding basis for ongoing non-capital expenditures for engineering, maintenance, and storm water quality staffing, expenses, and permit compliance. Staff and the Committee concur that the City should proceed with a Proposition City of Palo Alto Page 3 218 protest hearing and property owner ballot-by-mail election to approve future storm water management rates. Staff recommends that the process be timed such that the protest hearing is held in October 2017 and ballots are sent to property owners in early 2017. The following report describes the specifics of the Committee’s recommendations and a potential election process and timeline for Council consideration. Background The City’s storm drain capital improvement, maintenance and water quality protection programs are funded through the Storm Drainage Fund, an enterprise fund established by Council in 1989. Revenue to fund the Storm Drainage Fund’s programs and projects is currently generated by a Storm Drainage Fee assessed to all developed properties in Palo Alto on monthly utility bills. Description of Current Rate Structure The Storm Drainage fee schedule is based upon the premise that a property’s use of the municipal storm drain system is dependent upon the amount of storm water runoff that it generates during storm events, which in turn is related to the amount of impervious surface (hardscape such as buildings, driveways, patios, parking lots, etc.) on the property. The current Storm Drainage fee schedule has three flat rates for single-family residential parcels based on lot size and a multi- family residential/commercial/industrial rate based on actual measured impervious surface on each parcel (see Attachment A: Utility Rate Schedule D-1 - General Storm and Surface Water Drainage; and Attachment B: Utility Rule and Regulation 25 - General Storm and Surface Water Drainage). The Storm Drainage rate schedule billing unit is the Equivalent Residential Unit (ERU). One ERU equates to 2,500 square feet of impervious surface, the amount of hardscape on a typical Palo Alto single-family residential property. The Storm Drainage Fee was originally set with the establishment of the Storm Drainage Enterprise Fund in 1989 at a rate of $3.25 per month per ERU. Council increased the monthly rate to $4.25 per month per ERU as part of the FY 1994 budget approval process. History of Earlier Proposition 218 Elections Council traditionally had the authority to set the Storm Drainage rates as part of the annual City budget approval process. In November 1996, however, California voters passed Proposition 218, a comprehensive constitutional amendment that set substantive and procedural requirements for many types of property-related City of Palo Alto Page 4 fees, assessments, and taxes. Under Proposition 218, most property-related fees (with some exceptions, such as water and sewer) cannot be imposed or increased without the approval of a majority of property owners subject to the fee or a supermajority of voters. California courts have held that storm drainage fees like Palo Alto’s are property-related fees subject to Proposition 218’s procedural and substantive requirements. As a result, the City must obtain property owner or voter approval before increasing Storm Drainage fees. After a failed property owner election in September 2000 (which garnered only a 37 percent approval rating), the City conducted a second election in April 2005 seeking approval of an increased Storm Drainage Fee to fund needed storm drain capital improvements and enhanced storm drain maintenance and storm water quality protection. The ballot measure, crafted jointly by staff and a city manager- appointed Blue Ribbon Committee, included the following key elements:  An initial Storm Drainage Fee of $10.00 per month per ERU (fee for the typical single-family residential property owner);  Funding for seven high-priority storm drain capital improvements, estimated to cost approximately $17 million (2004 dollars);  Annual funding for innovative projects that reduce storm water runoff and pollutant levels;  Annual inflation-based adjustments to the proposed fee increase, subject to Council approval, with a maximum annual increase of 6%;  Twelve-year sunset provision for the proposed fee increase (ending in June 2017); and  Council appointment of a citizen oversight committee tasked with ensuring that the money raised from the increased Storm Drainage Fee is spent in accordance with the ballot measure. The 2005 Storm Drainage ballot measure (Attachment C) was approved, with 58 percent of responding property owners voting in favor of the fee increase. This 2005 property owner authorized funding is scheduled to sunset on June 1, 2017.1 The successful ballot measure has provided enhanced revenue for a fully self- sufficient Storm Drainage Fund, including funding for capital projects and ongoing operating expenses. Five of the seven storm drain capital improvement projects 1 The small pre-Proposition 218 fee amount of $4.25/month/ERU will not sunset and does not require re- authorization. City of Palo Alto Page 5 specified in the ballot measure have been completed to-date. A contract for construction of the final phase of the Lincoln Avenue Storm Drain Improvements Project will be submitted to Council for approval in two weeks, and the final project (Matadero Storm Water Pump Station Improvements) will be substantially completed in FY 2017. As described in the proposed FY 2017-2021 Capital Budget, the storm drain pipeline element of the Matadero project will be deferred to FY 2018 due to a funding shortfall. Attachment D provides a status update on the Storm Drainage Fund Capital Improvement Program. The Council- appointed Storm Drain Oversight Committee has performed annual reviews of the Storm Drainage Fund budget and expenditures to ensure compliance with the approved 2005 ballot measure. As authorized by property owners through the 2005 ballot measure, Council has approved increases in the base single-family residential Storm Drainage rate of $10.00 per month per ERU each year based on an index representing the local rate of inflation. The single-family residential rate proposed for FY 2017 is $13.03 per month per ERU, representing an average increase of 2.4 percent per year since 2005. If no action is taken to approve updated fees, the previously-approved fees will sunset, and the fee will revert back to its pre-2005 level of $4.25 per month per ERU in June 2017. Revenue from the $4.25 per month fee will not support current operational costs for storm drain system maintenance and State- mandated storm water quality protection programs and will provide no funding for continuation of a storm drain capital improvement program. Basis of Property Owner-Approved Projects The seven high-priority storm drain capital improvement projects specified for funding in the 2005 Storm Drainage ballot measure were based on recommendations made in the 1993 Storm Drain Master Plan. During the Blue Ribbon Committee’s deliberations on the scope and size of the ballot measure, the Committee acknowledged that there were a number of additional capital projects that would need to be funded after the June 2017 sunset date. Much of the City’s storm drainage infrastructure was constructed in a poorly coordinated manner as part of multiple individual residential subdivision developments during the high growth years between the mid-1940s and late-1960s. Many elements of the existing storm drain system do not meet the modern design standard of being able to convey the storm runoff from a 10% or 10-year recurrence storm event without street flooding. City of Palo Alto Page 6 2015 Storm Drain Master Plan Update In preparation for a potential future Storm Drainage ballot measure, staff completed a Storm Drain Master Plan Update in June 2015 that rexamined and reprioritized the storm drain capital improvements needed to increase the flow capacity of the City’s storm drain system to bring it into conformance with current design standards. The Master Plan Update identifies an estimated $43 million in high- and medium-priority storm drain capital improvement projects needed for flow capacity augmentation (the Storm Drain Master Plan is posted for viewing at: http://www.cityofpaloalto.org/gov/depts/pwd/stormwater/drains.asp). On October 19, 2015, Council approved staff’s recommended conceptual strategy for identifying a funding mechanism for future storm drain improvements and enhanced storm water quality protection programs. The approved strategy included the appointment by the city manager of a Blue Ribbon Committee of residents and business representatives to review storm drain funding needs. Water Board’s New Municipal Regional Permit In November 2015, the San Francisco Bay Regional Water Quality Control Board (Water Board) adopted a new Municipal Regional Permit (MRP) that regulates storm water discharges from municipalities and local agencies throughout the Bay Area. The MRP has traditionally included 15 provisions requiring activities to prevent storm water pollution, including business and construction site inspections, control of specific pollutants such as trash, pesticides, copper, PCBs, and mercury, new and redevelopment requirements, potable water discharge practices, public outreach and education. The renewed MRP continues all of the requirements from the prior permit and adds several new mandates, notably the development of a Green Storm Water Infrastructure Plan. Green storm water infrastructure protects or restores the natural water cycle by collecting and retaining and/or treating runoff rather than discharging it directly to storm drains. Green storm water infrastructure practices, also referred to as low impact development measures, include preserving natural landscapes and utilizing infiltration planters, rain gardens, tree wells, green roofs, pervious pavement, and rainwater harvesting to manage storm water runoff. These practices help to limit the discharge of pollutants from streets, parking lots, and roofs by infiltrating storm water into soils. Future storm City of Palo Alto Page 7 water program budgets will need to include funding for these new MRP requirements. Discussion In January 2016, as part of the October 19, 2015 Council-approved strategy for reviewing options for storm drain funding, staff contacted members of the public to solicit their participation on the Storm Drain Blue Ribbon Committee (Committee). The city manager appointed ten residents and community leaders to the Committee (see list of Committee members, Attachment E). The Committee members live in neighborhoods throughout the City and have expertise and interests in a variety of fields. The Committee had its first meeting on February 4, 2016 and met for two hours on a weekly or bi-weekly basis through early May. The Committee met 10 times for a total of 20 hours. The Committee meetings were open to members of the public, and information about the Committee meetings, including agendas, meeting summaries, and briefing materials, was posted to a special page on the City’s web site: http://www.cityofpaloalto.org/sdbrc. At the first few meetings, staff presented detailed information to the Committee on a variety of topics relevant to storm drainage, including existing programs, storm drain funding, Proposition 218, recommended storm drain capital improvements, and enhanced storm water quality protection programs, including green storm water infrastructure planning. During the remainder of the meetings, the focus switched to the Committee’s internal discussion and analysis of the issues. At their final meeting on May 5, 2016, the Committee voted on and approved a summary report containing their findings and recommendations to the city manager for future storm drain funding (Attachment F). Members of the Committee will be present at the June 6 Council meeting to address the Council and answer questions regarding their report. The Committee focused particular attention on the following set of key recommendations:  The name of the enterprise fund and the user fee should be changed to “Storm Water Management Fund” and “Storm Water Management Fee,” respectively, to reflect a broader, more holistic approach to storm water management;  The Storm Water Management Fee structure should include a fee amount City of Palo Alto Page 8 sufficient to fund ongoing non-capital expenditures for engineering, maintenance and storm water quality staffing, expenses and permit compliance that does not sunset; and  The City should place an emphasis on green storm water infrastructure planning and implementation, a paradigm shift in storm water management, in its future storm water program and City-wide capital improvement program scoping and budgeting. Staff worked cooperatively with the Committee on its summary report and concurs with its findings and recommendations. The following is a complete listing of the recommendations contained in the Committee’s summary report: 1) A renewed and renamed “Storm Water Management Fee” should be proposed to Palo Alto property owners for their approval in order to generate funding for storm water infrastructure improvements, system maintenance, and storm water quality protection on a pay-as-you-go basis as follows: a) Increase the base Storm Water Management Fee from $4.25 per month per Equivalent Residential Unit (ERU) to $6.62/month/ERU to cover ongoing non-capital expenditures for engineering, maintenance, and storm water quality staffing, expenses, and permit compliance. This increase would reflect the true cost of storm water management baseline services. The City Council should have the discretion to increase the base fee by the amount of change in the local Consumer Price Index (CPI) or 6% per year, whichever is less, and the base fee should not sunset. b) Include an additional Capital Improvement Project (CIP), Incentive Project (IP), and Green Storm Water Infrastructure (GSI) Project fee of $7.03 per month per ERU that would sunset after 15 years. The storm water capital improvement projects listed in Attachment A, totaling $27.2 million in Year 2015 dollars, should be pursued through renewal of the Storm Water Management Fee over a period of 15 years. These improvements would eliminate street flooding in storms up to the 10-year level in the areas they serve. These improvements also are intended to reduce road/sidewalk/curb/gutter repair costs by reducing subsoil water saturation and to increase traffic safety during storms. City of Palo Alto Page 9 c) The total monthly fee, including the base fee and CIP/IP/GSI fee, would be $13.65 per ERU beginning in FY 2018, a 2.3% increase over the current funding model approved in 2005. The City Council should have the discretion to increase the fee by the amount of change in the local Consumer Price Index (CPI) or 6% per year, whichever is less. d) The Storm Water Management Fund should maintain a reserve balance of at least $1.5 million to cover potential cost overruns on project or operational expenses. e) Further details on the project/program elements to be funded by the $13.65 monthly fee are contained in Attachment A (List of Proposed Storm Drain Capital Improvement Projects) and Attachment B (Recommended Storm Water Management Program and Funding Plan). f) The Storm Water Management Fee rate structure for single-family residential properties should retain its existing three rate categories, based on parcel size (less than 6,000 square feet; between 6,000 and 11,000 square feet; and greater than 11,000 square feet). g) As is currently the case, a fee reduction appeal process to City staff should be in place for those property owners who can demonstrate that the run-off from their properties drains directly to a creek or another city’s storm drain system, and that they have complied with all applicable permit and other legal requirements for such drainage. In addition, this appeal process should apply to those property owners who can demonstrate that they have constructed improvements to their properties to retain storm runoff onsite. In keeping with the present policy, the reduction in fees would not apply to that portion of the monthly fee attributable to City-wide programs. 2) The City should take all steps necessary to conduct a property owner, ballot-by-mail election in conformance with the provisions of Proposition 218 as early as possible in CY 2017 so that the fee can be implemented on June 1, 2017, when the existing property owner-approved fee sunsets. The election would require a simple majority vote to pass. City of Palo Alto Page 10 3) The fee name should be changed from “Storm Drainage Fee” to “Storm Water Management Fee.” 4) The City should develop an Integrated Water Management Plan (Plan) that takes a comprehensive look at how all water-related issues (water supply and demand, storm water, recycled water and groundwater) might be best addressed to achieve multiple benefits. This Plan is intended to complement the Utilities Department’s Urban Water Management Plan and Water Integrated Resources Plan. 5) Per the terms of the Municipal Regional Storm Water Discharge Permit, the City should adopt the framework for a Green Storm Water Infrastructure Plan by June 30, 2017. Until the Green Storm Water Infrastructure Plan is completed in 2019, staff should identify and implement opportunities for green storm water infrastructure projects. The framework should also elucidate goals for green infrastructure and consider the interaction between green infrastructure and shallow groundwater. 6) The City should implement pilot projects, such as utilizing pervious pavement materials to test their feasibility and effectiveness (e.g. use permeable materials for parking lane or bicycle lane as part of a scheduled street maintenance project). If the pilot projects are successful, the City should implement policies that make use of permeable pavement materials a standard practice. 7) Proposed Green Storm Water Infrastructure (GSI) funding will cover both the cost of the Green Storm Water Infrastructure Plan preparation and GSI projects. GSI projects retain, infiltrate and/or treat storm water and include, but are not limited to, rain gardens, green roofs, tree wells, bioswales, bioretention/infiltration basins, and permeable pavement. Incentive Project (IP) funding (as distinguished from GSI funding) will encourage residents and commercial property owners to incorporate green infrastructure measures into their private property projects. 8) A Council-appointed Storm Water Management Oversight Committee should be formed to oversee expenditures for all storm water funding elements, including, but not limited to, Green Storm Water Infrastructure projects, CIP City of Palo Alto Page 11 projects, and Incentive Project funding. The Committee should be empowered to consider and recommend consolidation of Green Storm Water Infrastructure and Incentive Project funding for particular projects. The Committee will annually review the Storm Water Management Fund budget and expenditures to ensure they are consistent with the funding plan included in the ballot measure approved by property owners and not used for other purposes. 9) Each new City storm drain capital improvement project should incorporate Green Storm Water Infrastructure measures to the extent practicable. 10) City staff should consider opportunities to include green infrastructure into all appropriate City capital improvement projects that impact storm water. Although GSI funds from the Storm Water Management Fund can be used to fund pilot projects, all City Departments should rapidly include funding for GSI elements when budgeting for their projects, and not be dependent upon funding from the Storm Water Management Fund. 11) The City should develop or participate in the development of green infrastructure design guidelines and standard specifications and drawings that can inform designers of private and public projects as they incorporate these features into their project designs. 12) The ongoing Comprehensive Plan Update, the City Parks Master Plan, Urban Forest Master Plan, and other City planning documents should include green infrastructure goals and policies as required by the Municipal Regional Storm Water Permit. 13) The City should expand the scope of its storm water rebate program to promote the use of green storm water infrastructure measures to reduce storm water runoff from private property, including, but not limited to, new rebates for rain gardens and increased rebate amounts for rain barrels, cisterns, green roofs, and permeable pavement. 14) The City should evaluate the implementation of a user fee for point-source discharges to the storm drain system to reflect their utilization of the system capacity. Exceptions should be provided for artesian well discharges and similar non-discretionary discharges. City of Palo Alto Page 12 15) The City should look for opportunities to work with the Santa Clara Valley Water District and others to minimize new concrete channels and replace portions of existing concrete channels with more natural creek channel materials, to the extent that flood protection is not compromised. The purposes of such projects are to increase infiltration, protect creek banks, and create recreational and educational opportunities. Staff has prepared conceptual 15-year revenue and spending plans based upon the Blue Ribbon Committee’s recommendations that correspond with the proposed sunset period to be included in the ballot measure. The first financial plan determines the fee amount needed to sustain the ongoing programs proposed to be supported with a permanent (non-sunsetting) base fee (Attachment G). As presented in the Attachment G spreadsheet, the monthly base fee is calculated to be $6.62 for FY 2018, increasing to $10.01 in FY 2032 under the assumption of annual 3% inflationary rate increases. Using the Committee’s recommended approach, the monthly Storm Water Management Fee would revert to the escalated base fee (estimated at $10.01 per month), as opposed to the current base fee of $4.25 per month, when the ballot measure would sunset in FY 2032, thus providing adequate ongoing funding for a base- level storm water management program. The second financial plan shows how the Committee’s recommended rate plan would fund its recommended operational and capital expenditures over the 15- year term of the ballot measure (Attachment H). As presented in the Attachment H spreadsheet, the monthly base fee is calculated to be $13.65 for FY 2018, increasing to $20.65 in FY 2032 under the assumption of annual 3% inflationary rate increases. The proposed FY 2018 monthly Storm Water Management Fee of $13.65 represents a 4.7 percent increase over the proposed FY 2017 rate of $13.03. The Committee believes that property owners are likely to support this recommended rate proposal, since it represents a one-time increase of only 2.3 percent above the 2.4 percent annual growth that occurred during the term of the 2005 ballot measure. Next Steps Staff and the Blue Ribbon Committee concur that the City should proceed with a Proposition 218 protest hearing and property owner ballot-by-mail election to City of Palo Alto Page 13 approve future storm water management rates. Approval of a new Storm Water Management Fee would require multiple steps, including specific procedures mandated by Proposition 218 (Attachment I). The first step is the tabulation of the specific monthly fee to be charged to each developed land parcel in Palo Alto under the proposed spending plan. Public notices including a detailed description of the spending plan and parcel-specific monthly cost information would then be mailed to each property owner. The mailing of the public notices would initiate a 45-day comment period which would culminate with a majority protest hearing held during a regular Council meeting. Property owners would have the opportunity to appear before Council during the hearing to register their concerns and protest the proposed fee increase. Those opposed to the proposed fee increase would need to submit a written protest to the City Clerk to officially register their opposition. At the end of the hearing, the City Clerk would report the number of valid written protests so the Council could determine whether a majority protest had been received. If Council were to determine, at the close of the public testimony portion of the public hearing, that written protests had been received from property owners representing a majority of the parcels subject to the proposed fee increase, the Mayor would declare the proceedings closed, and the fee increase would not be approved. If, however, Council were to determine that less than a majority of property owners have submitted written protest, Council could choose to move forward to the next stage of the Proposition 218 approval process, the mailing of ballots to eligible property owners. If Council were to decide to call for a mail ballot proceeding, the ballots would then be mailed to all eligible property owners. Ballots for the Storm Water Management Fee ballot proceeding would consist of a single question that requires a checkmark either for or against the proposed fee increase. The ballots would be supplemented with a summary of the balloting procedures and a description of the proposed fee and storm water management spending plan. The ballot measure would be approved if a simple majority of property owners returning ballots voted in favor of the measure. If the ballot measure were approved, Council could proceed to approve the new fee schedule consistent with the ballot measure. Staff recommends that the implementation of a Storm Water Management Fee increase proposal be timed such that the ballots are sent to property owners and received in early 2017. This schedule would ensure that the voting period is outside the distractions of the hectic general election cycle and the holiday City of Palo Alto Page 14 season and provides adequate time for a resident-driven outreach and advocacy campaign. The proposed schedule would also provide timely financial information about the Storm Water Management Fund for preparation of the FY 2018 budget. A potential implementation schedule for a Storm Drainage ballot measure is provided in the Timeline section of this report. If Council recommends that the City proceed with a property owner ballot-by-mail election, staff will return to Council after the summer recess to seek approval of the necessary Council resolutions specifying the scope and timing of the ballot measure. Staff will incorporate feedback from the Council into the final implementation of the balloting process. Timeline The following is a potential timeline for implementation of a Storm Drainage ballot measure: 8/15/16 Council adoption of resolutions proposing a Storm Water Managment Fee increase and establishing procedures for protest hearing/mail ballot proceeding 9/2/16 Legal notices mailed; start of 1st 45-day noticing period 10/17/16 Protest hearing (Need at least 45-day protest period) 1/16/17 Ballots mailed 2/13/17 Ballots due back to City Clerk (Need at least 45 days between protest hearing & final balloting day) 3/20/17 Council certification of election results 6/1/17 Effective date of new rate Resource Impact To maintain the self-sufficiency of the Storm Drainage Fund, the City must secure property owner approval of a ballot measure authorizing increased storm drain City of Palo Alto Page 15 funding before the 2005 ballot measure sunsets in June 2017. If the Storm Drainage Fee reverts back to its pre-2005 level of $4.25 per month per ERU, it will generate approximately $2.2 million per year. This amount of revenue would not support a minimum level of storm drainage service, which would cost approximately $4.3 million per year. (Please note that the $4.3 million figure includes $950,000 in annual debt service that will end in FY 2024.) In addition, the pre-2005 level of funding would preclude any further storm drain capital improvement projects. If a new ballot measure is not approved, storm drain system operations would need to be significantly curtailed. If the rate schedule recommended by the Committee were approved, it would generate the following revenue for storm water management programs and capital improvement projects in FY 2018: Base Fee ($6.62/month/ERU): $3.3 million CIP/IP/GSI Fee ($7.03/month/ERU): $3.6 million Total Storm Water Management Fee Revenue: $6.9 milion Policy Implications Identification of funding for storm drain capital improvements is consistent with Policy N-24 of the Comprehensive Plan, which states that the City should “improve storm drainage performance by constructing new system improvements where necessary and replacing undersized or otherwise inadequate lines with larger lines or parallel lines.” Program N-36 further states that the City should “complete improvements to the storm drainage system consistent with the priorities outlined in the City’s 1993 Storm Drainage Master Plan, provided that an appropriate funding mechanism is identified and approved by the City Council.” Environmental Review Review and adoption of of a funding mechanism for storm water management projects does not constitute a project subject to California Environmental Quality Act (CEQA) review, and no environmental analysis is required at this time. The level of future CEQA review will depend on the scope of the storm drain capital improvement projects that may be funded by the updated storm water management fees. City of Palo Alto Page 16 Courtesy Copies Storm Drain Oversight Committee Attachments:  A - Utility Rate Schedule D-1 (PDF)  B - Utility Rule and Regulation 25 (PDF)  C - 2005 Storm Drain Ballot (PDF)  D - Status of Storm Drainage Fund Capital Projects Listed in 2005 Ballot Measure (PDF)  E - Blue Ribbon Storm Drain Committee Members (PDF)  F - Blue Ribbon Storm Drain Committee Recommendations Report (PDF)  G - Ongoing Storm Water Management Funding/Spending Plan (PDF)  H - Recommended Storm Water Management Funding/Spending Plan (PDF)  I - Timeline for Potential Storm Drain Protest Hearing & Ballot Measure (PDF) GENERAL STORM AND SURFACE WATER DRAINAGE UTILITY RATE SCHEDULE D-1 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 7-1-2015 Supersedes Sheet No.D-1-1 dated 7-1-2014 Sheet No.D-1-1 A. APPLICABILITY: This schedule applies to all storm and surface water drainage service, excepting only those users and to the extent that they are constitutionally exempt under the Constitution of the State of California or who are determined to be exempt pursuant to Rule and Regulation 25. B. TERRITORY: Inside the incorporated limits of the city of Palo Alto and land owned or leased by the city. C. RATES: Per Month: Storm Drainage Fee per Equivalent Residential Unit (ERU) .......................................................$12.63 D. SPECIAL NOTES: 1. An Equivalent Residential Unit (ERU) is the basic unit for computation of storm drainage fees for residential and non-residential customers. All single-family residential properties shall be billed the number of ERUs specified in the following table, based on an analysis of the relationship between impervious area and lot size for Palo Alto properties. RESIDENTIAL RATES (Single-Family Residential Properties PARCEL SIZE (sq.ft.) ERU <6,000 sq.ft. 0.8 ERU 6,000 - 11,000 sq.ft. 1.0 ERU >11,000 sq.ft. 1.4 ERU All other properties will have ERU's computed to the nearest 1/10 ERU using the following formula: No. of ERU = Impervious Area (Sq. Ft.) 2,500 Sq. Ft. 2. For more details on the storm drainage fee, refer to Utilities Rule and Regulation 25. {End} SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-13-2000 Supersedes Sheet No. -1 dated 7-1-98 Sheet No. 1 A. GENERAL: For the purpose of CPAU Rate Schedule D-1 and this Rule and Regulation, the following words and terms shall be defined as follows, unless the context in which they are used clearly indicates otherwise. The definitions of words and terms set forth in Titles 12 and 13 of the Palo Alto Municipal Code shall also apply herein to the extent that they are not inconsistent herewith: 1.“Developed Parcel”shall mean any lot or parcel of land altered from its natural state by the construction, creation, or addition of impervious area, except public streets and highways. 2.“Equivalent Residential Unit (ERU)” shall mean the basic unit for the computation of storm drainage fees. The ERU’s for all parcels other than single-family residential properties shall be computed to the nearest 1/10 ERU using the following formula: Number of ERU = Impervious Area (Sq. Ft.) 2,500 Sq. Ft. The ERU's for single-family residential properties shall be computed as set forth in CPAU Rate Schedule D-1. 3. “Impervious Area”shall mean any part of any developed parcel of land that has been modified by the action of persons to reduce the land’s natural ability to absorb and hold rainfall. This includes any hard surface area which either prevents or retards the entry of water into the soil mantle as it entered under natural conditions pre-existent to development, and/or a hard surface area which causes water to run off the surface in greater quantities or at an increased rate of flow from the flow present under natural conditions pre-existent to development. By way of example, common impervious areas include, but are not limited to roof tops, walkways, patios, driveways, parking lots or storage areas, concrete or asphalt paving, gravel roads, or any cleared, graded, paved, graveled, or compacted surface or packed earthen materials, or areas covered with structures or other surfaces which similarly impede the natural infiltration of surface water into the soil mantle. SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-13-2000 Supersedes Sheet No. -2 dated 7-1-98 Sheet No. 2 4.“Non-Single-Family Residential Property”shall include all developed parcels zoned or used for multi-family, commercial, industrial, retail, governmental, or other non-single family residential purposes and shall include all developed parcels in the City of Palo Alto not defined as single-family residential property herein. 5 “Parcel”shall mean the smallest separately segregated lot, unit or plot of land having an identified owner, boundaries, and surface area which is documented for property tax purposes and given a tax lot number by the Santa Clara County Assessor. 6.“Primary CPAU Account”shall mean that CPAU account, as determined below, that will be assessed the storm drainage fee for a given developed parcel: (A) If there is only one CPAU account associated with a developed parcel, then that account is the Primary CPAU Account. (B) If there is more than one CPAU account associated with a developed parcel, then the Primary CPAU account shall be the account listed below, in order of preference: (1) The CPAU account designated as the “house account” or, if none or more than one, then; (2) The CPAU account in the name of the owner of the parcel, or if none, then; (3) The CPAU account(s) in the name of the occupier(s) of the parcel. (4) If more than one account, then the CPAU account that includes the most CPAU services. 7. “Single-Family Residential Property” shall include all developed parcels with either one or two single-family detached housing units or one two-unit attached dwelling structure commonly known as a “duplex.” 8.“Storm and Surface Water Control Facilities” shall mean all man-made structures or natural water course facility improvements, developments, properties or interest therein, made, constructed or acquired for the conveyance of storm or surface water runoff for the purpose SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-13-2000 Supersedes Sheet No. -3 dated 7-1-98 Sheet No. 3 of improving the quality of, controlling, or protecting life or property from any storm, flood, or surplus waters. 9.“Storm Drainage Facilities” shall mean the storm and surface water drainage systems comprised of storm and surface water control facilities and any other natural features which store, control, treat and/or convey storm and surface water. Storm Drainage Facilities shall include all natural and man-made elements used to convey storm water from the first point of impact with the surface of the earth to the suitable receiving body of water or location internal or external to the boundaries of the City of Palo Alto. Such facilities include all pipes, appurtenant features, culverts, streets, curbs, gutters, pumping stations, channels, streams, ditches, wetlands, detention/retention basins, ponds, and other storm water conveyance and treatment facilities whether public or private. See CPAU Rule and Regulation No. 8 “Access to Premises.” 10.“Storm and Surface Water”shall mean water occurring on the surface of the land, from natural causes such as rainfall, whether falling or flowing onto the land in question. 11.“Undeveloped Parcel” shall mean any parcel which has not been altered from its natural state by the construction, creation, or addition of impervious area. B. STORM DRAINAGE FEES: 1. There is hereby imposed on each and every developed parcel of land within the City of Palo Alto, and the owners and occupiers thereof, jointly and severally, a storm drainage fee. This fee is deemed reasonable and is necessary to pay for: (A) Improving the quality of storm and surface water; (B) The operation, maintenance, improvement and replacement of the existing City storm drainage facilities; and (C) The operation, maintenance, and replacement of future such facilities. It is the intent of the City of Palo Alto, and the City has calculated the storm drainage fee in such a manner, that the amount of the fee imposed upon any parcel shall not exceed the proportional cost of the service attributable to the parcel. It is the further intent of the City SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-13-2000 Supersedes Sheet No. -4 dated 7-1-98 Sheet No. 4 that revenues derived from the fee shall not exceed the funds required to provide the property-related services described in this Rule and Regulation 25, and that revenues derived from the fee shall not be used for any purpose other than those described in this Rule and Regulation 25. 2. All of the proceeds of these fees are deemed to be in payment for use of City storm drainage facilities by the developed parcel on, and with respect to, which the fee is imposed, and the owners and/or occupiers thereof. 3. The storm drainage fee shall be payable monthly and shall be paid to CPAU, as billed by CPAU, for each and every developed parcel in the City by the owner or occupier responsible for the Primary CPAU account for other CPAU services for the subject parcel, unless otherwise agreed in writing by CPAU. The method of billing described in this Rule and Regulation 25 has been designed for administrative efficiency. However, because the storm drainage fee is a "property-related fee" as defined by Article XIIID, Section 6 of the California Constitution, a property owner may in writing request that the storm drainage fee for a parcel owned by the property owner be billed directly to the owner, notwithstanding the typical method of billing. Because the storm drainage fee is a "property-related fee," the parcel owner shall be responsible to pay all unpaid or delinquent storm drainage fees. For administrative efficiency, the storm drainage fee for condominium and townhouse-style developments is typically billed to the CPAU account of the Homeowners' Association. 4. If a developed parcel does not have a CPAU account on the effective date of this Rule and Regulation, a new account shall be established for that parcel and billed to the owner as shown on the latest County Assessor's property tax rolls until such time as a Primary CPAU account is established for other CPAU services. 5. When an undeveloped parcel is developed, a new account shall be established and billed to the owner of that parcel as shown on the latest property tax rolls of the Santa Clara County Assessor until such time as a Primary CPAU account is established for other CPAU services. 6. BASIS FOR CALCULATION SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-13-2000 Supersedes Sheet No. -5 dated 7-1-98 Sheet No. 5 (A) The storm drainage fee shall be based on the relative contribution of storm and surface water from a given developed parcel to City storm drainage facilities. (B) The relative contribution of storm and surface water from each developed parcel shall be based on the amount of impervious area on that parcel and shall determine that parcel’s storm drainage fee. (C) For administrative efficiency, the impervious area of condominium and townhouse- style developments is typically calculated for the entire development rather than on a per-parcel basis. (D) The extent of impervious area will be established to the nearest square foot by any of the following methods: (1) Computation of the impervious area using on-site measurements of the apparent outside boundaries of the impervious area in or on such developed parcels made by CPAU or on its behalf; or (2) Computation of the impervious area using the dimensions of the impervious area in or on the developed parcels which are set forth and contained in the records of the office of the County Assessor. (3) Estimation, calculation and computation of the impervious area using aerial photography or photogrammetry, or using the information and data from on- site measurements of like or similar property or features or as contained in City or County records. (4) Computation of the impervious area using information submitted by building permit Applicants on forms provided by the City, subject to review and correction by the City. 7. CALCULATION OF MONTHLY FEE Monthly fees for all developed parcels shall be computed in accordance with the following formula: SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-1-2005 Supersedes Sheet No. -6 dated 6-13-2000 Sheet No. 6 Number of ERU’s x Rate per ERU as set forth in CPAU Rate Schedule D-1. 8. APPLICATION (A) Developed Parcels: Storm drainage fees shall apply to all developed parcels within the City, including those classified as non-profit or tax-exempt for ad valorem tax purposes. The fees shall apply to all government properties, to the full extent permitted by the constitutions of the United States and the State of California, including developed parcels of the City of Palo Alto, City-owned buildings and parks, but excluding public streets and highways. (B) Undeveloped Parcels: Storm drainage fees shall not be levied against undeveloped parcels that have not been altered from their natural state as defined herein under “Impervious Areas.” (C) Proportional Reduction of Fees: Developed parcels that have their own maintained storm drainage facility or facilities, and which do not utilize City facilities or which make no substantial contribution of storm or surface water to the City’s storm drainage facilities shall be liable to pay only that portion of the storm drainage fee attributable to the generic discharge of storm runoff (e.g. coordination with the Santa Clara Valley Water District on regional flood control projects, administration of the City's flood hazard regulations, and implementation of the urban runoff pollution prevention program) and shall not be liable to pay for the portion of the fee attributable to the actual usage of (i.e. drainage into) the City's storm drain system (e.g. storm drain system capital improvements and maintenance). Developed parcels that have a portion of their impervious area within City of Palo Alto shall be charged only for that portion of impervious area which is in the City of Palo Alto. Developed parcels that drain totally or partially into an area outside the City of Palo Alto shall be liable to pay only that portion of the storm drainage fee attributable to the generic discharge of storm runoff (e.g. coordination with the Santa Clara Valley Water District on regional flood control projects, administration of the City's flood hazard regulations, and implementation of the urban runoff pollution prevention program) and shall not be liable to pay for the portion of the fee attributable to the actual usage of (i.e. drainage into) the City's storm drain system (e.g. storm drain system capital improvements and maintenance). The City of Palo Alto has calculated the storm drainage fee for each parcel based on information available to the Public Works Department as to the amount of SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 25 (Continued) CITY OF PALO ALTO UTILITIES Issued by the City Council Effective 6-1-2005 Supersedes Sheet No. -7 dated 6-13-2000 Sheet No. 7 impervious area for the parcel, as well as other relevant information regarding the parcel. However, it is the intent of the City of Palo Alto that no fee shall exceed the proportional cost of services attributable to the parcel. Therefore, a parcel owner has the right, through Administrative Review, to request a proportional reduction in the storm drainage fee if the owner believes that the parcel contributes less water to the City's storm drainage facilities or uses fewer storm or surface water treatment services, notwithstanding the amount of the parcel's impervious area. 9. ADMINISTRATIVE REVIEW (A) Any person who owns or pays the storm drainage fee for a developed parcel and who disputes the amount of any storm drainage fee for the parcel, or who requests a deferred payment schedule therefor may request a revision or modification of such fee from the City Engineer. (B) The person seeking Administrative Review shall make such request in writing pursuant to Rule and Regulation 11 Section F. The request for Administrative Review must be signed by the property owner. The City Engineer shall conduct the review. (C) The City Engineer shall review the request and all data and documentation deemed by the City Engineer to be relevant to the request, and shall make a written determination as to whether the fee for the parcel exceeds the proportional cost of the service attributable to the parcel. If the City Engineer determines that the fee is proportional to the cost of service, no adjustment shall be made. If the City Engineer determines that the fee exceeds the proportional cost of service, the fee shall be adjusted accordingly. {End} April 4, 2005 Dear Property Owner: On March 7, 2005, the City Council held a public hearing on a proposed Storm Drainage Fee increase for properties within the City of Palo Alto. In January, you were mailed a notice and informational flyer regarding this public hearing and the specific fee increase proposed for your property. After receiving public testimony, the City Council took action to submit the proposed fee increase to property owners for approval. Enclosed with this letter is an official City of Palo Alto Property Owner Ballot and an official postage paid Return Envelope. Please mark your ballot “yes” or “no” and return it in the Return Envelope to the City Clerk by no later than 8:00 p.m. on April 26, 2005, to 250 Hamilton Avenue, Palo Alto. The City must receive mailed ballots by April 26, 2005. Postmarks do no count. The votes cast as “yes” or “no” will determine the fate of this fee increase. Ballots that are not returned or are returned late cannot be counted, so please return your ballot. Two items are enclosed with these ballot materials for your information. First, a summary of the procedures for the ballot proceeding is provided on the back of this letter. The complete procedures for this process are on file at the City Clerk’s office and are posted on the City’s web site (www.cityofpaloalto.org/stormdrain). The second enclosure is a copy of Resolution 8483, which the City Council passed on December 6, 2004, to formally establish the terms and amount of the proposed fee increase, and the projects/programs on which funds will be spent if property owners approve the fee increase. If you have any questions about the ballot proceeding, or if you are disabled and need special accommodation to vote, please call City Clerk Donna Rogers at (650) 329-2571. If you have questions regarding the fee increase, please call Matt Raschke in the Public Works Department at (650) 617-3183, or visit the City’s web site at www.cityofpaloalto.org/stormdrain. Please Vote! 4/4/2005 Page 1 RESOLUTION NO. 8483 RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ADOPTING THE AMOUNT OF THE PROPOSED STORM DRAINAGE FEE INCREASE, DESCRIBING THE STORM DRAIN CAPITAL IMPROVEMENTS AND PROGRAM ENHANCEMENTS ON WHICH THE PROPOSED FEE WILL BE SPENT IF APPROVED, AND ADOPTING A SCHEDULE FOR THE PROTEST HEARING AND MAIL BALLOT PROCEEDINGON THE PROPOSED FEE INCREASE [Approved By Palo Alto City Council on December 6, 2004] EXHIBIT “A” Description Of Amount Of The Proposed Storm Drainage Fee Increase A. Summary of current storm drainage fee system The City’s current storm drainage billing system is based on Equivalent Residential Units (“ERU”), which are generally determined by the square footage of impervious surface area on a property. One ERU equals 2500 square feet of impervious surface area on a property, and the current fee for one ERU is four dollars and twenty-five cents ($4.25). The ERU calculation was based on a sampling of single-family and duplex properties in the City, in which the typical impervious surface area was 2500 square feet. Thus, all single-family and duplex residential properties in the City are presumed to have one ERU of impervious surface area and are currently charged $4.25 per month for that ERU, regardless of the actual impervious surface area of their property. Commercial, industrial, institutional, government, and multi-family residential properties are charged for their actual amounts of impervious surface area, at a rate of one ERU per 2500 square feet of impervious area. B. Proposed storm drainage fee increase 1. New residential rate structure and increased fee The proposal to increase storm drainage fees involves two components. First, the charge per ERU would be raised from four dollars and twenty-five cents ($4.25) to ten dollars ($10). Second, the impervious surface area would no longer be presumed to be one ERU for all single- family and duplex properties. Instead, those properties would be placed into one of three ERU tiers based on the size of the property. Commercial, industrial, institutional, government, and multi-family residential properties would continue to be charged based on actual impervious surface area, but at the increased rate of $10 per ERU. The following tables describe the changed rate structure and proposed fee increase: RESIDENTIAL RATES (Single-Family & Duplex) PARCEL SIZE (sq.ft.) ERU PROPOSED RATE < 6,000 sq.ft. .8 ERU $8.00 6,000-11,000 sq.ft. 1 ERU $10.00 > 11,000 sq.ft. 1.4 ERU $14.00 COMMERCIAL RATES (Commercial, industrial, multifamily res.) $10.00 per 2,500 square feet of impervious surface area (ERU), rounded to the nearest 0.1 ERU. 4/4/2005 Page 2 2. Annual inflation adjustments to proposed fee increase In order to offset the effects of inflation on labor and material costs, the proposed fee increase would be subject to annual increases beyond the initial $10.00 per ERU rate as of July 1 of each year, starting in 2006. Inflation adjustments would be based on the lesser of the local rate of inflation (based on the change in the Consumer Price Index [CPI] for the San Francisco- Oakland-San Jose CSMA, published by the United States Department of Labor, Bureau of Labor Statistics) or 6 percent. The City Council would have the authority and discretion to implement inflation adjustments on an annual basis as part of the City budget process. 3. Twelve year sunset provision for proposed fee increase The proposed storm drainage fee increase would sunset twelve (12) years from the date the fee increase is implemented, as the storm drain capital improvements to be funded by the increase would be completed by that time. 4. Oversight provision for proposed fee increase The City Council would appoint an oversight committee to monitor and review the proposed storm drain capital improvements and insure that the money raised from the increased Storm Drainage Fee is spent in accordance with this resolution. The oversight committee would report its findings to the City Council at least annually. 5. Applicability of the Rate Assistance Program The City’s existing Rate Assistance Program, which provides a 20% discount to qualified low- income utility customers, would apply to the Storm Drainage Fee. 6. Pay-as-you-go funding of capital improvements The storm drain capital improvements to be funded through the proposed Storm Drainage Fee increase would be paid for on a pay-as-you-go basis, without debt financing. 7. Up-front payment of Storm Drainage Fees by City of Palo Alto In order to accelerate the construction of the proposed storm drain capital improvements, the City of Palo Alto would pre-pay in advance the Storm Drainage Fees attributable to City-owned properties for a period of twelve years, upon approval of the increased Storm Drainage Fee. 4/4/2005 Page 3 EXHIBIT “B” List Of Storm Drain Capital Improvements And Program Enhancements To Be Completed With Funding From The Proposed Fee Increase A. Seven proposed storm drain capital improvement projects 1. Construct pump station at 96” storm drain outfall to San Francisquito Creek (estimated cost = $4.5 million) 2. Install new storm drain pipelines to increase drainage capacity on Channing and Lincoln Avenues (from Channing/Heather to Lincoln/Alma) (estimated cost = $4.6 million) 3. Install Southgate neighborhood storm drain system (estimated cost = $2.0 million) 4. Extend Gailen Avenue/Bibbits Drive storm drain outfall to the Adobe Storm Water Pump Station (estimated cost = $650 thousand) 5. Connect the Clara Drive storm drains to the Matadero Storm Water Pump Station (estimated cost = $900 thousand) 6. Construct improvements to the Matadero Storm Water Pump Station and install new storm drain pipelines to increase drainage capacity leading to the Matadero Storm Water Pump station (estimated cost = $3.0 million) 7. Install storm drainage improvements along southbound Alma Street (estimated cost = $1.5 million) A map of the proposed projects is included in this exhibit. B. Proposed funding for enhanced maintenance of the City’s storm drain system 1. $500,000 budgeted annually (subject to annual adjustment for inflation) to replace and/or rehabilitate deteriorated components of the City’s storm drain system, including pipelines, catch basins, and manholes. 2. $90,000 budgeted annually (subject to annual adjustment for inflation) to fund additional storm drain maintenance resources, including staff and/or contract services, to perform services including, but not limited to, storm drain cleaning, minor storm drain repairs, video inspection of storm drain pipelines, and/or curb and gutter repairs. C. Funding of innovative projects 1. $125,000 budgeted annually (subject to annual adjustment for inflation) for innovative projects to reduce the amount of storm water runoff and environmental pollutants that enter storm drains and creeks. D. Funding of storm water quality protection activities 1. $100,000 budgeted annually (subject to annual adjustment for inflation) to pay for existing services related to storm water quality protection currently funded through the Wastewater Treatment Fund. E. Funding of additional engineering staff 1. $115,000 budgeted annually (subject to annual adjustment for inflation) for an additional staff engineer to assist with implementation of the recommended storm drain capital improvements. 5. EXTEND CLARA DRIVE STORM DRAIN TO MATADERO PUMP STATION 1. NEW PUMP STATION @ SAN FRANCISQUITO CK 6. IMPROVE MATADERO PUMP STATION& FEEDER STORM DRAINS 4. EXTEND GAILEN/BIBBITSSTORM DRAIN TOADOBE PUMP STATION 3. SOUTHGATE NEIGHBORHOODSTORM DRAINS 7. ALMA STREET STORM DRAINS (EXACT LIMITS OF PIPINGTO BE DETERMINED) 2. CHANNING/LINCOLN TRUNK LINE ($3 MILLION) ($1.5 MILLION) ($900 THOUSAND) ($650 THOUSAND) ($2 MILLION) ($4.5 MILLION) ($4.6 MILLION) Oregon Expressway C h a r l e s t o n R o a d E ast B a y s h o re W est B a y s h o r e 1 0 1 S e r ra Bo ulev a r d San Antoni o Av e n u e P a ge M i l l Road University Avenue Middlefield Road El Camino Real E m barca dero R oad E mb a r c a d e r o R o a d El Ca m i no R eal Palm Drive F o o t hil l Expr e s s 0'3000' Proposed Storm Drain Capital Improvements This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. CITY O F PALO A L TO I N C O R P O RAT E D C ALIFOR N IA P a l o A l t oT h e C i t y o f A P RIL 16 1 894 The City of Palo Alto assumes no responsibility for any errors. ©1989 to 2004 City of Palo Alto mraschk, 2005-03-10 11:00:53PROPOSED PROJECTS - MRICS (\\cc-maps\gis$\gis\admin\Personal\mraschk.mdb) City of Palo Alto Proposed Storm Drainage Fee Increase The information in this notice and the accompanying materials were compiled and are distributed at public expense by the City of Palo Alto in compliance with Article XIIID of the California Constitution, the Proposition 218 Omnibus Implementation Act and procedures adopted by the City of Palo Alto Resolution No. 8484. This information is presented in the public interest. It is not intended to influence or attempt to influence the actions of the voters to vote “yes” or “no” on the enclosed ballot. SUMMARY OF BALLOTING PROCEDURES If you are the owner of the property described on the enclosed Return Envelope, or a voting representative designated according to the City’s procedures for this ballot proceeding, you may submit the enclosed ballot to the City to support or oppose the proposed Storm Drainage Fee increase. Please follow the instructions below to complete and return your ballot. The full text of the procedures governing the fee increase proceedings is available on the City’s website at www.cityofpaloalto.org/stormdrain/docs/2005-voting-procedure.pdf. 1. Register your vote on the enclosed ballot in favor of or against the proposed fee increase by placing an “X” in the corresponding box. Mark your ballot in ink, not pencil. 2. Place the marked ballot in the official Return Envelope, and seal the envelope. 3. Mark, sign and date the Return Envelope in ink. Do not use pencil. Ballots received in a Return Envelope without a signature will not counted. 4. Mail or personally deliver your ballot to the City Clerk’s office at P.O. Box 51470, 250 Hamilton Avenue, Palo Alto, CA 94303 (The Return Envelope provides postage prepaid). The City must receive all ballots by April 26, 2005. Postmarks do not count. 5. Ballots must be received by the City Clerk prior to 8:00 p.m. on Tuesday, April 26, 2005. Any ballots received after this time cannot legally be counted (ballots may be hand-delivered to the City Clerk any time prior to this date and time). 6. After 8:00 p.m., the City Clerk and her designees will tabulate the ballots. Only one ballot may be submitted for each property. 7. If the results of the balloting indicate that a majority of the property owners voting upon the fee increase voted in favor of the increase, the City Council may adopt the fee increase. Shall the monthly Storm Drainage Fee for developed residential and non- residential properties be increased to $10.00 per Equivalent Residential Unit (ERU) for a period of 12 years, subject to an annual adjustment for inflation up to a maximum of six percent per year? The storm drainage fee will be used to improve local drainage and prevent street flooding by funding: • high-priority storm drain system capacity upgrades, • drainage system repairs, • enhanced storm drain maintenance, and • storm water quality protection activities □ YES □ NO Status of Storm Drainage Fund Capital Projects Listed in 2005 Ballot Measure   Project Name      Project Status    Project Expenditure  1. San Francisquito Creek Pump Station    Complete    $   9,135,000  2. Gailen Ave/Bibbits Ave SD Improvements  Complete    $      650,000  3. Alma Street Storm Drain Improvements  Complete    $      785,000  4. Clara Drive Storm Drain Improvements  Complete    $      750,000  5. Southgate Neighborhood SD Improvements  Complete    $   2,026,000  6. Channing Ave/Lincoln Ave SD Improvements 2 of 3 Phases Complete*  $   6,415,000 (est.)  7. Matadero Creek Pump Station Upgrade  Design Stage Near Complete  $   6,060,000 (est.)  TOTAL            $ 25,821,000    *  Construction is completed along Channing Avenue (Heather Lane to Lincoln Avenue) and Lincoln Avenue  (Channing Avenue to Middlefield Road.  Phase 3 (Lincoln Avenue – Middlefield Road to Alma Street will be  constructed starting in July 2016.   Design of the Matadero Creek Pump Station Upgrade began in June 2015; pipeline element of project deferred  to FY 2018 due to funding shortfall; pump station construction is scheduled to start in Fall 2016.    All seven projects will be substantially completed prior to the sunset of the Storm Drainage Fee in June 2017.  Attachment E Blue Ribbon Storm Drain Committee Membership List Name Address Beamer, Norm 1005 University Avenue Bower, David 868 Boyce Avenue Clark, Nancy 225 Addison Avenue Drekmeier, Peter 311 Fulton Street Rosenberg, Susan 1425 Stanford Avenue Wenzlau, Bob 1409 Dana Avenue Elliott, Claire 271 Chestnut Ave McGraw, Stepheny 3303 Thomas Drive Mickelson, Hal 167 Greenmeadow Way Whaley, Richard 4240 Briarwood Way Attachment F 2016 STORM DRAIN BLUE RIBBON COMMITTEE RECOMMENDATIONS REPORT To the City Manager: The Storm Drain Blue Ribbon Committee is pleased to provide this report recommending a package of storm water capital improvement projects, storm drain system maintenance actions, and storm water quality protection programs for the City of Palo Alto (City) to be paid for by a renewal of the Storm Drainage Fee (to be renamed the “Storm Water Management Fee”). BACKGROUND The City’s storm drain capital improvement, maintenance and water quality protection programs are funded through the Storm Drainage Fund, an enterprise fund established by Council in 1989. Revenue is generated through a Storm Drainage Fee, which is collected through monthly City utility bills. Before the current Storm Drainage Fee rate structure was approved in 2005 by a majority of property owners in a ballot-by-mail election, the fee was $4.25 per month per Equivalent Residential Unit (ERU). An ERU is the billing unit for the Storm Drainage Fee and is based on the average amount of impervious surface on a typical single-family residential property (2,500 square feet). Single-family residential (SFR) parcels are billed a flat rate of 0.8 to 1.4 ERUs based on parcel size, while non-SFR parcels are billed the number of ERUs corresponding to the actual measured quantity of impervious surface on the parcel. The 2005 property owner approval increased the fee to $10.00 per month per ERU, with provisions for an annual adjustment for inflation at the discretion of the City Council. The fee, which is set at $12.63 per month per ERU for FY 2016, is scheduled to sunset on June 1, 2017. Without renewal of the increased Storm Drainage Fee, the monthly fee would revert back to the base fee of $4.25 per month, which is insufficient to cover the storm drain program’s base operating costs. The Storm Drainage Fee is a property-related fee subject to the provisions of Proposition 218, requiring a majority of voting property owners to approve a fee increase. In 2000, the City conducted a property owner election seeking approval to increase the Storm Drainage Fee from $4.25 per month up to $9.00 per month to cover needed storm drain improvements. The ballot measure was unsuccessful. In 2002, the City Manager appointed a Blue Ribbon Committee to work with staff to review storm drain funding needs and identify a funding mechanism for future storm drain operational and capital improvement program expenses. The Committee recommended funding a storm drain program including augmented maintenance activities, expanded storm water quality protection activities, and a specific set of seven prioritized storm drain capital improvement projects on a pay-as-you-go basis by increasing the Storm Drainage Fee to $10.00 per month. The Committee also endorsed the creation of an oversight committee, the capping of annual inflationary rate increases at 6%, sunsetting of the higher fees after a program duration of 12 years, and funding for innovative projects. The Committee’s proposals were approved by the City Council and presented to property owners in a ballot-by-mail election in Spring 2005. The ballot measure passed with an approval rate of 58%. 2 The 2005 ballot measure provided for funding of the storm drain program through June 1, 2017. The resulting ratepayer revenues have enabled Public Works staff to implement a successful set of operational enhancements and storm drain capital improvements. All seven of the high- priority capital improvements specified in the ballot measure will be substantially completed or under construction by the June 1, 2017 sunset date. The following is a summary of the accomplishments achieved since passage of the 2005 ballot measure. Photos of some of the improvements are shown on pages 3 and 4 of this report.  Implementation of Storm Drain Capital Improvement Projects o San Francisquito Creek Storm Water Pump Station ($9.1 million) Completed in 2009 o Channing Ave/Lincoln Ave Storm Drain Improvements ($6.4 million) Completed in 2011 through 2016 (three phases) o Matadero Creek Storm Water Pump Station Upgrade ($6.1 million) To be completed in 20171 o Southgate Neighborhood Storm Drain Improvements ($2.0 million) Completed in 2014 o Alma Street Storm Drain Improvements ($785K) Completed in 2010 o Clara Drive Storm Drain Improvements ($750K) Completed in 2014 o Gailen Ave/Bibbits Drive Storm Drain Improvements ($650K) Completed in 2006  Operational enhancements implemented over the 12-year funding period o $7 million in storm drain system replacement and rehabilitation projects o $1 million in enhanced storm drain system maintenance (pump and equipment maintenance and replacement) o $1.2 million for increased staffing and expenses for storm water quality protection o $55,000 in incentive rebates to residents and businesses for rain barrels, cisterns, green roofs, and permeable pavement Storm water discharge regulations designed to protect local creeks and the Bay are stricter than those in place at the time of the 2005 ballot measure. Palo Alto received its first municipal storm water permit from the San Francisco Bay Regional Water Quality Control Board (Water Board) in June 1990. In 2009, the Water Board issued a single Municipal Regional Storm Water NPDES Permit (MRP) to regulate storm water discharges from municipalities and local agencies throughout the Bay Area. The MRP expanded regulatory requirements and included 15 provisions requiring activities to prevent storm water pollution, including business and construction site inspections, control of specific pollutants such as trash, pesticides, copper, PCBs, and mercury, new and redevelopment requirements, potable water discharge practices, public outreach and education. The storm water quality protection regulations were further strengthened with the Water Board’s issuance of an updated MRP in November 2015. 1 excepting the associated pipeline improvement project, which will be deferred to FY2018 3 Examples of Completed Storm Drain Capital Improvement Projects San Francisquito Creek Pump Station Channing Avenue box culvert Southgate neighborhood bioretention planter Southgate neighborhood permeable crosswalk Gailen/Bibbits storm drain pipeline 4 Examples of Storm Runoff Reduction Measures Funded Through the City’s Storm Water Rebate Program Rain Barrel Installation Permeable Interlocking Concrete Pavers Rain Barrel Installation Pervious Concrete Driveway Residential Green Roof 5 THE FUTURE OF STORMWATER MANAGEMENT Looking to the future, the City’s storm water management program will place a growing emphasis on activities and measures that protect and enhance the quality of the storm water entering our local creeks and San Francisco Bay. The updated MRP added a new focus on managing storm water runoff generated by the built environment using “green storm water infrastructure.” The following paragraphs provide background information and context for this new concept. Green Storm Water Infrastructure A new Municipal Regional Storm Water permit was issued in November 2015 and went into effect on January 1, 2016. The new permit continues all of the requirements from the prior permit and adds several new mandates, including the development of a Green Storm Water Infrastructure Plan. Green storm water infrastructure protects or restores the natural water cycle by collecting and retaining, and/or treating, runoff rather than discharging it directly to storm drains. Green storm water infrastructure practices, also referred to as low impact development measures, include preserving natural landscapes and utilizing infiltration planters, rain gardens, tree wells, green roofs, pervious pavement, and rainwater harvesting to manage storm water runoff. These practices help to limit the discharge of pollutants from streets, parking lots, and roofs by infiltrating storm water into soils. Furthermore, green infrastructure provides amenities with many benefits beyond water quality improvement and groundwater replenishment, including creation of attractive tree-lined streetscapes, wildlife habitat, reduction of heat island effect, bicycle and pedestrian accessibility, and enhanced public health. The recently completed Southgate Neighborhood Storm Drain Improvement and Green Street Project, with its bioretention planters and permeable crosswalks, is a local example of a green storm water infrastructure project. Green Storm Water Infrastructure Plan The MRP’s green infrastructure requirement includes development of a Council-approved Green Storm Water Infrastructure Plan (Plan) framework by June 2017, and development of a full Plan by June 2019, that includes a mechanism and set of criteria to prioritize projects for inclusion of green infrastructure, a list of prioritized projects and targets for green infrastructure implementation, design guidelines/standard specifications, ordinance changes, and a funding plan. The permit also requires annual review of proposed capital projects for green storm water infrastructure integration. Other City plans are also incorporating the concept of green storm water infrastructure. For example, the City’s draft Sustainability and Climate Action Plan (S/CAP) includes a strategy to create and implement a Green Infrastructure Plan that prioritizes green streets infrastructure (W-2.1):  Create policies that integrate the design of green infrastructure into City and private sector projects to store, infiltrate, cleanse and evapotranspire storm water.  Expand permeable paving and reduce impermeable paving.  Increase rainfall infiltration, replenish groundwater, utilize soil to filter pollutants, increase habitat, retain and detain storm water and meet State and Federal permit requirements. 6  Utilize: bioswales, raingardens, infiltration basins, retention basins, rain barrels cisterns, green roofs, vegetation, and permeable blocks, pavement and systems. Development of a Green Storm Water Infrastructure Plan and implementation of green infrastructure projects is a key new element of the Committee’s recommended storm water program and funding plan. Storm Drain System Capacity Upgrades In anticipation of the sunsetting of the 2005 ballot measure, Public Works Department staff retained an engineering consultant to update the Storm Drain Master Plan in 2015. The consultant updated the digital storm drain system model and identified a prioritized list of storm drain system improvements needed to enable the system to convey the runoff from a 10-year storm without street flooding over the top of the curb. The Master Plan Update lists approximately $98 million of recommended storm drain pipeline and pump station upgrades, including approximately $43 million of high- and medium-priority projects, which are those projects that address areas currently subject to street flooding depths over 6 inches over an extended period of time. The Committee sought to provide funding for as many of the projects as possible within the recommended rate structure and revenue stream, starting with the highest- priority projects. RECOMMENDATIONS The Storm Drain Blue Ribbon Committee recommends the following: 1) A renewed and renamed “Storm Water Management Fee” should be proposed to Palo Alto property owners for their approval in order to generate funding for storm water infrastructure improvements, system maintenance, and storm water quality protection on a pay-as-you-go basis as follows: a) Increase the base Storm Water Management Fee from $4.25 per month per Equivalent Residential Unit (ERU) to $6.62/month/ERU to cover ongoing non-capital expenditures for engineering, maintenance, and storm water quality staffing, expenses, and permit compliance. This increase would reflect the true cost of storm water management baseline services. The City Council should have the discretion to increase the base fee by the amount of change in the local Consumer Price Index (CPI) or 6% per year, whichever is less, and the base fee should not sunset. b) Include an additional Capital Improvement Project (CIP), Incentive Project (IP), and Green Storm Water Infrastructure (GSI) Project fee of $7.03 per month per ERU that would sunset after 15 years. The storm water capital improvement projects listed in Attachment A, totaling $27.2 million in Year 2015 dollars, should be pursued through renewal of the Storm Water Management Fee over a period of 15 years. These improvements would eliminate street flooding in storms up to the 10-year level in the areas they serve. These improvements also are intended to reduce road/sidewalk/curb/gutter repair costs by reducing subsoil water saturation and to increase traffic safety during storms. 7 c) The total monthly fee, including the base fee and CIP/IP/GSI fee, would be $13.65 per ERU beginning in FY 2018, a 2.3% increase over the current funding model approved in 2005. The City Council should have the discretion to increase the fee by the amount of change in the local Consumer Price Index (CPI) or 6% per year, whichever is less. d) The Storm Water Management Fund should maintain a reserve balance of at least $1.5 million to cover potential cost overruns on project or operational expenses. e) Further details on the project/program elements to be funded by the $ 13.65 monthly fee are contained in Attachment A (List of Proposed Storm Drain Capital Improvement Projects) and Attachment B (Recommended Storm Water Management Program and Funding Plan). f) The Storm Water Management Fee rate structure for single-family residential properties should retain its existing three rate categories, based on parcel size (less than 6,000 square feet; between 6,000 and 11,000 square feet; and greater than 11,000 square feet). g) As is currently the case, a fee reduction appeal process to City staff should be in place for those property owners who can demonstrate that the run-off from their properties drains directly to a creek or another city’s storm drain system, and that they have complied with all applicable permit and other legal requirements for such drainage. In addition, this appeal process should apply to those property owners who can demonstrate that they have constructed improvements to their properties to retain storm runoff onsite. In keeping with the present policy, the reduction in fees would not apply to that portion of the monthly fee attributable to City-wide programs. 2) The City should take all steps necessary to conduct a property owner, ballot-by-mail election in conformance with the provisions of Proposition 218 as early as possible in CY 2017 so that the fee can be implemented on June 1, 2017, when the existing property owner-approved fee sunsets. The election would require a simple majority vote to pass. 3) The fee name should be changed from “Storm Drainage Fee” to “Storm Water Management Fee.” 4) The City should develop an Integrated Water Management Plan (Plan) that takes a comprehensive look at how all water-related issues (water supply and demand, storm water, recycled water and groundwater) might be best addressed to achieve multiple benefits. This Plan is intended to complement the Utilities Department’s Urban Water Management Plan and Water Integrated Resources Plan. 5) Per the terms of the Municipal Regional Storm Water Discharge Permit, the City should adopt the framework for a Green Storm Water Infrastructure Plan by June 30, 2017. Until the Green Storm Water Infrastructure Plan is completed in 2019, staff should 8 identify and implement opportunities for green storm water infrastructure projects. The framework should also elucidate goals for green infrastructure and consider the interaction between green infrastructure and shallow groundwater. 6) The City should implement pilot projects, such as utilizing pervious pavement materials to test their feasibility and effectiveness (e.g. use permeable materials for parking lane or bicycle lane as part of a scheduled street maintenance project). If the pilot projects are successful, the City should implement policies that make use of permeable pavement materials a standard practice. 7) Proposed Green Storm Water Infrastructure (GSI) funding will cover both the cost of the Green Storm Water Infrastructure Plan preparation and GSI projects. GSI projects retain, infiltrate and/or treat storm water and include, but are not limited to, rain gardens, green roofs, tree wells, bioswales, bioretention/infiltration basins, and permeable pavement. Incentive Project (IP) funding (as distinguished from GSI funding) will encourage residents and commercial property owners to incorporate green infrastructure measures into their private property projects. 8) A Council-appointed Storm Water Management Oversight Committee should be formed to oversee expenditures for all storm water funding elements, including, but not limited to, Green Storm Water Infrastructure projects, CIP projects, and Incentive Project funding. The Committee should be empowered to consider and recommend consolidation of Green Storm Water Infrastructure and Incentive Project funding for particular projects. The Committee will annually review the Storm Water Management Fund budget and expenditures to ensure they are consistent with the funding plan included in the ballot measure approved by property owners and not used for other purposes. 9) Each new City storm drain capital improvement project should incorporate Green Storm Water Infrastructure measures to the extent practicable. 10) City staff should consider opportunities to include green infrastructure into all appropriate City capital improvement projects that impact storm water. Although GSI funds from the Storm Water Management Fund can be used to fund pilot projects, all City Departments should rapidly include funding for GSI elements when budgeting for their projects, and not be dependent upon funding from the Storm Water Management Fund. 11) The City should develop or participate in the development of green infrastructure design guidelines and standard specifications and drawings that can inform designers of private and public projects as they incorporate these features into their project designs. 12) The ongoing Comprehensive Plan Update, the City Parks Master Plan, Urban Forest Master Plan, and other City planning documents should include green infrastructure goals and policies as required by the Municipal Regional Storm Water Permit. 9 13) The City should expand the scope of its storm water rebate program to promote the use of green storm water infrastructure measures to reduce storm water runoff from private property, including, but not limited to, new rebates for rain gardens and increased rebate amounts for rain barrels, cisterns, green roofs, and permeable pavement. 14) The City should evaluate the implementation of a user fee for point-source discharges to the storm drain system to reflect their utilization of the system capacity. Exceptions should be provided for artesian well discharges and similar non-discretionary discharges. 15) The City should look for opportunities to work with the Santa Clara Valley Water District and others to minimize new concrete channels and replace portions of existing concrete channels with more natural creek channel materials, to the extent that flood protection is not compromised. The purposes of such projects are to increase infiltration, protect creek banks, and create recreational and educational opportunities. STORM DRAIN BLUE RIBBON COMMITTEE MEMBERS Peter Drekmeier, Co-Chair Claire Elliott, Co-Chair Norm Beamer David Bower Nancy Clark Stepheny McGraw Hal Mickelson Susan Rosenberg Bob Wenzlau Richard Whaley 10 ATTACHMENT A STORM DRAIN BLUE RIBBON COMMITTEE’S RECOMMENDED LIST OF STORM DRAIN CAPITAL IMPROVEMENT PROJECTS Project Name Location Cost (2016$K) 1. Loma Verde Ave (Louis to Sterling Canal) capacity upgrade Midtown $2,200 2. Corporation Way/E Bayshore Road Pump Station to Adobe Ck Baylands $2,420 3. W. Bayshore Rd to Adobe Ck capacity upgrade Palo Verde $1,390 4. W. Bayshore Rd Pump Station to Adobe Creek Palo Verde $1,040 5. E. Charleston Rd to Adobe Ck capacity upgrade Charleston Terrace $1,300 6. E. Meadow Cir connection to Adobe Ck PS E Meadow Circle $ 360 7. E. Meadow Dr to Adobe Ck PS capacity upgrade Ortega $ 400 8. Fabian Way capacity upgrade Fabian Way $ 580 9. Hamilton Ave (Center to Rhodes) capacity upgrade Duveneck-St Francis $3,440 10. Louis Rd (Embarcadero to Seale-Wooster Canal) capacity upgrade Garland/Midtown $6,910 11. Louis Rd (Seale-Wooster Canal to Matadero Ck) overflow pipe Midtown $1,560 12. Colorado Pump Station removal Midtown $ 430 13. Loma Verde Ave (Ross to Louis) capacity upgrade Midtown/Palo Verde $1,340 14. Center Drive capacity upgrade Crescent Park $1,620 15. E. Charleston Rd (San Antonio to Fabian) capacity upgrade Charleston Terrace $1,030 16. Embarcadero Road (Fulton to Newell) capacity upgrade Leland Manor $1,200 TOTAL $27,200 11 Map of Completed and Proposed Storm Drain Improvements = Previously completed storm drain capital improvements = Proposed storm drain capital improvements 12 Examples of Street Flooding to be Addressed by Proposed Storm Drain Capital Improvements Ashby Drive East Meadow Circle East Bayshore Road E. Charleston Road Fabian Way 13 ATTACHMENT B STORM DRAIN BLUE RIBBON COMMITTEE’S RECOMMENDED STORM WATER MANAGEMENT PROGRAM AND FUNDING PLAN A) Base (Ongoing) Components 1) Ongoing storm drain maintenance & water quality programs 2) New Regulatory Water Quality Protection Requirements (Municipal Regional Permit from State) 3) Resulting new Base Fee Amount: starts at $ 6.62/month 4) Escalates by Consumer Price Index (CPI) or 6%, whichever is less, each year 5) No Sunset provision on Base (goes on indefinitely) B) Project/Green Infrastructure Components 1) Funding for listed Storm Drain Capital Improvement Projects (CIP) 2) Annual Green Stormwater Infrastructure (GSI) funding (starting at $450K/year) (unused funding goes to capital improvement projects, unless it is to be carried forward to an identified GSI project in subsequent years) 3) Annual Incentive Project (IP) funding component (starting at $154K/year) 4) Annual Storm Drain Repair/Rehabilitation CIP funding (starting at $500K/year) 5) Maintain reserve balance of $1.5M (~15% of annual expenditures) to cover potential cost overruns on project or operational expenses 6) Project/Green Infrastructure Fee Amount: starts at $ 7.03/month 7) Escalates by CPI or 6%, whichever is less, each year 8) Sunsets after 15 years C) Total Fee Amount for All Components 1) Resulting new Total Fee Amount (Ongoing + Project/GI Components): starts at $ 13.65/month in FY 2018 2) Equates to 2.3% increase from projected FY 2018 Fee under current funding scenario (which is estimated to be $ 13.34/month in FY 2018) STORM DRAIN PROGRAM FINANCIAL MODEL (All dollars expressed in thousands) ONGOING FUNDING SCENARIO: PERMANENT FUNDING FOR ONGOING NON-CAPITAL EXPENSES Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Annual Revenues Fee Revenue 3,356 3,457 3,561 3,667 3,777 3,891 4,007 4,128 4,252 4,379 4,510 4,646 4,785 4,929 5,077Interest Earnings 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130Storm Drain Violation Fines 333333444444445Storm Drain Development Review Fees 90 93 95 98 101 104 107 111 114 117 121 125 128 132 136From Fund Reserves 000000000000000 Total Revenue 3,579 3,683 3,789 3,899 4,012 4,129 4,249 4,372 4,499 4,630 4,765 4,904 5,048 5,195 5,347 Annual Expenses - Base Program Flood Control Improvement 95 98 101 104 107 110 113 117 120 124 128 132 135 140 144Capital Program Support 193 199 205 211 217 224 230 237 244 252 259 267 275 283 292Storm Water Quality Protection 1,087 1,120 1,153 1,188 1,223 1,260 1,298 1,337 1,377 1,418 1,461 1,505 1,550 1,596 1,644Storm Drainage Maintenance 1,153 1,188 1,223 1,260 1,298 1,337 1,377 1,418 1,461 1,504 1,550 1,596 1,644 1,693 1,744Emergency Response 116 119 123 127 131 134 139 143 147 151 156 161 165 170 175Debt Service 000000000000000Administrative Support Costs 937 965 994 1,024 1,055 1,086 1,119 1,152 1,187 1,223 1,259 1,297 1,336 1,376 1,417To Fund Reserves 000000000000000 Subtotal - Base Expenses 3,581 3,688 3,799 3,913 4,030 4,151 4,276 4,404 4,536 4,672 4,813 4,957 5,106 5,259 5,417 Annual Expenses - Proposed Additional Program Elements Green Municipal Infrastructure 000000000000000Capital Improvements (2) (6) (10) (14) (18) (23) (27) (32) (37) (42) (47) (52) (58) (64) (69)Storm Drain System Repairs 000000000000000Add'l Engineering staff 000000000000000Innovative Projects 000000000000000 Subtotal - Proposed New Program Elements (2) (6) (10) (14) (18) (23) (27) (32) (37) (42) (47) (52) (58) (64) (69) Total Current and Proposed Expenses 3,579 3,683 3,789 3,899 4,012 4,129 4,249 4,372 4,499 4,630 4,765 4,904 5,048 5,195 5,347 Monthly Fee Per ERU $6.62 $6.82 $7.02 $7.23 $7.45 $7.67 $7.90 $8.14 $8.39 $8.64 $8.90 $9.16 $9.44 $9.72 $10.01 Ongoing Funding Scenario 5/3/2016 STORM DRAIN PROGRAM FINANCIAL MODEL (All dollars expressed in thousands) FINAL SCENARIO: ENHANCED STORM DRAIN PROGRAM + NEW WATER QUALITY MANDATES + $27.2M HIGH- & MEDIUM-PRIORITY CIPs (15 years) + $450/YEAR GREEN INFRASTRUCTURE (ANNUALLY ADJUSTED FOR INFLATIO Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Annual Revenues Fee Revenue 6,920 7,128 7,342 7,562 7,789 8,022 8,263 8,511 8,766 9,029 9,300 9,579 9,867 10,163 10,467 Interest Earnings 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 Storm Drain Violation Fines 333333444444445 Storm Drain Development Review Fees 90 93 95 98 101 104 107 111 114 117 121 125 128 132 136 From Fund Reserves 000000000000000 Total Revenue 7,143 7,354 7,570 7,794 8,023 8,260 8,504 8,755 9,014 9,281 9,555 9,838 10,129 10,429 10,738 Annual Expenses - Base Program Flood Control Improvement 95 98 101 104 107 110 113 117 120 124 128 132 135 140 144 Capital Program Support 193 199 205 211 217 224 230 237 244 252 259 267 275 283 292 Storm Water Quality Protection 1,087 1,120 1,153 1,188 1,223 1,260 1,298 1,337 1,377 1,418 1,461 1,505 1,550 1,596 1,644 Storm Drainage Maintenance 1,153 1,188 1,223 1,260 1,298 1,337 1,377 1,418 1,461 1,504 1,550 1,596 1,644 1,693 1,744 Emergency Response 116 119 123 127 131 134 139 143 147 151 156 161 165 170 175 Debt Service 94794795095195094794700000000 Administrative Support Costs 937 965 994 1,024 1,055 1,086 1,119 1,152 1,187 1,223 1,259 1,297 1,336 1,376 1,417 To Fund Reserves 000000000000000 Subtotal - Base Expenses 4,528 4,635 4,749 4,864 4,980 5,098 5,223 4,404 4,536 4,672 4,813 4,957 5,106 5,259 5,417 Annual Expenses - Proposed Additional Program Elements Green Municipal Infrastructure 450 464 477 492 506 522 537 553 570 587 605 623 642 661 681 Capital Improvements 1,351 1,416 1,480 1,548 1,620 1,697 1,772 2,796 2,876 2,959 3,044 3,131 3,221 3,314 3,409 Storm Drain System Repairs 500 515 530 546 563 580 597 615 633 652 672 692 713 734 756 Add'l Engineering staff 160 165 170 175 180 185 191 197 203 209 215 222 228 235 242 Innovative Projects 154 159 163 168 173 179 184 189 195 201 207 213 220 226 233 Subtotal - Proposed New Program Elements 2,615 2,718 2,821 2,929 3,043 3,162 3,281 4,351 4,478 4,608 4,743 4,881 5,024 5,170 5,322 Total Current and Proposed Expenses 7,143 7,354 7,570 7,794 8,023 8,260 8,504 8,755 9,014 9,281 9,555 9,838 10,129 10,429 10,738 Monthly Fee Per ERU $13.65 $14.06 $14.48 $14.92 $15.36 $15.82 $16.30 $16.79 $17.29 $17.81 $18.34 $18.89 $19.46 $20.05 $20.65 Capital improvements completed per year:1,351 1,416 1,480 1,548 1,620 1,697 1,772 2,796 2,876 2,959 3,044 3,131 3,221 3,314 3,409 Year-end capital improvement program balance:27,200 26,665 26,048 25,350 24,562 23,678 22,692 21,601 19,453 17,160 14,716 12,113 9,346 6,405 3,283 (27) Assumed annual inflation rate 3.00% Total capital improvement program total 27,200 Final Scenario 5/9/2016 Attachment I Proposition 218 Property Owner Election Process and Timeline Start Council adoption of ordinance authorizing mail ballot process and resolution establishing procedures for protest hearing/election 3 weeks Legal notices/brochures mailed; start of 1st 45-day noticing period 7 weeks Protest hearing (Need at least 45-day protest period) 3 weeks Ballots mailed 4 weeks Ballots due back to City Clerk (Need at least 45 days between protest hearing and ballot due day) 5 weeks Council certification of election results (Need time to process staff report) 4 weeks Effective date of new rate Minimum 26 weeks elapsed time City of Palo Alto (ID # 6594) City Council Staff Report Report Type: Action Items Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Comp Plan Draft EIR Comments Title: PUBLIC HEARING: Request for City Council and Public Comments on a Draft Environmental Impact Report (DEIR) and Fiscal Study Prepared for the Comprehensive Plan Update. The Draft Environmental Impact Report was Published on February 5, 2016 for a Public Comment Period That will end on June 8, 2016 From: City Manager Lead Department: Planning and Community Environment RECOMMENDATION Staff recommends that the City Council conduct a public hearing on the Draft Environmental Impact Report (DEIR) for the Comprehensive Plan Update and provide questions and comments regarding environmental impacts, mitigation measures, and alternatives for inclusion in the Final EIR. Comments on the draft fiscal study are also welcome. The DEIR can be found at the following link: (http://www.paloaltocompplan.org/eir/). Reviewers are directed to the Executive Summary in Chapter One for an overview. The draft fiscal study can be reviewed at the following location: (http://www.cityofpaloalto.org/civicax/filebank/documents/51329). Please Note: On May 16, 2016, the City Council provided direction regarding development of a fifth and sixth scenario for analysis as part of the EIR. The staff’s understanding of Council’s direction is summarized in Attachment F and the Council may offer additional thoughts and clarifications as part of their comments on the Draft EIR. Public comments are also welcome. The analysis of the additional EIR scenarios will be circulated for public review and comment prior to preparation of the Final EIR. EXECUTIVE SUMMARY The City is the “lead agency” under the California Environmental Quality Act (CEQA) and has prepared a Draft Environmental Impact Report (EIR) to assess potential impacts of the Comprehensive Plan Update. CEQA provides for public review of Draft EIRs, and the City Council is requested to conduct a public hearing for the purpose of soliciting public comments regarding the Draft EIR. Written City of Palo Alto Page 2 comments are also being accepted until the close of business on June 8, 2016. All substantive comments received, whether at the public hearing or in writing, will be responded to in the Final EIR rather than at the public hearing this evening. As the Council is aware, the DEIR analyzes four high level alternatives or “scenarios” at an equal level of detail in order to assess potential impacts of the Comp Plan Update. The four scenarios were designed to test the potential policy choices that will have to be made as the Comprehensive Plan Update planning process moves forward. The City Council has requested that additional scenarios be analyzed and circulated for public comments as a supplement to the DEIR before a Final EIR is prepared. These additional scenarios have been defined by the City Council and will be further informed by Council comments on the summary in Attachment F, as well as public comments received on the Draft EIR. The Final EIR that will be prepared will incorporate written responses to all substantive comments received on both the DEIR and the supplemental analysis of the additional scenarios. The Final EIR must be prepared and certified prior to any final decision on the Comprehensive Plan Update. CEQA does not require an analysis of fiscal impacts; however, the City Council requested a separate analysis of potential impacts of the Comp Plan Update on the City’s fiscal health. As a result, a draft fiscal study was prepared and reviewed by the Finance Committee on March 15, 2016. (See http://www.cityofpaloalto.org/civicax/filebank/documents/51329 for the Draft Fiscal Study and see Attachment C for minutes of the Finance Committee meeting.) Staff will update the Fiscal Study to address policy level comments received from the Finance Committee and Council and will review and incorporate relevant technical comments received from the public this evening. BACKGROUND The 1998-2010 Palo Alto Comprehensive Plan (Comp Plan) contains the City’s official policies on land use and community design, transportation, housing, the natural environment, business and economics, community services, and governance. Its policies apply to both public and private properties. Its focus is on the physical form of the City. The Plan is used by the City Council and PTC to evaluate land use changes and to inform funding and budget decisions. It is used by City Staff to regulate building and development and to make recommendations on projects. It is used by citizens and neighborhood groups to understand the City’s long-range plans and proposals for different geographic areas. The Plan provides the basis for the City’s development regulations and the foundation for its capital improvement program. A Comprehensive Plan update was initiated by the City Council in 2006 to focus on preservation of commercial land uses, preservation of retail and community services to support new residential growth, incorporate sustainability concepts, update the housing element and prepare concept area plans for East Meadow Circle and California Avenue/Fry’s areas. In 2014 the Council endorsed a new framework for the planning process to include broad community City of Palo Alto Page 3 engagement, discussion and analysis of alternative futures, cumulative impacts, and mitigation strategies. A community “summit” was held in mid-2015, and a Citizens Advisory Committee (CAC) was formed to make recommendations to the City Council on policies and programs for inclusion in the update. Purpose of the June 6, 2016 Public Hearing The purpose of this public hearing is to receive public testimony and to allow the community and the Council, individually and/or as a group, to provide comments and questions regarding environmental impacts, mitigation measures, and alternatives presented in the Draft EIR. It also provides an opportunity for further input on the additional scenarios that the Council has requested be analyzed prior to preparation of a Final EIR. The California Environmental Quality Act (CEQA) is a State law that requires California agencies to identify the significant environmental impacts of their actions and describe feasible measures that can be taken to avoid or mitigate those impacts. An Environmental Impact Report (EIR) is required by CEQA when an agency determines that a project may have a significant effect on the environment. An EIR evaluates a proposed project’s potential impacts on the environment, and recommends mitigation measures or alternatives to reduce or eliminate those impacts. Decision-makers use information in an EIR to help determine whether or not to approve a project. The most common type of EIR assesses potential impacts associated with a specific development project. The Comprehensive Plan Update is not a specific development project, and instead constitutes an effort by the City of Palo Alto to determine comprehensive land uses, policies, and programs that will guide public and private decision making regarding land use and development issues over the next 15 years. The City has prepared what is referred to as a program-level Draft EIR, which assesses the potential cumulative impacts of development that may occur during the life of the plan, considers potential alternatives, and identifies mitigation measures that should be adopted to reduce or avoid significant impacts. This is the same level of environmental analysis that was prepared for the exiting Palo Alto 1998-2010 Comprehensive Plan. Preparing a program level EIR for citywide growth allows the City to better identify –and mitigate—cumulative impacts of overall growth that may otherwise be missed in a more focused project specific environmental analysis. CEQA specifically requires that a program EIR be prepared for plans that govern a continuing program. Although the legally required contents of a program EIR are the same as project specific EIR, such as the one prepared for the golf course project, a program EIR is more conceptual, with a more general discussion of impacts, alternatives and mitigations. CEQA clearance for subsequent projects can provide more specifics by “tiering” off the program EIR. Depending on the complexity of the project, such CEQA clearances can include Negative Declarations and Supplement EIRs. City of Palo Alto Page 4 An EIR describes the objectives for a proposed project, the location of the project and actions proposed. It evaluates how the existing environment would be changed if the project was approved and provides feasible mitigation measures or alternatives to avoid or reduce significant adverse changes to existing conditions. The Draft EIR was prepared for the Comprehensive Plan Update to examine four alternatives at an equal level of detail, allowing for an informed decision to adopt one of these alternatives at the end of the process, or potentially a blend of the alternatives if desired. The EIR describes and defines the alternatives in sufficient detail to permit an analysis of their potential impacts, and to permit meaningful public input. The alternatives assess a variety of land use and infrastructure options, and collectively present a range of possible outcomes to inform a final decision about the future of Palo Alto. A fiscal study on the impacts of the Comp Plan Update has also been prepared. As noted earlier, the City Council has requested that additional alternatives or “scenarios” be defined, analyzed, and circulated for public review prior to preparation and certification of a Final EIR. See below for more information on the four scenarios in the Draft EIR and the Council’s request for additional scenarios. Notice of Preparation and Notice of Availability A Notice of Preparation (NOP) was circulated for the Comprehensive Plan Update on May 30, 2014; see http://www.paloaltocompplan.org/wp-content/uploads/2016/02/AppendixA_NOP- NOPComments.pdf. The end of the NOP public review period was specified as June 30 for public agencies and August 6, 2014 for the general public. All of the input received during the NOP period was considered during the preparation of the EIR. Five public scoping meetings were held in the form of three public workshops, one PTC meeting and a City Council hearing. Staff received multiple scoping comments from the public via letters and comments during public hearings, and also received three agency comment letters from the Valley Transportation Agency (VTA), the Bay Area Air Quality Management District (BAAQMD) and the California Department of Transportation (Caltrans). The City prepared the DEIR to provide the public and responsible agencies information about potential adverse effects on the local and regional environment associated with the proposed project. A Notice of Availability/Completion (Attachment A) was prepared and published on February 5, 2016. The DEIR is provided was previously provided to the Council in an earlier packet and is available online on the project website (http://www.paloaltocompplan.org/eir/). The extended public comment period on the DEIR began on February 5, 2016 and now runs through June 8, 2016. The public is invited to comment on the DEIR at this time. All substantive comments received during the comment period will be responded to in a Final EIR. PTC, ARB and LAC Hearings The Planning and Transportation Commission (PTC) held a hearing on the DEIR on April 13 and will hold a second hearing on May 25. The Architectural Review Board (ARB) and the Historic City of Palo Alto Page 5 Resources Board (HRB) discussed the DEIR at a joint meeting on April 21. Staff also introduced the DEIR to the Library Advisory Commission (LAC) for their input on April 28. Minutes for the PTC and ARB/HRB meeting are provided as Attachment E. A video link to LAC meeting can be found at this following webpage: http://midpenmedia.org/library-advisory-commission-12/. (Other boards and commissions were offered an opportunity to schedule a hearing on the Draft EIR, but did not do so.) DISCUSSION As noted above, public agencies are required by CEQA to conduct environmental review to identify significant environmental impacts and adopt feasible mitigation prior to making a final decision on a proposed project. This law ensures that decision-makers and the public understand the implications of agency decisions in advance. CEQA was recently referred to as “the tail that wags the planning dog in California”1 and is an important part of any complex, long-range planning project. Knowing this, the City Council agreed to use the CEQA process to help advance the Comprehensive Plan Update by assessing high-level planning scenarios that illustrate or test various possible policy decisions in the DEIR as described further below. Like other EIR’s, the Comprehensive Plan DEIR is required to provide detailed analysis for the environmental resources defined in Appendix G of the State CEQA Guidelines. The topics range from aesthetics and cultural resources to greenhouse gas emissions and transportation. Each of these resource topics is evaluated against significance thresholds to judge the severity of the impact on a scale from no impact to significant unavoidable impact, and to determine when mitigation measures are needed to reduce the severity of the impact. The Comp Plan Update DEIR differs from most EIR’s in that it assesses four alternatives or “scenarios” at an equal level of detail. The four scenarios are intended to illustrate potential impacts of policy decisions that will have to be made as the Comprehensive Plan Update planning process is completed. By using this approach, the Draft EIR is intended to advance and inform the planning process, and not to dictate what its outcome will be. The Four Scenarios in the Draft EIR At the core of the Draft EIR’s analysis are four high level planning scenarios that were designed to test a range of possible land-use, transportation, jobs and housing choices that must be made before the Comprehensive Plan Update is completed, and to the show what the impacts of those possible choices would be. The four scenarios are: 1Page 14 of ”CEQA at 45; Will California Reform its Unique – and Entrenched – Environmental Review Law?” In Planning Magazine, Volume 81, Number 9, October 2015, by William Fulton. Mr. Fulton, who has written the book on planning in California, also notes that CEQA “is wound around every planning process and every planning decision” that is made in the State. City of Palo Alto Page 6 1. “Business As Usual” – the “business as usual” scenario shows the results if the City continued to operate under the existing Comprehensive Plan with no changes to goals, policies and programs. Any new housing built would be constructed under existing zoning and no innovations in housing or new approaches to address the high cost of housing would be explored. No new growth management measures are anticipated, and any transit or traffic improvements would come from the existing infrastructure plan for the City. This scenario uses a local forecast of housing growth based on the City’s past performance (a long term average of about 150 new dwelling units per year), and ABAG’s 2013 projection of job growth.2 2. Scenario Two, or the “Growth Slowed” Scenario, would slow the pace of job growth when compared with Scenario One by moderating the pace of office/R&D development throughout the city. Scenario Two would also ensure that the modest amount of housing growth expected under Scenario One would be built-out as small units and other housing types appropriate for seniors and the Palo Alto workforce. Transportation investments in this scenario would include implementation of the County’s expressway plan. 3. Scenario Three, or the “Housing Reconsidered” Scenario, would implement a growth management regime similar to the interim annual limit on office/R&D adopted by the City Council in 2015 for the fastest changing areas of the City and would eliminate housing sites along San Antonio and South El Camino. In place of these housing sites, Scenario 3 would increase housing densities on sites Downtown, near California Avenue, and in other locations in the City close to transit and services. Policies, regulations, and incentives would be designed to ensure smaller units for the working professional and senior populations of the City. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench. 4. Scenario Four, or the “Sustainability Tested” Scenario, assumes the most growth in housing and employment, consistent with ABAG projections. Rather than moderating the pace of development, this scenario would seek to limit the impacts of development. Potential policies and regulations would be enacted to advance sustainability objectives, including free transit passes for residents in transit-served areas, achieving LEED platinum certification for new development, maximizing local solar energy production, foregoing new natural gas hookups, and utilizing drought-tolerant landscaping. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench, and incorporating mix flow bus rapid transit on El Camino Real (with curbside stations and queue jumping for transit vehicles). 2 The City does not have the basis for a local forecast of job growth, and will have to rely on ABAG’s forecast until the new business registry provides useful trend data. City of Palo Alto Page 7 In keeping with the requirements of CEQA, the Draft EIR assesses potential environmental impacts and mitigation measures for the four scenarios addressing:  Aesthetics  Air Quality and Community Health Risk  Biological Resources  Cultural Resources  Geology, Soils, and Seismicity  Greenhouse Gas Emissions  Hazards and Hazardous Materials  Hydrology and Water Quality  Land Use and Planning  Noise  Population, Housing and Employment  Public Services  Parks and Recreation  Transportation and Traffic  Utilities and Service Systems A separate, fiscal study looks at potential impacts the four scenarios on the City’s finances. (This is a separate study because CEQA does not require an assessment of fiscal impacts.) Additional Scenarios for Analysis Prior to the Final EIR The Draft EIR anticipated that the City Council might ultimately want to mix and match components of the four scenarios, or pursue a hybrid of two or more. On January 19, 2016, and February 22, 2016, the City Council discussed their desire to define a fifth scenario for analysis and public review prior to proceeding to a Final EIR and on May 16, 2016, the City Council requested that staff analyze two new scenarios as described in Attachment F. The Council may provide additional guidance on these scenarios or their analysis this evening. A full description and analysis of the additional scenarios will be published as a supplement to the Draft EIR and circulated for public review and comments before a Final EIR is prepared. NEXT STEPS The public comment period on the Draft EIR will close on June 8, 2016 and at that time all of the public comments received will be posted on the City’s website and be provided to the City Council. Analysis of the additional scenarios described in Attachment F is expected to be completed in the late fall, after which time the analysis will be circulated for public review and comment as a supplement to the Draft EIR. (Note: this work is contingent on an additional amendment to the City of Palo Alto Page 8 consultant contract, which is currently being developed.) The City will prepare formal written responses to all substantive comments received on the Draft EIR and on the analysis of the additional scenarios in the form of a Final EIR. The City Council is required to review and certify the FEIR prior to taking action on the Comprehensive Plan Update. Certification of the Final EIR and consideration of the Comprehensive Plan Update is currently scheduled for mid-2017. Attachments:  Attachment A: Notice of Availability/Completion (PDF)  Attachment B: EIR Orientation Brochure (PDF)  Attachment C: March 15, 2016 Finance Committee Minutes (PDF)  Attachment D: April 13, 2016 PTC Draft Verbatim Minutes and April 21, 2016 ARB/HRB Minutes (PDF)  Attachment E: Comp Plan Update DEIR comment letters (PDF)  Attachment F: Summary of New Scenarios for Analysis in the EIR (DOCX) NOTICE OF AVAILABILITY AND COMPLETION OF A DRAFT ENVIRONMENTAL IMPACT REPORT FOR THE COMPREHENSIVE PLAN UPDATE (SCH#2014052101) NOTICE IS HEREBY GIVEN that a Draft Environmental Impact Report (EIR) has been prepared to assess the environmental impacts of the following project: COMPREHENSIVE PLAN UPDATE LEAD AGENCY: City of Palo Alto, 250 Hamilton Avenue, Palo Alto, CA 94301 Project Description: The Palo Alto Comprehensive Plan is the City's governing document for land use and development decisions. The City is undertaking a Comprehensive Plan Update in order to establish a shared vision for the future of the community through to the year 2030. The Project will update goals, policies, programs, narrative, maps and diagrams throughout the Comprehensive Plan. Given the long-term horizon of the proposed Plan and the permitting, planning and development actions that are related both geographically and as logical parts in the chain of contemplated actions for implementation, this draft EIR has been prepared as a program EIR, pursuant to the CEQA Guidelines. This Program EIR analyzes four planning scenarios at an equal level of detail within the body of the Draft EIR, thereby illuminating potential environmental impacts of a range of alternatives designed to address the proposed Plan objectives. Scenario 1 is a “Business as Usual” scenario and assumes the proposed Plan would not be adopted, and change and development in Palo Alto through 2030 would occur under the existing Comp Plan. Scenarios 2, 3, and 4 each include different strategies related to the pace of non- residential development and job growth, the placement of housing sites and densities, desired transportation investments, and sustainability measures. Probable Environmental Effects of the Project: The EIR will evaluate potentially significant environmental impacts associated with the adoption and implementation of the Comprehensive Plan Update, consistent with the State California Environmental Quality Act (CEQA). The proposed project will have potentially significant environmental effects with regard to Air Quality, Greenhouse Gas Emissions and Climate Change, Land Use, Transportation and Traffic, Population and Housing, Noise, Utilities and Service Systems, Cultural Resources, and Hydrology and Water Quality. CEQA requires this notice to disclose whether any listed toxic sites are present at the project location. This is a citywide project, and there are sites within the city that are contained in the Cortese List of toxic sites. The Draft EIR is on file and may be reviewed at the Palo Alto Planning Division, 250 Hamilton Avenue, 5th floor, during business hours. The EIR will also be available for review on the City’s project website-- http://www.paloaltocompplan.org, and at the following public libraries: Rinconada Library, 1213 Newell Rd., Palo Alto, CA 94303, and Palo Alto Downtown Library, 270 Forest Ave., Palo Alto, CA 94301. The public review for this Draft EIR begins on February 5, 2016 and ends on May 5, 2016. If you wish to provide written comments on the EIR, please submit these to Elena Lee, Department of Planning and Community Environment, 250 Hamilton Avenue, Palo Alto, CA 94301, or Elena.Lee@CityofPaloAlto.org, no later than May 5, 2016, at 5:00 p.m. During the public review period, both the Planning & Transportation Commission and the City Council will hold public meetings to take public testimony on the Draft EIR. The public meetings are tentatively scheduled for April 13, 2016 at 6:00 p.m. (Planning & Transportation Commission) and April 25, 2016 at 7:00 p.m. (City Council). Both meetings will occur in the Council Chambers, 1st Floor City Hall, 250 Hamilton Avenue and all persons may appear and be heard at these meetings. Substantive public comments received at these meetings and in writing will be responded to in a Final EIR before there is any decision to adopt The Comprehensive Plan Update. Members of the public are also encouraged to attend meetings of the Citizens Advisory Committee to offer their comments and Attachment A suggestions regarding the development of policy language for the updated plan. Visit PaloAltoCompPlan.org for more information. If any person challenges this item in court, that person may be limited to raising only those issues the person or someone else raised at the public hearings described in this notice, or in written correspondence delivered at, or prior to, the public hearings. In compliance with the Americans with Disabilities Act, those requiring accommodation for these meetings should notify the City of Palo Alto 24 hours prior to the meetings at (650) 329-2496. HILLARY GITELMAN, DIRECTOR OF PLANNING AND COMMUNITY ENVIRONMENT Attachment B FINANCE COMMITTEE FINAL MINUTES Page 1 of 64  Regular Meeting Tuesday, March 15, 2016 Chairperson Filseth called the meeting to order at 7:03 P.M. in the Community Meeting Room, 250 Hamilton Avenue, Palo Alto, California. Present: Filseth (Chair), Holman, Schmid, Wolbach: Absent: Oral Communications Chair Filseth: We have one item on our agenda tonight, but before that we have oral communications. Are there any members of the public here? None. Agenda Items 1. Introduction and Discussion of the Draft Fiscal Analysis of the City of Palo Alto 2030 Comprehensive Plan Update (Continued From March 1, 2016) Chair Filseth: In that case, why don’t we proceed to our list of action items this evening, which is Introduction and Discussion of the Draft Fiscal Analysis Comp Plan. With that, thank you for joining us and you have the floor. Hillary Gitelman, Director of Planning and Community Environment: (Crosstalk). Chair Filseth and Council Members, I am Hillary Gitelman, the Planning Director. I am joined by Roland Rivera on our staff and Benjamin Sigman from EPS Consultants. They have done this fiscal study for us. We also expect Joanna Jansen, the prime consultant from Placeworks to join us. She is in traffic. The discussion this evening is about a draft study to look at the fiscal impacts of the Comp Plan update. It is meant to compliment the draft Environmental Impact Report (EIR). I think the Council rightfully recognized that under the the Calrifornia Environmental Quality Act (CEQA) we don’t have to analyze the fiscal impacts of a project, but it makes good ATTACHMENT C FINAL MINUTES    Page 2 of 64 Finance Committee Draft Action Minutes March 15, 2016   sense governance-wise to do so. This is a supplement to that exercise and like a draft EIR, we are welcoming comments and questions and we hope to build a stronger and better final report to ultimately aid in the Council’s decision-making process. We are certainly going to need to supplement the study. We already know the Council has directed us to develop, with your help, I hope, the fifth scenario or quality-of-life scenario, and we will have to add that to this study at some point. Just so you know, in fact, Council Member Schmid just heard this at the Citizen Advisory Committee (CAC) meeting, our plan on that fifth scenario is to get the Council’s input on housing issues next Monday, to get input on sustainability-related issues on April 18, when you will hear our presentation on Earth Day and the Sustainability and Climate Action Plan (S/CAP) to get input from the Council on mitigation measures when we have the hearing on the draft EIR April 25, and then to come back to Council in mid-May for that discussion about the fifth scenario and to bring you the information and options that you requested when we talked on February 22. We are expecting quite a dialogue this evening. We have a brief presentation, Ben has a brief presentation. We intentionally have left a lot of time for questions and comments. We understand that the results of this study don’t necessarily match the narrative that some Council Members have adopted based on prior studies, so we are going to have to talk about the data and results here and we are not really requesting a formal action. What we would like are your comments and questions and we will bring those forward to the full Council. We will probably put this on the same agenda as the draft DIR and get Council questions and comments to respond to and address in a final document. With that I will hand it over to Ben. Ben Sigman, Executive Vice President for Economic & Planning Systems, Inc.: Thank you for having me. It is really an honor to be working on this assignment with the City of Palo Alto. I am Ben Sigman, Economic and Planning Systems. I am an Executive Vice-President and I have about 15 years of experience in this kind of work. We have done fiscal studies for specific projects, specific plans, general plans all over the State of California. This reflects sort of the standard in practice in our area and I think we have also built on that a bit, given the direction from Staff and from the City as to what you are looking for, and so we have about a 20-minute presentation. I am happy to make this as conversational as you would like, if you would like to ask questions along with it, that is just fine. I think we have plenty of time to get through the material, no matter which way we do it. I am going to walk you through the alternatives, I should say, we build off the Comprehensive Plan scenarios, and so we will review those really briefly. I am going to show you the findings of this study. I think everyone has had FINAL MINUTES    Page 3 of 64 Finance Committee Draft Action Minutes March 15, 2016   the hard copy of the report, so you are familiar with that, so we can move through that, but I want to make sure we are all sort of on the same page about the order of magnitude of the findings. Then I will walk you through the methodology and some of the data assumptions, and then we will talk about where we go from here. This study has a very focused scope. We are looking exclusively at your General Plan or General Fund and we are looking at the operational cost factors, right, so what we are not looking at are the capital expenditures the City may need to make as part of the Comprehensive Plan scenarios. We are not quantifying the cost of any mitigations associated with quality-of-life here in Palo Alto. I know there is a lot of sort of uproar about traffic and other quality-of-life affects that come with growth. This is purely a financial look at the General Fund, so it does not capture all these things, and that is really important to state right off the bat. It is consistent in a lot of ways with the study you all had done in 2009, the Applied Development Economics (ADE) Study, a very similar look at the General Fund. We focused more on the revenue and cost drivers by land use, so where as they would have assigned sales tax to commercial uses because that is the point of sale, we try to break out where that spending that generates the sales tax is actually coming from in terms of households versus workers and I’ll walk you through those methodologies momentarily. We also, as compared with the ADE Study, are looking at the margin. We had the benefit of having these comprehensive plan scenarios and we are saying, “What happens from here going forward,” not, “What is the sort-of fiscal makeup of the General Fund today on average overall.” The other thing I would point out about our work compared to the ADE work is we had the benefit of time. It has taken a while to get this study in front of you, and that is largely because we spent a lot of time meeting with City Department Staff, working through some of their cost data to understand the cost implications of growth at the department level for the major departments. I also note from some of your preliminary comments, you might have been hoping for some taxation policy analysis, and that is not something we have done here, but could be something certainly in the future. On this Slide it is important to note we did look back 15 years at some of the trends, so we are not operating in a sort of bubble. We are looking at sort of long-term trends in the City and it is important for me to point out that there are a whole bunch of things that might go on externally and in the world that we are not able to guess about and we don’t try to guess about, so regional growth, technology, environmental changes, we are not adjusting anything to reflect what we think some of those categories might have in terms of effects on the City. I just want to give you a sense of the process we have been going through. It has been more than a year, extensive review of documents and data from the City, a lot of meetings with City Staff, as I FINAL MINUTES    Page 4 of 64 Finance Committee Draft Action Minutes March 15, 2016   mentioned. We have done two major presentations to City Staff already, so we have gotten a lot of input from the Finance Department, a lot of input from Planning and Community Environment, input from the City Manager’s Office, so this reflects a sort of collaboration between our firm and Staff on this analysis, and as Hillary said, I think we are interested in hearing where we’re right or where you have questions. There is definitely a lot of opportunity for sensitivity analysis around some of the assumptions or deeper research where we had to go with available data sources, but perhaps you are interested in primary research. I am going to move right to the scenarios. I think you are all familiar with these from having studied the Comprehensive Plan draft that is out. We are looking at between 10 and 16 percent growth in population and housing and 10 to 16 percent growth in jobs, so that is the range. We have, I don’t know if we need to get into all the detail, but Scenario One is sort of a business-as-usual scenario; Scenario Two, business-as-usual with a jobs reduction; Scenario Three is sort of a modest-growth scenario where we explore different options for the office cap; Scenario Four is our high-growth scenario. Flipping to the sort of bottom line, if you will, the findings of the study are that from a General Fund perspective, just at the margin looking out at this 10 to 15, 10 to 16 percent growth in the next 15 years, today’s dollars, excluding any trends that you might have in health care costs or pensions, those types of affects are sort of held constant, we see that the growth scenarios would yield between $5 and $7.4 million, 2015 dollars in additional net revenue accruing to the General Fund. It is really relatively modest, right, that is between three and four percent essentially of your current General Fund. Chair Filseth: And that’s over 15 years? Mr. Sigman: Over 15 years, yup. Chair Filseth: This is fascinating, and I am glad we are going to do all this, but the short answer is the net financial fiscal impact of all the scenarios is based on (inaudible). Mr. Sigman: Yup. And I think this is, in Palo Alto… Chair Filseth: Tremendously valuable right. Mr. Sigman: We are not answering every question that people have, but it is important to put this to bed, right. It is important to have studied this and be confident that you understand the effects of growth on your General FINAL MINUTES    Page 5 of 64 Finance Committee Draft Action Minutes March 15, 2016   Fund, so it is not going to please all the people and it doesn’t, there is more work to be done, but I think, I don’t want to suggest that this wasn’t necessary. So what is going on here is, this is a mature city, right, with a mature City Government that at the margin can expand services without a lot of cost affect. I will get into the details of that on a department-by- department basis as needed, but that is the sort of headline. When we ran around to various departments, maybe with the exception as you’ll see of your Public Safety, many of them can scale up and accommodate additional population and employment levels in the City without adding a lot of cost. Then similar to some of the other studies you had done, I did want to report these costs and revenues to the General Fund on a per capita or per job basis. As you can see, what we are showing is the residents actually net provide a little bit more revenue to your General Fund than the workers, so that is sort of an interesting finding, a little bit out of the ordinary as compared with other cities. Usually we see residential as being a bit of a drain on the General Fund, but in this case again, because for instance, your Parks Department is so well established and so sizable, they can accommodate these additional residents without a lot of additional cost burden. It took a lot of digging with them to kind of get to that conclusion. Chair Filseth: I don’t want to derail this, but since at this point it is really basic, one of the results from this is basically for both additional residents and additional employees, basically they contribute twice as much revenue as the cost? Mr. Sigman: Yea, roughly. Chair Filseth: However, every year the General Fund basically breaks even. How is that possible, from 90,000 (inaudible). Mr. Sigman: Yea. Chair Filseth: Not including our unfunded long-term (inaudible). Mr. Sigman: Right, well, you may be better positioned to answer this. (crosstalk). You fill the spending to meet the budget in a lot of cases. I think it is also sort of departmental habit, this is speaking broadly, I don’t know if it is a Palo Alto culture or not, but to always seek to grow your budget, to do more, and I think that in this community where high-quality services are so valued and City Staff try so hard to deliver good quality services, they are FINAL MINUTES    Page 6 of 64 Finance Committee Draft Action Minutes March 15, 2016   always looking for more resources to do that. There is always more that can be done. Chair Filseth: Yet if that is the case, because the General Fund expenses are basically head count which correlates to services, so if we expand services to fit the available revenue, you would think that would show up in the costs. Mr. Sigman: Right, so the methodology we use locks current services. We assume that the current service levels remain perfectly unchanged. It is as if we said, “These additional 15 percent … Chair Filseth: So the next person is different from the last person. Mr. Sigman: Incrementally. Chair Filseth: Right. Mr. Sigman: We do costs at the margin and the costs are not the average costs. That is a distinction between our work and the ADE work and eventually I think it can be argued that all costs revert to the average, so if we were projecting a 75 percent growth, I think at that point you start to hit some cost thresholds and you need the new police station or the new fire station, which may be a better example here, so those costs do kind of come back to the average as you expand, even at the margin, to meet dramatic growth, but because we are talking about 10 or 15 percent, some of those fixed costs are not changing, so this increment is modest and when we worked with the departments to talk about what this kind of incremental grown meant to them, they all felt they could accommodate it with minimal affects. Council Member Holman: Can I ask a question too, which is if we are talking about incremental change at the same time, if you look at the difference between Scenario Two and Scenario Four, the next to last row on there is adding three million to four million square feet of additional workspace, so that, we might call that incremental, but it is wow, so that much square footage to be considered incremental is just… Mr. Sigman: Right, it is just, so we have pretty good data about square feet in the City and you know it is still on the same order of 12 to 15 percent growth in work space, so the growth in employment space is similar to the FINAL MINUTES    Page 7 of 64 Finance Committee Draft Action Minutes March 15, 2016   overall growth in jobs, it is not out of whack. It is not as if we are going to have to increase work space by 50 percent to get 15 percent more jobs. Council Member Holman: I guess what I am getting at is, you know, incremental, of course it does depend on what your base is, but three million to four million square feet of additional work space is not incidental. It might be incrementally small, but it is not incidental, and that is what I was trying to… Ms. Gitelman: Council Member Holman, you are absolutely right. It is not an inconsequential amount of new development that would happen. The interesting thing for me in how we have analyzed both the fiscal impacts and the environmental impacts, is it is really based on the number of jobs, it is not based on the amount of square footage, so a lot of the analysis is based on the job number and the different scenarios assume different employment densities, different amounts of new development, to look at those impacts that come from building footprints, aesthetics, land use, but most of the impacts that we think of as quality-of-life, traffic, noise, the fiscal impacts come from the job number, not the square footage number. I think that interaction is fascinating. Council Member Holman: Except, of course, they are so absolutely directly related. Ms. Gitelman: They are related, (crosstalk) but are not proportional. So the economic cycles really determine the employees per square foot and it is not always a direct relationship, new development to new employees. We saw, for example, after the recession, it took us a long time to start adding square footage, but we added jobs like crazy, so it is not a directly proportional relationship, so these scenarios are trying to show and test various amounts of employment and various amounts of square footage, recognizing that relationship is not always proportional. Council Member Holman: I guess the other point I would make, pardon me for not going through you, Chair, the other point I was trying to make too is that once the building is built, we only have so much control, so the fluctuations that we almost can’t monitor in terms of changing markets at least, is whether it is two per thousand or 12 per thousand. That fluctuation exists in reality if the amount of square footage is added that we are contemplating. FINAL MINUTES    Page 8 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: You are just speaking of that employment density in the space, so you build the space and then you could end up with a lot more jobs than you anticipated. Council Member Holman: Yes. Mr. Sigman: Right, that is a fair point and we have keyed in exactly to the assumptions within the Comprehensive Plan update and so there are fixed ratios for each scenario, but (crosstalk) the net new square footage of work space. Chair Filseth: The scenarios state a ratio of jobs per square foot, and you just used that. Mr. Sigman: They state the square feet, do they not? Chair Filseth: And they state the number of jobs. Ms. Gitelman: That’s right, but some of the job growth may be in existing building square footage, not in new square footage, so that’s the complexity. Mr. Sigman: Okay, thanks. I’ll keep moving (crosstalk), I don’t have, that’s okay, we have the time, but we don’t have too many slides to get through. So this is the revenue side. Property Taxes are far and away the largest source of revenue to the General Fund under these growth scenarios. They make up 50 to 56 percent of the total revenue. Sales Tax is also quite significant in terms of the magnitude. Just to keep moving, I wanted to make a point here about Property Tax, it is, because it is such an important category of revenue… Council Member Wolbach: I’m sorry, can we just go back. You said, I didn’t crunch the numbers myself, but you said Property Taxes account for 50 to 56 percent of the new revenue or of total revenue? Mr. Sigman: Of the revenue we are generating in these scenarios, so it is the new revenue, so in this table here it is the top line, Property Taxes, over the total revenue associated with each of these scenarios. Council Member Wolbach: That’s what I thought but I just wanted to check. Thank you. FINAL MINUTES    Page 9 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: Yes, I think to answer the other point though, it makes up about one-fifth, about 20 percent, Property Tax, of your total General Fund revenue and actually residential is about three times commercial in terms of the assessed value contribution to that. One of the things we wanted to sort of be clear about, and there is a lot going on in this slide, but the upper left- hand corner is assessed value, residential versus non-residential in the City of Palo Alto over roughly a five-year period that we had data for, and it has been pointed out, I think, in some of the Council meetings, that this residential value is increasing as a share of the total. It has gone up about five points over this period. We wanted to just sort of be clear that we believe this is a baseline condition. That sort of no matter what you build new in Palo Alto, you are probably going to see this trend continue. We pulled some data from the County Assessor’s Office and what we found that for recent years the new construction actually accounted for only 15 percent of the change in assessed value year over year. So really what you are seeing is dynamic in assessed value is a result of your existing housing stock, so that’s one note we wanted to make, just going in. We did quite a bit of research looking at the real estate market to arrive at the assumptions we used in this study. Here is the sort of schedule of new product pricing that we are using. The for-sale residential, it is important to note, is essentially representative of multi-family, condominium product. We are not assuming a whole lot, if really any, in the analysis new single family detached homes. We are assuming it is in fill multi-family attached. We do include the housing element policy for affordable housing. We follow Housing and Urban Development (HUD) guidelines for pricing that housing. We also did quite a bit of work using data from Costar Group, which tracks with all the brokerage houses in terms of retail, office, industrial and some of the other land uses out there. Other includes things like hospitality, so hotels as well as health care uses. Because we wanted to be realistic about the effects of Proposition (Prop) 13 and appreciation in the market, we did create a sort of separate model that looks at turnover in the property markets. We have some sort of assumed whole periods that reflect the market data we have, as well as appreciation factors, so the long and short of this is that by 2030 the real value of affordable housing will be slightly lower than it is today, and the real value of the market rate products, both residential and commercial will be slightly higher because of the real appreciation in the market place. Council Member Wolbach: Even with Prop 13? Chair Filseth: Is this a 2030 number, or is this a today number? FINAL MINUTES    Page 10 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: So you are looking at our assumption from today’s on the left- hand column there, the assessed value column, that is where we start. Chair Filseth: Okay. Mr. Sigman: And it is not in this slide, but in the report I can direct you, we have this sort of market adjustment factor that comes from this turnover model that we built. So I want to say something like the for-sale residential goes up about 40 percent in real terms by 2030. Chair Filseth: Got it. So office space at $700 square foot? Mr. Sigman: That’s right, and you have to remember that… Chair Filseth: So that is like $30 million an acre, is that accurate? Mr. Sigman: I’m sorry, per square foot of built space. Chair Filseth: Of built space. Mr. Sigman: Built space, so Floor Area Ratio (FAR) space, yeah. So not acreage, all of this is per unit, I should be more clear. Chair Filseth: That’s within constructed building on top of it with plumbing, heating, electricity and so forth, not just a lot. Mr. Sigman: So for the office, if you bought a 1,000 square foot office, it is $700,000. So we can come back to some of these assumptions. A lot of this presentation is just walking you through the data, so moving on to the retail sales, we rely on, since this data concerning the income levels in Palo Alto for the households and their spending, their retail spending pattern comes from a survey provided by the Bureau of Labor Statistics, the Consumer Expenditure Survey, a very common source for this kind of work. Then the capture rate, how much of that spending actually happens in Palo Alto, is an assumption we make. We are justified by that being the fair share of retail space in the market area of Palo Alto versus the broader, roughly five-mile radius of retail, so a pretty reasonable capture assumption. Then on the worker’s side, very similarly we used the best available survey data, same survey that ADE used in their prior work, and it is International Council of Shopping Centers Survey on workers’ spending and we are able to make FINAL MINUTES    Page 11 of 64 Finance Committee Draft Action Minutes March 15, 2016   adjustments for the type of retail that is available in Palo Alto, so based on that we are assuming $9,300 in spending, and this is spending that workers make to and from their place of work, in the vicinity of work, so it is not just lunch, it is also groceries on the way home, also shopping they might do at the Stanford Shopping Center after work or before work or at lunchtime, so it is sort of all-encompassing in that regard. We are careful to adjust for double counting, so any workers that also live in Palo Alto are counted as households and excluded from the worker spend here. Then we also capture a variety of business spending types, so business-to-business, particularly in the technology industry is a significant source of retail tax revenue. In Palo Alto we have seen it vary greatly over the years, up to 30 percent of total sales tax down at 12 percent, so we found middle ground at about 15 percent of your total retail sales tax revenue from Business to Business (B- to-B) is kind of a stabilized number, and what we did was divide it by the real estate that we think produces that type of sales tax in town and came up with this $20 a foot, which corresponds very closely to some survey work that we have access to from Menlo Park in one of their business parks, so I think we are pretty comfortable that this reflects a sort of typical B-to-B sales tax generation. Chair Filseth: So what is a typical example of a transaction that you are talking about? Mr. Sigman: Yeah, so… Chair Filseth: Hewlett-Packard (HP) in Research Park sells a logic analyzer to somebody. Mr. Sigman: Yes, servers and other technology where they make the point of sale the office headquarters. I don’t have a lot of very specific examples, but we see it in aggregated sales tax data for all kinds of cities. We have done a lot of this work recently in Cupertino and there where they have Apple as a significant generator of B-to-B I think it is like 100 times, you know, so this is pretty modest, but they are a special case too. I think in their case, I think they are basically accounting for a lot of the on-line music sales and device sales that they sell over the internet, point-of-sale is registered in Cupertino. Chair Filseth: That would be retail wouldn’t it, not the B-to-B? FINAL MINUTES    Page 12 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: I believe because it is, that is a good point, but because it is not coming from a retail outlet, it is registered at a headquarters location, I think it gets counted as B-to-B. Chair Filseth: So Tesla sells somebody a car here, is that B-to-B? Mr. Sigman: If Tesla sells, so do they have an office location here? So if they have designated this as the point-of-sale, and I know there is some flexibility in that because where… Council Member Schmid: They did that for 18 months, then they ruled to move that over to the East Bay, so that was… Mr. Sigman: I know Cupertino made a deal a number of years back where they compelled Apple to move point-of-sale for a variety of transactions to the Cupertino location and in return the City gave them a sales tax kickback, so there is, you know, it can move. Council Member Wolbach: That is interesting, because basically what we are saying here is that we actually got sales tax dollars from office space sometimes. Mr. Sigman: Oh yeah. Council Member Wolbach: It is interesting to know that. Mr. Sigman: And like I say, it (crosstalk) 27 percent of your total Retail Tax has been from B-to-B which is presumably from office locations or similar industrial locations. Lalo Perez, Chief Financial Officer: Industrial locations, probably the (crosstalk) and the HP example. Chair Filseth: Clearly so, I mean that is the difference between HP and Flipboard. Flipboard doesn’t make any money so they don’t pay any tax. Actually, I don’t know if we get sales tax from Flipboard, I doubt it. Actually, I’m sure we don’t. I’m sure their point-of-sales is in Ireland or someplace like that. FINAL MINUTES    Page 13 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: The other category of business spending that we have, and we can come back to B-to-B if we want to talk about those, it is fine. The spending a business will make on its employees on a day-to-day basis, so food they might bring in from local restaurants, stationery, other business supplies, incidentals that they bring in. We made a pretty simple assumption of $500 a head for employees spending. Council Member Holman: Is there any way, a wild question here, is there any way at all to understand what the spending for businesses persons is for restaurants versus other retail? Mr. Sigman: Yes, so in the International Council of Shopping Centers Survey, they asked workers, they go around the country, they ask workers a sample, how do they spend their money on their way to and from work, and they have a number of categories. They may leave you wanting, but it is more than a total number. For instance, they tell us about transportation spending, which we don’t believe is taxable so we take that out, and we were able to make some adjustments to try to capture the portion of their spending we think is taxable, and I believe they do a pretty good job of breaking out restaurant spending or food spending. I don’t have it off the top of my head. I can certainly follow up. Chair Filseth: Sorry to dwell on this briefly, but this is sort of a major, one of the small number of significant divergences between where you guys did and some of my colleagues’ analyses here before, but it has to do with, sort of, the household spending. So if I understand, you made an estimate for what the average household in Palo Alto spends on stuff per year, and that is the $32,000? Mr. Sigman: Taxable retail items, yeah. Chair Filseth: And how do you get that number? Mr. Sigman: We have again survey data from the Bureau of Labor Statistics, Consumer Expenditure Survey. Chair Filseth: So that is a nationwide… Mr. Sigman: It is a national survey, but what it allows you to do is categorize household spending by income, so we select the bracket of spending profile FINAL MINUTES    Page 14 of 64 Finance Committee Draft Action Minutes March 15, 2016   that most closely matches the average household income in Palo Alto, so while it doesn’t reflect even a California household, it does reflect a household with $150,000 and more annually. Chair Filseth: Right, so you said if you are in this income bracket you probably spend this much and if you are in that income bracket you will probably spend that much and so forth on a national basis. Mr. Sigman: Correct. And so we take the profile, which is essentially a distribution of spending across retail types and we apply it to your specific household income average. Council Member Wolbach: In that capture rate, that means of that $32,000 that they are spending, 30 percent of it would be here in Palo Alto, the other 70 percent would be in other communities. Mr. Sigman: Exactly right. Council Member Wolbach: (inaudible). Chair Filseth: And you said you have a formula based on sort of the amount of retail space in Palo Alto as a proportion of the amount of retail space within a five-mile radius. Mr. Sigman: Yes, which we would consider to be the trade area, correct. Chair Filseth: And you assume that some percentage is, you did something, you said there is a combination of the amount of area and how close it is to you, whereas the amount of area elsewhere, 4.9 miles away? Mr. Sigman: Actually, it may be even simpler than you are thinking. It literally is that the City of Palo Alto has 30 percent of the retail square footage in a five-mile radius. Chair Filseth: So you assume that, okay, so it is a straight ratio. Mr. Sigman: I know you have had quite a bit of retail work done in the past, you could get very sophisticated on this and I am not sure if it would make the answer any more accurate or not. FINAL MINUTES    Page 15 of 64 Finance Committee Draft Action Minutes March 15, 2016   (crosstalk) Joe Saccio, Assistant Director of Administrative Services: I was just going to say (crosstalk), this percentage which shows a fair amount of, this percentage of 30 percent shows a fair amount of like leakage to other surrounding areas, and that is supported by sales tax data that we get quarterly from our sales tax consultant, and it is basically, you know, there is a Wal-Mart out there, there is a Costco out there and the big box stores. Chair Filseth: I shop at (crosstalk). Mr. Saccio: I just thought I would add that. Council Member Wolbach: I also wanted to ask, so in the end we are looking at, according to this model, $9,700 of retail spent by a household in Palo Alto, it is actually spent here. Mr. Sigman: Spent here on taxable items. Council Member Wolbach: On taxable items. Okay, per year. Mr. Sigman: So prescription drugs wouldn’t be in there, transportation might not be in there. Council Member Wolbach: Right, so then the next question is, how much money do we actually end up getting from them, and what percentage of that goes to, where? Can I see it broken down? How much goes to County versus State versus City. Mr. Sigman: So that is detailed in the Appendix and we do not estimate any tax revenue that accrues to the County in our study. It is completely outside the analysis. So… Mr. Saccio: Here we got $97, out of that $9700. If someone spends $9700 in Palo Alto we get 1 percent. Mr. Sigman: Right. So the Appendix figure, A9 is where you want to look. So each of these Appendix tables is for one of the scenarios, so Scenario One for example, the residential uses provide $26.5 million almost in taxable spending, $265,000 a year in Sales Tax revenue accruing to the General FINAL MINUTES    Page 16 of 64 Finance Committee Draft Action Minutes March 15, 2016   Fund and in that particular scenario, because you have quite a bit more employment relative to households, it is $150 million in spending and $1.5 million in sales tax revenue accruing to the General Fund. Council Member Wolbach: Thank you. Mr. Sigman: Of course. So we will keep going. We can come back to any of this, of course. Transient Occupancy Tax is our next category of revenue. We use a firm called Smith Travel Research, which is the most reputable hotel data available. (inaudible) A full percentage points of the study costs, but $240 was your average room rate at the time of the study, so at the middle of last year. That part is easy. The tax rate is easy at 14 percent, that all accrues to your General Fund. We did a couple of things to break it out and this is where we are focusing here on the demand drivers rather than just calling that commercial tax revenue. The residential we did a pretty extensive literature search on what households attract in terms of visitors from out of town and what share of those visitors stay overnight in paid lodging and we arrived at this two nights per household estimate or assumption, and then in terms of the worker-driven demand, so this is folks coming from out of town on business to meet with Palo Alto firms, an informal survey in Menlo Park had us at about three room nights per worker, so we sort of stress tested that a few different ways, and so those are the assumptions we ended up with here. Similar to the Sales Tax, we do have a capture rate that we apply, so these households may attract overnight guests and these businesses may attract overnight business, but we are assuming there is a 10 percent leakage that some folks to over the Menlo Park or go elsewhere to stay and so that are the assumptions that go into that piece of the analysis. Chair Filseth: So those numbers are marginal numbers, right? Mr. Sigman: Correct. Chair Filseth: Are they the same as the average numbers? Mr. Sigman: We applied it to the current composition of the City and compared it to your Transiet Occupancy Tax (TOT) revenue now and it made sense, so it is probably pretty similar to the average. This was, quite honestly, very challenging. There is not a lot of data about this. We did some interviews with the hoteliers. You know, they tell us it is a very business- driven hotel market. FINAL MINUTES    Page 17 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: But I thought it was all business actually, my guess here. Mr. Sigman: Yes, and you know, so we went to the literature which is not exactly robust and did a little bit of this informal survey work and we fell like this is a pretty strong estimate, given the level of effort we put in. Chair Filseth: So Stanford must account for a chunk of this too. Mr. Sigman: Yeah, so I don’t present it here but in the report, on both the Sales Tax and the TOT, I try to put our model results in the context of the City today and so, let’s see TOT. Chair Filseth: It’s this one, right? Mr. Sigman: Yeah, there you go. Council Member Wolbach: Which (inaudible). Mr. Sigman: No, this is in the body, this is Page 28, Estimated Transient Occupancy Tax Generation By Demand Source, so I basically take the model and run it through your current households, current businesses. We have a survey from Stanford that they did. It is a few years old, but it still gives us a sense of their level of visitors to both the hospital and the campus. So what we get, I think, at least past the lab tests with business supporting about, this is sort of today, right, rather than at the margin to your distinction, about 45 percent, 44 percent of TOT coming from businesses, about 9 percent coming from households, a little over 20 percent coming from Stanford, 30 percent other visitors. Chair Filseth: I know what I wanted, I should have asked it before, I’m sorry. So this one I understood, but I wanted to ask you about the same breakdown in sales tax, because you sort of say, “Okay, half of it comes from visitors,” so that is a big bucket. So does the visitors, this is on Page 25. Does it map to the same proportions as the TOT? Is some of this visitors-to-residents and some is visitors-to-businesses and some of it visitors-to-Stanford? Mr. Sigman: Right, so in this instance it could be visitors to any of those things. And I think our explanation here for why this other visitors is such a huge share of the pie is because the Stanford Shopping Center is a regional FINAL MINUTES    Page 18 of 64 Finance Committee Draft Action Minutes March 15, 2016   mall, so it attracts lots of shoppers from outside the City and similarly the downtown is a regional attraction as well. Council Member Holman: So does this track, what’s on Page 25, business spending at retail establishments, does that really track with what we had on one of the earlier slides, business spending at retail establishments is $2. Is that, (crosstalk). Mr. Sigman: The business spending at retail establishments, the 1 percent, yes. Council Member Holman: So the two do… Mr. Sigman: We are using the same assumption of $2 a foot. Chair Filseth: I’ll let you finish, then I’ll ask my question. Council Member Holman: Well, the only other question I had about the presentation on Page 11 is, I don’t know how many hotels we have in Palo Alto, but any time I checked, room rates $240 seems low, even as an average. Mr. Sigman: Right, but there is a distinction between what is called the rack rate and the average daily rate, and the average daily rate takes into account vacancies in the hotel room, so any unfilled rooms are zeros and then the rack rate is whatever they sell the rooms at. So you look up a bunch of room rates on line, it is going to look a lot higher than this, because you are not seeing all the zeros that go into the average. Council Member Holman: It is an interesting term, rack rate. Mr. Sigman: I’m not really a hotel guy, I’m sorry, but that’s what I believe they call them. Council Member Holman: So what’s our, maybe Lalo knows this, what’s our hotel vacancy rate? Mr. Perez: Go ahead Joe. FINAL MINUTES    Page 19 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Saccio: The occupancy rate? Council Member Holman: Yeah. Mr. Saccio: Right now because of the addition of rooms, it is between 75 and 80 percent, roughly. You know that 80 percent and a little bit above it could represent full occupancy, but it has gone a little bit lower recently because of the expansion of the room base. The $240 is accurate in terms of what we are getting even right now, the $240 per day. Mr. Perez: One of the things that we discussed internally with Ben, but we knew that we had to pick a point in time and move on to finish this is that our experience has been since then, that the TOT revenue has come in at a much different pace, and so there are adjustments to these numbers based on that experience of the expansion in terms of the average daily rate, but as Joe mentioned, the occupancy has gone down a little bit, and you know, we still have another hotel coming on line that hasn’t had a full year, so this is developing. Chair Filseth: So back on this one, for purposes of allocating to households or to businesses, how did you allocate the, or did you allocate all the businesses? Mr. Sigman: That is a great question. The visitors in both the TOT and the Sales Tax model are what we call the residual, it is the leftover portion of the pie, so what we are able to estimate using the model is the household spend, the employee spend, the Stanford visitors, the B-to-B and this business spending at retail establishments. Everything else is what’s left over is this other visitors. Chair Filseth: I understand. So you said okay, because you have your model for how much households spend money by income times 30 percent and that is how much these people who live here spend. And then you’ve got your employees spend that you went through your process, and they said, “Okay, anybody that is left over must be a visitor,” right, but some of those visitors, if somebody comes to visit Karen from out of town and goes shopping at the shopping center, right, they would be part of the visitors, because they wouldn’t be part of the household, right, because that only included Karen. So some portion of these must be households, some portion must be (crosstalk) you know I have my East Coast sales team come in for the week or something, and they eat in restaurants while they are here, so that would FINAL MINUTES    Page 20 of 64 Finance Committee Draft Action Minutes March 15, 2016   be a business expense and that is not in visitors, right? Some of it is people that want to shop at the shopping center and drive here from San Jose because it is closer than (inaudible) than it is from the City, right? I’m asking how they allocated visitors between businesses and households. Council Member Wolbach: Like you did for TOT. Chair Filseth: TOT you broke it out very explicitly. Council Member Wolbach: So you didn’t do a breakdown? Mr. Sigman: This is a good point. We don’t, it is not assigned either. Chair Filseth: It is not assigned to either. Mr. Sigman: It is outside the model. So we do count (crosstalk). Chair Filseth: Why to the 229 or the, it’s not even in here at all. Mr. Sigman: That’s right. Chair Filseth: Okay. Mr. Sigman: But I think it is an astute point, because we certainly could start to take our assumptions about visitors that we do apply to the TOT and break up this orange piece of the pie. Chair Filseth: I actually took a whack at it and allocated it by the same portions as you did the TOT. Council Member Holman: You are doing very well, by the way. Our astute Chair hasn’t thrown you yet. Mr. Sigman: Wait, we are still at the beginning, right? Chair Filseth: I just want to say, for the record, okay, we haven’t heard from Greg yet. Sorry, please proceed. FINAL MINUTES    Page 21 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: Okay, moving on from TOT, let’s move to costs. So those are the big, we have gone through all the big revenue items. We did take a close look at the Utility User’s Tax as well. We went and actually obtained the data from your department, splitting out Utility User Tax generated by businesses versus households, so that is pretty good data from you, and in that instance we do just assume the average, so the average Utility User’s Tax that comes from households and businesses on a per-head basis is what we use. That is the other category, not getting into detail on this presentation. Okay, on the cost side, Public Safety is far and away the big item and this is true of most cities we work in. We have seen most of these numbers before I am going to go into detail, but here they are arrayed for you. We started off, I should say, everything is based in our 2015 Budget. We sort of locked in that and I think, while there are more recent budget data available, I think we sort of took our snapshot and stuck with it. It dovetails nicely with the horizon for the Comp Plan analysis and I don’t think, you all tell me if you see issues, but we felt like it was fairly representative of Palo Alto today. Here it is important that we tried to focus on the big ticket items, so Police, Fire, Community Services, there were others, Library, Public Works. We did detailed interview work with a number of the other sort of lesser cost departments, we didn’t spend as much time on. We didn’t do multiple interview process and data collection exercises with, so this was sort of helping us sort through the wheat from the chaff. Like I said, we did look at the trends over time. Council Member Holman: Before you go to that, a question about Public Works. In your interviews with Public Works, so at what point, you know, we have sewer lines, we have water lines, we have some improvements are being made that at what point do we, what did you include in here? Just delivery of services or infrastructure costs, or what’s included in Public Works? Mr. Sigman: Yes, so this goes back to my comment at the beginning that there is no infrastructure investment that… Council Member Holman: I missed that, sorry. Mr. Sigman: Okay, that is included. This is really an operational view where, and you know we really probed the departments, are you going to need new facilities to carry out your mission with 10 to 15 percent growth. And what we heard from Public Works was, “We are not going to build any new roads, so no. What we are going to experience is a greater degree of depreciation FINAL MINUTES    Page 22 of 64 Finance Committee Draft Action Minutes March 15, 2016   on the existing roadways,” and so we worked through with them essentially an increased cost of road maintenance that accounts for higher vehicular traffic on the City’s roadways. And that was the extent of the Public Works costs. Council Member Holman: The roads are kind of the least of my concerns. Mr. Sigman: Yeah. I understand and I think that (crosstalk) Chair Filseth: I thought that was a major component of what you looked at in Public Works. (crosstalk) Council Member Schmid: Why didn’t you use (inaudible) tax allocate since business uses much more utilities, the commuters use much more of the roads, wouldn’t it be natural to allocate the Public Works on the same basis as the (inaudible). Mr. Sigman: So we actually used the Comprehensive Plan’s traffic consultant to give us worker trip versus household trip generation factors, and that was the weighting we used, so it reflects the traffic engineer who is supplying the analysis to the Comprehensive Plan, that firm’s professional judgement and their assumption for your Comprehensive Plan and the EIR, the roadway usage by use category. So I understand your point, but that is what we went with. Mr. Perez: Let me see if I can add a little bit. Just so we are on the same page, because as you know, other work as you mentioned, storm drains, refuse, airport, water treatment, so none of that stuff was included. It was mostly the administration and the engineering factors, and even with some of the engineering, some of it is in the capital side as well of the General Fund, so it is a smaller piece of the Public Works. Because, like I said, we had the same question for him, like, why is that number so low. Because it is really, we have pulled most of the other items out. They were on the Enterprise Fund side. Council Member Holman: Some of those were Enterprise, a lot of them weren’t. FINAL MINUTES    Page 23 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Perez: We did it based on the fund expense and revenues. Whatever belonged on those funds, they stayed in those funds, so they focused on the General Fund side and that’s how we looked at it. Chair Filseth: So for example, the digester, a big ticket item. That’s going to fall on the Enterprise Funds, so it doesn’t appear here? Mr. Perez: A portion of the administration would because we allocate the administrative costs of the plan, so the administrative functions of it does, so the Director and his support. Chair Filseth: And that shows up in City Administration. Mr. Perez: Correct, and the Public Works. Chair Filseth: Okay, because I would guess. Mr. Sigman: It would show up under Public Works then, not under that administration plan, I don’t think. Mr. Perez: I’m sorry, administration of Public Works, not administration over… (crosstalk) Mr. Saccio: Can I ask a question? What proportion are the trips that are generated for residential versus commercial, I mean versus business. Mr. Sigman: It’s in the report (crosstalk). Let’s double check because I can’t remember well enough to be on the mike. Chair Filseth: It’s 60/40 or something like that. (inaudible) Mr. Sigman: Thank you. So household trips 44 percent, worker trips 56 percent of total trips generated. Council Member Wolbach: What page was that? Mr. Sigman: We are on Page 43. FINAL MINUTES    Page 24 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: It’s almost half and half actually. Mr. Sigman: It’s in the last paragraph, under cost attribution. (inaudible) Mr. Sigman: Alright, keep going? So we did look at these trends over time and what you are looking at here is the same General Fund expense trend, one adjusted for inflation, one not. The flatter one has been adjusted for inflation in this chart. When you look at real, so adjusting for inflation, we have seen over the past 14 years or so, about 1.5 percent real increase in your expense budget. This kind of goes to your point about rates. I think a lot of that is attributable, again, correct me if I am wrong, this isn’t something we got into great detail on, but health care costs, pension costs, those kinds of things moving up in excess of inflation, but as you can see, we have this sort of steep line 2000 to 2003. It is pretty flat after that in real terms, and that, I think, is what is noted. So now here, how do we think about costs at the margin? How do we talk to the departments about it? It is pretty tricky. Do you want to… Okay, so in a mature city like this, as I said, most of these departments aren’t going to scale up dramatically to meet additional service demands from 15 percent more population and employees. Some departments maybe a little bit. We put Plan A and Community Environment in, for instance, they take care of your Transportation Demand Management (TDM) Planning, right, so we are expecting with increased population, Transportation Demand Management, transportation solutions, they are going to be working hard to accommodate this growth, so they may scale up a modest amount. Public Safety really does have to increase its activities in lock step with people. You know, more people, more problems, and so and that is what we heard from them. Then I just wanted to reiterate here, you know, there are factors, regional growth, density around you, might increase costs, we are not including that here. Technology may make things cheaper for you in the future. You may find cost savings along the way. We are not factoring in that kind of potential benefit. We took great care to focus on the net costs of providing services. You have a number of departments that do generate revenue, Community Services, the Recreation Programs for instance, revenue there, those kinds of things. We looked at cost recovery factors and then looked at net of that cost recovery, the real cost to the taxpayer in the General Fund of providing services, and that’s what we focused on in doing our cost estimating, so we are assuming that your cost recovery, the revenues that you take in as a share of the costs of running this department stays constant going forward. I mentioned doing this sort of detailed, deep dive with various departments. FINAL MINUTES    Page 25 of 64 Finance Committee Draft Action Minutes March 15, 2016   Here is the list. We spent a lot of time with Police, Fire, Community Services in particular, your Library Staff and your Public Works Staff, as I mentioned, involved two to three interviews, in some cases Community Services, more, and some unique analyses. So I think this is the right place to talk about, yes, so we worked with each of these departments to determine basically their service populations. You know, to what degree are they serving residents versus employees. In some cases, Community Services, we had some survey work. When you guys did your Parks Fee Nexus Study, you went out and interviewed park users and figured out were they residents or were they workers or were they from elsewhere with no relation to the City. So we used those data where we could. Police did a custom calls-for-service or incident reporting analysis for us and did their attribution of the expense of Police services to commercial districts and to businesses versus residential areas, and a very similar analysis from Fire. For Library we used your circulations data, so we actually know, based on the library cards, people taking out books, if they are residents or they are from elsewhere. In Public Works I sort of had the discussion already with the data from the Transportation consultant. I wanted to give you an example here so you can sort of follow along, how we allocate out the costs. So in the Police calls-for- services analysis, they arrive at attributing about 70 percent of their service burden to commercial and 30 percent of their service burden to residential. I can get into that a little bit more, but just moving on from that, we have their 2015 Budget. We net out the cost recovery and we get this sort of what we call variable effect on the General Fund. We divide that by the service population, you know, the 30 percent of the net effect divided out by the population gets us $112 a head to serve a resident in town. Then employment, 70 percent of the cost divided by 95,000 employees gets us about $180 a head to provide Police services to an employee in town. That is a snapshot of the math. We go through this exercise with each and every department. I should also mention that for the departments we didn’t interview, we used an assumption that is very typical of this type of work, where we assume that basically a worker creates 50 percent of the burden of a resident. It is kind of based loosely on the hours spent in town, the full basis for cost allocation in the ADE where they didn’t do the detailed department interviews, so I think we have sort of gotten a richer answer for you on that point, but for some of the smaller ticket items we did use this kind of stock assumption. Council Member Wolbach: And I just wanted to question here, on where you list employment uses, that would probably include things like restaurants, bars, etc. So if people are coming to visit, say had a few too many, there is an altercation or tussle and the police are called in, that would probably fall FINAL MINUTES    Page 26 of 64 Finance Committee Draft Action Minutes March 15, 2016   under employment uses, even though it is not necessarily employees misbehaving, it could be, it’s really business. Chair Filseth: (crosstalk) the detail on this. Mr. Sigman: That’s exactly right. So in our conversations with representatives from the Police Department, that is the way they view it. The commercial areas in the City are essentially an attractor for criminal activity, and it’s the mix… Chair Filseth: I thought it was just City Hall here. (laughter) Mr. Sigman: So yes. It’s not as if their calls for service analysis went through and said, “We picked up that guy, he was a resident, we picked up that guy, he works here.” It is very much looking at areas in town that generate calls for services by type of crime and allocating the types of crime out so they basically said, “These are commercial zone crimes, these are residential zone crimes.” Council Member Wolbach: So this is really commercial, not necessarily the employees. Chair Filseth: Is it really that concentrated in the downtown core? Is it really that disproportionate? Mr. Sigman: Yes, that is the way it was described to me and I think we had an actually pretty robust discussion in one of our meetings about could this assumption be extrapolated to other areas of town. So, for instance, the research park or the shopping center, and I think in both cases… Council Member Wolbach: Or California Avenue. Mr. Sigman: Mm-hmm, exactly. That one is, I think, a little easier to connect but, you know, the stand-alone shopping center or the Research Park right now don’t necessarily have that same conglomeration of mixed of uses… Chair Filseth: Well (inaudible) private security right? Mr. Sigman: Yes, you would know better, but I think down the road where these places may evolve into mixed-use centers, they could have, the idea is FINAL MINUTES    Page 27 of 64 Finance Committee Draft Action Minutes March 15, 2016   that in our projection as we look forward with growth they could be vibrant in the same way that Downtown is, so making that extrapolation seemed pretty reasonable. Council Member Wolbach: Thanks for spending some time on that. Mr. Sigman: Sure. And then… Council Member Holman: I just want to make sure I’m clear on something. So you’ve got Police here that, I think it is Fire that actually has the much higher demand then Police, and so the table here shows employment uses, and this is Police, and it is broken out as 70 percent in marginal per capita expense, so there is a difference between per capita expense, there is a per capita expense, but there is also the proportional aspect during the day certainly, demand. So did you do that for Fire as well as Police? I mean you have Public Safety on next and you did Public Safety. Mr. Sigman: Yeah, so let me be clear, because I can understand your confusion. So this slide is illustrative of the calculations we used for every department, or representative. So there is a table, and I apologize for the font size, but it is the last table in the whole study on A17. It shows essentially this map for every department and it shows it specifically for Fire broken out in detail, so in their case the analysis showed 64 percent of their cost burden going to residential uses and 36 going to employment, so essentially the revers almost of this, largely because they are converting or they are evolving into Emergency Medical Services Department more than fire. Their story was, “We don’t really put out fires any more, there really aren’t fires any more, or big fires, one a year maybe.” So they are spending all their time, or the majority of their time providing emergency medical services, which is, based on their analysis, much more due to households than places of work, and so we end up with, so yes, we can see this cost allocation, the percent variable we assigned to it and the same per capita expense, specifically for Fire in this Appendix Table A21, and then here in the presentation, yes, I have rolled Fire and Police into one for summary. Council Member Holman: I guess I am misremembering that, because I was thinking that, yes, we are using a lot more paramedics and I was thinking especially in the Downtown and the work-day demand was so much greater than the evening or even weekend. I was thinking it was much more out of kilter than that in the other direction. FINAL MINUTES    Page 28 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Schmid: Yeah, if I could bring up some data by the Utilization Study, City of Palo Alto, they did a map of the community with intensity of responses and this shows exactly what Karen was saying. The downtown is by far the place of the greatest number of responses for Emergency Medical Services (EMS) and the ones that come in after that are the Stanford Shopping Center, Cal Lab and El Camino commercial. Mr. Sigman: It sound like a similar story to the Police. Council Member Schmid: That sounds like it should be the same as the Police. Mr. Sigman: Right. Council Member Schmid: Now fire incident is a little more spread out, but still clearly the downtown is the center of activity. So I don’t see why they are any different than Police. Mr. Sigman: So in both cases these are responses from these departments and… Council Member Schmid: Again, if you look at time of day most of them were midday. They are not spread out over 24 hours so that would mean it’s the daytime population that brings the demands. Council Member Wolbach: Midday is the demand? Mr. Sigman: Yeah, we can go back to the departments. Mr. Perez: The only thing I can think of is, I think when that was done, I think I am looking at the Report, it is the International City/County Management Association (ICMA) Report 2009… Council Member Schmid: 2011. Mr. Perez: 2011, there was a recategorization of the calls and how they were being captured was one of the recommendations I recall, so I think we can have Ben discuss it with the Chief and specific to that to see that they update the way they are classifying. FINAL MINUTES    Page 29 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Schmid: That is the only hard data we have. It says quite the opposite here. Chair Filseth: Thinking off the cuff here, so maybe this is completely wrong, okay, but if you took that chart and overlaid it with a chart of where the population is in the City, because the analysis here on Fire EMS, particularly EMS, says basically it is primarily residential to mean household, right, and therefore, it ought to follow where the households are. So if you found that there was a big proportion difference in the ratio of calls to households downtown is different from the ratio of calls… Council Member Schmid: These are incidents that occurred per square mile per person. Chair Filseth: Incidents per person, so that is built in, the population density is built in, so yeah, so if it were primarily residential you would expect a… Council Member Schmid: (inaudible) a string of old peoples’ homes from San Antonio, (inaudible), California Avenue, saying lots of old people here so it is not just the distribution of old people. Chair Filseth: So yeah, if it is normalized to population… Council Member Holman: I’m getting sensitive to the term old people. (crosstalk) Chair Filseth: If it is normalized to population right, then you would expect it to be flat if it is mostly residential, so to the extent that hot spots (inaudible). Is there a correct train of thought? Ms. Gitelman: The greater density is definitely North Palo Alto. Chair Filseth: He says it is normalized to density though. Ms. Gitelman: I’m not sure. Council Member Schmid: No, it is normalized by square mile. FINAL MINUTES    Page 30 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: Okay, so it would follow density, it would have to follow density. Ms. Gitelman: Greater residential that is North Palo Alto, near Downtown. Chair Filseth: So you would have to normalize for that. Council Member Wolbach: It is per square mile, not per, not normalized for density or structure or population. Mr. Sigman: So I summarized the costs here on just a per-head bases per resident, per worker, and that is the end of the presentation. I am happy to continue this discussion. Chair Filseth: On the previous slide, maybe I was looking at one of the attendant slides. Mr. Sigman: You know, I have, maybe this was confusing you a little bit, but I have rolled these up in a way that is really just for this presentation. The City Administration category you are looking at here encompasses a lot of things that are broken down. Chair Filseth: Did you make any assumptions about the growth in City expenses per worker. Did you assume they would follow inflation? Mr. Sigman: Everything in the study is done in today’s dollars, 2015 dollars, so it is really inflation neutral, so we are not making any, the only exception to that is we took care to look at housing escalation, because we have seen historically in California that outpace inflation. Really we are assuming that, with the exception of that, housing pricing, everything perfectly keeps pace with inflation. Chair Filseth: So you said that City wages and benefits kept pace with inflation? Mr. Sigman: Yes. Chair Filseth: And you did per capita costs. FINAL MINUTES    Page 31 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Wolbach: Right, so you didn’t include the per capita costs, but as you mentioned earlier, you did account for greater strain on the City resources and infrastructure that exists. For instance, the greater expenditures on maintenance of roads, because of the assumption of greater car travel. Mr. Sigman: That’s right. And even the Fire Department, because we are anticipating they are going to need to scale up a good bit. They indicated to us they may need to make some modest capital improvements, but it would be within the scope of their General Fund spending. So what we are not capturing are, I have sort of categorized it as two distinct items. There is mitigation, I think, for any quality-of-life issues you are suffering now. So whether it is really significant investments in transportation that haven’t occurred to date really aren’t captured in the budget we studied. Those aren’t in here. (crosstalk). Council Member Wolbach: (Crosstalk) last night. Mr. Sigman: I didn’t watch the tape yet, but I knew that was on your agenda. Chair Filseth: They are all externalities. Mr. Sigman: Then the other is the investments that are envisioned as part of the scenarios in the Comprehensive Plan. There are some pretty significant infrastructure investments in there and we believe those would be paid for in other ways, through impact fees, through other sources of funds. It is a next step for Fiscal Study. Council Member Wolbach: And that is actually really useful for us. I appreciate you just being really clear about what this Study does and doesn’t try to do. There are certain variables you said we are going to look at these variables and focus on that and, I think, it is actually very helpful to not break it down across five or six different axes. Mr. Sigman: We’ll take a reasonable first bite. Council Member Wolbach: I think that is very useful so… FINAL MINUTES    Page 32 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: So the way I like to think about it is, to just sort of try to add a little bit on is if these people were here today, if your 2030 projection were here today and you were running the City the way you are now, this is how it would affect your General Fund. Chair Filseth: Great. Council Member Schmid: Yeah, if I could ask a couple of basic questions. The fiscal impact is very important for us. It grapples with the question of who pays, who benefits and it is a key element in our dealing with the Comp Plan and your report says that the new residents, new workers add more in revenue than they cost and that the impact is modest, so it is all right. I guess that is counter to what I would have thought. Now let me go back to our Comprehensive Annual Financial Plan and you are only looking at the margin. If you take the last five years of this plan on Property Tax, it says that the change in Property Tax, to go a step backwards, changed in assessed valuation at the County of residents has gone up by $5 billion. For businesses it has gone up $460 million. A ratio of 11:1. Now that is a marginal change, a change over time and there are reasons for that, as you say is built into the system, but it also is measuring what we can anticipate the last five years, the next five years, and that ratio of 11:1 is taking place during a time period where the construction for nonresidential growth has added three jobs for every employed resident. So there is a ratio of 3:1 of commercial growth and yet the change in payment has been 11 times on the other side. Now if I was looking at a Comp Plan and asking fiscal impact, I guess I would start from that question, “What is going on, what has gone on, what will be going on, and can we influence that number,” and it seems out of balance on any cost analysis that the residents are paying. As a matter of fact, if you look at Property Tax as the basis, not just the most important tax for the City, but it is also for the County, the School District, the special districts, it is local government. So it is very upsetting and the question is, “How do the choices we make on jobs and housing and land use affect that ratio?” Can we influence the future or are we stuck. So I go to your numbers that you are looking at in here and it seems as though you are using as the basis for your evaluation, real estate values. You are not using the assessed value in the Count Assessor’s Office, you are using real estate values. But the reason the County doesn’t get any upgrades on the business is there are no sales, or the number of sales of business property is so small that it doesn’t show up in these numbers. The implication is in the next five years that ratio of sales between residential property and commercial property will be as it has been. Now you make an assumption that the sales rate of commercial property will be half that of residential FINAL MINUTES    Page 33 of 64 Finance Committee Draft Action Minutes March 15, 2016   properties and I guess I don’t believe that. You say it is the turnover ratio, you had a slide, you showed a turnover ratio. Mr. Sigman: I’ve got it up on the screen, sir. Slide Nine. Council Member Schmid: Yeah, I think the ratio is probably 1:20. That only a dumb landowner developer would move out of Prop 13. Chair Filseth: Do you understand what he is talking about? Mr. Sigman: I believe I follow. Chair Filseth: There is a loophole that allows you to transfer ownership of commercial buildings without actually selling them and, therefore, it never gets reassessed. Did you guys consider that? Mr. Sigman: So it’s illegal to transfer the majority share of the property without triggering a reassessment. You can have minority shares switching in and out. Council Member Schmid: It’s 90 percent. Chair Filseth: That’s how it works in this town. Mr. Sigman: So I’ll take a moment to comment. I understand where you are coming from. I think we have heard you speak on this subject previously, so we went, we felt, to great lengths to establish what the baseline condition is. Say we turned off the tap, no more building. You are going to continue to see the residential assessed value outpace commercial. So we agreed with that and can you influence it? I think what we are showing is that at the margin, as you say you have had this period of sort of relatively robust real estate development in town and, at least this particular year we are looking at, it is a small fraction of the total change in assessed value, so redevelopment has a minimal influence I would say. Council Member Schmid: I guess that is one of the things that we are looking at in these alternative scenarios is, let’s look at a scenario in which there is, say more housing built than residential. The problem is, these scenarios you have looked at because we gave them to you, each continues the 3:1 ratio of commercial to employed resident, so we don’t even get a FINAL MINUTES    Page 34 of 64 Finance Committee Draft Action Minutes March 15, 2016   chance to see, is it a 1 percent change or a 10 percent change if we vary that ratio. That why it is essential that one of the things we look at is a balance in jobs it has, just to see if as you say it would be insignificant or, gee, it does make a change over the decades. Because what we are dealing with now where the residents are carrying a $5 billion charge every five years, and you are right, it’s not all the residents, just the new ones, and the businesses that are growing much faster and earning much more money are not contributing to local government finances. Mr. Sigman: I understand your point. I think one thing that I could offer is that on the turnover rate, so we are assuming on these commercial assets, 25 year holding period, which is three times the national average or something like that. It is a long hold for any commercial investor. I understand we have some extenuating circumstances here, so we can do some sensitivity analysis around these hold periods. Council Member Schmid: It is not unusual in California, or especially the Bay Area where property values are rising so high (inaudible) Mr. Sigman: So I think we can certainly explore the impact that very much even lower than this turnover would have on these fiscal outputs. Council Member Schmid: And again, the other one to look at is what happens if you have a better jobs/housing balance. If you move toward better… Ms. Gitelman: Can I ask a question on that? Part of what we want to do is understand what additional analysis is needed, so you are going to help us at the Council in May define this quality-of-life scenario that will further depress jobs below what we have in Scenario Two, and potentially have the same housing numbers or more housing numbers, we don’t know that yet. That, in our last discussion was I think the extent to which the Council wanted us to address the jobs/housing imbalance. The Council was not willing to go and test really aspiration goal, 2.4 or something like that. I am just wondering whether the Committee, on the fiscal side, wants us to do a sensitivity analysis that the Council was not willing to do on the land use side, or whether you would be satisfied just doing this Fifth Scenario once it is defined. Chair Filseth: I just want to make sure I understand the explanation Ben just gave, which is, there are two issues you are talking about. One is the FINAL MINUTES    Page 35 of 64 Finance Committee Draft Action Minutes March 15, 2016   jobs/housing ratio, the other is this business of how fast does the commercial property turn over. If I understand what you said, you said, “Aha, we include the fact that stuff doesn’t turn over very often, assuming a very long… Mr. Sigman: Right, so the… Chair Filseth: A very long holding period. Is that what you said? Mr. Sigman: Right. Everything that is commercial, 25 to 50 years, including the rental residential. The condominiums or for-sale residential turns over twice as much in this model. Chair Filseth: So I might be interested in what happens if you assume a lower turnover. Council Member Schmid: I think there are two things, the lower turnover… Mr. Sigman: Does it make a big impact or little impact, that’s what you want, right? (crosstalk) Mr. Sigman: Let’s talk about it, but I’m not sure what we can do to study the baseline condition. I think we establish that is the case, we acknowledge that we have this sort of disproportionate contribution to Property Tax now, but we are looking forward. A lot of this is really… Chair Filseth: Your question is really, does it move the needle or not right, basically? Council Member Schmid: Yes, and we are doing the Comprehensive General Plan that looks out 15 years, so we have to ask the question, if we started doing something that had an impact over that time. Chair Filseth: Notwithstanding, but none of this moves the needle very much. FINAL MINUTES    Page 36 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Schmid: And it is not just looking at, “Gee, there is an imbalance,” but there is a striking imbalance over all local governments. It is not just us. The School District gets three times as much as we do out of Property Tax, so it is our future of local government and it is an important issue. I think one of the reasons Council didn’t get to that issue is because we didn’t have the fiscal impact. We didn’t see the numbers and say, “Wow, that’s a big number.” Chair Filseth: So it shows up in Property Tax and Document Transfer Tax. Is that what goes for that? Mr. Sigman: Yes. Council Member Schmid: Well the Document and Transfer Tax actually (inaudible) but it is a 3:1 ratio, residents paying over, because that is a better reflection of a number than what you come up with on the property taxes. Council Member Wolbach: I just wanted to ask, so a lot of this is caused, frankly, by perversions to our real estate market caused by Prop 13, right? And that is why no matter what scenario we pick, that’s not, like I said before, you tried to study certain variables. You tried to limit the number of variables in a reasonable way, because if you have too many variables then it is apples and oranges and your study could take 100 Staff people and 100 years to put together and one of those variables is, “What if there is Prop 13 reform,” which would, maybe, be useful, but that is way beyond any of the options (crosstalk). Chair Filseth: No wait, when Mark gets to Sacramento, he is going to fix it. Council Member Wolbach: I’m sure he will talk to his 119 colleagues and try to do that. Council Member Schmid: Last night we had a discussion at the Council of the Business Tax, should we do that in November? We need to make a decision in the next month or the next six weeks. So what we are talking about is not, “Oh, we can’t do anything about that.” We do have options and they are on the table. FINAL MINUTES    Page 37 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Wolbach: This also goes back to what Ben was saying before, that beyond business – basically what we are looking at here is business as usual with population of daytime and nighttime population changes of four different options. But as you said before, the way we conduct business, according to this study, is consistent with what we do today. So all of those questions, all of those options about what happens in Sacramento, or what happens if the economy completely tanks or if it turns out everybody is driving self-driving cars win 15 years, which I think is very overly optimistic, and what if we end up passing some kind of significant taxes locally or have some other major windfalls by diverging from status quo practices in order to fund major transportation issues or whatever. That is all important stuff we can consider, but this actually provides, I think, a useful baseline to overlay those discussions on top of. That’s how I look at this. If I am wrong, somebody let me know. Chair Filseth: I thought this was vastly valuable, especially the existing stuff. I mean, the marginal stuff is very interesting, but it doesn’t add up to very much in the grand scheme of things, but the assessment of structural stuff I thought was tremendously valuable. Sorry, go ahead. I’m agreeing with you. Council Member Wolbach: Great, again, I guess I was looking for either agreement or if I was missing details. Chair Filseth: Greg still has the floor too. Council Member Wolbach: I thought it was conversational, but of course. Council Member Schmid: One other point, on the Sales Tax, you have a chart I believe you put up which shows a circle. Mr. Sigman: It’s in the document, not the charts, sorry. We are on 25. Council Member Schmid: Now you cite here the Stanford Study. The Stanford Study is very nice. You don’t need decorated, top drawer economists working on it, but it is Stanford. Stanford is saying, “We spend money in all kinds of different places.” Now we have this ADE Study, you mentioned it so you are familiar with it. It has quite different numbers on that circle. You have households at 11 percent, they have households at 53 percent. You have local employees at 25, they have them at 17. Both have the business-to-business at 15. You have other visitors 47, they have other and Stanford at 15. Now they claim that this is a purely Palo Alto study. FINAL MINUTES    Page 38 of 64 Finance Committee Draft Action Minutes March 15, 2016   They went into the files of each of the local merchants and said, “Okay, what is your revenue, where are your customers coming from?” They look at the employment center around town to do the calculations. So they have some credibility as a local study. I know you ultimately cite, they also cite, this study from the national organization… Mr. Sigman: International Council of Shopping Centers. Council Member Schmid: Yeah, but this study is based on a national data base of suburban shopping centers around the Country, 4,000 entries. Mr. Sigman: Urban and suburban, yeah. Council Member Schmid: Yeah, but there are 4,000 altogether so maybe 1500 suburban, maybe 150 suburban California, so it doesn’t sound, and the questions they asked the workers, “Are you within four minutes of a shopping center, of a department store, of a grocery store?” So the data that they have attracted is not necessarily relevant to the Palo Alto, where we have three commuters to every employee resident, we have tens of thousands of people every day moving in and out of town. We have the Stanford Industrial Park as the biggest unit. There are no stores there. I don’t think there is anyone who by 5 or 5:30 is going to hop in their care and drive half an hour to get to University Avenue to shop. I don’t think in the Stanford Health Center, where they are touting the number of people on Caltrain, who are going grocery shopping in Palo Alto carrying their groceries onto the train. So the numbers you have of 80 percent spending of that $9,000 by commuters doesn’t make sense in Palo Alto. I find it hard to imagine someone facing a 45-minute commute saying, “I want to go shopping.” Council Member Wolbach: Can I, for anecdote in thinking about that, I used to work in San Mateo while living in Palo Alto just until about, oh, less than a year ago. I did that for a couple of years and that was counter commute, and in order to avoid a commute, even that, I agree, you don’t want to sit in all traffic, but while I was in San Mateo I would often stick around, have dinner there, maybe do some shopping there, and wait until the end of rush hour, so I would actually end up being longer… (crosstalk) Council Member Holman: But you were Downtown San Mateo. FINAL MINUTES    Page 39 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Wolbach: Not really. I could get there but in the same way, Research Park, for instance, we heard last night that there are shuttles that run from Research Park to our Downtown where people get on the Caltrain. Council Member Schmid: She said it took 25 minutes to get to Caltrain’s station. Council Member Wolbach: That’s right. I’m not saying that every Stanford Research Park employee is doing that, but I would not dismiss the possibility that Palo Alto… Council Member Schmid: Palo Alto is a little different. We’re unique. We’ve got this 3:1 ratio. The only big cities in the Country that have that are Manhattan and Washington, D.C., and so we are a little different from California suburbs. It is hard to take the data you get from the suburban business park and apply it to Palo Alto. So… Mr. Sigman: I understand the point and I appreciate the anecdote. We are using the same data that ADE used on this point, and actually ours is from a more recent survey than theirs. It is just a more current year of a very similar (inaudible). I take your point. It is not Palo Alto data and I would certainly welcome the opportunity to bring better data to bear on this. So if that is an issue and an intercept survey is appropriate, and we want to get some Palo Alto data to make this stronger, because we are not convinced we are getting the right answer here, that is totally within our power. We are using the same household spend, the same worker data (crosstalk), so I take your point about Stanford. It is their study. We are basically relying on it to understand the number of visitors they report drawing to the community. The spending profile looked pretty reasonable to us, given what we know. On that point we might have differences on how that other piece that isn’t even attributable to residents and workers in Palo Alto, we might have differences there, but (crosstalk) I don’t think it is that different and I would, again, welcome better data if it is available. Council Member Schmid: The reason I bring it up is because we are thinking of the impact of residents against workers, and in your data it shows local employees are spending twice as much as households, 80 percent of their discretionary money in Palo Alto. Mr. Sigman: The way the survey asked the question was, “How much do you spend in proximity to our place of work.” It is not their full retail budget. FINAL MINUTES    Page 40 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Schmid: And the earlier ADE data has a 3:1 share of households over workers, so those are opposite directions. Mr. Sigman: I’m sorry, could you repeat the last point. I apologize. Council Member Schmid: The chart you have shows workers spending twice as much as households. The data in the ADE states households are spending three times what the workers are. Mr. Sigman: I can certainly spend more time trying to dissect what they have done, and I wasn’t aware that they may have interviewed local businesses. I think our impression, our professional opinion, is that these survey data are the best data available. You get into trouble with anecdotes, you get in trouble by samples of businesses, so we used the published data because these are the best available. Ms. Gitelman: Can I ask a question. I wonder whether the capture rate is where the difference between the two studies are. The gossip internal on the ADE Study was the capture rates were overestimating the percentage of the sales tax that was staying in Palo Alto. Maybe we could look at that. Chair Filseth: Can I weigh in on this for just a second. I had some of the same questions, so I took a whack at it because this meeting got delayed a couple of weeks so nothing better to do, right. I tried to do a household versus businesses versus Stanford breakdown of all this stuff, and the only really material variance is sort of your approach for trying to calculate the distribution allocation of Sales Tax versus your approach to try to calculate allocation of Sales Tax. I did it both ways and, I actually did it three different ways, and it looked to me like overall it actually didn’t make that much difference whether you did it your way or Greg’s way. And the third way, by the way, was where I went and took that orange piece and tried to allocate it between. So my numbers for all of this were, in all three cases, Stanford comes in at 6 to 8 percent of revenues and for the others, depending on whether you use your method, Greg’s or one with this allocated in between, it was pretty much an even split between businesses and households. Your method, a little more businesses, your method a little more households, with this allocated kind of in the middle. So either way you look at it, at least what it looked to me like, was that pretty much, I mean, after Stanford’s 6 to 8 percent, probably about half and half. I liked that the ADE Study actually did sort of bottom’s up locally, so if I had to weigh them, I would probably weigh that one a little more than your approach, but they both FINAL MINUTES    Page 41 of 64 Finance Committee Draft Action Minutes March 15, 2016   seemed like viable approaches. This stuff is inexact. The way to do it is do it three different ways and see if they are all clustered together. So that was my conclusion from this. It didn’t actually make that big a difference. Again, the dominant ones are property tax, some of the other kinds of things. Utility User’s Tax (UUT), TOT were pretty big. Council Member Holman: Can I go in a different direction? I don’t want to interrupt that line of thinking, so can I go in a different direction? So the Comprehensive Plan Scenarios assume no different land use designations and if we are learning from this that it actually costs more to have an employee than it does a resident, can we find out without a horrible amount of effort, what some changes would indicate, since this is fiscal analysis, just fiscally. So let’s just say, for instance, we changed our mixed-use designations from 0.4 residential to 0.6 commercial, and at least flip those, because, again if it is a better financial picture to have a resident than an employee, so let’s flip those. Do you know what I am saying? It’s not a different land-use designation, but it is a zoning change. Ms. Gitelman: I do know what you mean, and we will talk about some of these ideas on Monday, when we talk about housing sites and programs, how you might modify our mixed-use categories to encourage more housing and less employment. I just want to get back to your base assumption that it costs more to have employees than residents (crosstalk). Council Member Holman: Well, the revenue is greater from a resident. That’s what it says in here, right? Mr. Schmid: Yeah. Ms. Gitelman: My takeaway from these results, these are such small numbers, my takeaway is like, thank goodness, we are looking at over the next 15 years not really having a negative drain on the General Fund (crosstalk). We may have mitigation costs up the wazoo. We may have infrastructure costs up the wazoo, but when you look at the big picture, we are not going to have a significant negative drain for many of these scenarios. Council Member Holman: I don’t disagree. At the same time, we talked about earlier how our density in commercial buildings varies over time. This analysis is based on a four per thousand, correct? FINAL MINUTES    Page 42 of 64 Finance Committee Draft Action Minutes March 15, 2016   Ms. Gitelman: This analysis is looking at those four scenarios that vary in terms of employment densities, so those four scenarios are testing a range of options, because, as you pointed out, we don’t control the amount of employees you can stuff in a building, so we looked at a range to be able to test what the results would be. Council Member Holman: Okay, so the housing we are going to talk about Monday, I saw Corey kind of light up, and there are some other things, and I don’t know how many of these will come up, but for instance, and it is a little one but it kind of has a double whammy impact, we allow such things as, and I don’t want to get in the weeds about this, but I just think there are some things we ought to look at, at least, we allow businesses to have their own on-site cafeterias if they are not really close to commercial areas, but that includes areas like the California Avenue part of the Research Park. I mean, we allow them that close, but that takes away from how much the employees spend in our retail places. I don’t know if you happen to notice any accumulation of those kinds of changes that we could or should make to better enhance. No one thing is going to make an enormous difference, but there is an accumulation factor in some of these just from a good business practice, and some, at least, financial impact. So I don’t know if you happen to notice any of those other… Ms. Gitelman: This is not that kind of fine grained analysis, and I think the Council knows inherently these are policy tradeoffs. You include an on-site cafeteria and it means that a portion of the workers are not going to spend their dollars in the neighborhood, but it also means a proportion of the workers are not going to get in their cars and drive, so you are trading income for… Council Member Holman: That’s why proximity is important. Ms. Gitelman: Which is why (crosstalk) direction we are really trying to be more discriminating about when we let businesses take advantage of that exception. Council Member Schmid: Hillary, if I could make one follow up. You said the scenarios shown would not make much difference. That implies that in each of the scenarios we are looking at, continues the 3:1 ratio of jobs to employed residents, and that sort of implies going along this path for another 15 years is okay. I think some of the data coming out of our (inaudible) is saying, “Wow, there is something fundamentally wrong going FINAL MINUTES    Page 43 of 64 Finance Committee Draft Action Minutes March 15, 2016   on to apply that to a model. If you do it for another 15 years, you might be entering more serious problems than you have now.” So, I think the Fiscal Analysis should at least open up that issue, address the issue that if you acted differently it might have a longer-term impact. Council Member Holman: That’s kind of what I was bringing up earlier about, especially when we look at per employee or per resident, it doesn’t give, if we are focusing on that, it doesn’t really give the full picture. And if you look at the various scenarios that we have in front of us now, let’s just say at scenario four, which is the highest amount of growth, four million square feet, that is 16,000 residences that we are behind, but we are only building, again, according to the scenarios, 4420, so that is almost a 4:1 ratio that we are behind, so… Ms. Gitelman: If I can jump in, I think Council Member Schmid is correct, as everyone has pointed out and as we discussed on the 22nd of February, the ratio of jobs to employed residents in all of these scenarios is pretty similar, and so the Council has said, “Hey, we want to look at another scenario that has a lower job growth, and potentially higher housing growth.” We are going to talk about that on Monday, but I think the questions for you, I think we would appreciate your input. We know we are going to update this study to analyze whatever the Fifth Scenario is going to be, and you are going to help us craft that scenario over the next 60 days or so, but do you want us to also do some kind of hypothetical sensitivity analysis that goes farther afield and towards a jobs/housing ratio that, frankly, all of us think is probably not achievable in 15 years. That is the question. Council Member Schmid: Right. I guess could we use Ben’s talents and knowledge to just give us a simple… Ms. Gitelman: Sensitivity analysis? Council Member Schmid: Yeah, sensitivity analysis. Council Member Wolbach: What do you mean by sensitivity analysis? Mr. Sigman: When we say that, we just mean that we have made some assumptions here, turnover rate is a good one, and it is not fact. That may not be the right number, so a sensitivity analysis would say, “What if it goes up or down 5 percent, what if it goes up or down 10 percent. What does that do to the fiscal outputs that the model generates?” So it puts some brackets FINAL MINUTES    Page 44 of 64 Finance Committee Draft Action Minutes March 15, 2016   on the fiscal outcomes when we start looking at what if certain assumptions we made were likely to be higher or lower. Council Member Wolbach: Okay, so we are adding another variable or two. Mr. Sigman: Same variable, just changing the assumption up or down. Council Member Wolbach: Okay. Chair Filseth: You’re looking at sensitivity study. Mr. Sigman: Yeah. And then I just want to come back to this idea of, we are on the wrong track and what does the (inaudible) tell us. We had sort of a number of discussions with Staff about could we somehow integrate this kind of relatively traditional land-use fiscal impact methodology, somehow make it into a Long-Range Financial Forecast, and I don’t think we have figured out a good way to do that. What if we did nothing or we just stayed business as usual. You have a different model here in the City that analyzes that, so that is another resource to bring to bear. I don’t think, it doesn’t isolate the land-use changes or potential rate, and it is… Council Member Schmid: The Long Range Financial Forecast doesn’t say where the Property Tax money is coming from, it just says here’s it is. Mr. Sigman: Right, so I don’t think we have, (crosstalk) without a lot of complexity, a model that kind of bridges the two. We have something, hopefully, relatively elegant here that sort of teases out some of the impacts when you change land use and land use only and you have a long-range financial forecast that says, “Are we on the right track, is this sustainable?” Council Member Schmid: Yeah, I was at a land use meeting earlier and I listened to maybe 15 people, each had two minutes, on this committee, and virtually every one of them said we have a housing issue. Just it is unaffordable for anyone except the rich and the old people who are here. That’s something we have got to address in our Comp Plan and the fiscal impact is the major cause of what’s going on. Chair Filseth: Are we drawing to getting through this, because I want to circle back to the question you asked at the beginning. Thanks for coming FINAL MINUTES    Page 45 of 64 Finance Committee Draft Action Minutes March 15, 2016   here and doing all this and letting us like jump all over you. That’s why we are doing this, because we are so interested in this. Mr. Sigman: I am impressed with the level of effort on that side of the table. Chair Filseth: So the thing that sort of struck me looking at this, and again, in the context of this the numbers are not that big in the context of this, especially between the scenarios, but I am still struck by the fact that the bottoms-up analysis says that revenues are more than twice as much as expenses for each additional employee, and yet here’s the history of the General Fund revenues and expenses. I mean, that’s almost one line there, it is the red and the green line. Sorry, never mind the green line, the red and blue, our revenues and expenses from the General Fund. Guess what, since the turn of the century our General Fund revenues and expenses are almost identical. We break even every year. And you pointed out that it is natural that as we see, “Gee, we got a few extra dollars, gee, we can do some more services,” and so forth. But the implication is that actually it is past. If you follow your number, the behavior you are talking about, then yes, each new employee and each new resident has something small in the overall context, but adds something to the finance of the City. On the other hand, if we follow the track we have done for the last 15 years, then it is going to be a zero net impact, or at least whatever impact is going to be externalities, right, something we can’t measure, which brings me to the other piece of this which is another externality, but very, very real for us. The green line is actually the Unfunded Pension Liability to the City, just pension I looked at in this case, and that has gone up dramatically. So the implication is, in fact, if you consider that, we are actually not breaking even in the General Fund. Actually we are losing money in the General Fund, but a bunch of it is being deferred. So I thought about that in your analysis of sort of revenue and expenses per person. I said, “Well, how much is that?” We don’t have good ways of calculating that, so here is a really, really handy way to calculate that. Right now the accumulated unfunded pension and (inaudible) liability for the City is about $450 million if you believe CalPERS assumptions on returns, and so forth, and it’s been 13 years because it was zero in 2002. It was all since the Gray Davis era. Okay, so that is a little over $30 million a year. If you look at General Fund expenses in that period of time frame, you know, at the beginning of the century there were about $115 million and now they are about $180 million, so on average $150 million, so $30 million a year as a percent of $150 million, on average our costs are 20 percent higher. So if you take that and apply it to your numbers of revenues versus expenses per employee and to say the expenses are 20 percent higher than yours, you still come out with a net positive contribution FINAL MINUTES    Page 46 of 64 Finance Committee Draft Action Minutes March 15, 2016   to the General Fund. But if you assume that we are going to be like that, the historical pattern, then we are losing money on every resident and new employee. So I don’t know how to account for that in a report like this, but it is quite real. So a huge impact goes back to the question of, “Why does yours say every resident and employee earns twice their keep,” but if you look at our trajectory that hasn’t been our experience and that seems to be a really fundamental question. Mr. Sigman: Because we are looking at what you do fund, not what you don’t fund. So this trend is a baseline condition and you raise a totally valid point. It is outside this study, but it is an issue you have and it is going to take some fiscal prudence to deal with it. Just as we come out with the results that expenses are less than costs, yielding this net revenue, well, it takes some fiscal discipline to realize that. You have to lock down that spending because it is, balanced budget, I think in municipal finance, is the norm. It could go the other way too. Stock market collapses, Property Taxes readjust to lower levels, Sales Tax falls dramatically. We have seen this. You cut some Full Time Equivalents (FTE’s), you have to balance the Budget. It works both ways. I think you are right to point that out, but as I said, we take a snapshot in time and hold everything constant. This pension liability is one of those things. So just like these other mitigations, quality-of-life mitigations, there is a fiscal mitigation that you have to develop to account for this, to deal with it, and we can think about that. That is something that, as we add in these other costs that are external to this analysis, if you direct us to look at those, that would be appropriate, but because this is a static model in essence it simply doesn’t capture that. It is a limitation of it. Chair Filseth: I understand. I think the pension piece, unless you guys have a way to calculate that, which we don’t, at least not an easy way, there is probably not much you can do with it. I think the issue of the discrepancy between revenues to actual costs in our actual experience is the one that I’m not really sure we understand that one. Mr. Sigman: And I think if we use this and we said you always balance your budget, there would be no point in doing this, right? Chair Filseth: Well, actually given the percentage and the scale of all these (crosstalk) Mr. Sigman: You make very good points. FINAL MINUTES    Page 47 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: What you just said occurred to me. I think it is worth doing this. Mr. Sigman: Good. Council Member Holman: So you’re not out of a job. Chair Filseth: Absolutely not. I appreciate it. Ms. Gitelman: Just because I feel like we are starting to wind down, I think one of the things that we would really like is some input on the additional analysis that you are seeking from us. You know, the blogs over the weekend were, “Don’t spend another penny on this, it’s not worth it.” You know, we do feel like this is adding something to the dialog. We want to do the sensitivity analysis you talked about with the slower turnover rate for commercial… Chair Filseth: Yes, that one I would, sorry… Ms. Gitelman: Then we have, obviously, the Fifth Scenario, the Quality-of- Life Scenario. We are going to look into the Fire cost data from the ICMA Study and try to come to some understanding about how that varied. Those are the three big ones I have, and then potential ones are looking at hypothetical aspirational jobs to housing ratio in 15 years. Council Member Schmid: I think rather than that, just what happens if we have a 1:1 for five years, what would be the impact. Council Member Holman: Five years or 15? Council Member Schmid: Well, 15, just sensitivity of a balance between jobs and… Ms. Gitelman: So the growth in jobs as 1:1 to the growth in employed residents? Council Member Holman: Yeah. Ms. Gitelman: Okay. FINAL MINUTES    Page 48 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Sigman: I think another major point was the worker spending, so if sensitivity analysis around that is appropriate? Council Member Schmid: Yeah, workers, services. Council Member Wolbach: If you haven’t already, may I recommend touching base with Stanford Research Park and the Downtown Transportation Management Association (TMA) for information about their employee travel habits. They might have information about this question raised earlier about when people leave town, do they stick around to buy dinner at a restaurant, and give us sales tax revenue from that or not. They might. I just throw it out there as a suggestion. Ms. Gitelman: I bet we will have it for Downtown, probably not for the Research Park for a couple of months. Council Member Schmid: They will have it probably after their August (crosstalk). Ms. Gitelman: Okay, so anything else that you would like us to do. We are developing a contract modification with a cost number that we will bring to Council. Council Member Wolbach: That is actually the question I was about to ask is, we are not authorizing further expenditures that come. Ms. Gitelman: No. Council Member Wolbach: Just triple checking. Ms. Gitelman: No. We are benefitting from your input to prepare a cost proposal and a contract modification that will come to the full Council. Council Member Wolbach: And do you need a Motion tonight or is this good? (crosstalk) Council Member Schmid: I guess not as far as contract, just part of Council absorbing it would be good to have the contextual data of what is the FINAL MINUTES    Page 49 of 64 Finance Committee Draft Action Minutes March 15, 2016   current changes going on out of (inaudible) residents versus nonresidents and the property values. Council Member Holman: So I guess I had one other question that is potentially something addition. We talked earlier about capital investment and the department you talked to said that, and Lalo comments said that in the capital investment, should it be required but mostly this seems like not, would be in Enterprise Funds, but I would like to know what isn’t, what might be required. I ‘m thinking park land in particular, what might not be included in park lands infrastructure, but it is not Enterprise Funds, so what isn’t captured in Enterprise Fund that could be some additional, and I am particularly thinking about park land, that’s required in the Comp Plan. Mr. Sigman: I can simply say that in our interviews with Community Services Department, they described to us their capital investment strategy for the coming years. It did not involve significant land acquisitions. It does involve a new amenity or investment at the golf course. We discussed that in pretty good detail with them and came to the conclusion that it was essentially a baseline investment they were not making due to the new population, but rather to enhance the overall suite of services and amenities they have for the community as a whole. Council Member Holman: We are currently behind on park land, so why would we be looking to add to it with the population growth? Ms. Gitelman: This is General Fund revenue and expenses. It doesn’t include the Impact Fee revenue. Council Member Holman: Yes, I understand, but if we… Ms. Gitelman: So there are Impact Fees that would be generated and could be used for park land acquisition. Council Member Holman: It’s not going to measure up to… Ms. Gitelman: I think all of us understand our park land goals are aspirational in the extreme. Over 15 years I don’t think we are going to get to the goals we have set, unless you disagree. To quantify what it would cost to get there, that number would be astronomical. FINAL MINUTES    Page 50 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Holman: But maybe not in totality, but at least in part and is there anything else besides park land that isn’t in an Enterprise Fund that we might consider? Mr. Perez: I think from the Enterprise Fund that should take care of itself within its own rate structure. I think what we are talking about is more the General Fund capital side, which is, I think, your point. Council Member Holman: Yes. Mr. Perez: So I agree with you that there is the base assumption here has us transferring somewhere in the $14 million from the regular pot, and now the new number, the total number there it is about $8 million in addition from the TOT, the Hotel Tax, so it is about $22 million that is going to go towards infrastructure. At some point we are going to finish the infrastructure massive plan over 126, it has to be updated. The assumption that we would make here with this view is that then you are going to have those funds available to do something else, so what is not included in here, for example, is the 7.7 acres of foothills… Council Member Holman: The Animal Shelter. Mr. Perez: The Animal Shelter, the… Council Member Holman: The park land. Mr. Perez: The three, I forget how many acres at the golf course that we need to put fields in, the three fields, the massive plan update that has been getting closer to completion. So there are going to be things that are not going to be there that we are going to have to – and then this view we are assuming if there is going to be something done and now something else is going to have to go in, can we keep up with those revenues that are coming in with the future costs of these items? That is something that we would work on through the Capital and Operating Fund, five-year view of the capital and then the ten-year Long-Range Forecast. I have some concerns I am expressing to the Council about funding all of our needs because of the escalating costs, so there is a tug there and we are going to be forced to reprioritize, whether we want to spend less on operating and more on capital, or finance more or defer more, which is obviously not desirable. FINAL MINUTES    Page 51 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Holman: To the extent that it is relevant to this study and the growth scenarios, I would actually like what you just talked about and what we have been talking about to be captured in some kind of fiscal analysis. I know these are going to be captured elsewhere, but to the extent that we can. Mr. Perez: I guess what we are trying to distinguish is the view of this study versus the going forward of these other things that we know need to be addressed. I am kind of coming in for one piece of the wedge of this whole view that you are looking at, so I may not make sense to you. Chair Filseth: What you are asking for, Karen, that is Council’s job, not Staff’s job, to decide, to make that kind of decision. What do you need from Staff to facilitate that kind of decision? Council Member Holman: I guess from an impact, we are changing – I don’t know how I am going to be able to say this very well – but we are changing from, if we are reducing our commercial growth especially, we are going to be reducing to that extent, our Impact Fees, and so how does it make sense to fund and what do we have to fund that we should look at in the Comprehensive Plan Fiscal Analysis. So, should we use this vehicle to look at, and I am particularly focused on park acquisition, where would we buy it, so I am particularly focused on that one. Ms. Gitelman: This actually raises an interesting question. In the original scope of work we talked about doing some kind of analysis of infrastructure funding options. You know, how might we fund park acquisition and infrastructure costs during the life of the Comp Plan? What are the funding mechanisms available? It is a little bit like what the Council is going to undertake with regard to transportation funding. We didn’t end up doing that as part of this study, but it is something we could add. It would, maybe, inform additional discussions. Mr. Sigman: Should it go here or should I go with the regular Comp Plan Study? Ms. Gitelman: Well, it would go in this Fiscal Study and we would look specifically at infrastructure proposals that are included in these scenarios and others that may be required over the 15-year period. FINAL MINUTES    Page 52 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: You’re not going to ask those folks to design a revenue enhancement? Ms. Gitelman: No, no, no. It would simply be providing to us information about the various funding mechanisms available for infrastructure, right? Mr. Sigman: Right. So we would, for most of these capital improvements we would start with fees and we would look at your fee programs and try to understand the degree to which your park’s fee, for example, is capable of funding the level of park amenities that is envisioned by the Comprehensive Plan. If there is a gap, how do you fill that gap? Are there other revenue sources, whether it could be an Enhanced Infrastructure Financing District (EIFD), it could be an Assessment District or a Community Facilities District, one of many tools. I don’t think those are appropriate necessarily, but I am just saying what are the tools available to Finance, would they be appealing and are there regional or State sources that might also help you fill the gap. It think it is important, as a next step and to satisfy, I think, some of the comments I have been reading in some of these blogs that you have to look at, after you establish, that there is a General Fund operational element to this. There also is a very significant investment program that comes with the Comprehensive Plan. How does that get paid for, and that is something that has not been done yet. So I would advise that both pieces are complementary and appropriate to have in hand when you start to decide or narrow in on what the next 15 years are going to look like and what comes with that. Chair Filseth: So one of the takeaways from what we have concluded here is that none of the four scenarios in the (inaudible) none of the four scenarios generates significant amounts of capital in order to do that with, so we are going to have to look at other places. Council Member Holman: What I don’t want is to just because we have both a shortage of land and because we are not going to generate, as you say, funds here, and fund under any scenario, even the Fifth Scenario, the funds to bring up to what the Comp Plan requirements are for park land, and again, I am just kind of focusing on that one, we shouldn’t just ignore it. Ms. Gitelman: I think this is going to come up when we ask for your input on the mitigation measures in the EIR. That is associated with the scenarios. You are going to look at them and some of them you are going to like and some of them you are going to hate, but your first question is going to be, FINAL MINUTES    Page 53 of 64 Finance Committee Draft Action Minutes March 15, 2016   “What is it going to cost?” We haven’t done that and so we could see doing that additional work at the end of this process once we have your feedback on the mitigation and incorporate. My feeling is, once we get that feedback, those will be incorporated into the Quality-of-Life Scenario, and so in the course of that analysis we could do this kind of General Fund revenue/expenses test, but we could also look at the costs inherent in those mitigation measures. Council Member Holman: Can I bring up two other issues here, and again, I hope this doesn’t appear to be in the weeds, but the more residents we have more than the more workers we have, we also have an effect, and I can’t remember if in the animal shelter audit this was, I can’t remember if in that audit there was any reference to per capita the animal shelter houses X number of animals. So that’s kind of one, maybe I could ask Tina that. That’s one, but the other one is, that I don’t want us to ignore, is our canopy. Mr. Sigman: Tree canopy. Council Member Holman: Tree canopy, yes, our tree canopy, both in terms of planting and replacement of trees that reach the end of their lifetime, and also maintenance, because that is also, it is a different kind of infrastructure, but I don’t know, I have no reason to know if that was captured in any of this analysis. Mr. Sigman: No, on the surface (crosstalk) that is one where I would struggle, I do struggle to see the connection between a few more people and the tree canopy. I guess maybe there is one, but it wasn’t expressed in the interviews we had. You know, in other instances here I have referred to sort of a baseline condition. It’s not one of the things that changes when we think we are going to add 15 percent or 10 percent more people. Does that make sense? Council Member Holman: Yes, I could maybe come back to that at another time. Mr. Sigman: You know, these mitigations, these quality-of-life mitigations or enhancements, if you are on the wrong track, if you are not doing the work that needs to be done on tree maintenance and canopy, that is something that we have to find a way to do, but it isn’t directly related, at least in our FINAL MINUTES    Page 54 of 64 Finance Committee Draft Action Minutes March 15, 2016   study, and you could make – I would be curious, maybe we could table it, but it is not captured here. Council Member Holman: It’s probably more related to our Urban Forest Masterplan. Chair Filseth: Head slap here. I figured out where you’re going, I think. So one thing you could do and would fit in the context of an analysis like this, is you could say, “Comp Plan says four acres per 1,000 residents, land 10 million an acre, if you can find it.” So each resident is going to cost, in this case at four acres, $40,000 per resident over the next 15 years in terms of park acquisition. So you could add that to the cost. (crosstalk) Mr. Sigman: It kind of sounds like you just need a fee update. Chair Filseth: But she is making a (crosstalk) it could be part of an analysis that says here is how much it costs for each resident, right. Not necessarily how you pay for it, but when you are looking at revenues brought in by each resident versus cost brought in by each resident (crosstalk) Council Member Holman: Right now you are ignoring it. Mr. Sigman: You know, the fee act is there for you to charge new development for its fair share of these types of things, and so if the fee is insufficient… Chair Filseth: So you’re saying it shouldn’t come out of the General Fund, it should come out of fees, and therefore, it should be off this analysis, because it is a General Fund focus? Mr. Sigman: That I think sounds more strategic than I am trying to be. I think when we look at funding shortfalls for parks and you have significant development pressure in place and your fee is insufficient to do what you need it to do… Council Member Holman: Always. Mr. Sigman: It is time to update it. Council Member Holman: But we have been doing that and… FINAL MINUTES    Page 55 of 64 Finance Committee Draft Action Minutes March 15, 2016   (crosstalk) Mr. Sigman: When we have a recession, you guys can get out there and buy some land. Chair Filseth: I think you’re right, because if you make the assumption that there is not going to be millions of square feet in redevelopment in the next 15 years, then putting a fee on it isn’t going to yield any revenue and it’s going to have to come out of the General Fund. Council Member Holman: That’s right. Chair Filseth: So at that point you’re using the General Fund to fund capital expenditures. If you can’t fund it with fees, then that’s what you do. Mr. Perez: Now you’re back to the points I was making, aren’t you? You look at the fee recovery level, you saw some of those examples for (crosstalk) Chair Filseth: Since the Comp Plan does say X many acres per thousand residents, that seems like it ought to be in the (inaudible) maybe as a footnote or something. That’s a footnote, so why couldn’t this be? Mr. Perez: Absolutely, and I think then you task us to figure out how we would make that work within your other priorities. That’s kind of where I was going. You set up some base, we identify the issues and this drives some of the policy and decisions, okay, strategically from a… Chair Filseth: (Crosstalk) asking for something quite a bit less ambitious than that, which is just shows up in the bottom line analysis. Council Member Holman: Exactly, because like I say, right now it is ignored. Mr. Perez: It shows up in the report. Council Member Holman: It’s not even a reference, and I would say the same thing with Animal Shelter, which surely there is with population growth, there is additional pressure on animal services. We don’t charge an Impact Fee for Animal Services, but there is an impact with additional residential, and to some extent at least, commercial growth, certainly both park land and Animal Services, which means we need a new Shelter. FINAL MINUTES    Page 56 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: So if you amortize it over 40 years, amortize it over 30 years and you discount interest costs then it is a couple thousand per new resident. (crosstalk) It blows away his analysis because it is like 20 times higher than it is now. Council Member Holman: So however you want to capture that, and I am not going to try to dictate that, but Greg. Council Member Schmid: No, I was just going to wrap it up. (crosstalk) Chair Filseth: There would have to be an asterisk somewhere that says, Policy sees (inaudible) Council Member Holman: Well, more than a footnote, because a footnote tends to be in that 4.5 to 5 (inaudible). I don’t want to (crosstalk) Ms. Gitelman: I think we can talk about the fact that the City has an infrastructure plan that is not addressed here, or capital costs that are not addressed here, and those include your infrastructure plan, also includes the acquisition and development of new park land. We can say that. Council Member Holman: Let’s focus it on the things that are actually referenced in the Comprehensive Plan. You know, not all the infrastructure things are referenced in the Comprehensive Plan, not all of them are. Chair Filseth: True. Council Member Holman: But some of them very specifically are, especially park land. Ms. Gitelman: That’s true and I just wanted to say we have an existing deficiency, a substantial existing deficiency in park land if you use that ratio, and so I don’t want to pretend that over 15 years anyone could imagine we would have the funds to resolve that. Chair Filseth: I actually did it two ways, one with the aspiration ratio and one with the existing ratio. FINAL MINUTES    Page 57 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Holman: Understanding a deficiency but we don’t want to exacerbate, so I think Greg is trying to call us to a conclusion. But you’re a park land fan, Greg, come on. Council Member Schmid: Well, you could add schools to that as well. Chair Filseth: Well, that’s not part of the Comp Plan. Council Member Schmid: It is. Chair Filseth: That’s true, it is. So are we reaching a point of wrap up here? Council Member Schmid: Yes. Chair Filseth: I think there is probably no further discussion from this side. Ms. Gitelman: Thank you very much for your input. (crosstalk) Council Member Holman: Thank you for going from meeting to meeting. Were you at the CAC as well, Roland? Roland Rivera, Business Analyst for Planning & Community Environment: I was not. Council Member Holman: Well, thank you for being here anyway. Mr. Sigman: Thank you all for our comments. I really appreciate it and I appreciate your time. Council Member Holman: Thank you Ben. NO ACTION TAKEN Future Meetings and Agendas FINAL MINUTES    Page 58 of 64 Finance Committee Draft Action Minutes March 15, 2016   Chair Filseth: Okay. Thank you guys for coming in. The next item on my list is discussion of future meetings and agendas. Lalo Perez, Chief Financial Officer: Yes, so we are coming to you then back on April 5. We have the beginning somewhat of the budget process with the Community Development Block Grant (CDBG), that’s (crosstalk) we have a Federal deadline that we must meet so this starts a little bit earlier than the regular process of the Budget. Then we have Mr. John Bartel coming in. Chair Filseth: So is he here on April 5? Mr. Perez: Yes. He is not available April 4. He is a very busy man and we tried to see if we could switch him from the 5th to the 4th, so he could be here for the Long Range with the whole Council, but unfortunately, he is in Southern California, so you get him on the 5th. Council Member Wolbach: How do you spell his last name? Mr. Perez: Bartel, one l. Council Member Wolbach: Thank you. Mr. Perez: And then the pool car utilization. You have been waiting for this one so it’s coming and that’s it for that night. I think we will probably have a good agenda for that. Then on the 19th it gets a little more packed, but I think a couple of those items are going to go quick, at least that’s what I would expect given prior history with you. You have heard some of the early warnings and proposals on the rates, so it’s the water and wastewater, and they’re coming now because of a notice of 2/18, so that’s why you are only seeing some of them. Storm drain is based on the Consumer Price Index (CPI) so it is pretty straightforward. We will probably do that one first and get it out of the way. Then, it’s not listed in here, but we have agendized the refuse rates as well. Then the last item, Community Services Deparmtnet (CSD) wants to give you an update on the Junior Museum and Zoo (JMZ) and in regards to the construction of the new building, give you a status on that. Then from there we go to the month of May which will be full of budget hearings, as we gave you that schedule and for June we are working on tentative items. FINAL MINUTES    Page 59 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Schmid: Supposedly again, the Budget would come to the Council. Suzanne Mason, Assistant City Manager: April 25th. Mr. Perez: April 25th is the levy of the budget document fees by the Council and then the first hearing of the budget is the 3rd of May, that is a Tuesday, but keep in mind that we segment it so you don’t have to read everything, I mean, you could if you wanted to. You got it segmented so we’re not giving you too much time it’s in trenches. I think that’s all we have. Chair Filseth: So this is sort of a tentative schedule for May? Mr. Perez: It’s still holding until you, the Committee tell us otherwise. We arrange the Staff to be prepared for these nights based on the departments and the listing of those. And I remember Council Member Wolbach is absent on the 12th. Chair Filseth: Which day, the 12th, that you’re not available? Council Member Wolbach: I believe that is correct. Chair Filseth: So you would miss Municipal Fee Schedule, Public Works. Council Member Holman: If I am remembering right, the wrap up is kind of that and potentially not very much, and the reason I am saying this is because I may be out of town May 24th. Chair Filseth: So my recollection of last year, if I get this right, the wrap up session actually took multiple days, because as we went through it there was stuff that we weren’t, we didn’t feel comfortable with (crosstalk) but it was stuff that we had trouble making a firm decision on until we saw other stuff, and so we had a bunch of stuff ended up in the parking lot and then the last couple of days is when we went through that. Mr. Perez: (crosstalk) Council Member Holman: So does wrap up not start on the 19th, because I look at “hold for additional discussion, if needed”. Is that not actually wrap up? FINAL MINUTES    Page 60 of 64 Finance Committee Draft Action Minutes March 15, 2016   Mr. Perez: We have a problem. Jim’s out if my recollection is correct. We had held it in there, but then he notified us that he is out. Chair Filseth: So what does that mean? Council Member Holman: So what do we do? Mr. Perez: Well, his preference would be to be here with you on the 24th. Chair Filseth: So what does that mean for the 19th? Mr. Perez: I’m sorry, there would be no meeting at this point. Council Member Wolbach: So should we cross it off the Agenda at this point, or what. Mr. Perez: Let us confirm, see if anything has changed, but given what we just heard. Council Member Holman: Is it just that night he is out? Mr. Perez: No, he is out a couple of days that week. His thinking was that he wanted to be here for the wrap up, to discuss it and the potential issues. Council Member Schmid: Yeah, that’s reaching conclusions, right. Chair Filseth: Which day was that? Was that the 24th or the 19th? Mr. Perez: Right now the wrap up is on the 24th. (crosstalk) Council Member Holman: So does that mean if we don’t have the 19th, but there is a 24th, does that mean the 24th might also be the 31st? Mr. Perez: Let me correct myself. What we (crosstalk). We just don’t want to do the wrap up on the 19th, so it could be a meeting to follow up on some discussions, but we were trying not to hold the wrap up that night because he’s not here. So, I’m sorry for not being clear earlier. FINAL MINUTES    Page 61 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Wolbach: Are parking lot items wrap up items, or is that separate? Mr. Perez: Yeah, typically because you want to make decisions on them and it would probably be good for, you know. Council Member Holman: So I guess my question is, if the 24th takes the place of the 19th, or the 19th isn’t happening, so if we have the 24th, is the 24th actually going to be two meetings as opposed to the 19th and 24th, is it going to be the 24th and something else? That was the question. Mr. Perez: The wrap up should be all of the outstanding items, but if you want us to look at an alternative night that week, we can look at that. Council Member Schmid: But the goal is to have that one night. Mr. Perez: If possible. Council Member Holman: Just one night. Mr. Perez: Because typically you’re just dealing with the outstanding items. Council Member Holman: Then why did we have the 19th scheduled? I’m confused. Mr. Perez: That’s if some department hearing from earlier did not get completed, there have been cases where we just don’t get to a department because we got… Council Member Holman: Doesn’t that then bump them to the 24th? Mr. Perez: It would enough in this schedule because it is a backup. Council Member Schmid: So that could be done without Jim? Mr. Perez: Yeah. Council Member Wolbach: So here’s my question, going back to where this was kind of commencing Chair Filseth brought up, which is do we need an FINAL MINUTES    Page 62 of 64 Finance Committee Draft Action Minutes March 15, 2016   extra spot on here? Should we reserve on our own schedules the 26th, two days later? Do we need a spillover? Do we need a back-up date and should we start reserving that on our schedules? That’s my question. Mr. Perez: Yeah, I was just going to say as a process we try to have all four of you in the wrap up night. That’s been our goal. Chair Filseth: So Cory’s question is, I think, is that if the wrap up takes more than one day, should we have a tentative place holder, a tentative back up day. Ms. Mason: Why don’t we confer with Jim his schedule and then we will come back and talk about that. I think last year we started a few in the afternoon too, so that we would potentially have longer. Council Member Holman: Can you suggest an e-mail. Mr. Perez: Sure, we will e-mail the Committee and let you know the confirmation of those dates and then if you want us to work on having a back-up date to the wrap up, then we will check our dates and let you know. Chair Filseth: It seems like now is the time we want to check. Ms. Mason: (crosstalk) Council Member Holman: And I’ll see if I can move the 24th. Council Member Wolbach: And I’ll also say that the 26th and the 31st are both currently free for me, so I’m happy to keep them reserved until we have confirmation. Just based on what you were saying about past experiences, it sounds like it might be a good idea to have. Council Member Schmid: Karen, right now are you available on the 24th? Council Member Holman: Well, right now I’m not, that’s why I’m saying I can double check, but right now I’m not. I am on the 19th. Council Member Schmid: So that’s an issue. FINAL MINUTES    Page 63 of 64 Finance Committee Draft Action Minutes March 15, 2016   Ms. Mason: We’ll confirm and then we will check on the 26th as well, which is a Thursday night, and the 31st. Council Member Holman: So you will confirm the 19th and the 26th and the 31st? Ms. Mason: We will confirm he is out on the 19th and then we will see about the 26th as an alternative. Mr. Perez: Could we say we will confirm the 19th, we will look at the 25th and 26th, just in case, because we are bumping into the Memorial Day weekend and some here might have plans, I don’t know. Council Member Holman: But you’re not going to take out the 24th? I’ll see if I can… Mr. Perez: Okay, we’ll hold onto that. Chair Filseth: It is also High School Finals Week, so it’s hard to travel that week. Before we break and leave completely the issue of the Agenda, I wanted to ask, with respect to the City Auditor’s presentation and discussion around that for the last couple of weeks, one of the issues that came up was there is this whole issue of the Parking Assessment District, which the finances seem very murky to all of us, and we just don’t understand, it’s like a black hole. There is precedent for property owners claiming that their membership, belonging to the Assessment District basically grants them access to certain numbers of parking spaces and it isn’t clear whether those are in any garages or not, whether the claim is valid or not, and particularly, since we are talking about building more parking garages as part of the infrastructure plan, right, are there claims against some of those spaces that are not even built yet? Is that something that the Finance Committee ought to look at and see what are the claims, what are the finances involved here and is this something we are going to have to worry about. I think this sort of came up, Karen ducked the issue last night, right, which is why it didn’t come back here? She left when she knew it was coming up. Council Member Holman: Oh, no. Chair Filseth: That seems like something the Finance Committee might consider taking a look at, because somebody should. FINAL MINUTES    Page 64 of 64 Finance Committee Draft Action Minutes March 15, 2016   Council Member Holman: I’d second that, for whatever it’s worth. Council Member Wolbach: I’d be open to that. Mr. Perez: So I think the question is, is that within your prevue to assign or is that something that needs to be assigned through the Council. So let us check into that because it may tie into other discussions that you have and that could be brought up at that point and referred. I’m thinking out loud here, but off the top of my head, but let us check on that. Chair Filseth: Okay. Council Member Holman: So you got the issue, right? Ms. Mason: Right. Council Member Holman: Okay, thank you. Chair Filseth: Okay, in that case we are adjourned. Thank you very much. Thanks for staying late guys. NO ACTION TAKEN ADJOURNMENT: The meeting was adjourned at 9:37 P.M. City of Palo Alto Page 1 Planning and Transportation Commission 1 Draft Verbatim Minutes 2 April 13, 2016 3 4 EXCERPT 5 6 2.Comprehensive Plan Update:  Public Hearing to Accept Comments on the Draft7 Environmental Impact Report Prepared for the Comprehensive Plan Update.8  9 Acting Chair Gardias: Let’s reconvene. It’s about 7:26.  We have the second item on the agenda, 10 which is Comprehensive Plan Update, public hearing to accept comments on the Draft 11 Environmental Impact Report (DEIR) prepared for the Comprehensive Plan Update. 12 13 Elena: Thank you.  We’re here tonight to request public and Commission feedback on the DEIR 14 prepared for the Comprehensive Plan update.  Basically the question to you is: did we get it 15 right and is there anything else that we need to be analyzed? The Environmental Impact Report 16 (EIR) was published on February the 5th and the public circulation review period of an extended 17 90 days. Typical California Environmental Quality Act (CEQA) requirement is for 45 day review 18 period.  This is the first of several public hearings on the EIR, this was the first and there will be 19 hearings on April the 21st before the Architectural Review Board (ARB) as well as the Historic 20 Resources Board (HRB) and will also be going to the Library Commission at the end of the 21 month to obtain their feedback.  The EIR was also posted online and notices have been 22 disseminated both to agencies and to the public and is also part of the Comp Plan Update 23 Project website.   24 25 Tonight, we also have Joanna Jansen, Associate Principle of PlaceWorks, which is the City’s 26 Comp Plan Update consultant as well as the EIR preparer.  And also to stipulate questions and 27 comments received during this public review period will be responded to in the final EIR.  28 Joanna will be providing an introduction to the EIR and the process and also this item was 29 tentatively scheduled for Council review on April the 25th.  That has been deferred to June the 30 6th, and so that will affect our schedule.   31 32 But I also just wanted to just to stipulate also that these hearings are an opportunity to provide 33 a public forum for feedback from not only the boards, commissions and council, but also the 34 public.  But the public and anyone else is also welcome to submit written comments to my 35 attention during the public comment review period.  Although the public review comment 36 period is scheduled to end on May the 5th, because the Council date was extended to June 6, 37 we will be revisiting exactly to end that comment period.  And with that I will turn this to 38 Joanna. 39 40 Joanna Jansen, PlaceWorks: Thank you, Elena.  Thank you Commissioners for your time.  41 Tonight, as Elena said we are here to discuss the DEIR or EIR, on the Comp Plan update and 42 specifically we want to hear from you and from any members of the public about your 43 questions or comments or concerns on the EIR, because down the road we are going to be 44 coming back to you and asking for a recommendation for the Council action on this EIR.  And 45 the Council will need to certify this EIR or make a decision about certifying the EIR and they are 46 ATTACHMENT D City of Palo Alto Page 2 going to do that in part based on your recommendations.  So we want to make sure that you 1 feel equipped to make that recommendation when we come back to you.  And so as part of 2 that, tonight is your opportunity to help us understand what kind of questions or concerns you 3 might want to see resolved before you feel ready to do that. And I am going to explain in much 4 more detail kind of the steps and the process between here and there to help you understand.   5  6 So the kinds of questions you might have that are about the EIR specifically are questions about 7 the methodology that we used, questions about our impact conclusions, questions about the 8 mitigation measures that the EIR includes, for example.  Just to be clear, the in terms of the 9 CEQA process, what’s not part of the CEQA process necessarily per se are the policy decisions 10 that are going to be made as part of the Comp Plan update.  So a decision about whether or not 11 to change a particular policy or to adopt a particular policy is not part of what the EIR looks at, 12 but the potential physical impacts of adopting or not adopting that policy is really what the 13 EIR’s focus is and what our focus is here tonight.  And as Elena already mentioned, in 14 accordance with CEQA, part of our task in the future will be to respond to each one of the 15 comments that we receive on the EIR that address those types of questions about the EIR and 16 its analysis and its conclusions.  17  18 So let me just go over briefly what the EIR process is.  Elena outlined some of these important 19 dates for you.  On the left‐hand side we start out with the Notice of Preparation, meaning that 20 we publish a notice to the public and to state agencies and to other local agencies that we are 21 going to be doing this EIR.  We give them a chance to tell us what kinds of issues we need to be 22 aware of and what kinds of issues the EIR needs to consider during what’s called the scoping 23 period.  And that happened back in 2014, in the during the summer of 2014.  Then we shut 24 ourselves up and worked very hard on the environmental review section of the document and 25 we published our DEIR back in February.   26  27 So right now we are in the public review period for the DEIR, so as Elena mentioned we actually 28 have doubled the public review period from what its requirement would be under the law.  So 29 we are having a 90 day, at least a 90‐day period instead of a 45‐day period.  And after we 30 conclude that period we are going to be, as I said, responding to all of the comments in a final 31 EIR.  And then we will come back to you and then to Council for hearings to certify the EIR.  And 32 certifying the EIR will then put the City in a position to adopt an updated Comprehensive Plan.  33  34 So I want to spend a couple of slides now just going over what an EIR is.  I know some of you are 35 very familiar with this.  We may have members of the audience or watching at home who are 36 less familiar so I want to just go over some of the basics.  An EIR, or an Environmental Impact 37 Report is required by the California Environmental Act, we usually call it CEQA.  And it’s an 38 informational document, so the EIR is not a policy document.  It doesn’t regulate land use or 39 any other part of City operations, but it informs the City decision makers like yourselves and 40 members of the community and other agencies what the physical environmental impacts might 41 be of a given project or a plan.  42  43 This EIR is a programmatic document and we talked a little bit about that in your staff report, 44 the difference between a program level EIR and the kind of EIR that you might be more used to 45 seeing, which is probably a project EIR.  And I have another slide on that in just a second.  So for 46 City of Palo Alto Page 3 program level EIR’s we are really looking at more long‐term big‐picture effects of adopting or 1 not adopting a certain set of policies or a certain set of transportation improvements or a 2 certain set of land‐use designations rather than looking at a particular building on the ground.  3 So in the Comp Plan EIR we are going to be looking citywide and we are going to be looking 4 long‐term at the horizon year of 2030.  So we are going to be quite at a different scale than 5 what the project EIR looks at when you have you know where buildings are going to be, you 6 know where sidewalks are going to be, you know how many parking spaces there are going to 7 be and how many stories tall it is going to be.  We don’t have that specific information for any 8 given project under the Comp Plan.  So we are going to be focusing on a much more citywide 9 and much more long‐term level in a programmatic EIR.  It’s a different level of detail than you 10 find in a project document.   11  12 So, how do we look at a Comp Plan then in an EIR?  We consider the policies and the actions of 13 the Comp Plan and then think about how those policies and actions might, or policies and 14 programs might avoid or lessen impacts, or might create impacts based on how they would 15 allow or guide future growth.  And as I said, the EIR is an informational document so an 16 important role here is to consider the analysis and conclusions of the EIR and then think about 17 how you would change, you might want to change the Comp Plan accordingly to reflect what 18 you learned from the EIR.   19  20 So and one final important note here about what an EIR is and what it does is that the law 21 requires an EIR to compare to existing conditions.  So we are comparing how things would 22 change under the proposed Comp Plan or under the different scenarios that we analyzed versus 23 how things are on the ground today as opposed to, for example a comparison to the existing 24 Comp Plan.  So that’s an important distinction.  We would make our impact findings based on 25 potential physical impacts to existing conditions not whether or not things would be better or 26 worse than your existing Comp Plan.  27  28 Let’s go over the project description of the EIR and talk a little bit more about what we 29 analyzed.  In order to move this Comp Plan process for the EIR looks at four simplified planning 30 scenarios and I’m going to talk about each one of the planning scenarios.  The project 31 description defines the housing, population, and job numbers for each of those scenarios, 32 which differ, of course, in each scenario, and then land‐use policies, transportation 33 investments, growth management strategies, potential zoning code amendments, and a set of 34 sustainability measures.   35  36 So each of the four scenarios has some differences in each one of those categories and the 37 reason we wanted to do it this way, which is not the typical way of doing a Comp Plan or a 38 General Plan EIR, is to really help you and the Council and the community understand the 39 potential impacts of a range of policy decisions.  Because as you are well aware there are still a 40 number of policy discussions that are ongoing and a number of ideas that have been 41 contributed into the process from the community, from the Citizen Advisory Committee (CAC), 42 from yourselves and from Council members.  So we wanted a way to test and compare this 43 range of options and give you information about the potential outcomes of each.  That’s why 44 we have chosen to compare these four scenarios.  I think it is important to note, it’s not on this 45 slide, but I want to be clear that none of the scenarios includes changes to the Comp Plan Land 46 City of Palo Alto Page 4 Use Map, so these are really policy and program changes that would, that are being compared 1 and all of the scenarios have similar, the same protection for preserving existing single‐family 2 neighborhoods in Palo Alto.  So those are two important ways in which the scenarios are the 3 same.  4  5 Right, Elena is reminding me that there is a possible change to the Fry’s site considered in the 6 scenarios.  So some, a potential for housing, increased housing on that site as part of Scenario 7 4, for example.  So these scenarios really came out of a public workshop series that we did in 8 the middle of 2014.  And we got ideas that those are workshops about kind of where are some 9 of the areas of Palo Alto that are most likely to change over the next 20 years or so and where… 10 15 to 20 years, and where, what kinds of changes might happen.  And as you can imagine we 11 got a real diversity of opinions and so we translated that diversity into this range of four 12 scenarios to test.  So the EIR now you, that you now have before you really is intended to 13 provide you and the public with some very quantitative very specific information about the 14 possible outcomes comparing among those different four scenarios.  15  16 In addition to the four scenarios that we developed through the public process so far on 17 January 19th at a Council meeting, Council requested a fifth scenario that would improve Palo 18 Alto’s jobs/housing ratio specifically.  So we are currently in the process of crafting that fifth 19 scenario and the Council is going to have a hearing to discuss that coming up I believe on May 20 16th.  So we’re still in the process of developing that.  That scenario is anticipated to be analyzed 21 at the same level as the four scenarios that you have in your EIR right now, in a supplemental 22 document that we are planning to publish this fall.  23  24 And then once you have the fifth scenario and its additional analysis then the next phase of the 25 process will be identifying a preferred scenario.  So just to make sure you understand, we don’t 26 expect that anybody is going to pick one of the scenarios whole cloth and that will be what is 27 adopted.  The way that these kinds of processes usually work are picking kind of the best pieces 28 from each one of the scenarios, the things that make the most sense for Palo Alto, that 29 preserve quality of life, that mitigate impacts, that achieve the goals that the City wants to 30 achieve.  So we anticipate that that will likely represent some sort of hybrid with components 31 of one or excuse me of two or more of the scenarios.   32  33 And then once we have that preferred alternative there will need to be a step of some 34 sensitivity testing, figuring out whether or not the preferred scenario is really covered under 35 the environmental analysis that’s already been done.  Certainly, it’s been our hope with this EIR 36 to present what we have been describing as kind of book ends or an envelope within which a 37 scenario could be crafted that would be covered by this EIR, but that’s going to be an important 38 future step once we have that scenario, to make sure the analysis still is valid for that preferred 39 scenario to move forward and be adopted.  40  41 So with that explanation of what the scenarios are, I want to then just take a moment to go 42 through each one of the scenarios and again you have this within your Staff report and also in 43 the orientation document.  So this just summarizes some of the information you have already 44 been presented with.  So Scenario 1 is a business as usual scenario.  This is a pretty typical CEQA 45 alternative just that is required by CEQA to question well, what would happen if we did 46 City of Palo Alto Page 5 nothing?  So in this case doing nothing means leaving your existing Comp Plan in place.  The 1 amount of housing that’s assumed under this alternative, excuse me, this scenario and the 2 amount of population is based on past development trends in Palo Alto.  And the amount of 3 jobs in this scenario is based on the Association of Bay Area Governments (ABAG) jobs 4 projection, so it has the lower end of housing and the higher end of jobs among the four 5 scenarios.  6  7 By comparison Scenario 2 slows both housing and jobs.  So it has the same lower end of growth 8 and housing and population as did Scenario 1, but it slows jobs through an annual limit on office 9 and Research and Development (R&D).  In terms of transportation, this one would consider a 10 relatively limited number of continuing existing investments and then also making the 11 investments that are called for under the County Expressway Plan.  12  13 Scenario 3 is a different way of looking at housing.  It increases the amount of housing growth 14 or the rate of housing and population growth and it also would consider a shift on where that 15 housing is located.  So the current adopted Housing Element has housing sites identified kind of 16 all the way down the length of El Camino Real and this would really move some of those 17 housing sites from the south and from the San Antonio area to farther north and increase 18 densities in Downtown and the California Avenue area.  So that is one scenario that tests the 19 slightly higher amount of housing and it has kind of the midpoint of jobs.  So lower than 20 Scenario 1, but higher than the job numbers in Scenario 2; and another important feature of 21 Scenario 3 is testing the idea of Caltrain in a trench, so grade separating the Charleston and 22 Meadow Caltrain crossings.   23  24 Then Scenario 4 is the scenario that includes both the highest end of the housing growth as well 25 as the highest end of the job growth.  In Scenario 4 the amount of housing growth is consistent 26 with ABAG projections as well as the job projections from ABAG.  And so rather than focus on 27 limiting housing growth quantitatively, this scenario would focus on addressing the potential 28 negative impacts of that housing through the most robust and extensive suite of sustainability 29 strategies and measures, things like transit passes and alternative energy measures.  So this 30 would really seek to address the impacts of housing rather than just limit the numbers of 31 housing.  Again, the focus on housing would be in the Downtown area and the California 32 Avenue area around existing and planned transit stops and even possible Bus Rapid Transit 33 (BRT).  BRT would be, mixed flow BRT would be considered on El Camino Real as part of this 34 scenario as well as the grade separate of Caltrain that also is in Scenario 3.  And by that 35 combination of measures we want to test whether or not or how those, that assembly of 36 measures can mitigate the effects of even a higher amount of growth than would be 37 anticipated given Palo Alto’s past development history.  38  39 This slide is just a side‐by‐side comparison of the four scenarios.  We can come back to that 40 later if that’s useful.  So for each one of these scenarios we analyzed these topics at the same 41 level of detail. These topics come to us from CEQA, from what we call the Appendix G checklist.  42 So CEQA helps us identify what topics to analyze.  The City has actually adopted its own 43 thresholds of significance.  So the specific kinds of questions that we answer about each one of 44 these topics is set by the City, given your specific list that’s tailored for Palo Alto and specifically 45 for the Comp Plan analysis.  So you can see here that there’s really a broad range of topics.  And 46 City of Palo Alto Page 6 an important point for folks that are less familiar with CEQA that I mentioned before is that 1 CEQA really focuses on the physical environment, so what you don’t see here are economic or 2 social topics.  That’s not part of CEQA, but this analysis is really focused on the physical 3 environment itself.   4  5 So when we look at these impacts, let me just take a minute to orient you to this table here, 6 this table is trying to show a side‐by‐side comparison of where the impacts were different.  So 7 less than significant is a CEQA term of art, meaning that the impact would not be so severe that 8 mitigation measures are required or specific changes to the plan or to the project to make its 9 impacts less severe; potentially mitigatable or significant and mitigatable means that there 10 could be an impact, but we think that we have an idea about a mitigation measure that will 11 resolve the impact or reduce it to a level where it’s not so severe.  And then significant and 12 unavoidable impacts are those where the impact is going to cross a certain threshold that’s 13 usually identified by CEQA, by the threshold of significance, and even if the City does everything 14 that we think is feasibly in its power that would not reduce the impact to below that threshold.  15 So the impact would still occur even if the City attempts to mitigate it.  And I can talk a little bit 16 more about some of those specifically and why they occur, but that’s an explanation of the 17 abbreviations you see here on this table.   18  19 So I think that an important takeaway from this table is that even though the numbers that you 20 saw on this table might be seen quite dramatically different to you kind of in your daily 21 experience of Palo Alto and how much growth and change this represents, the degree of 22 difference in the physical environmental impacts between these scenarios is really not extreme.  23 You can see that in all of the topics that are included on this slide they actually had the same all 24 four scenarios actually had the same level of impact.  And then when we go to the next set of 25 topics there are some differences in terms of the noise impacts and there are some differences 26 in terms of the utility demands, but even there in both of those categories the impacts can be 27 mitigated.  So the differences are important and I think the EIR provides a lot of valuable 28 information on the difference of degree, but the ultimate kind of level of impact is not 29 dramatically different among the four scenarios.  30  31 So just briefly I want to go through how the topics slotted out into those different categories of 32 less than significant or versus mitigatable versus significant and unavoidable.  Less than 33 significant impacts meaning no mitigation measures are needed.  We found would happen in 34 the topics of biological resources, geology and soils, hazards and hazardous materials, and 35 population and housing.  There is a larger group of topics that would where we did identify 36 impacts, but we decided that those impacts probably can be feasibly mitigated.  And so that’s 37 this list, aesthetics, air quality, cultural resources, hydrology and water quality, land use, noise, 38 public services, transportation and utilities.  So those, for each one of those topic areas then we 39 have in the presentation the mitigation measures themselves because I anticipated that you 40 may have some questions or we might have some discussion about these mitigation measures.  41 I’m not going to read each one of these mitigation measures to you or attempt to summarize 42 them, but I just want to let you know that they’re here and we can come back to any of these 43 that you want to go into in more depth, and of course, you have these in your packet as well.  44  45 City of Palo Alto Page 7 And then finally there is a set of impacts that I mentioned earlier that were called significant 1 and unavoidable.  And these impacts are in the categories of air quality, greenhouse gasses and 2 transportation.  So for each one of these impacts we did identify and discuss a potential 3 mitigation measure, but ultimately we concluded that the level of the impact would be beyond 4 the threshold of significance even with the mitigation measure and so we cannot conclude that 5 the impact would be able to be mitigated to a less than significant level.   6  7 And I want to point out as you can probably tell that all of the impacts in this Category A are 8 types of analysis that are very quantitative analysis in the EIR.  Some types of the analysis that 9 we do are more spacial.  For example, questions about whether or not there would be 10 development in a flood plain or a very high fire hazard severity zone, that really depends on 11 where the development is located or where the Comp Plan would identify different types of 12 development to occur.  Other types of the analysis that we do in the EIR is really pretty 13 qualitative, like whether we think about impacts on aesthetics, for example.  But these 14 categories are all very quantitative and they are based really on the numbers that you saw in 15 that table for future development as well as the numbers for growth in the region.  So when we 16 think about traffic in Palo Alto and when we think about the associated air quality emissions 17 and greenhouse gas emissions we can’t just take the trips that are part of Palo Alto, we have to 18 take all of the trips coming into and going out of Palo Alto, including trips that are using your 19 roadways, even if they’re not stopping in Palo Alto, that’s not part of the greenhouse gas 20 analysis, but for transportation, for example.  So we really have to look at Palo Alto in a regional 21 context and because of that we find that the amount of, for example, greenhouse gas emissions 22 and the amount of needed reduction in greenhouse gas emissions when we think about Palo 23 Alto as well as the region is going to be higher than we can feasibly say that we can bring down 24 to levels that are consistent with the thresholds of significance.  So I think that’s the reason why 25 some of these are significant and unavoidable that even if you include all of the mitigation 26 measures that are proposed and do as much as you can to, for example, ensure that the City’s 27 actions are going to be consistent with state goals for reducing greenhouse gas emissions, we 28 still can’t necessarily demonstrate through the quantitative modeling that the City would be 29 able to achieve those goals.  30  31 And it’s similar with the transportation, so when you have standards for increase in BMT or 32 impacts related to Level of Service (LOS), for example, even if the City does a very extensive 33 suite of measures it may not be adequate to reduce these impacts to a less than significant 34 level.  So we conclude that those are significant and unavoidable and what that means for you 35 and for your Council is that there are a certain type of findings, a statement of overriding 36 considerations that would need to be made to adopt a Comp Plan, even acknowledging that it 37 would cause significant and unavoidable impacts.  38  39 So just before we move on to the discussion I want to remind folks of the timeline.  We’ve 40 talked already about the earlier phases of this project and when they were completed.  The 41 public review period we are still as Elena said considering when the appropriate final date of 42 that is based on when the Council hearing is going to be.  So right now that is, right now the 43 most current thing that’s been published is the comment period will go through May 5th, but 44 we are considering whether or not that may be extended in light of the Council hearing.  And 45 then we are going to be publishing the scenario analysis this fall and then a final EIR that 46 City of Palo Alto Page 8 includes responses to comments on both the fifth scenario and the DEIR in May, and that will 1 tee up the Planning Commission and the Council to consider adoption of the Comp Plan in the 2 second half of 2017.  3  4 So just in the, the most immediate next steps the Council, the next upcoming Council meetings 5 are discussion of the fifth scenario on May 16th, as we mentioned.  And they are going to have a 6 hearing very similar to this one on June 6, another opportunity for them and for the public to 7 comment on the DEIR.  And then hopefully having a public hearing on the fifth scenario again 8 sometime this fall; it’s currently scheduled for November 14th.  And we’ll be coming back to 9 you, of course, before that for your chance to talk to us about the fifth scenario in November, 10 November 9th.  And again, all of this is towards publishing a final EIR in May and then going 11 towards adoption from there.  12  13 So just as a reminder tonight what we are really hoping to get is comments and questions that 14 are focused on the EIR itself, on its methodology or findings or the mitigation measures that 15 we’ve touched on briefly here.  And we will do our best to respond here tonight, especially if 16 the questions are factual or relatively brief, but the real place for the responses is going to be in 17 the final EIR that will be published after the fifth scenario is out and after its had its chance at 18 public review, so that’s where you’ll get your real point‐by‐point in‐depth responses.  But again, 19 certainly we will do our best tonight as well to the extent possible.   20  21 So written comments are welcome and encouraged and Elena is going to be the point person 22 for those comments.  So anyone who has written comments please submit those to Elena.  Her 23 address and email address is on the screen.  Email is perfectly acceptable.  So we welcome and 24 encourage any comments.  Thank you. 25  26 Cara Silver, Senior Assistant City Attorney: Chair Gardias, just to wrap things up, if I could just 27 add a few brief comments on this.  So we did want to let you know that this is your first 28 opportunity to review this EIR.  There will be other opportunities throughout the process, so 29 don’t feel that you need to get all of your comments out at this session.  30  31 Also, I just wanted to kind of point you to sections of the EIR that are particularly relevant when 32 reviewing it.  Sometimes when you are given a big, thick document like this with lots of 33 technical appendices and tables, etcetera, it is a little bit difficult to figure out what you should 34 focus on.  And we typically advise that reviewing the executive summary is really a very good 35 starting point.  The executive summary lists all of the impacts.  It lists all of the mitigation 36 measures and whether the impact can be mitigated or not.  If as you read through that 37 summary section, you will find other issues that you may want to drill down on more 38 completely and so you can then refer to other pieces of the EIR and other chapters for more in‐39 depth review.   40  41 Another place to focus on, as Joanna mentioned, is the impact methodology and the mitigation 42 measures.  Those are very important.  We would like to get your input on whether the 43 mitigation measures that have largely been developed by the City staff and the consultant team 44 do adequately mitigate the impacts that we have identified and if there are any additional 45 City of Palo Alto Page 9 mitigation measures or if you do not think that the mitigation measures we’ve suggested are 1 adequate we would love to receive your feedback on those.   2  3 And then finally, I did want to point you to Appendix B, which is contained in Volume 2 of the 4 EIR, and that is a very good memo that discusses the evolution and the analysis that we have 5 prepared in connection with the thresholds of significance that the EIR uses.  And so it shows 6 the kind of the historical background on those thresholds and then describes in detail what 7 thresholds are being used for this particular EIR.  So that’s also a good reference for you all.  8 Thank you.  9  10 Acting Chair Gardias: Thank you very much.  It’s a good comment so just before we move on 11 with public hearing I want to just touch bases on this because we discussed this at the pre‐12 Commission meeting that given the breadth and importance of this document it is impossible 13 for the Commission just to review it at tonight’s meeting.  So what we discussed to already 14 reserve a time following the Commission meeting for another review and limit this just review 15 and just do the portion of this document.  So that’s what we discussed and with thanking 16 Joanna for the review, I would like to just give the voice to the public.  So let’s review the 17 comments from the public and then let’s discuss what we can achieve today and what we will 18 not achieve today so we have some clear delineation.  So with saying this, thank you very much 19 for the review and let’s see if we have any comments from the public. 20  21 Acting Vice‐Chair Waldfogel: Our first public comment is from Mr. Stephen Levy, five minutes.  22 Do you need 25? 23  24 Stephen Levy: No, I mean you know.  A document like the one that Joanna prepared can be 25 completely accurate, professionally done and not respond fully to the information needs that 26 this community deserves, and I believe that’s the case.  I think there is one striking omission 27 and basically I’m urging you to urge everyone in the new alternative to correct the omission.  I 28 think there are two thorny problems that may be a result of the way the EIR is structured.  Not 29 anyone’s fault, but omissions.  As Joanna said, they crafted the alternatives based on a series of 30 community meetings.  I went to all of them; you went to some of them in 2004.  The housing 31 alternatives, even the high one in 4, do not reflect my oral communication to you at the 32 beginning that there are no regional population numbers, new regional job numbers, new 33 regional household numbers.  They are all higher for two or three reasons, but more than that 34 the EIR alternatives do not reflect the May Summit that most of you went to, and the enormous 35 public comments before this body, before the CAC on which I serve, and before the Council 36 about housing. So I encourage you to encourage Joanne and the staff to go big on housing in 37 alternative 5.  The Council will ultimately decide.  We are not talking about decisions now; we 38 are talking about a community getting the information to understand what it is to really 39 contribute to the regional housing shortage.  We’ve had 280,000 new jobs, 170,000 new people 40 since this alternative was crafted, so go big.  41  42 The two technical points are, and you know more about this than we do, that the community in 43 the EIR is transfixed with identifying and mitigating what Joanne has correctly said are 44 differences, but small differences among growth alternatives.  But we all know that if you want 45 to reduce the impacts on the air, on the environment, on traffic and parking, we need to be 46 City of Palo Alto Page 10 talking about mitigation measures that change the behavior not of the new residents or 1 whether it is 5 or 10 percent, but of the 100 percent of existing residents who are here.  If the 2 EIR and the Comp Plan and my committee and your Commission are going to move the needle 3 we need to be talking about not mitigating primarily new growth, but mitigating and changing 4 the behavior of the parking and traffic and environment of existing people.  5  6 And the last point, and it’s just a fixation of how CEQA is done or city councils and planning 7 commissions work, the EIR and Joanna correct me if I’m wrong, because I think you did a 8 completely wonderful job, but the EIR when it looks at the impacts on a city pretends that if it 9 doesn’t happen here, it doesn’t happen nearby, and that’s demonstrably false.  And so if you 10 are a regional thinker and Joanne mentioned that we are doing this in the regional context, 11 then this community deserves to know so at least they can make the decision about whether a 12 little bit of growth here has fewer impacts than that same growth in Sunnyvale or Menlo Park 13 or Redwood City because we are the most mitigating, environmental sensitive community and I 14 can’t believe that growth anywhere else is better for the regional environment, for the global 15 climate than here.  I know that the EIR and the CEQA process forces us to think of us as an 16 island, but we’re not.  So encourage the Staff and the consultant and you all to think about 17 whether it’s better to limit growth here and push it elsewhere if we really are regional 18 environmentalists or whether we should just be an island.  And thank you for five minutes.  19 That’s refreshing.  20  21 Acting Chair Gardias: Thank you.  This concludes the public hearing, but per our practice we 22 would like staff to respond to the issues that Mr. Levy brought up.  So if you could just spend a 23 couple of minutes just to review all this items that he brought to the table.  Thank you. 24  25 Ms. Jansen: Sure, I’m happy to take a stab at that.  So the first point was about thinking about 26 an additional fifth scenario that really goes big on housing and there’s one comment that Mr. 27 Levy made that I’m not sure whether you misspoke or misunderstood what I said, but the 28 meetings that these are based on were from 2014.  And so they are based on ABAG’s 29 Projections 2013, so I’m certainly not disputing that since the summer of 2014 there’s been 30 additional growth and additional change.  That’s certainly true.  As far as I’m aware, there’s not 31 another set of ABAG projections that’s been released, since Projections 2013.  32  33 Acting Chair Gardias: No, it’s time for the staff to respond so…  34  35 Ms. Jansen: So I, again, the point is certainly taken that conditions have changed.  We didn’t 36 finalize these scenarios until after the Summit, so we really did our best to take into account the 37 input that we heard at the Summit although we had already started forming the ideas about 38 that there would be four scenarios and that they would test a range.  So I wouldn’t say that 39 they don’t take into account the input of the Summit, although the Summit, as you probably 40 recall, was really kind of more focused on policies and issues rather than on specific land use 41 discussions and the more land use focused discussions were really the ones that we had in the 42 summer, the previous summer of 2014.  But I think we did particularly when we talk about the 43 range of growth management strategies, the range of sustainability strategies, the range of 44 transportation investments, not just the pure numbers, but other types of characteristics that 45 City of Palo Alto Page 11 are considered in the scenarios those very much come directly from the Summit.  So we did 1 make a very strong effort to incorporate that input.  2  3 That said, certainly the fifth scenario is an opportunity to add another bookend to this process.  4 We have heard voices that one way of addressing the jobs/housing imbalance that the Council, 5 that would really seem to spur the Council to want to add a fifth scenario is not just to decrease 6 jobs, but also to increase housing.  So we have heard that message and I’m sure that’s 7 something that’s going to be an ongoing part of the discussion.  As Mr. Levy accurately said, no 8 decisions have been made about that and we are going to be talking about that more with the 9 Council on May 16th.   10  11 Another point that was made was about mitigation measures changing the behavior of existing 12 residents and I think that is a really important and intriguing question, and it’s also, as Mr. Levy 13 noted, somewhat awkward to address under CEQA.  In terms of statute and case law, really we 14 can’t write an EIR or a mitigation measure that requires a project to mitigate existing 15 deficiencies.  And in terms of thinking about a mechanism for doing that such as funding for a 16 particular transportation improvement or a particular mitigation, really the best mechanism we 17 have are things like development impact fees and, of course, as you are aware, those are 18 charged to new development.  So, while I think it’s absolutely vital to change behaviors or 19 address problems that are happening now, today, even in the absence of any growth, it may be 20 a little bit challenging to do that through your EIR and its mitigation measures specifically.  I 21 think the Comp Plan and its policies and programs are a great venue for considering those kinds 22 of attempts, but I think it is, again, a very valid point that we need to keep in mind the 23 increment of new growth compared to what’s already here is not solely responsible for the 24 types of impacts that you see when you read the EIR.  25  26 And then finally, the question about how the EIR conceptualizes where growth might happen or 27 what might be the impacts of deflecting growth away from Palo Alto.  It’s accurate to say that in 28 terms of the traffic modeling, just to take one quantitative example, the traffic model is a 29 regional traffic model.  It’s the Santa Clara Valley Transportation Authority (VTA) model, which 30 looks not just at the nine county Bay Area, but even beyond those borders.  We kind of plug 31 numbers, the numbers that you saw for the scenarios into that traffic model and when we 32 decrease housing in Palo Alto it is accurate to say that we didn’t then look into the model and 33 increase housing in Tracy or in Sunnyvale or in other places, so I think that’s a valid point.  We 34 did, I think, touch on this in some other maybe less model‐based sections of the EIR.  For 35 example, in the section on population and housing the discussion of Scenarios 1 and 2 does 36 bring up the question of well what will happen in terms of housing affordability or displacement 37 if the supply of housing is lower rather than higher.  So that I think maybe gets to some of that 38 question.  It may not be a complete answer, but those are my responses. 39  40 Acting Chair Gardias: Very good.  Thank you very much.  So let’s then focus for a moment on 41 what we may accomplish today.  So any proposal from you?  Are there any sections we can 42 review today and some that we may leave for the next time?  43  44 Elena: Thank you Chair.  Staff would suggest that we follow the format of the slide right here to 45 focus the discussion on the EIR methodology, the impact findings and mitigation measures, and 46 City of Palo Alto Page 12 specific attention to mitigation measures that maybe you have some comments on and also 1 specifically probably the significant and unavoidable impacts.  2  3 Acting Chair Gardias: Ok, so that would be the agenda for today, right? 4  5 Jonathan Lait, Assistant Director: If the Commission feels, again it’s your… we are here to 6 receive your comments so if you can do it today, great.  If you want us to come back, just tell us 7 the areas that you want us to focus on when we come back as well.  That would be great.  8  9 Acting Chair Gardias: Yeah, well I mean for sure we would like to have a follow up session.  That 10 we, we already know this, right?  Because there will be some learning curve, some after 11 thoughts, so we would like to already put it on our calendar and then we will not be able to 12 review everything.  13  14 Mr. Lait: Ok, so when we get to the calendar, I don’t think our consultant is available for the 15 next meeting, but we can find some time in I guess May where we can come back before the 16 Council meeting? Ok? 17  18 Acting Chair Gardias: Very good.  19  20 Mr. Lait: Thank you.  21  22 Acting Chair Gardias: Ok, thank you.  So let’s get started with EIR methodology.  Would you like 23 to take us into it, just to give a summary of the methodology within a couple of minutes?  So it 24 would just put us into the mood.   25 Mr. Lait: So yeah, if I could suggest, maybe… so I, I don’t know how much the Commission has 26 read.  I mean, it’s a big document and I don’t think we are expecting… we actually had this 27 conversation late in the afternoon.  I mean it could be a little bit intimidating because there is a 28 lot of technical information in here, a lot of details, and as a Commissioner that might be a little 29 bit, could be a little bit off putting because how are we to know about all these different 30 detailed aspects of the code?  And so that extent we do have, we can respond to some of those 31 questions if something strikes you as not being right or you want some more information we 32 can talk about that.  But I would suggest that as community members I would look at the 33 document from that lens and as Commissioners, to you know… if you’ve read the document 34 and Cara kind of spoke to some of the key areas to pay attention to.  If you’re reading 35 something that doesn’t quite sound right those are the things we kind of want to hear about. If 36 we were to launch into a discussion about methodology we would be here into tomorrow 37 sometime. 38  39 Acting Chair Gardias: Ok. 40  41 Mr. Lait: But I guess I would ask maybe amongst the Commissioners if there’s any specific 42 questions that Commissioners have, maybe that would be a way that we can kind of tease out 43 (interrupted)  44  45 Acting Chair Gardias: Very good.  Ok, I know.  We’ll get there.  So good, thank you.  Please. 46 City of Palo Alto Page 13  1 Ms. Jansen: I just want to reassure you that it’s been my experience at hearings like these with 2 planning commissioners on a big document like that, that the questions are kind of all over the 3 place.  So certainly from my point of view it’s fine if we jump around from parks to air quality to 4 traffic and that’s however you guys want to dive in is totally fine.  5  6 Acting Chair Gardias: Very good.  We’ll do. 7  8 Acting Vice‐Chair Waldfogel: Framing question, another framing question. 9  10 Acting Chair Gardias: Yes, so yeah, Commissioner Waldfogel. 11  12 Acting Vice‐Chair Waldfogel: Yeah, thank you.  I mean there’s clearly a huge amount of work 13 has gone into this over more than just a few days, so it’s impressive.  Just another question for 14 staff is, do you want us to try to weigh in on the scenarios, preferencing scenarios versus the 15 question of, say, mitigation that may apply across multiple scenarios?  I mean what I am struck 16 by in this document is that there are very few categories where the impacts differ between the 17 scenarios.  There are just a few and I’m just wondering are we looking for some focus on that 18 question?  I mean you commented earlier that this is an unusual EIR in that it contains multiple 19 scenarios.  You know, I’m surprised you didn’t do a little job descript, interactive calculator for 20 us.  Maybe that will be the next version of this.  But it’s not a serious request.  But I just wonder 21 if you want us to think about that question at all tonight? 22  23 Ms. Jansen: I think the main goal in my mind for tonight is to hear any questions or concerns 24 that you have really about the analysis of the scenarios and the approach to how they were 25 analyzed or the conclusions that we came to.  So to speak to your point, for example, if you 26 would have thought that by reading a particular threshold of significance you just kind of at a 27 gut level would have said, “Oh, well, Scenario 4 is going to be way worse than Scenario 1 on this 28 threshold,” and then you read the discussion and it said “Oh, I have exactly the same impacts.”  29 That’s the kind of question you might raise tonight and say, “Well, why is this?  And I don’t see 30 how that can be, or did you take this into account?” and that would be fine.  As opposed to just 31 a discussion of what we in CEQA parlance call kind of the merits of Scenario 1 versus Scenario 4, 32 if that’s helpful. 33  34 Acting Vice‐Chair Waldfogel: And just a suggestion as you present this you might want to 35 present the baseline numbers for these categories of housing, jobs, and because it’s, again it’s 36 hard to assess whether we are talking about 3 percent changes or 30 percent changes without 37 seeing the baseline numbers presented in this, in this (interrupted)  38   39 Ms. Jansen: Ok, great point.  Yeah and those certainly are in the EIR, but I can see how that 40 would be helpful to have it on here.  41  42 Acting Chair Gardias: Very good, thank you.  Commissioner Downing. 43  44 Commissioner Downing: So I do have kind of a preliminary question, probably a question for 45 Cara.  But so the first two scenarios look at housing growth or looking at the average amount of 46 City of Palo Alto Page 14 housing we’ve added per year, so a little over 100 units, so my question is: how does that work 1 when we’re supposed to put together a Comp Plan that’s also consistent with our Housing 2 Element?  Because in our Housing Element we’ve committed to 1,998 housing units by 2023 3 and so the EIR you’re doing here is looking at significantly less than the impact you would have 4 had to look at for the Housing Element.  So how do these two things jive together?  5  6 Ms. Silver: Thank you.  That’s a good question.  So the Housing Element requires that the City 7 zoned for a certain number of units and so it’s really a theoretical number.  It’s not the actual 8 number that is going to be built; whereas, the growth scenarios sort of estimate what we, it’s 9 not even a belief, it’s just kind of testing what happens if X number of units get built.  So the 10 Housing Element looks at theoretical sites and then these growth scenarios look at the actual 11 units that will be built and what the environmental impacts of that particular level of growth 12 will be. 13  14 Commissioner Downing: So I think what I have difficulty in understanding is that when people 15 go ahead and they do development in line with the housing sites that we selected in the 16 Housing Element, people are relying on this EIR to cover themselves for that development, 17 right?  Because we’ve already looked at what that looks like.  That’s what they are relying on 18 when they go to build out their specific project.  So what I don’t understand is let’s say for 19 whatever reason one year instead of 175 something units or whatever, someone grows at 500 20 units.  How are they covered from an EIR perspective if the EIR looked at far fewer units than 21 they are allowed to build?  How does that work? 22  23 Ms. Silver: Well, this EIR looks at the full range and so actually you will see in this document the 24 environmental impacts of that 500 unit development.  It’s analyzed.  I think what you’re asking 25 though is what happens if the Council were to select a Comp Plan policy that was targeted at 26 that particular number of units and that’s kind of a different issue.  That’s not the CEQA 27 coverage aspect of the issue.  That is if somebody, if the Council selected a growth option that 28 anticipates say 100 units and then a project for 500 units came on line that would be 29 inconsistent with the Comp Plan and would require a Comp Plan amendment.  30  31 Commissioner Downing: Right, so I guess what I’m getting at is I don’t even know why we’re 32 looking at an EIR with two possible options neither of which they could actually select for the 33 new Comp Plan update because it wouldn’t be in line with our Housing Element.  34  35 Ms. Jansen: I just want to go back to that because these are in line with the Housing Element.  36 But all of the scenarios include at least the minimum amount of housing that’s called for in the 37 Housing Element.  Scenarios 1 and 2 anticipate the continuation of the existing adopted 38 Housing Element, and then in 3 and 4 we look at additional housing or a change in the housing 39 sites.  40  41 Commissioner Downing: But I don’t follow that because you’re… the number of housing units 42 you’ve targeted, I mean it’s for 100 something units, and that’s far less than what would 43 actually be allowed to be built under the Housing Element. That’s less than the target.   44  45 Man off microphone: It’s 151 per year. 46 City of Palo Alto Page 15  1 Commissioner Downing: Yeah, 151 per year and yet we’re supposed to build almost 2,000, the 2 target is 2,000 by 2023, so I don’t understand because the two option (interrupted)  3  4 Ms. Jansen: Oh, I see what you’re saying, in terms of the rate. 5  6 Commissioner Downing: Yeah. 7  8 Ms. Jansen: So the total amount is greater, right.  So this won’t do anything to prevent the 9 housing from being built that’s called for in your Housing Element.  I guess the point that I’m 10 making is the total amount, I’m trying to go back to the table here, the total amount under 11 Scenario 1 and Scenario 2, which are the two lowest ones, are still above what’s called for in 12 your current Regional Housing Needs Allocation (RHNA); so in your current Housing Element.  13  14 Commissioner Downing: Well, so I mean to get really technical about it, right, our target for 15 2023 is almost 2,000 units.   16  17 Ms. Jansen: Right. 18  19 Commissioner Downing: Almost certainly for the next 7 year period after that it’s going to be 20 much more than 2,000 units, so I count a minimum of 4,000 units just based on RHNA 21 allocation.  So that’s not even like oh, we want to fix our housing problem.  That’s just plain 22 RHNA allocation.  So the only scenario that even comes close to that is Scenario 4.  So my 23 question is, I’m just… I don’t understand why we are studying scenarios that are not in line with 24 our Housing Element, which would be, if selected for the Comp Plan, immediately inconsistent 25 with the Housing Element.  That’s what I don’t understand.  26  27 Ms. Jansen: I guess, it seems like my concept here that we’re… the total number is larger than 28 your total RHNA is not an adequate response.  So I apologize for that. I think what we wanted 29 to, your question really is: why are we considering this?  I think you have a two‐part question is 30 one, why are we considering this, and two, could we really even adopt this? 31  32 Commissioner Downing: Right, right. 33  34 Ms. Jansen: And I would say the reason you’re considering this is because it’s consistent with 35 the past, I think it’s 40 years of development history in Palo Alto.  So in terms of identifying a 36 range of scenarios I think there is some validity for considering, and again, what we’re testing 37 here is what would happen if, right, we’re not saying this is what you should do or this is the 38 one you have to pick, but part of the question, and I think it is valid to ask is: what would 39 happen if we just continued that pattern?  And so that’s why this Scenario 1 as well as Scenario 40 2 are on the table is because this is the average of the rate you have been doing for the past 40 41 years and because we did hear a lot of voices in the community that say, “I don’t want to grow 42 any faster than that.”  So that’s why these scenarios are among the range of what was tested.  43  44 So then I think the second part of your question is, could we really even really feasibly adopt 45 these?  I think that you could adopt these, and again, the modeling that we’ve done for these 46 City of Palo Alto Page 16 scenarios, the 2 lowest growth Scenarios 1 and 2, does take into account the existing housing 1 sites.  So the housing sites from your adopted Housing Element are in what was modeled for 2 Scenarios 1 and 2 and that’s assumed that those housing sites are going to build out and in 3 addition there would be some more room for additional growth.  What about your future 4 RHNA?  Is it reasonable to say that you would be able to meet those?  I think that’s a more 5 speculative question and I don’t really think there’s necessarily a yes or no answer that anybody 6 could give you today.   7  8 The way that ABAG derives those RHNA projections is based in part on local regulations so you 9 might say that if Palo Alto like had a particularly restrictive growth regime than ABAG might 10 take that into account when assigning you your RHNA and assign you a lower RHNA than we’re 11 guessing today that you’ll get.  Of course, the other thing that ABAG takes into account when 12 it’s making its RHNA assignments is Plan Bay Area and the RTP and the sustainable community 13 strategy and thinking about kind of a larger regional idea of concentrating growth, for example, 14 around transit. Of course, Palo Alto has some really important transit resources that ABAG 15 would probably be looking really closely at as a great place for more housing.  So, would 16 adopting Scenario 1 or Scenario 2 as the preferred scenario make it more difficult for you to 17 meet your RHNA in the future?  I think that’s a very valid question and the City may well find 18 itself in that position.  But I think that’s an important part of what we’re trying to surface here 19 with looking at this range of four scenarios. 20  21 Commissioner Downing: So I just want to make sure that I understand what we’re looking at.  22 So if we did adopt Scenario 1 and 2, and there comes a year where we’re not adding 151 units, 23 we’re adding 500 units, 600 units, are those developers then out of luck?  Do we have to go and 24 redo our EIR if we are, in fact, building out the units that we said we would in our Housing 25 Element? Would we have to go back and redo the EIR? 26  27 Ms. Silver: In general, probably not.  What we would do is we would look at where those 28 housing units are built.  Assuming they are built in the areas that have been analyzed in the EIR, 29 there wouldn’t be a need for additional analysis.  Although there might be some sort of project 30 level impact analysis, so once you know exactly what the… this is kind of a very general program 31 level EIR.  Once a project is identified, a housing project, there might be some additional shade 32 and shadow impacts and aesthetic impacts and groundwater contamination issues or things like 33 that associated with the particular project that is proposed that would require some additional 34 environmental analysis.  35  36 Commissioner Downing: Ok, but they wouldn’t have to go do a separate EIR is what you’re 37 saying?  If they were, if we were over that limit?  If we were over these projections? 38  39 Ms. Silver: If we were… I’m sorry. 40  41 Commissioner Downing: So these EIR’s right, so this projects 151 units per year.  If we had a 42 year where we were building 600 units, would the projects that are over 151 units, would they 43 have to go and do their own separate EIR because this one does not cover them? 44  45 City of Palo Alto Page 17 Ms. Silver: Right, as I explained as long as the sites in this EIR have been analyzed and those are 1 the sites that are being proposed, they wouldn’t have to do program level EIR, but there might 2 be some project specific issues that would be studied in more detail.  It may not be an EIR, it 3 may be Negative Declaration, just some lesser environmental review. 4   5 Commissioner Downing: Ok, and if we had chosen a scenario that covered that number of units, 6 then would that be avoided? 7  8 Ms. Silver: Yeah, it’s really the same answer. 9  10 Commissioner Downing: Ok.  Alright. 11  12 Acting Chair Gardias: So I think Commissioner Alcheck would like to speak to the same subject. 13  14 Commissioner Alcheck: Well actually, ok well first I want to just sort of formally acknowledge 15 that I really appreciate your contributions, Mr. Levy.  I find them particularly informative and 16 inspiring and I hope that you continue to communicate your knowledge to the leadership in this 17 City and to its residents.   18  19 I think it’s hard to imagine like that we will continue for decades this process the way it 20 currently is, because I couldn’t agree more about the issue that we are addressing, this 21 environmental impact as an island.  I’m on a high horse here when I say this, but I think that the 22 solution, the road out of here, is a visionary… there’s a home in Leland Manor this week that’s 23 being listed for $2,000 a square foot.  We have, in my opinion, the only impact that I find 24 problematic at this point is the housing shortage, and I find… It’s my impression that the fifth 25 scenario is a reaction, that all the scenarios are incorporating too much growth.  That was my 26 impression.  I may be wrong, but my impression that this Council and the leadership was not 27 satisfied that any of these scenarios were sufficiently slow enough and that is, I believe, I won’t 28 speak for everyone on the Commission, but I think I am, we are of one mind, Commissioner 29 Downing and I.  And I imagine there are other peers here that feel the same way, that this is 30 just… we need some visionary leadership that inspires this community to address the housing 31 crisis instead of encouraging the sort of fears that are being perpetuated particularly among our 32 residentialist community members who want to sort of turn a blind eye to this problem.  And I 33 think that this notion that the Housing Element, all we have to do in the Housing Element to 34 sort of make it legally adequate is to suggest that we could build this many homes, but we have 35 absolutely no responsibility to really encourage that. In fact, we’re just going to pretend like 36 that’s an option, but we are never going to allow a process that would build more than 140 37 units, which is what we have.  And you’re right, it’s a very restrictive approach to housing 38 development.  And I just can’t imagine that RHNA moving forward will go oh, you have such a 39 restrictive housing policy in place so we’re going to continue to allocate you less units simply 40 because you prefer to live in a $2,000 a square foot residential market.  None of our peers, 41 none my peers of capable of affording housing in this area and it’s just… it’s so hard to imagine 42 that there won’t be some significant just like slap in the face moment over the next decade 43 where we just… I find it problematic.  44  45 City of Palo Alto Page 18 I find this exercise, it’s such an important exercise and I’m so discouraged because I feel like, I 1 don’t feel like our efforts to encourage a fifth scenario that would be in line with the go big 2 approach of Mr. Levy has any likelihood of occurring.  And I think that’s really problematic and I 3 appreciate that the EIR is not the place where we sort of define how we solve every problem, 4 but I do think that this concept of what… maybe the EIR doesn’t have to address the regional 5 and environmental impacts, but why wouldn’t our leadership encourage a draft of an EIR that 6 did accept or define those impacts with more information?  I think this is going to fall on deaf 7 ears.  I think it’s going to go to City Council, I think when it goes to City Council they’re going to 8 be much happier when they see a Scenario 5 that is less than Scenario 4, which is woefully 9 inadequate.  10  11 So I don’t know in hearing your sort of dialog with our City Attorney I think that every project 12 that sort of… any project in our current scenario that would create 500 units of housing would 13 absolutely probably affect elements of the community that would probably necessitate if not a 14 Negative Declaration some sort of the EIR approach on a project based specific level, and I 15 don’t know that there would be a conflict.  I kind of think that her answer that it would be the 16 same answer is probably accurate.  I don’t think that… I think the more important point that 17 you’re highlighting is just, what an inconsistency that the City would approach this from a 18 scenario that is wholly disconnected from… highly sophisticated suggestion of how many units 19 we need.  It just feels like we are participating in an effort to provide inaccurate information.  20 And so by suggesting that we don’t actually have to build those units and that 145 is really what 21 we’ve done for the last 40 years; the last 40 years have resulted in what I would call an housing 22 disaster, and so the… and I don’t know that the RHNA allocation even if we did accomplish it 23 would actually get us out of this disaster so quickly.  Because it probably won’t, but I just think 24 there has to be more emphasis placed on the notion that we should aspire for a regional…  25  26 Our City should aspire to impact the region in an overall positive way, as opposed to how can 27 we essentially ignore the regional situation?  And really it’s funny that comment about 28 addressing the changes that would be required for 100 percent of the existing residential 29 population it’s… the residents of this community that’s not, you would not think that that is the 30 kind of information people want to hear, you know?  We might need to change the way we 31 want to live so that our community could benefit, for our region to benefit, for our earth to 32 benefit.  But, if I, if it was my choice, that’s the sort of information I would like us to consider.  33 What mitigation efforts does the whole community could possibly take on in an effort to 34 improve the negative impacts?  And so I think I’ll end there, but I’m discouraged with the, with 35 my anticipated belief of what Scenario 5 will be, and that’s it.  36  37 Acting Chair Gardias: Thank you.  Commissioner Rosenblum. 38  39 Commissioner Rosenblum: Hi.  So I take the advice to heart to try to concentrate on the analysis 40 and possibly how you came to certain conclusions; however, I think you can’t really do that 41 without looking at the scenario ranges.  And so a couple things that I think would be helpful: 42 what is our number for 2030 in terms of RHNA and ABAG allocation?  So if we hit our minimum 43 from the numbers that you were using from 2013 what is our minimum threshold in terms of 44 household formation that we are expected to hit?   45  46 City of Palo Alto Page 19 Ms. Jansen: You’re asking about if you projected the RHNA, your current RHNA which goes 1 through 2023 (interrupted)  2  3 Commissioner Rosenblum: Correct. 4  5 Ms. Jansen: To 2030. 6  7 Commissioner Rosenblum: Correct. 8  9 Ms. Jansen: What that would be? 10  11 Commissioner Rosenblum: Yeah, because in [unintelligible] Commissioner Downing you said 12 you believe that all of them would meet this.  What is the number we had to meet? 13  14 Ms. Jansen: Well, what I was referring to is just the like I said, the overall total and I understand 15 the point about the rate.  So I certainly don’t have that calculation going forward at my 16 fingertips.   17  18 Commissioner Rosenblum: Ok.  I think that’s a really important number and my guess is that 19 these, all the scenarios except Scenario 4 will be short and that when the new numbers are 20 calculated that even that will be short.  Because I believe the analysis that Dr. Levy brought 21 around there are forces that are moving that number upward.  And furthermore it doesn’t even 22 take into account an existing gap when this started, which as you correctly point out are 40 23 years of housing policy.  So you started in the hole.  We were given an allocation that is based 24 upon 3 percent of the County population, but we have 9 percent of the jobs, 25 percent of 25 Caltrain boardings.  We’re an important regional hub, but we got off light in some ways in the 26 RHNA calculations, but that doesn’t even account for the deficit we started with.  So if we’re 27 trying to address the jobs/housing imbalance I understand there’s a denominator issue you can 28 just get rid of jobs and that might be an answer, but I think the solution is really around 29 housing, particularly if you’re thinking about sustainability and regional planning.   30  31 The second thing I wanted to bring or first question, but also to bring in… I just did, I agreed 32 with Commissioner Waldfogel that it’s very helpful to actually have the baselines.  So I put the 33 baselines in to just calculate the range of growth that you’re anticipating.  And it’s between I 34 think .54 and .88 percent growth per year in housing.  And that is I believe below the regional 35 estimate in every case.  And so I think that even our most aggressive scenario we’re still slipping 36 behind.  And so I echo my Commissioner’s ask to make sure the baseline is there.  Put that 37 baseline against the region.  I think that would be really helpful.  It must be in this document 38 somewhere and I just, again, I read the executive summary.  I went to individual exhibits, but I 39 couldn’t find it myself.   40  41 The final comment I’ll make is Dr. Levy also referenced the Our Palo Alto Summit that took 42 place this last year.  And I remember our Mayor at the time, Holman, made a great speech at 43 the beginning.  Said, “This is the Constitutional Convention for this document, for the 44 Comprehensive Plan” and that that’s what we’re doing is trying to come up with exactly these 45 things.  How much growth do we want in housing?  What is our policy towards job growth?  46 City of Palo Alto Page 20 What is our transportation policy?  And the interesting thing is that they tabulated this.  So 1 every table had to submit their answers by phone and the City captured all this.  So you can just 2 go and download it and I did that.  And so it’s quite revealing.  You have a very high 3 preponderance of answers that were for much higher density, even to the extent of saying we 4 should get rid of our height limits and the people that showed up and it’s a very large set of 5 people, it was like 400 something people, and under each category you have more than 80 6 answers for each of these things.  So you actually have a fairly good set of results and what I’m 7 getting to here is none of the scenarios reflect that.   8  9 All the scenarios are low growth scenarios defined as lower than the County, lower than what 10 would make a dent in the jobs/housing imbalance.  And certainly when you look at certain goals 11 like reducing vehicle miles traveled covering emissions the scenarios really all very similar.  I 12 mean you’re absolutely correct when you said the impacts are all the same.  It’s because the 13 scenarios are almost the same.  And so my point on the analysis is in some ways they’re all kind 14 of the same.  And what I’m asking for is you’re doing Scenario 5 is there should be a bold 15 scenario particularly around housing.  And housing is the root of a lot of the goodness that 16 particularly when you look for sustainability goals, but also to help with affordability and other 17 things that we saw the last time we met, which was around the Citizen’s Survey, the great 18 dissatisfaction was all around affordability of housing, diversity of housing.  Those were the 19 most notable things by far. 20  21 So anyway, so my comment is when I look at the scenarios they feel although you give them 22 different titles the numbers are all within a fairly narrow range.  And that’s why the impacts are 23 all the same.  And so put that aside in terms of the crafting of the document itself, baselines 24 plus our compliance requirements regionally would be super helpful right up front and to see 25 where we are under those would be, would be useful.   26  27 Ms. Jansen: Elena was kind enough to find the current RHNA for me from your current Housing 28 Element.  It’s 1,988 units as Commissioner Downing said.  So I think over eight years that’s 248 29 units a year times 15 years from 2015 to 2030 would be 3,720 units.  I think if I can remember 30 how to do math by hand.  So that would be beyond Scenarios 1 and 2 as you pointed out, 31 slightly beyond Scenario 3, then Scenario 4 would exceed that. 32  33 Commissioner Rosenblum: Yeah, so again I concur with Commissioner Downing.  It’s odd that 34 three of our four scenarios are below what the conservative RHNA estimate is and if Dr. Levy 35 who is a regional economist is correct about this, those numbers are only going up, and we 36 started in a hole.  So I, that reflects my comment that if housing is our main, is one of the main 37 issues as reflected in the Citizen’s Survey, as reflected in the Our Palo Alto Summit, as reflected 38 in just about daily life and the cost of housing, it’s just odd that three of our four scenarios 39 don’t even meet our kind of statutory requirement.  So I think it’s important and I’m glad you’re 40 doing a fifth scenario because it gives us an opportunity to really put the hammer down. 41  42 Acting Chair Gardias: Very good, thank you.  It looks like that’s the material that we would 43 appreciate at the following, at the follow up meeting and probably you should just spend first 44 hour just on reviewing the relationship to the RHNA numbers and scenarios that we have on 45 the table.  Can we do this?   46 City of Palo Alto Page 21  1 Ms. Jansen: Yes, that’s fine. 2  3 Acting Chair Gardias: Very good, thank you.  So (interrupted)  4  5 Ms. Jansen: We’re happy to do that.  I guess, I’m sorry, could I just ask for a clarification on your 6 point about comparing… what I wrote down was put the baseline against the region.  Could you 7 just say again what metrics you’re thinking of there to make sure we’re (interrupted)  8  9 Commissioner Rosenblum: Yes.  Two baselines; the first is your summary tables.  I’ll say net 10 new.  Net new housing, net new population, net new jobs, but don’t give the current.  So two of 11 those numbers are quite easy to find; it’s very easy to find the total number of current 12 households and the total current population.  It’s difficult to find the number of current 13 estimated jobs.  All of them are findable and, but it would be good instead of us trying to find 14 our own numbers, working off different rates you just had the official City numbers that you 15 used when you did the scenarios.   16  17 Ms. Jansen: Ok.   18  19 Commissioner Rosenblum: The second is regional policy estimates, so the latest numbers from 20 ABAG, RHNA, what we’re expected to do.  And so use that as like here’s the hurdle we need to 21 try to hit and if you have a policy if we decide we don’t want to hit it for whatever reason that 22 should be explicit.   23  24 Ms. Jansen: Ok.  And we are happy to provide that and I will since you mentioned looking for it 25 in the EIR just note that at least some of that is in the Population and Housing Chapter which 26 has comparisons to the Current ABAG projects, but I’m happy to put in the, what you’re asking 27 for here, but it is in the EIR. 28  29 Acting Chair Gardias: Very good, thank you.  Commissioner Downing. 30  31 Commissioner Downing: So a little bit out of the box thinking here, but there are certain 32 elements of our Comprehensive Plan for example that are required by law.  We’re required to 33 provide them, we’re required to have Land Use, we’re required to have Housing, but I would 34 suggest a conversation for staff and for Council about other elements that are not necessarily 35 required which other cities undertake because they view them as valuable for assessing the 36 quality of life of the city and where it’s going.  We’ve spent a lot of time talking about these 37 kind of core things, but sort of missing a little bit of the side things.   38  39 So to the point of ok, this is like the one percent of growth, what about the other 99 percent I 40 mean there are Comprehensive Plans that do address those things.  There are Comprehensive 41 Plans that look at economic vitality, right?  That [unintelligible] any number of things that a 42 community finds valuable to itself and for us I mean I certainly think that looking at 43 displacement, looking at housing affordability, just looking at what the quality of life is, what 44 the diversity of the housing stock is.  Not just the numbers, but how many people can actually 45 find what they need?  What actually matches their household size, what actually matches their 46 City of Palo Alto Page 22 incomes, right?  I don’t know that we’re necessarily doing a very good job of coving that and if 1 this is a top priority for us and I don’t know.  I’d like to explore that option for the future 2 because it’s clear that this community has priorities and when other communities come up with 3 priorities that aren’t statutory they still had them in the Comp Plan. 4  5 Ms. Silver: Just one clarification on that.  I think that’s an excellent point.  So and again we have 6 to separate the Comp Plan from the Comp Plan EIR so some of that discussion is actually in the 7 Comp Plan itself in the Housing Element.  And then if your comment is that you would like to 8 see what the environmental impacts of that displacement is and that would be an appropriate 9 comment for the EIR.   10  11 Acting Chair Gardias: Very good.  Cara, thank you very much for reminding us about the 12 objective of this session and all those comments are truly good, right?  We need to just verify 13 the math and I heard we will do it, right?  At the follow up session, but if we may just start 14 refocusing on the EIR because there is another big book that we need to review so I would like 15 to ask my colleagues just to do this.  Commissioner Waldfogel. 16  17 Acting Vice‐Chair Waldfogel: Thank you.  And perhaps to just amplify on some of the comments 18 that have just been made and by the way my preference is to get this done in a finite amount of 19 time.  So that would be a good thing. 20  21 How coupled are the various aspects or how coupled are the impacts from the various aspects?  22 So I mean if we were to think about I’ll probably be pilloried for putting a number out, but if we 23 were to think about say, a 10,000 housing unit objective, but without substantially changing the 24 jobs number I mean how would we even think that one though?  I mean would we have to, I 25 mean are all these things coupled together that the cultural impacts, aesthetic impacts, the air 26 quality impacts are all wrapped around each of these pieces or are they fairly separable?   27  28 Ms. Jansen: It’s a great question and it’s, it’s really something we struggled in both constructing 29 the scenarios and in analyzing the scenarios because at a certain point you really have to look at 30 something as a piece.  It’s very difficult to just analyze an isolated component of a scenario by 31 itself.  So just to take an example kind of a micro‐example of the transportation measures I’ll 32 have you look in the project description and you’ll see that the different scenarios include 33 different sets of transportation measures so like these are summarized in Table 3‐7 and they 34 include different ideas about sustainability for example.  And so when you measure Scenario 4 35 just as an example that really looks at the entire kind of package of a sustainability initiatives 36 and transportation infrastructure improvements and those numbers, the jobs and housing 37 numbers coupled with that set of improvements and that set of sustainability initiatives.   38  39 So just thinking about the job for example of our traffic modelers they can’t really model the 40 effects of only giving employer incentives for carpooling and bicycling separate from giving free 41 transit passes.  Or they could, but what that would mean would be remodeling the scenario 42 kind of for each one of what our five different sustainability initiatives for example that are 43 listed under Scenario 4.  So the approach to the analysis is really to consider these kind of as a 44 package and for that reason it can be somewhat difficult to disentangle whether a given level of 45 impact is due to or a lack of an impact is really due more to the employer incentives or is it due 46 City of Palo Alto Page 23 more to the free transit passes and kind of what, what’s the magnitude of those different 1 measures (interrupted)  2  3 Acting Vice‐Chair Waldfogel: Right, but relative to that can you disentangle housing from jobs?  4 I mean at least at that level.  Is that a, are those separable threads? 5  6 Ms. Jansen: I want to make sure that I’m trying to respond in a helpful way.  The way that the 7 quantitative analysis was done considers both of those things as a package.  To think about the 8 differing impacts I think you’d be really talking about those two topics kind of conceptually.  So 9 does housing generate more trips or do jobs generate more trips or at what times of day do 10 those trips occur?  And you could kind of talk qualitatively about what you might expect to see 11 from an increase in housing or a decrease in jobs, but when we, if we want to do specific 12 quantitative modeling that actually looks at developing different parts of Palo Alto in different 13 ways then we need to assign specific numbers to specific locations and then do that, that 14 modeling and that analysis of that particular scenario.  So to consider a change in one aspect of 15 that scenario whether through a fifth scenario or some modification of one of the scenarios 16 would really mean kind of going back and changing the numbers and doing the model again. 17  18 Acting Vice‐Chair Waldfogel: Well and just to finish this thread and is that a, is that process 19 statutory?  I mean I guess what I’m looking for is: is there a way that we can answer some of 20 these questions?  I mean I’ve heard some requests which I support for scenarios that have 21 more housing.  I don’t think I’ve heard any demands here for scenarios that support more jobs, 22 but people may have viewpoints on that here.  I bet it’d be great if there was a quick way to get 23 to that so that we don’t draw this out into a Scenario 5 followed by Scenarios 6, 7, 8, 9, and 10. 24  25 Ms. Jansen: Sure.  Sure, sure.  Yeah. 26  27 Acting Vice‐Chair Waldfogel: That would just be my ask. 28  29 Ms. Jansen: Right.  And I think that was part of the goal in the scenarios and I definitely have 30 heard that for some of you or maybe all of you the scenarios don’t really seem to represent a 31 range.  For other people they seem very dramatically different.  So, but that was the goal of the 32 four scenarios just to kind of provide like a low and a high so that then once we  do that, those 33 analyses we can make some educated guesses about how changing the numbers or the 34 locations of growth might, might make an (interrupted)  35  36 Acting Vice‐Chair Waldfogel: So to that point then I think there would be a lot of value in 37 perhaps following some of the suggestions here and looking at some, looking at some stretch 38 numbers (interrupted)  39  40 Ms. Jansen: Beyond the range we have (interrupted)  41  42 Acting Vice‐Chair Waldfogel: Right, beyond the ranges that we have because at least that way 43 we can, at least we’ll have some seat of the pants analysis.  So I mean we may say 10,000, 44 15,000 units clearly unacceptable impact, but at least we have something to base that 45 discussion on rather than pure speculation.   46 City of Palo Alto Page 24  1 Acting Chair Gardias: Very good.  We have Commissioner Alcheck waiting for his time. 2  3 Commissioner Alcheck: Yeah, actually I just… this might be a question for Assistant Director 4 Jonathan Lait.  Do you have the impression that Scenario 5 is supposed to be a slower growth 5 model than Scenario 4?  I know that it’s not being presented tonight, but I assume that it’s 6 being worked on and before we get too far ahead of ourselves I’m just curious if you have any 7 information to share sort of regarding what… is it still open for?  We had a community member 8 today that suggested we should go big.  Is that an option or is it, has there been Council 9 direction as to what they’re hoping it should be that you can sort of specify today?   10  11 Mr. Lait: So I’m going to ask Elena who has been working with the consultant team and staff to 12 develop that Scenario 5, but I again just want to take the opportunity to redirect us to the 13 document.  We’re not here about, we’re not here tonight to talk about the Scenario 5, but 14 there will be opportunities to have this discussion.   What we’re here prepared to talk about is 15 the document, but with that in mind I’ll ask Elena just to kind of briefly update the Commission 16 on that Scenario 5.   17  18 Elena: So we have requested direction and feedback from the City Council on what Scenario 5 19 should be analyzing.  We had a meeting about housing in February where we asked should we 20 consider significant housing changes that would result in changes to some of these policies or 21 even the Housing Element and we didn’t receive as much feedback as we had hoped.  We did 22 receive a lot of good information, but I think that’s what we’re anticipating to be hearing back 23 from May 16th, on May 16th.  Our impression is not that they’re looking more for significant 24 increase of housing.  The direction seems to be more looking at the quality of life.  To finding 25 that balance between jobs and housing that would help support existing and future residents of 26 what they expect from the City of Palo Alto.   27  28 Acting Chair Gardias: Very good.  Ok, thank you for the update.  I have two Commissioners 29 waiting for their [unintelligible], but in order just to shape the discussion toward the document 30 I will start asking questions myself.  So hopefully it’s going to just trigger the switch.  So if you 31 don’t mind I will just go through the impacts and mitigation measures and I will refer to the 32 specific sheets so please just follow me and I will just do a couple of them at the time because I 33 know that the others may want to continue on the scenario numbers.   34  35 So if you just let’s go to the Page 1.8 that is the first from the impacts series and just talks about 36 the aesthetics.  And this refers to the, refers to the discussion that was at the Council level 37 about how should Palo Alto look like.  And I think that there will be probably a specific Council 38 direction about how truly architecture and aesthetics of Palo Alto should be derived and I’m 39 sure that they will provide some sort of pointers and guidance in that perspective, but there 40 should be some policy or mitigations because of the changes.  And some of the mitigation 41 measures that address the first aesthetic points talk about variety of the different of promotion 42 of quality design and some other items.  It is always a question what is a quality design.  And 43 then there will be many parties just arguing about this.   44  45 City of Palo Alto Page 25 There is from perspective of the aesthetics and architecture and visual resources there is a 1 concept of vernacular design that pretty much addresses everything that’s [rated to] the 2 environment because that’s the design that just takes the resources that are in, the local 3 resources and builds locally, right?  So there is no transportation, no environmental impact and 4 so forth.  And then pretty much there is a certain aesthetic look that is derived from the local 5 environment.  So this is how adobe buildings were built at a certain point of time because they 6 were natural.  They built out of natural resources; clay and straw and whatever was available.  7 That pretty much gave the old missions their look and then that is a possibility or opportunity 8 for Palo Alto.  So I would if I, I would suggest to insert vernacular definition into this document 9 that would maybe be more appropriate.  So that’s comment number one.   10  11 Then if you turn to Page 1.17 and before I just go to the specific item I would like to just also 12 know that this that was kind of obvious during this discussion, but when you look at that 13 significance of different scenarios as my colleague observes, observed, all of them are pretty 14 much the same for all the, for all impacts which is truly to believe.  There are some differences, 15 like for example for Culture‐3 item, but throughout all of them those scenarios they pretty 16 much they have the same impact.  And I would recommend that you just go and review them 17 again because when I was just looking myself and I can give you maybe couple of comments 18 after the meeting I find that some of them were truly to be, were not really… they should vary 19 among themselves.  That was my perception.  So on Page (interrupted)  20  21 Ms. Jansen: Sorry, couldn’t I just ask about that?  Are you saying that what’s in the table doesn’t 22 match the conclusion that’s in the text or are you saying that you disagree with the conclusion 23 (interrupted)  24  25 Acting Chair Gardias: I disagree with the significance (interrupted)  26  27 Ms. Jansen: Ok. 28  29 Acting Chair Gardias: Of the impact for different scenarios. 30  31 Ms. Jansen: Ok, thank you. 32  33 Acting Chair Gardias: And I just don’t want to just use too much time on this, right?  So there is 34 like for example when I go to Page 117 and that’s a good, I’m going to give you an example on 35 the that relates to a Culture‐1C item, a mitigation measure, and this talks about archeological 36 resources, but pretty much take this comments throughout.  There is number of the state level 37 policy requirements which I believe that are not necessary to be in this document.  They just 38 put a haze and lots of verbiage in this documentation that may not be necessary.  If there is 39 already a policy, state policy measure that we need to comply with this doesn’t have to be in 40 this document.  This is just an obvious reference.   41  42 Ms. Jansen: I agree. 43  44 Acting Chair Gardias: So if there is a possibility and then pretty much this was a bullet point 45 within this mitigation about protection of Palo Alto’s archeological resources; this is governed 46 City of Palo Alto Page 26 with state level documentation so I don’t believe that we need to pretty much repeat what’s 1 governed with the state measures.  And I may find more examples like this.   2  3 So now I’m going to just go back to my colleagues and I know that Commissioner Rosenblum 4 has a comment.   5  6 Commissioner Rosenblum: Yeah so going back to a couple of the specific items under the plan, 7 so assuming the scenarios are what they are a few things I think would be significant.  I think 8 that the biggest lever you have for mitigations so the of the four plans as presented or the four 9 scenarios as presented Scenario 4 seems to be the most thoughtful within the community input 10 that I’ve seen.  Meaning it’s attempting to use various mitigation measures to manage growth 11 versus hard caps.  It anticipates a larger proportion of housing, etcetera.  So if I concentrate on 12 that one I find that the most useful of the scenarios and it seems compliant and it’s the only 13 one that seems compliant with our regional allocation.   14  15 I think that there is language that seems so Transportation 3A, require Transportation Demand 16 Management (TDM) programs, for example, and so my question is how granular do we get at 17 this level?  So do we try to advocate for specific mode shares through more aggressive TDM 18 programming?  So the thing I’m thinking of specifically we just launched our Transportation 19 Management Association (TMA).  They’re beginning to acquire funding.  They are, they have 20 their own goals for trying to work on mode shift.  And so under Scenario 4, under all the 21 scenarios actually, probably the biggest lever in managing impacts is changing people’s 22 behaviors in mode shift.  Should this EIR anticipate the level of funding or the kind of TDM’s 23 that may be required?  Because right now it just says “require TDM,” but is that something 24 that’s going to be anticipated by the Comp Plan or as part of the EIR?  So that’s the question.  25 The comment would be I want this probably to be the biggest lever that we could use 26 particularly under Scenario 4.    27  28 Ms. Jansen: I think that the EIR mitigation measures really have a responsibility to be specific, 29 feasible, and enforceable.  So if we were to just kind of throw out there that oh, the City should 30 start a TMA and do some TDM stuff and we didn’t really have any evidence that you had the 31 resources to do that or you had any intention of doing that then it would be very difficult to 32 kind of propose that as a mitigation measure with a straight face.  But given the fact that you do 33 have a TMA in place and some, [unintelligible] some programs are beginning and the City is 34 funding the early stages of this process I think it can defensively be included as a mitigation 35 measure.  So you might see other for example transportation improvements where we say well, 36 if you’ve built this then that would mitigate the impact, but you don’t have any funding 37 identified to build it so we can’t really rely on that mitigation measure to mitigate the impact.   38  39 Commissioner Rosenblum: In your experience do well crafted EIRs that are related to 40 Comprehensive Plans have specific targets for things like TDM?  So for example, this has targets 41 for number of housing units, number of jobs created, and those are all things that will be 42 achieved through policies and this doesn’t have any zoning implications, but for example, 43 zoning.  Things like that.  And then someone actually has to go and build those housing units.  44 Similarly for TDM right now it’s, it just says and TDM is a mitigation measure.  Is there ever an 45 attempt to say and as part of the scenario mode of Single Occupancy Vehicle (SOV) needs to 46 City of Palo Alto Page 27 drop to this level which implies fairly aggressive TDM probably doubling the frequency of 1 shuttles plus… just curious if this is normally not part of the Comp Plan because in my view this 2 is a very appropriate thing in this kind of Comp Plan where you’re planning housing, jobs, and 3 transportation together. 4  5 Ms. Jansen: I think that you are seeing some communities in California moving in that direction 6 at the Comp Plan or the General Plan level.  I would not necessarily say that it’s widespread at 7 this point particularly in the example that you’re pointing out as TDM.  I’m sure obviously as 8 you’re aware that we’re [unintelligible] see that a lot more.  These days it is tied to specific 9 development proposals and EIRs or specific plans and EIRs in Mountain View, in Menlo Park, 10 etcetera where they’re tied to these kind of larger developments or specific plan areas and they 11 have those kinds of targets or metrics for trips or trip reductions. 12  13 Commissioner Rosenblum: Yeah, so I’ll just make one comment then and then let it go back to 14 my colleagues.  A couple of things to consider; so one, this may be just my personal view, but 15 it’s fairly strongly held which is TMA/TDM is one of the most effective mitigating factors that we 16 have and given that Palo Alto just started one if there’s an area to spend more time on on the 17 mitigation side this would be a good one to dig into, set targets and those would probably be 18 tied eventually to budgets.  But Council would be able to see that and say oh, if this is what has 19 to happen then there’s some implications.   20  21 The second you just mentioned larger developments so I would imagine like North Bayshore 22 and Mountain View or other major developments would have to have more specific plan.  So 23 on that note Palo Alto has a couple of specific plans so Downtown, Cal Ave., and eventually 24 Fry’s.  And I don’t know if this is outside of the scope of this or not, but to have 25 recommendation for specific area plans for those sites if that’s something that… yeah, so?  Is 26 appropriate?  Ok.  Like those sites probably, those three areas have such a disparate effect on 27 really everything, transportation, jobs, and housing sites that those probably need a specific 28 plan.  And other communities in our vicinity have done that through use of specific plans in 29 addition to their comprehensive plan.  So those would be the comments of things that I would 30 see outside of the scenarios that would be useful.   31  32 Acting Chair Gardias: Very good, thank you.  Commissioner Downing. 33  34 Commissioner Downing: I think what I would be interested in knowing is sort of in your expert 35 opinion what are the things that, what are the policies, what are the considerations that when 36 you’re doing these EIR analysis you’re like oh, that shifted the needle.  That made something 37 much better or that made something much worse.  So I think the problem that we’re having in 38 kind of even beginning to kind of look at this analysis in an analytical way is that because every 39 scenario came up with more or less the same impacts it’s really hard for us to even kind of drill 40 into something and say to you oh, well, why is this so much better under this scenario than that 41 one, right?  We can’t even ask you that question because there’s nothing for us to sink our 42 teeth into.  And so in the absence of that I guess I’m asking in other EIRs that you’ve done in 43 other places where you worked what are the things that you saw made a big impact in these 44 kind of analyses?   45  46 City of Palo Alto Page 28 Ms. Jansen: It’s a, that’s a great question.  It’s a tough question to answer because in my 1 experience I mean I’m kind of thinking ahead here and I’m realizing this may sound like I’m 2 trying to weasel out of something and I’m truly not.  Every community is different and the kind 3 of issues that are most important to every community are just so different that the things that 4 they’re trying to grapple with are so divergent.  In some communities it’s schools and school 5 capacity.  That’s the main issue and solving that problem is the thing that they spend the most 6 time on and in other communities it’s [ag] land preservation and in other communities it’s 7 traffic congestion.  So it’s there’s really there’s truly not kind of a one size fits all answer.   8  9 So I think here in Palo Alto I totally agree with Commissioner Alcheck that the thing we’ve 10 probably heard the most about is housing and the need for affordable housing and the need for 11 people to be able to stay in Palo Alto that are already here.  And so I do, I do think you, you 12 already have a robust set of programs in your adopted Housing Element.  Certainly this Comp 13 Plan looks at other ways of, or the Comp Plan scenarios look at other ways of addressing that 14 problem whether through providing more housing and I know there’s as Elena mentioned at 15 the February Council meeting they talked about still more ideas for housing and really kind of 16 housing affordability and preserving affordable housing not just building more housing.  So not 17 all of these solutions are going to necessarily come through your Comp Plan process either as 18 policies or programs or even through EIR mitigation measures.   19  20 Another issue that we’ve heard a lot about here in Palo Alto has been traffic congestion.  And I 21 think we’ve heard from people who both really want to make sure that there continues to be a 22 focus on transit use and access to transit and making transit more accessible and putting more 23 people on transit and also people who say, look regardless of how workers get in and out of 24 Palo Alto I have two kids to get to soccer games and grocery stores and etcetera and we also 25 need to think about ways of getting around Palo Alto that work and where we’re not at total 26 gridlock.   27  28 So those are two different sets of problems with two different sets of solutions and in the latter 29 I think what this EIR shows is one of the biggest differences it could happen from trenching 30 Caltrain.  And that’s one of the EIR’s, excuse me, one of the mitigation measures or one of the I 31 guess scenario components in this EIR that’s really shown to make one of the most kind of 32 dramatic differences that we see between the scenarios just as one example.  So to go back to 33 Commissioner Rosenblum’s comment that’s a component of the scenario where making that 34 happen would clearly be a significant investment for the City and it would also require some 35 regional level of effort likely and not just for Palo Alto by itself.  It’s kind of difficult to tell you 36 here’s the list of the mitigation measures you should adopt because it, I think the problems that 37 you see as the most pressing and that you individually or as a group want to solve may not be 38 the same as the problems that other community members or decision makers see as the most 39 pressing and the most in need of solution. 40  41 Commissioner Downing: Well let me ask you a different question.  I’ve noticed that on both 42 sides [here] we’ve sort of interchanged these two concepts between what’s a policy in a 43 scenario and what’s a mitigation?  And so I guess my question is how do we decide what we’re 44 going to call it and then on the mitigation front are we more or less doing the same mitigations 45 across all scenarios or how do we… how are we picking and choosing those things? 46 City of Palo Alto Page 29  1 Ms. Jansen: It’s another excellent question.  The especially when we look at a programmatic EIR 2 like this the line between what’s kind of a project component and what is tacked on as a 3 mitigation measure can get a little bit blurry.  And I realize that I probably should have touched 4 on this in my presentation.  Typically when we would do a Comp Plan and a Comp Plan EIR the 5 way we handle mitigation measures is an assumption that what we identify as a mitigation will 6 be incorporated into the plan itself as a policy or a program.  So you see that language in some 7 of the mitigation measures like the aesthetics one that Chair Gardias was mentioning earlier 8 where it says the Comp Plan should add these policies to strengthen the protection for visual 9 resources.  So in that case right now actually some of the policies that we reference are current 10 Comp Plan policies, but because of their significance in helping to mitigate that impact we want 11 to make sure and call them out in the mitigation measure so that we say these are really some 12 policies that the Comp Plan needs to include if you want to avoid this potential impact.  So the 13 policies could get, the mitigation measures could become part of the project when the Comp 14 Plan is adopted.  So you might end up with a relatively short what we call Mitigation Monitoring 15 and Reporting Program and instead fold these mitigations into the Comp Plan itself. 16  17 Commissioner Downing: So with respect to this EIR and with respect to kind of 18 transportation/traffic issues of the mitigation measures that you’ve proposed which ones do 19 you think have the most significant impact? 20  21 Ms. Jansen: The most significant ability to reduce impacts?  You know I would have to go back 22 and look at each one individually to give you a good answer and I’m happy to do that.  Of 23 course, the level of impact that you’re trying to mitigate varies between the different scenarios 24 so I think another important question is going to be where do we end up on the preferred 25 scenario and then as I mentioned in the presentation there’s going to have to be a very 26 important step of comparing that preferred scenario to the list of mitigation measures that 27 we’ve identified and either confirming that those mitigation measures would effectively reduce 28 the impacts of the preferred scenario or if necessary identifying additional mitigation measures 29 or tweaking the mitigation measures we have here so that we know that they’re responsive.   30  31 But to go back to your earlier question about kind of how do we, I know which mitigation 32 measure we’re applying to which scenario.  The EIR does say that, but I mean for each 33 mitigation measure.  But to the extent that the City has identified in this EIR a mitigation 34 measure that’s feasible and implementable and effective to some extent it kind of has an 35 obligation under CEQA to make sure that that mitigation measure is adopted and enforced if 36 that impact is going to occur under the preferred scenario.   37  38 Commissioner Downing: It would just be helpful to know what, what are the biggest levers for 39 us to press?  Where are areas that presumably in looking at these mitigation measures you’ve 40 looked at the reality, you’ve looked at budgets, you’ve looked at what you think is feasible, but 41 if there’s a particular mitigation measure that you’re like hey, if we had twice the funding we 42 could quadruple the impact we have here.  Like those are things that would be really helpful for 43 us to know and I feel like I’m not really getting that out of the EIR.  I’m sure it’s in your heads, 44 but I don’t know what those things are.  I don’t know what you guys seem to find as most 45 helpful mitigation measures. 46 City of Palo Alto Page 30  1 Ms. Jansen: Right. Well, I mean I guess two responses.  I think really where those kind of big 2 ticket wins would come from in my mind is less in the mitigation measures because I kind of 3 think of the mitigation measures as cleaning up after the fact.  Like we’ve come up with these 4 scenarios and then these scenarios have these little pitfalls or problems and we’re trying to fix 5 those with the mitigation measures.  I think more effective is to look at the components of the 6 scenarios themselves like you guys have already been talking about.  And I know we’ve been 7 saying that we’re here to talk about the EIR so I’m not trying to get you back off course, but in 8 terms of effecting the greatest change in response to your question I think that really comes in 9 the scenarios rather than in the mitigation measures.  Not that the, the mitigation measures are 10 important, absolutely.  But in terms of making the greatest difference and having just said that I 11 think what we’ve all acknowledged is that among the scenarios and I think this is important, 12 you’re just from the increment of new growth and given the situation that you have on the 13 ground I think it is important to acknowledge that a change like shifting housing sites from 14 south to north and concentrating more density in Downtown or California Avenue just does not 15 have a different universe of impacts, positive or negative necessarily.  It may have some 16 benefits or it may have some smaller negative impacts, but it’s not a different order of 17 magnitude from the other scenarios. 18  19 Acting Chair Gardias: [To what to] discussion about mitigations and measures and policies.  We 20 talk about this at the pre‐Commission meeting and I had a comment that there is number of the 21 policies and programs that are being inserted by CAC group, but possibility by Council to the 22 Comprehensive Plan and then also there is this list, right?  So we may need to just take a look at 23 this comprehensively, understand all this policies and just make sense out of them not only 24 from EIR perspective, but latter on from the Comprehensive Plan perspective. 25  26 Ms. Jansen: Yeah, and we are trying as we’re working with the CAC through their process of 27 working on the elements to make sure that when there are policies that are specifically 28 mentioned that should be in the Comp Plan that we’re putting those in to the elements for 29 discussion by the CAC and those include a note that say “EIR mitigation measures” so they 30 realize the role that they’re playing in the EIR side of the process.  But yes, that step is 31 important and definitely will need to happen. 32  33 Acting Chair Gardias: Ok, very good.  Thank you.  So let me just take a couple of minutes myself.  34 So I would like to just refer you to Page 123.  That is about, that is about greenhouse gas 35 emissions and climate change and because of the draught that’s hopefully just ending I have 36 couple of thoughts that I would like to add to this and specifically on the Page 123 there is 37 verbiage about flooding.  So in some countries, for example, Germany, planning focuses on 38 1,000 flooding zone.  We still just take into the consideration 100 years flood zone.  And also 39 this is the flooding.  The same may be flopped and we can say there should be also impact from 40 the draught perspective.  So my question to you is like this: what would be the impact if we 41 changed the language from 100 to more restrictive 1,000? 42  43 Ms. Jansen: If we… which language are you referring to specifically?   44  45 Acting Chair Gardias: There is within that bullet point there is… 46 City of Palo Alto Page 31  1 Ms. Jansen: That, that Page 123 has, it does have flooding related mitigation measures on it.  2 They had to do mostly with sea level rise rather than the 100 year flood plain.   3  4 Acting Chair Gardias: Right, exactly.  So (interrupted)  5  6 Ms. Jansen: Hydrology (interrupted)  7  8 Acting Chair Gardias: Yeah so instead of 100, right?  Mitigation should just focus on the larger 9 disasters that should be of related to the 1,000 flood zones. 10  11 Ms. Jansen: So the, an example of some specific thresholds of significance that talk about the 12 100 year flood hazard area are Hydrology 7 and 8.  Those are on Page 127.  So just looking at 13 those thresholds and the way they’re currently worded we didn’t identify significant impacts.  14 To your question of what would happen if that, I think the question you’re asking is: what 15 would happen if that threshold was changed to look at 1,000 year (interrupted)  16  17 Acting Chair Gardias: Yes, exactly. 18  19 Ms. Jansen: Flood or a more comprehensive area.  And so I guess there’s kind of a technical 20 question about whether or not that data exists.  I know there’s data for 500 year flood plains, 21 but I think it would be a question of looking at the mapping or the data that exists to say well, 22 where are those impacted areas?  And I would anticipate as I’m sure you would too that that’s 23 kind of a much larger area.  And so we would find more of the City and sphere of influence to 24 be effected by the 1,000 year flood. 25  26 Acting Chair Gardias: Yes, of course.  Yes.  Yes. 27  28 Ms. Jansen: So then you’d be in the position of thinking of either making land use changes or 29 policy and program changes here as mitigation measures (interrupted)  30  31 Acting Chair Gardias: It would definitely cost us more, right?  I mean if we’re going to just adopt 32 1,000, right, it would be just… it would be quite a potential [out place], right, to mitigate this.  33 Right?  But what I am suggesting is just to reconsider this (interrupted)  34  35 Ms. Jansen: I guess another option could be for I think to get at the point you’re making is less 36 of a CEQA impact and mitigation measure question and more of kind of a policy level in the 37 amended Comp Plan to include a policy to examine this or include some information disclosing 38 what those different kind of levels of flood plain are and not just the 100 year flood plain. 39  40 Acting Chair Gardias: Yeah, maybe we should start with the disclosure.  Maybe that should be 41 the first step, right?  Because of course it would be harder for us [that adopt] something more 42 stricter than everybody else is doing.   43  44 Ms. Jansen: Right. 45  46 City of Palo Alto Page 32 Acting Chair Gardias: But at a certain point of time we may get there, right?  So maybe 1 disclosure should be the first step toward this stricter rules.   2  3 Ms. Jansen: Ok. 4  5 Acting Chair Gardias: So then (interrupted)  6  7 Ms. Silver: Excuse, Commissioner Gardias one point to add to the issue of sea level rise when 8 you do get deeper into the discussion of that particular chapter it was interesting from our 9 perspective where in the middle of the analysis an important Supreme Court case decision 10 came down that said that you no longer need to analyze sea level rise under CEQA.  It’s not 11 considered an environmental impact under CEQA.  We chose to move forward with that 12 analysis anyway.  We can analyze more than what’s required at minimum and so you will see a 13 detailed description of or analysis of sea level rise in this document. 14  15 Acting Chair Gardias: Ok, very good.  Thank you.   So if I may just give another example.  So on 16 Page 125 there is a hydrology and water quality and then it just there is couple of risks that 17 talks about the watering of the basement construction, which of course was the subject of 18 various articles.  And then just I found that and then this in addition to the severe draught that 19 we had this year and some tree loss that we had in the, in Palo Alto which maybe we can 20 somehow connect those three items together.  Of course I know that would be hard to argue 21 that the watering of the basement would impact it, but it would just could add to the 22 conditions, to the impact on the lack of trees if you do water certain construction site for 23 basement.   24  25 I think that what we should do we should make sure that we have a specific mitigation measure 26 that spells out that pumped water is belongs to the local, belongs locally.  Otherwise what is 27 happening is just pretty much [unintelligible] it flushes back to the bay and I know that under 28 pressure it comes back later on a couple of months later, but still this water, right, it’s not the 29 bay, the water from the bay, but the water from that vicinity where the construction is 30 occurring.  So I believe that there should be a specific mitigation measure that would require 31 somehow to distribute this water locally as opposed to just doing analysis.  Of course analysis 32 would be one of the parts, right, but then specific requirement to distribute this water locally as 33 opposed to flush it to the bay, which of course is easy.   34  35 So that was another comment.  So now let’s I’m going to go back to my colleague’s comments.  36 No other lights?   37  38 Elena: Chair Gardias if I could just add?  Staff has clearly heard that there’s definite concerns 39 about the breadth of the scenarios and the fact that most of the scenarios are very similar.  We 40 just wanted to add that these scenarios are in the EIR based on Council direction, based on 41 multiple hearings and that’s why they’re framed the way they are.  But there is the fifth 42 scenario that’s coming up as we said on May 16th which is an opportunity to provide a different, 43 a different perspective.  And that item will go to Council and it will also come back to you for 44 further discussion and for further feedback. 45  46 City of Palo Alto Page 33 Acting Chair Gardias: Very good, thank you very much.  So since I don’t see any other lights I’m 1 going to just take another three minutes.  I promise I’ll be brief.  I have a couple of other red 2 lines so I’m going to just give it to you.  It will be ammunition that you can use.   3  4 So Page 129 there is a program to maintain and periodically review height and density limits to 5 discourage single uses.  I’m not really sure if we need such a program.  It’s just pretty much it’s 6 just a part of ongoing operations, right?  It just goes back to my comment that we should not 7 just making certain, we should not be just reinventing this what already is in place. 8  9 Then there is another comment as to the noise level, Page 131.  It just talks about and this is 10 Noise‐1A.  It just talks about exterior noise level.  And one second… and I’m sorry I think that it’s 11 just, I would just take you to Page 132 as opposed to 131.  That when it talks about interior 12 noise level, but pretty much it’s within the same logic, right?  So we have a noise ordinance 13 which is 9.10 that already just specifies a certain standard.  I would like to ask you just to review 14 this, this certain numbers because I think that we have stricter.  I think that our 9.10 just talks 15 about 30 decibels for the, for residential rooms and then 40 decibels for others.  So pretty much 16 making reference to the standards that are not as strict as ours, it’s not necessary here.  Please 17 double check on this. 18  19 Ms. Jansen: I will be happy to double check on that.  I feel fairly confident that this mitigation 20 measure was crafted with reference to the noise ordinance, but I’m happy to double check on 21 that. 22  23 Acting Chair Gardias: Yes, please double check, right?  I just you know I may be mistaken, but I 24 looked at this and I thought that we have a stricter standard. 25  26 Ms. Jansen: Ok.   27  28 Acting Chair Gardias: So and then there was a discussion within the community about the 29 airplane passing over Palo Alto.  I couldn’t find anything in the document.  Maybe there is 30 something, I don’t know, but please take a look at this as well. 31  32 Ms. Jansen: That is touched on in the Noise Element.  If you want me to take a second I’d be 33 happy to give you the, or excuse me, Noise Chapter.  Some specific page numbers, but basically 34 just to summarize the thresholds of significance that we look at when we look at a 35 programmatic document like this really have to do with long term ambient noise increases 36 rather than periodic events.  So it’s again not to say that the airplane over flights are not an 37 important factor in quality of life, but just in terms of which specific quantitative thresholds are 38 looked at those kind of isolated noise events aren’t really captured in the 24 hour ambient 39 noise levels that are the subject of this analysis. 40  41 Acting Chair Gardias: Understand.  Thank you very much for responding.  So that’s we can take 42 it off the table right then?  So then just going to the population and housing 141 and we it also 43 relates to the scenario discussion in a certain way, right?  Because it just it talks here about 44 balance between if you look at the impact Pop‐4 on Page 141 it just talks about that there will 45 be possible imbalance or not imbalance between residents and jobs.  I think that this specific 46 City of Palo Alto Page 34 issue that needs to be studied farther and there needs to be a specific as opposed to comment 1 that no mitigation necessary that’s what this, well, I’m sorry, no.  This says Pop‐3 has no 2 mitigation necessary.  There needs to be you’re just referring to the study that needs to be 3 done and I think the study should be, would be good if that study would be accomplished 4 within the perimeter of the Comprehensive Plan.  It may be too late.   5  6 Because we talk about different, we have different sides about one argues for more housing, 7 the other side argues about the bonds, but to be honest I’m not really sure if we truly know 8 mathematically what this balance is, right?  And we can just if you think about the jobs, right, 9 you can say that there is, there are different, there is a different structure of jobs.  So like for 10 example there are County related jobs, there are original jobs, right, there are different [haps] 11 there are local jobs as well, right?  So it would be nice if somebody just looked at this, truly 12 conducted the study as quickly as possible and just provide us with some perspective which 13 jobs we can just support with the housing in Palo Alto, which jobs we will not be able to support 14 in Palo Alto because regardless what we do those jobs would be pretty much or just the 15 employees would be coming from the outside.  So I think this is important distinction so that is 16 maybe not the correction, but some action item that could be accomplished.  And also 17 (interrupted)  18  19 Ms. Jansen: I just want to make sure that you and all the Commissioners are aware because I 20 think Cara was quite correct in encouraging you to kind of at least focus first on the executive 21 summary, but I just do want to make sure that you’re aware that when you see a little sentence 22 like “no mitigation necessary” I realize that in the table that might sound a little bit dismissive 23 so I want to make sure you know that in the chapter itself if you go to the discussion of that 24 impact you will find a more, much more detailed explanation and in many cases lots of tables 25 and math to support the conclusion.  So I just want to make sure you know that’s there and it’s 26 not just tossed off with one sentence. 27  28 Acting Chair Gardias: Very good, thank you; I will look at this.  And then finally this will be my 29 last comment, on Page 145 you talk about TDM what my colleague Rosenblum talk about.  And 30 this has specific reduction percentages and I would like to and those are coming from the 31 transportation engineer’s manual. 32  33 Ms. Jansen: Right. 34  35 Acting Chair Gardias: Which differ from, which differ I believe from the objectives in the 36 reductions that we had.   37  38 Ms. Jansen: Oh, these are reductions that are based on the rates in the Institute of 39 Transportation Engineers (ITE) trip generation manual.  So that’s kind of a nationwide standard 40 of how many trips you might expect an office park to generate.  And so what this is saying is 41 using that as a benchmark reduce from there.  not to use that standard, but to use that 42 standard as a starting place for then doing a pretty substantial 45 to 30 to 20 percent reduction.    43  44 Acting Chair Gardias: I see, ok.  So that was the point.  Ok.  Very good.  Ok.  So that clarifies this 45 item. 46 City of Palo Alto Page 35  1 Ms. Jansen: Yeah. 2  3 Acting Chair Gardias: Thank you.  So those were my comments.  So just going back to my 4 colleagues; Commissioner Rosenblum. 5  6 Commissioner Rosenblum: Yeah, just a very brief comment.  So I just wanted to respond to Ms. 7 Lee.  I appreciate that you have a range that was given to you by Council and so some of this 8 exercise is us giving feedback to Council that it would be equally odd if we were considering 9 four scenarios that each anticipate adding 50,000 units of housing and there’s community 10 outrage and we didn’t question say why are all these scenarios on the very high side?  And so I 11 think we understand that you’re doing this at Council direction.  The comment to put in the 12 record is they’re all kind of the same.  They’re all lower… I looked up actually you have a table in 13 there so I apologize that actually has your ABAG projection.  It’s 4,420.  It was your projection 14 for 2030 so only Scenario 4 meets it, does not exceed it.  But I think that is how you actually did 15 Scenario 4.  And so you have one barely compliant scenario under those projections and so the 16 message back to Council is we probably need a range here especially if housing is that 17 important.  But otherwise I really thank you for the time.  I understand the constraints that you 18 guys are operating under.   19  20 Acting Chair Gardias: Very good.  I think this concludes our review and we’re going to come 21 back to this at a later time again.  So thank you again for all this work and all this knowledge 22 that you brought to us.  Thank you. 23  24 Ms. Jansen: Thank you very much.   25  26 Commission Action: No action taken, Commissioners provided comment only 27 Call to Order Roll Call Present: ARB: Chair Robert Gooyer Vice Chair Alexander Lew, Board Members Peter Baltay, Wynne Furth, Kyu Kim Absent: None Present: HRB: Chair Martin Bernstein, Board Members David Bower, Beth Bunnenberg, Roger Kohler Absent: Vice Chair Margaret Wimmer, Board Members Patricia DiCicco, Michael Makinen Action Items The following item was heard by the Architectural Review Board and Historic Resources Board jointly. 3. Draft Environmental Impact Report for the Comprehensive Plan Update: Request for Architectural Review Board, Historic Resources Board and Public Comments on a Draft Environmental Impact Report (DEIR) prepared for the Comprehensive Plan Update. The Draft Environmental Impact Report was published on February 5, 2016 for a 90-day public comment period that will end on May 5, 2016. For more information, contact Elena Lee at elena.lee@cityofpaloalto.org [This item was heard following Oral Communications.] Elena Lee reported the purpose of the item was to solicit feedback. The Final Environmental Impact Report would contain responses to all public comments. The Planning and Transportation Commission heard the item on April 13, 2016, and a second hearing was scheduled for May 11, 2016. The City Council was scheduled to hear the item on June 6, 2016. The comment period would end at the close of business on June 6, 2016. Ms. Lee reviewed the process for the DEIR. The City Council was the body responsible for certifying the EIR. The EIR studied long-term policies and programs; it did not set policy. Decision makers could consider revisions based on analyses and conclusions contained in the EIR. As required by CEQA, the document analyzed change from existing conditions rather than the existing Comp Plan. For each scenario, project descriptions summarized the differing impacts or results from housing, population and job projections, land use policies, transportation and infrastructure improvements, growth management strategies, Zoning Code amendments, and sustainability measures. The City Council had expressed a desire to understand all ramifications before selecting a preferred scenario. For the current document, staff prepared a range of potential scenarios. The EIR illustrated potential impacts of potential decisions and programs. The final preferred alternative could be a combination of scenarios. Once the City Council selected the final scenario, Staff would perform additional sensitivity testing to determine whether the EIR covered all topics. The four scenarios did not propose any significant land JOINT ARCHITECTURAL REVIEW BOARD AND HISTORIC RESOURCES BOARD MEETING DRAFT EXCERPT MINUTES: April 21, 2016 City Hall/City Council Chambers City of Palo Alto Page 1 use changes. Scenario 4 proposed changing the zoning designation of the Fry's site from multifamily residential to mixed use. The first scenario was the "business as usual" or the no project scenario as required by CEQA. Scenario 2 proposed the slowest growth of all the scenarios. The third scenario, housing reconsidered, proposed slower growth but not as slow as Scenario 2. Scenario 4 was a sustainability-tested scenario. Areas of significant unavoidable impacts were greenhouse gas and transportation. Areas of less than significant impacts were biological resources, geology, soils, hazards and population and housing. All other areas were determined to have impacts that could be successfully mitigated. In terms of aesthetics, the goal was to ensure visual character was not degraded. For cultural resources, it was important to ensure historic resources were not demolished or altered. A fifth scenario would be published as a supplement to the EIR in approximately October 2016. Staff anticipated providing a Final EIR covering all five scenarios in May 2017. Board Member Bunnenberg inquired whether Board Members could submit personal comments and comments made in public. Ms. Lee replied yes. Board Member Bunnenberg asked if declaring a preference for a scenario constituted taking a position. Ms. Lee advised that Board Members could comment on both the update of the Comprehensive Plan and scenarios. Chair Bernstein inquired whether a definition of compatible had been published and whether creative design had been identified. Ms. Lee explained that the EIR identified additional things that needed to be accomplished after adoption of the EIR. Identification of methods to implement projects would occur after adoption of the EIR. Board Member Bunnenberg indicated the main threats to historic structures were transportation projects, large redevelopment projects and land values. She suggested the Comp Plan recognize the threats of transportation projects and redevelopment projects and include a sphere, perhaps 150 feet, of potential effect around historic properties that would allow the HRB to comment early in the process. She proposed staff submit comments from the HRB to the ARB and to the City Council. She preferred the slow or very slow growth scenarios. Board Member Baltay wanted the EIR to address the potential impact of reducing parking requirements for some higher-density residential developments. Allowing only one parking unit per development was worth study and could have the impact of making it easier for builders and architects to develop units, which could encourage or force people to use alternate means of transportation. The EIR should study in detail the impact of changing parking requirements in a non-obvious way to promote greater densities of housing. Board Member Bower noted San Francisco had adopted a limited parking requirement for buildings which resulted in vast amounts of cars parking on the street. Therefore, he would be hesitant to do the same. The HRB was constantly faced with destruction of historic resources without a means to stop the destruction. He hoped that would be recognized in the new Comp Plan, and that the new Comp Plan would contain better tools to deal with destruction of historic resources. The DEIR discussed potential shade and shadow impacts as it impacted open public spaces. That should be broadened to surrounding structures. Vice Chair Lew inquired whether the EIR could evaluate proposals contained in other cities' general plans and perhaps incorporate some proposals in the new Comprehensive Plan. Ms. Lee reported some proposals were being evaluated in the Comp Plan update process. In addition, staff was following Comprehensive Plan updates in East Palo Alto and Menlo Park. The EIR studied impacts from traffic, population and greenhouse gas emissions in the cumulative analysis. Vice Chair Lew was struck by the similar numbers of the four scenarios, but the aesthetics of the four scenarios were potentially very different.. He suggested the four scenarios contain illustrations of the aesthetics for each scenario. He also suggested traffic data be illustrated with graphics. He liked the shadow studies for public open space and was interested in the standards for shading impacts. City of Palo Alto Page 2 Board Member Kohler requested a list of accomplishments resulting from the Comprehensive Plan. He had reviewed several Comprehensive Plans over the years of his service on the HRB; however, conditions in the City never seemed to improve. Board Member Furth suggested the ARB schedule a study session to discuss the Comprehensive Plan. Baseline numbers in the DEIR would be helpful to determine the percentage of change. An important point of the EIR was that it circumscribed the outer limit of possible policy changes that would not require further environmental review. However, the document did not go far enough. Small changes in vehicle miles traveled per capita meant an overall increase in vehicles mile traveled, which suggested decreased mobility. The Transportation Element seemed to have inadequate measures to address mobility. Based on her cycling experiences, onsite bicycle parking requirements did not support a more aggressive and intensive use of bicycles for short trips. That should be addressed in the Transportation Element. She suggested the document include a table of acronyms. With respect to Scenario 3, she was unsure how focusing on working professionals and ignoring lower-income groups was admirable or consistent with federal and state housing policy. She did not feel they had adequate tools to think about that. She suggested more discussion of the environmental effects of demolition of existing buildings. In analyzing the "business as usual" scenario, staff should assume that all sites would be built to maximum FAR with underground parking. She expressed concern regarding the effects of that in terms of intensity of development and in terms of greenhouse gas and other pollution issues. It was now possible to have a light-industry software factory in any space except a retail space. Actually, it could even occur in a retail space. That issue should be addressed. She expressed concern that small professional offices were being replaced with larger uses and that urban greenery was being lost. They needed analytic tools to indicate whether redevelopment would increase greenery and to determine whether development would result in heat islands. She did not find an analysis of heat islands in the DEIR. She hoped proposed demolition regulations for historic resources and evaluation of potential historic resources were tied together. She expressed concerns regarding loss of views of the Foothills and the skyline changing from greenery to buildings. Perhaps the definition of scenic highways should be expanded. Board Member Kim agreed that illustrations and drawings and that a study session would be helpful. In addition, summaries indicating Comprehensive Plan and EIR components subject to ARB review would be helpful. They needed better definitions of high quality and creative design as they could be subjective. He asked if another draft would be reviewed after the City Council reviewed it on June 6th. Ms. Lee explained that ff the EIR included all the analysis the Council felt was necessary and identified all mitigation measures, then that piece would be packaged in the form of a Final EIR. An environmental analysis of the fifth scenario would be a separate companion document to the Draft EIR. At the end of the process, both documents would be addressed in the Final EIR. If the City Council identified a new scenario or other items that had not been fully analyzed in the EIR, then staff would prepare a full analysis of that in a second supplement to the EIR, which would be subject to the full review process. Board Member Kim inquired whether a draft of the Final EIR would be reviewed or submitted to Council for certification. Ms. Lee reported the Final EIR was required to be circulated for a minimum of 10 days for public comment. If no further comments were received or changes needed, then the Final EIR would be certified by the City Council. Chair Bernstein concurred with comments regarding a study session. The HRB was encouraging applicants to request a study session with the HRB prior to submitting an application. Perhaps the EIR could include encouragement of study sessions with the HRB. With respect to POP-4A, page 8, affordable housing should be placed on the site being considered rather than elsewhere. A study session regarding a historic resource should be required and should include review of an area of potential effect. Perhaps the DEIR could analyze a central district where cars were prohibited. Scenario 3 should include analysis of lower-income households in areas of increased housing densities. Chair Gooyer felt the priority had been housing, which resulted in housing being placed in commercial or R&D areas. Scenario 3 was the most practical scenario. TOD was the future and the most practical approach. City of Palo Alto Page 3 Board Member Questions, Comments, Announcements Board Member Furth requested a study session regarding the Draft EIR for the Comprehensive Plan. Vice Chair Lew felt there were two items: the DEIR and the Comprehensive Plan. Board Member Furth wished to discuss the aesthetics section. It seemed to omit some important elements. If Board Members agreed that the ARB wasn't or couldn't evaluate aspects of projects, then shaping mitigation measures in the Comprehensive Plan EIR was a good way to make that happen. Chair Gooyer inquired whether Board Member Furth was interested in a discussion or having someone present to review the finer points. Board Member Furth was more interested in Board Members' views. The criteria for aesthetic evaluation and proposed mitigation measures and level of significance drove what happened in the Comp Plan. Public comments regarding neglected aesthetic aspects were interesting. If it was properly mitigated, the City would be better looking in the future. Board Member Baltay would support scheduling a study session if the goal was for the Board to speak as a unified voice and impact the process. Board Member Furth concurred. Board Member Baltay stated it would be appropriate for the Chair to appoint a subcommittee to develop a plan. Board Member Furth wished to consider the important as well as the urgent. Board Member Furth was willing to serve on a subcommittee. Chair Gooyer requested a second Board Member volunteer for the subcommittee. Vice Chair Lew did so. Board Member Baltay suggested all Board Members submit written comments. Board Member Furth stated that would violate the Brown Act. MOTION: Board Member Furth moved, seconded by Vice Chair Lew, to form a subcommittee to review the Comprehensive Plan DEIR. City of Palo Alto Page 4 ATTACHMENT E Palo Alto Comprehensive Plan Update Summary of Additional Scenarios Proposed for Analysis in a Supplement to the Draft EIR May 23, 2016 This attachment summarizes the City Council’s direction to analyze additional scenarios in a supplement to the Draft Environmental Impact Report (EIR) on the City’s Comprehensive Plan Update prior to proceeding to a Final EIR. As described further below, two new scenarios would supplement those included in the Draft EIR as follows: Table 1. Summary of EIR Scenarios: Population & Employment Parameters (1) Net Change 2015-2030 (City of Palo Alto Only) Resulting Jobs/Housing Balance in 20303 Population/ Housing Non-Res Sq. Ft.2 Jobs 1. Business as Usual 6,600/2,720 3.3M 15,480 Jobs/Employed Residents Ratio of 3.20 2. Slowing Growth 6,600/2,720 3M 9,850 Jobs/Employed Residents Ratio of 3.04 3. Housing Tested I 8,435/3,545 3.5M 12,755 Jobs/Employed Residents Ratio of 3.03 4. Sustainability Tested I 10,455/4,420 4.M 15,480 Jobs/Employed Residents Ratio of 3.04 5. [NEW] Sustainability Tested II 8435/3,546 2.7M 8,868 Jobs/Employed Residents Ratio of 2.93 6. [NEW] Housing Tested II 13,737/6,000 2.7M 8,868 Jobs/Employed Residents Ratio of 2.71 (1) The scenarios also include different ideas for zoning/implementation actions, transportation investments, and sustainability measures as discussed further below. (2) This number includes 1.3M sq. ft. that has already been approved at the Stanford Medical Center. The balance of the new nonresidential square footage would be located in areas both inside and outside of the “monitored areas” referenced in Policy L-8 and Map L-6 in the Comp Plan and in areas both inside and outside of the area subject to the interim annual limit of 50,000 square feet new office/R&D space. (3) The number of employed residents in 2030 is estimated at approximately 48% of total population based on ABAG Projections 2013. The ratio of jobs to employed residents in this column assumes a 2014 base of 65,685 people and 95,460 jobs. Source: Palo Alto Department of Planning & Community Environment, May 2016 The City of Palo Alto has been working on an update to its Comprehensive Plan since 2008 and ATTACHMENT F May 23, 2016 Summary of EIR Scenarios Page 2 published a Draft Environmental Impact Report (EIR) in February 2016 assessing four “scenarios” or alternatives at an equal level of detail, hoping to inform policy direction regarding the location and amount of growth desired by 2030, as well as policies and programs needed to mitigate the impacts of that growth. On January 19 and February 22, the City Council indicated their desire to analyze an additional scenario in a supplement to the Draft EIR and on May 16, the City Council provided basic parameters of two new scenarios (scenarios number 5 & 6), as shown in Table 1.  The first new scenario, Scenario 5, Sustainability Tested II, proposes 10% fewer jobs than Scenario 2, Slowing Growth, and the same number of housing units as Scenario 3, Housing Tested I. This new scenario is intended to test the efficacy of mitigation and sustainability measures when applied to relatively slow growth over the 15 year planning period.  The second new scenario, Scenario 6, Housing Tested II, proposes 10% fewer jobs than Scenario 2, Slowing Growth, and 36% more housing than Scenario 4, Sustainability I. This new scenario is intended to test policies and programs to accelerate the production of housing over the 15 year planning period, while applying mitigation and sustainability measures to address the impacts of growth. In both of the new scenarios, Comprehensive Plan programs and zoning changes would be developed to provide for a mix of housing for Palo Alto residents, including affordable housing, senior housing, housing for special needs populations, micro units, housing with preferences for members of the local workforce, and housing with reduced parking and traffic impacts, reduced air emissions, and reduced energy and water use when compared with conventional units. Housing locations and characteristics for each scenario are summarized in Table 2, below. Table 2. Summary of Housing-Related Policies & Programsa Summary of Housing Policies & & Programs Scenarios 1 2 3 4 5 6 Maintain All Existing Housing Sites √ √ √ Eliminate Housing Sites on San Antonio and South El Camino √ √ √ Increase residential densities on sites in Downtown, the California Ave Area and along El Camino Real √ √ √ √ Add new housing sites to the El Camino frontage of the Research Park and the Shopping Center √ √ Consider additional sites near SUMC or in western portion of the Research Park √ Convert some commercial development potential (FAR) to residential FAR √ √ √ √ √ Remove constraints on the addition of Accessory Dwelling Units √ √ √ √ √ May 23, 2016 Summary of EIR Scenarios Page 3 Summary of Housing Policies & & Programs Scenarios 1 2 3 4 5 6 Adopt policies to avoid the loss of existing housing and displacement √ √ √ √ √ Adopt regulations and incentives to create smaller units √ √ √ √ √ (a)This list is not a complete listing of possible policy and zoning changes, but includes major initiatives required to reach the housing projections of each scenario. There is some overlap between these and the zoning changes summarized later. Source: Palo Alto Department of Planning & Community Environment, May 2016 Brief Description of the Six Scenarios 1. “Business As Usual” – the “business as usual” scenario shows the results if the City continued to operate under the existing Comprehensive Plan with no changes to goals, policies and programs. Any new housing built would be constructed under existing zoning and no innovations in housing or new approaches to address the high cost of housing would be explored. No new growth management measures are anticipated, and any transit or traffic improvements would come from the existing infrastructure plan for the City. This scenario uses a local forecast of housing growth based on the City’s past performance (a long term average of about 150-160 new dwelling units per year), and ABAG’s 2013 projection of job growth. 2. Scenario Two, or the “Growth Slowed” Scenario, would slow the pace of job growth when compared with Scenario One by moderating the pace of office/R&D development throughout the city. Scenario Two would also ensure that the modest amount of housing growth expected under Scenario One would be built-out as small units and other housing types appropriate for seniors and the Palo Alto workforce. Transportation investments in this scenario would include implementation of the County’s expressway plan. 3. Scenario Three, or the “Housing Tested I” Scenario, would implement a growth management regime similar to the interim annual limit on office/R&D adopted by the City Council in 2015 for the fastest changing areas of the City and would eliminate housing sites along San Antonio and South El Camino. In place of these housing sites, Scenario 3 would increase housing densities on other housing sites Downtown, near California Avenue, and in other locations in the City close to transit and services. Policies, regulations, and incentives would be designed to ensure smaller units for the working professional and senior populations of the City. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench. May 23, 2016 Summary of EIR Scenarios Page 4 4. Scenario Four, or the “Sustainability Tested I” Scenario, assumes the most growth in housing and employment, consistent with ABAG projections. Rather than moderating the pace of development, this scenario would seek to limit the impacts of development. Housing sites along San Antonio and South El Camino would be eliminated and replaced by both increased densities on other housing sites and by the addition of new sites along the El Camino Real frontage of the Stanford Research Park and the Stanford Shopping Center. Potential policies and regulations would be enacted to advance sustainability objectives, including free transit passes for residents in transit-served areas, achieving LEED platinum certification for new development, maximizing local solar energy production, foregoing new natural gas hookups, and utilizing drought- tolerant landscaping. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench, and incorporating mix flow bus rapid transit on El Camino Real (with curbside stations and queue jumping for transit vehicles). 5. Scenario Five, or the “Sustainability Tested II” Scenario, would implement a growth management program to limit the pace of office/R&D development and convert some commercial development potential (Floor Area Ratio or FAR) to residential FAR in Downtown and the California Avenue area. Scenario 5 would eliminate housing sites along San Antonio and South El Camino and in place of these sites, would increase housing densities on sites Downtown and in the California Avenue area close to transit and services. Policies, regulations, and incentives would be designed to ensure smaller units for the working professional and senior populations of the City. Potential policies and regulations would be enacted to advance sustainability objectives, including free transit passes for residents in transit-served areas, achieving LEED platinum certification for new development, maximizing local solar energy production, foregoing new natural gas hookups, and utilizing drought-tolerant landscaping. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench. 6. Scenario Six, or the “Housing Tested II” Scenario, would also implement a growth management program to limit the pace of office/R&D development and would convert some commercial development potential (Floor Area Ratio or FAR) to residential FAR in Downtown, the California Avenue area, and along the El Camino Real corridor. Scenario Six would eliminate housing sites along San Antonio and South El Camino and in place of these sites, would both increase housing densities in other areas of the City close to transit and services, and add new housing sites along the El Camino Real frontage of the Stanford Research Park and the Stanford Shopping Center. Additional housing sites in the Research Park could also be considered. Policies, regulations, and incentives would be designed to ensure smaller units for the working professional and senior populations of the City. Potential policies and regulations would be enacted to advance sustainability objectives, including free transit passes for residents in transit-served May 23, 2016 Summary of EIR Scenarios Page 5 areas, achieving LEED platinum certification for new development, maximizing local solar energy production, foregoing new natural gas hookups, and utilizing drought- tolerant landscaping. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench, and incorporating mix flow bus rapid transit on El Camino Real (with curbside stations and queue jumping for transit vehicles). Under all scenarios, goals and policies of the Comprehensive Plan Update will be implemented through programs, some of which will support specific changes in the City’s zoning ordinance. The four EIR scenarios recognize this fact by suggesting and evaluating zoning code amendments that could accompany the Comp Plan Update. These suggested amendments are not meant to be prescriptive, but generally outline actions that could be taken to implement the policy parameters of each scenario. Similarly, the evaluation of Scenarios 5 & 6 can test a variety of zoning amendments to achieve the population/housing and employment/square footage numbers included in Table 1. Suggestions are included in Table 3, below. Table 3. Zoning Code Amendments for the EIR Scenarios Proposed Zoning Code Amendmentsa Scenarios 1 2 3 4 5a 6a Planned Community (PC) zoning district provisions would be reformed. √ √ √ √ √ √ Strategies to preserve retail would be enhanced for the city’s neighborhoods. √ √ √ √ √ √ Incentives would be considered for small lot consolidation along El Camino Real. √ √ √ √ √ √ A Conditional Use Permit (CUP) would be required for new office and R&D uses in order to regulate employment densities. √ √ √ An alternate mechanism would be explored for moderating employment densities, either through regulation or revenue collection. √ √ Allowable commercial densities would be reduced and replaced with residential densities. √ √ √ √ √ Modest exceptions to the City’s 50-foot height limit would be permitted for projects with ground floor retail and residences above. √ √ √ Allowable residential densities would be increased downtown and near California Avenue, possibly by adding the PTODb zoning designation to downtown and streamlining the permitting process to allow for residential development in the PTOD zone by right. Another possibility would be to eliminate maximum dwelling unit densities and use minimum densities and FAR to encourage more, smaller units. √ √ √ √ May 23, 2016 Summary of EIR Scenarios Page 6 Proposed Zoning Code Amendmentsa Scenarios 1 2 3 4 5a 6a Allowable residential densities would be increased on the El Camino Corridor, possibly by adding the PTODb zoning designation to pedestrian “nodes” along the corridor with modified regulations to encourage use of the designation. Another possibility would be to eliminate maximum dwelling unit densities and use minimum densities and FAR to encourage more, smaller units. √ √ Mitigation and sustainability measures would be adopted to minimize impacts of new market rate housing and new non-residential development by requiring mitigation, monitoring, and enforcement. √ √ (a)The suggested zoning changes listed here do not include all of the sustainability measures or mitigation measures which could be applied to the scenarios. (b) The Pedestrian and Transit-Oriented Development (PTOD) combining zoning district is intended to allow higher density residential dwellings on commercial, industrial, and multi-family parcels within a walkable distance of Caltrain stations, while protecting low density residential parcels and parcels with historical resources. Source: Comp Plan Update Draft EIR, February 2016 and Palo Alto Department of Planning & Community Environment, May 2016 The Comprehensive Plan Update will identify infrastructure investments expected to occur over the next 15 years to the extent feasible and will rely on the City’s adopted infrastructure plan as a base document. The planning scenarios evaluated in the program-level EIR provide an opportunity to evaluate other potential transportation infrastructure projects, and these are included in Table 4, below. Table 4. Infrastructure Investments for the EIR Scenarios Summary of Infrastructure Investmentsa Scenarios 1 2 3 4 5 6 New Public Safety Building √ √ √ √ √ √ Bicycle Bridge over US 101 √ √ √ √ √ √ Bicycle/Pedestrian Plan Implementation Projects √ √ √ √ √ √ Byxbee Park √ √ √ √ √ √ California Avenue Parking Garage √ √ √ √ √ √ Downtown Parking Garage √ √ √ √ √ √ Fire Stations √ √ √ √ √ √ County Expressway Plan Implementation √ Grade separation of Caltrain in a trench below Charleston and Meadow; other improvements along the corridor. √ √ √ √ Bus Rapid Transit on El Camino Real in mixed-flow lanes with the addition of queue jumping and curbside stations. √ √ (a)This list is not a complete listing of the City’s infrastructure plan, but includes those investments highlighted in Draft EIR Scenarios 1-4 as well as others that may be appropriate for highlighting in Scenarios 5&6. There may be some overlap between the suggested investments listed here and the sustainability measures and May 23, 2016 Summary of EIR Scenarios Page 7 performance/mitigation measures referenced later. Source: Comp Plan Update Draft EIR, February 2016 and Palo Alto Department of Planning & Community Environment, May 2016 On April 18, 2016, the City Council indicated their support for the draft SCAP goal of reducing GHG Emissions 80% below 1990 levels by 2030 (twenty years ahead of the State’s goal) and requested clarity on how the Comp Plan Update and the SCAP will be integrated. The two plans are intended to be coordinated and complimentary, and while SCAP principles and strategies have not been fully defined as of yet, Table 5 acknowledges the relationship between the two plans, and indicates some of the sustainability measures that are common to both for evaluation as part of the EIR scenarios. Table 5. Sustainability Measures for the EIR Scenarios Summary of Sustainability Measuresa Scenarios 1 2 3 4 5 6 Mobility Paid transit passes for employees in workplaces with over 50 employees (portion of SCAP Strategy F-INC- 1) √ √ √ √ √ √ Employer incentives for carpooling and bicycling (SCAP Strategy F-FAC-3.4) √ √ √ √ √ Unbundled parking costs for multi-family units (portion of SCAP Strategy T-INC-2) √ √ √ √ Parking charge program for existing workplaces with over 50 employees (portion of SCAP Strategy T-INC- 2) √ √ √ Paid parking in Downtown and California Avenue areas (portion of SCAP Strategy T-INC-2) √ √ √ Free transit passes for all Palo Alto residents in transit-accessible areas (portion of SCAP Strategy F- INC-1) √ √ √ Adoption of the SCAP goal of a 80% reduction in GHG emissions by 2030 and alignment of the Comprehensive Plan Update with SCAP principles. Inclusion of Comprehensive Plan policies and programs supportive of the refinement and furtherance of SCAP strategies. √ √ (a)The suggested sustainability measures listed here do not include every strategy from the draft SCAP, which is still a work in progress. This list also does not include mitigation measures which are listed separately below, even though many address topics related to sustainability (for example, transportation mitigation to limit and off-set new trips). Source: Comp Plan Update Draft EIR, February 2016; Draft SCAP, April 2016, and Palo Alto Department of Planning & Community Environment, May 2016 All of the EIR scenarios will require mitigation measures to address significant environmental impacts and consistent with the Council’s direction, these will be analyzed as part of Scenarios 5 and 6. For example, the analysis will assess the effectiveness of Mitigation Measure May 23, 2016 Summary of EIR Scenarios Page 8 TRANS1a, which establishes a framework for imposing a “no net new trips” requirement on market rate housing, office/R&D development, and other uses. The measure reads: TRANS-1a: Adopt a programmatic approach to reducing traffic with the goal of achieving no net increase in peak period motor vehicle trips from new development, with an exception for uses that directly contribute to the neighborhood character and diversity of Palo Alto (such as ground floor retail and below market rate housing). The program should, at a minimum:  Require new development projects to prepare and implement a Transportation Demand Management (TDM) Plan to achieve the following reduction in peak period motor vehicle trips from the rates included in the Institute of Transportation Engineers’ Trip Generation Manual for the appropriate land use category. These reductions are deemed aggressive, yet feasible, for the districts indicated. o 45 percent reduction in the Downtown district o 35 percent reduction in the California Avenue area o 30 percent reduction in the Stanford Research Park o 30 percent reduction in the El Camino Real Corridor o 20 percent reduction in other areas of the city TDM Plans must be approved by the City and monitored by the property owner on an annual basis. The Plans must contain enforcement mechanisms or penalties that accrue if targets are not met.  Require new development projects to offset remaining peak period motor vehicle trips through one of the following methods: o By directly contracting with another property owner or organization to reduce trips generated from another site; or o By paying an annual fee to the City for use in reducing motor vehicle trips to the extent feasible through the provision of transit services, carpool/rideshare incentives, bicycle lanes, and other similar programs and improvements. A full list of EIR mitigation measures needed for Scenarios 2-4 is included in the Executive Summary (Chapter 1) of the Draft EIR and potential modifications or additions to this list will be considered during the analysis of Scenarios 5-6. Next Steps Once the Draft EIR comment period has concluded and final direction on the new scenarios is provided, staff will post written comments on the website and make them available to the Council, the Planning & Transportation Commission, and the public. Staff will also work with the City’s consultants, Placeworks, to modify the scope of work included in the contract amendment approved on May 16, 2016 to allow for analysis of a sixth scenario. (The May 23, 2016 Summary of EIR Scenarios Page 9 amendment assumed only five scenarios.) Some efficiencies may be possible given that the new scenario five is very similar to those already analyzed in the Draft EIR, but it’s expected that an additional contract amendment will be required. City of Palo Alto (ID # 6721) City Council Staff Report Report Type: Action Items Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Draft 1700 Embarcadero Road: Mercedes Benz Dealership Title: PUBLIC HEARING: Adoption of a Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program, and Approval of a Site and Design Application to Demolish the Existing Approximately 18,000 Square Foot Building and Construct a new Approximately 62,000 Square Foot Building for an Automobile Dealership Located at 1700 Embarcadero Road. The Application Includes Design Enhancement Exception Request to Allow Deviation from the 10 Foot Build-to-Line From Embarcadero Road and Bayshore Road. There is Also a Request to Apply the Automobile Dealership (AD) Zoning Overlay. Environmental Assessment: An Initial Study and Mitigated Negative Declaration was Circulated. Zoning District: CS (D) Service Commercial and Site Design Review Combining District. The Planning and Transportation Commission Recommended Approval. From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council: 1. Adopt the Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program; 2. Adopt the ordinance adding the Automobile Dealership (AD) combining district to the subject property (Attachment C); 3. Approve an application for a Site and Design and Architectural Review for the construction of a new automobile dealership, based on findings and conditions contained in Attachment B; and 4. Approve an application for a Design Enhancement Exception for deviation from the ‘build-to’ setback along Embarcadero and Bayshore Roads, based on findings and conditions contained in Attachment B. Executive Summary The applicant, Fletcher Jones, representing Mercedes Benz, proposes to demolish the former City of Palo Alto Page 2 17,942 square foot single-story Ming’s Restaurant building and construct a three-story 61,459 square foot automobile dealership with roof deck parking and detached car wash facility. The property is within the Site and Design Review (D) combining district and adjacent to the Baylands (within Baylands Master Plan). The applicant also requests the Automobile Dealership Combining District (AD) be applied to the subject property to permit automobile sales. The Site and Design Review and AD Combining District requests required the Planning & Transportation Commission (PTC) review and recommendation to the City Council. The requested Design Enhancement Exception (DEE) to deviate from the “build-to-line” requirement for the Embarcadero Road setback and the Architectural Review require the Architectural Review Board (ARB) to provide a recommendation to the City Council. To implement the project in accordance with the California Environmental Quality Act (CEQA), an Initial Study/Mitigated Negative Declaration (IS/MND) was prepared and circulated on April 22 for 20 days. The PTC at their meeting on April 27, 2016 recommended that the City Council adopt the IS/MND, the Zoning Amendment and Site and Design Review findings. The ARB at their meeting on May 19, 2016 recommended that the City Council adopt the IS/MND, the Architectural Review and DEE findings. Background The site was zoned Planned Community until the Council approved a rezoning of the site to the CS(D) zone in conjunction with a hotel project entitlement in 2009. The hotel entitlement was extended in 2013 and has since expired. Nonetheless, new development on the site must meet the development standards of the CS(D) zoning district. Planning and Transportation Commission Review On April 27, 2016, the Commission reviewed the Zoning Amendment, Site and Design Review applications, and voted unanimously to recommend project approval as recommended in the staff report. The minutes from the April 27, 2016 Commission hearing are not available, however, the video of the discussion is available at the following link: https://www.youtube.com/watch?v=aflImdyj9qc&start=11465&width=420&height=315. The Commission staff report can be found on the City’s website at the following link: http://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?BlobID=52072. In summary, the Commission had discussion about loading of inventory and that there should be some review of traffic conditions beyond the impacts identified in the project’s Traffic Impact Analysis for the vicinity around the U.S. 101/Embarcadero Road-East Bayshore Road intersection. The Commission acknowledged that this traffic was not a result of the project. Staff acknowledged the concern and comment. Architectural Review Board City of Palo Alto Page 3 The subject application was presented to the ARB on four occasions with the last hearing focusing on project related landscaping, the color of an exterior stair feature and exterior lighting. On May 19, 20161 the ARB Recommended approval of the project 5-0. The Board discussed the project at length and had concerns about the overall mass and scale of the building. In response to boardmember comments, the applicant, eliminated large car elevators above the roofline, which resulted in space being dedicated to internal drive aisles and ramps instead of service and new car inventory parking; however, this change addressed a significant ARB concern. The applicant modified the landscape plan to be more appropriate to the local environment and respect the Baylands. The building color pallet was also modified to a more muted look while still responding to dealership brand identity requirements from the car manufacturer. The Board also observed that the zoning for the subject property permits building heights up to 50 feet, which is proposed for this project. Other parcels in the area are zoned ROLM with a maximum height limit of 35 feet. A few other parcels in the area are zoned Planned Community but do not exceed 35 feet in height (19’-6” and 27’-6” respectively). In its deliberation, the Board considered the existing regulatory setting, the prior hotel project approved for the subject site that extended to 50 feet, the applicant’s design approach to house the service- related aspects of the project within the building, and potential impacts from the Baylands. While acknowledging that the proposed project would be the tallest in the immediate area, the Board, on balance, found that the proposed building setback, landscaping and view from the Baylands, which showed the project blending in with the urban background, would not be impactful to the area. Earlier staff reports include background information, project analysis and evaluation to City codes and policies; these reports are available online; a copy of the most recent report without attachments is available in Attachment I. Below are links to the previous reports: ARB November 19, 2015 - https://www.cityofpaloalto.org/civicax/filebank/documents/49848 ARB February 18, 2016 - https://www.cityofpaloalto.org/civicax/filebank/documents/51101 ARB May 5, 2016 - https://www.cityofpaloalto.org/civicax/filebank/documents/52196 ARB May 19, 2016 – https://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?BlobID=52377 Videos for these hearings can be viewed on the Midpen Media Center website at http://midpenmedia.org/category/government/city-of-palo-alto/ 1 1 05/07/15: Study Session video: https://www.youtube.com/watch?v=6KAKgKC7Po4&start=108&width=420&height=315 08/27/15: Preliminary Review video: https://www.youtube.com/watch?v=Qp1FdZWSoLs&start=3395&width=420&height=315 08/27/15 Meeting Packet: https://www.cityofpaloalto.org/civicax/filebank/documents/48697 City of Palo Alto Page 4 Project Description The applicant proposes to demolish the existing restaurant building and site improvements and construct a three-story automobile dealership with roof deck parking and detached car wash facility (for automobile service or sales patrons). The building would integrate sales and administrative offices, customer parking, vehicle merchandise storage, and vehicle service/repair areas on multiple floors. On-site improvements would include customer parking, vehicle merchandise display, solid waste/recycling facilities and landscaping. The project is subject to architectural review findings, context-based design criteria and compliance review with the Baylands Master Plan Site and Assessment Design Guidelines. Implementing the project requires a rezone to include the Automobile Dealership (AD) combining district. As designed, the project does not meet “build-to” setback requirement along Embarcadero Road. This necessitates approval of a Design Enhancement Exception (DEE). During the course of the project evaluation, notable revisions to the project have included the removal of the “Baylands inspired” landscape theme at the intersection corner, the elimination of the detached freestanding canopy adjacent to the car wash, and the elimination of the elevator access to the roof deck because access would be provided via a vehicular ramp from the third floor. Table 1 summarizes the floor area for the project. As a result of the changes, the square footage is less than originally proposed. Table 1 Proposed Project Summary Floor Areas Square Footage Total (Square feet) Ground Showroom, sales, office 25,016 Floor Vehicle Service/Repair 2,027 Vertical circulation 2,237 29,280 2nd Floor Office 4,696 Vertical circulation 2,558 Customer parking (service) Not Applicable 7,254 3rd Floor Vehicle Service/Repair & 19,425 Showroom, sales, office 382 Vertical circulation 4,529 City of Palo Alto Page 5 Floor Areas Square Footage Total (Square feet) Customer parking Not Applicable 24,336 Roof Vertical circulation 589 589 Customer parking/Inventory Not Applicable 0 Total 61,459 Source: 4-27-16 submittal Automobile Dealership Overlay The applicant proposes to rezone the site to include the Automobile Dealership (AD) overlay. The AD combining district is intended to modify the base zoning district to create and maintain areas accommodating automobile dealerships primarily engaged in new and used automobile sales and service on a citywide and regional basis. Such uses generally require special parking, access, and outdoor display provisions for customer convenience, servicing of vehicles or equipment, loading or unloading, or parking of commercial service vehicles. The Automobile Dealership combining district allows additional Floor Area Ratio (FAR) exclusively for showroom purposes (0.2:1) for a total FAR of 0.6:1 for the site, where the CS zone allows FAR of only 0.4:1. The inclusion of the AD combining district would be necessary to implement the applicant’s proposed project. Project Design The design of the building is a contemporary corporate design used by Mercedes Benz that is featured in their automobile dealership facilities worldwide. This building proposal includes steel frame design with exterior cladding that includes metal, glass, poured concrete and stucco materials using different shades of greys. Specifically, in response to the ARB comment regarding compatibility with the Baylands Master Plan, the applicant included the ‘sandy hook grey’ color. A second floor balcony is provided as an outdoor amenity for employees, which includes plantings at the perimeter of the balcony. The perimeter of the site includes trees that provide a visual buffer from the adjacent roadways and properties, and the Bayland trails. The detached car wash building is designed to be structural block with steel framed roofing with exterior cladding that matches the building with metal panels and stucco. Parking and Access During the course of review of the project, the project’s height was reduced with the removal of the elevator access to the roof deck. Vehicular access to the roof is proposed with a vehicular ramp from the third floor. With those changes, the required parking was reduced. For instance, while the new vehicular ramp from the third floor to the roof deck is included in the FAR calculation, it is not included as space for parking purposes. The proposed project would include a total of 139 parking spaces, 43 of which would be surface parking spaces. An additional 66 parking spaces would be located on the second floor and 30 parking spaces on the roof deck. Vehicular access would be provided from an existing driveway on Embarcadero Road City of Palo Alto Page 6 and an existing driveway on East Bayshore Road. Inbound and outbound movements would be allowed at both access points and would be controlled by stop-signs. Pedestrians would access the proposed auto dealership building from the west or south side. Internally, elevators would carry vehicles through floors one through three and vehicular ramps would allow access to the rooftop deck parking area. Discussion Based on the project description, the project needs a series of entitlements. Since the project includes a legislative action, all of the project entitlements are being forwarded to the City Council for review and approval. Below is a summary of the requested entitlements and the process to complete those requests:  Architectural Review – Major (AR): The process for evaluating this type of application is set forth in PAMC 18.77.070. AR projects are evaluated against specific findings. All findings must be made in the affirmative to approve the project. Failure to make any one finding requires project redesign or denial. The findings to approve an AR application are provided in Attachment B.  Design Enhancement Exception (DEE): This is to deviate from the “build-to-line” (percentage of building along the front setback) requirement within the CS district. The process for evaluating this type of application is set forth in PAMC 18.76.050. DEE projects are also subject to findings, which are provided in Attachment B.  Site and Design Review: The process for evaluating this type of application is set forth in PAMC 18.30(G).060. These applications are reviewed by the Planning & Transportation Commission (PTC) and recommendations are forwarded to the City Council. Site and Design Review projects are subject to specific findings. All findings must be made in the affirmative to approve the project and are contained in Attachment B.  Amendment to Zoning Map: This is a request to add the Automobile Dealership (AD) combining district. The process for evaluating this type of application is set forth in PAMC 18.80. Rezone applications are reviewed by the PTC and recommendations are forwarded to the City Council. The PTC has recommended approval of the ordinance contained in Attachment C. Setbacks The applicant requests deviation from the “build to” requirement, which would otherwise result in a minimum 10’-0” setback. The applicant proposes a 46’-8” setback along Embarcadero Road and an 80’-0” setback along Bayshore Road. In summary, the applicant is requesting this modification to minimize the impact of the building mass adjacent to the street and to create a more efficient circulation layout, including improved fire protection access. Aesthetics & Compatibility City of Palo Alto Page 7 A key consideration for development within the Baylands Master Plan area is compatibility with surrounding and ensuring the project is harmonious with the nearby open space areas. The project site is within the “private lands” area of the plan, however, is visible from the Baylands recreation area and trail. Therefore compliance with the applicable policies within the Baylands Master Plan would address this consideration. Baylands Site Assessment and Design Guidelines The Site Assessment and Design Guidelines, Palo Alto Baylands Nature Preserve, developed in 2005, are intended to be used when designing or reviewing projects located in any part of the Baylands—including projects on privately-owned land. Conformance with these Guidelines will help to ensure compatibility with the special aesthetic qualities and environmental conditions unique to the Baylands. Baylands General Design Principals The following design principles are suggested to reflect and preserve the Baylands’ unique landscape character and have been used to review this application.  Use only muted, natural colors. Choose materials and finishes that will weather without degrading: The proposed building would be clad in metal panels and cement plaster system with natural and light grey and “sandy hook grey” (Baylands standard) trim. Glass would be high performance, insulated, low-e glazing.  Preserve the horizon line with low and horizontal elements: The building would be 50’- 0” in height for the parapets and 55’-0” in height for elevator shafts (Within the requirements of the PAMC). The building’s mass is articulated, includes fenestration and floors that are horizontally oriented, with the exception of the elevator shaft, which has a vertical orientation.  Mount fences, enclosures, and identity signs low to the ground: The project includes details on wall signs, and freestanding signs that are consistent with the PAMC requirements. Signs located within the elevations of the buildings and freestanding signs are low profile.  Reduce the size and mounting heights of regulatory signs: The project’s freestanding signs are consistent with PAMC Section 16.20.120 and are below 5’-0” in height.  Design for practicality: The proposed dealership with a building that includes integrated sales, service and inventory is efficient and innovative. Views from Embarcadero Road Scenic Corridor The project does provide a 46’-8” setback along Embarcadero Road, which pushes the mass of the building away from Embarcadero Road. Additional screening is formed by existing street trees and new trees to be planted at the interior of the project. The subject property presently has a tall PG&E high voltage electric transmission tower located at the intersection corner of the property. This condition will remain unchanged. City of Palo Alto Page 8 Views from Baylands Preserve Views of the building from the Baylands Nature Preserve would be continue to be interrupted by existing trees and new plantings will also screen the building. The design of the building will meet the design principles outlined in the Baylands. Attachment E includes a photograph from the Baylands Nature Preserve and photo-simulation with proposed building. Lighting Lighting is also a consideration because of the adjacency to the Baylands and typically automobile dealerships use more intense exterior lighting than other uses. As with the adjacent Audi dealership, a condition of approval (mitigation measure) will ensure that lighting is less intense after 10PM. An additional condition ensures that staff would have the ability to further restrict hours of illumination and intensity of light if warranted. In addition, the project has designed lighting on the roof deck to be low profile and based on sight lines would not be seen from the Baylands. The issue was evaluated by the ARB and deemed to be consistent with surrounding uses. Policy Implications The attached Record of Land Use Action includes project-related findings, including statements of compliance with certain Comprehensive Plan policies (Attachment B). From a land use perspective, the application of the AD overlay is consistent with other properties in the area. Each of the nearby ROLM zoned properties each have the AD overlay applied to those properties. Additionally, two of the three PC zoned properties are authorized for automobile dealerships. Other dealerships in the area include Honda and Audi. The addition of Mercedes Benz contributes to a modest auto row in the City, which is easily accessible from the freeway, notwithstanding periods of traffic congestion in the area. The request for the design enhancement is consistent with direction staff has received from Council to eliminate the requirement in certain parts of the city and to relax the standard in others. Reinforcing the built environment with building facades near the street is not consistent with the pattern of development in the area, which reflects a more suburban appearance. City staff has been contacted by reported representatives of Audi. While no plans have been filed, there may be interest in redeveloping that site. Future site development plans may be influenced be by the actions taken on the subject application. Resource Impact While economic factors are not taken into consideration by advisory Boards and Commissions for discretionary projects, the City Council may be informed by such matters as it relates to the legislative aspects of the project and their decision-making process. Automobile dealerships often bring in important sales tax revenue to cities. The applicant reports an estimated annual sales tax revenue to the city to be approximately $948,527. Environmental Review City of Palo Alto Page 9 The Mitigated Negative Declaration (Attachment G) indicates that with implementation of the project there could be potential significant environmental impacts to Biological resources and Transportation systems. Mitigation Monitoring and Reporting Program The Initial Study-Mitigated Negative Declaration identifies the mitigation measures that will be implemented to reduce the impacts associated with the 1700 Embarcadero Road Auto Dealership Project. The California Environmental Quality Act (CEQA) requires a public agency to adopt a monitoring and reporting program for assessing and ensuring compliance with any required mitigation measures applied to proposed development. The mitigation monitoring table lists those mitigation measures that may be included as conditions of approval for the project. To ensure that the mitigation measures are properly implemented, a monitoring program has been devised which identifies the timing and responsibility for monitoring each measure. The project applicant will have the responsibility for implementing the measures, and the various City of Palo Alto departments will have the primary responsibility for monitoring and reporting the implementation of the mitigation measures. The Mitigation Monitoring and Report Program is included in Attachment G. Mitigation Mitigation measures are proposed to reduce the biological resources impacts to less than significant through surveys for nesting birds and avoidance; and reduction of light sources after 10:00pm. Regarding transportation, the addition of project-generated traffic would create a significant impact at the intersection of East Bayshore Road and Embarcadero Road during the PM peak hour under Background plus Project and Cumulative scenarios, and during the AM peak hour under the Cumulative scenario. Mitigation is required to reduce impacts to a less than significant level. The identified mitigation would address congestion related to the large volume of left turns and a large volume of through traffic on eastbound Embarcadero Road in the morning. Creating two separate dedicated left turn lanes and two through lanes would reduce delay for eastbound traffic. In summary, the traffic mitigation is described below: East Bayshore Road and Embarcadero Road. The project applicant shall construct the following improvements and enter into a reimbursement agreement with the City for payment less their fair share of the improvement costs: 1. Revise the eastbound leg on Embarcadero Road to include two left turn pockets, a through lane, and a shared through/right-turn lane. This improvement shall also include changing the east-west phasing from split phase timing to protected left turn phasing. City of Palo Alto Page 10 2. Restripe the northbound approach to have one left turn lane and one shared left- through-right lane. This would likely require modifying the median island and relocating the signal equipment on the west leg of the intersection. Comments Staff received three comment letters (Santa Clara County Parks Department; Santa Clara Valley Transportation Authority; and Caltrans) regarding the transportation section of the Mitigated Negative Declaration. The Caltrans letter was received after the public comment period and during final packet preparation of this report. However, the traffic consultant and staff have considered the Caltrans comments and concluded they do not raise significant issues requiring recirculation of the MND. A complete response is included in the attached MND. In response to the comment letters, the following changes have been made to the TIA: Figure 3 of the Transportation Impact Analysis was updated to show the on-street bicycle route within the right-of-way on Geng Road and the California Avenue Trail beyond the “bike/pedestrian bridge”. In addition, the TIA was updated to include an analysis of transit delay and an auto trip reduction statement. None of the changes require a re-circulation of the Initial Study because of any new significant impacts. The Commission and the Board also commented on the perception of traffic at the intersection of Embarcadero Road and East Bayshore Road. Both review bodies encouraged the city to look at further improvements not related to the project to improve the intersection and traffic flow in the area. The proposed mitigation addresses the actual impact at the intersection and staff will look into the other commented issues within the vicinity of the intersection. Attachments:  Attachment A: Location Map (PDF)  Attachment B: Record of Land Use Action (DOCX)  Attachment C: (AD) Ordinance (DOCX)  Attachment D: MB Palo Alto Application Narrative (PDF)  Attachment E: Site Photographs (PDF)  Attachment F: Zoning Compliance (DOCX)  Attachment G: Final 1700 Embarcadero IS-MND (PDF)  Attachment H: Project Plans (DOCX)  Attachment I: 1700 Embarcadero ARB Staff Report ID# 6963 (PDF) 003-49-021 003-49-020 003-49-019 003-49-018 003-49-017 -023 003-49-003 003-49-004 003-49-006 003-49-005 003-48-074 003-48-073 003-48-072 127-02-114127-02-064 127-02-107 127-02-108 127-02-109 127-02-110 127-02-125 127-02-126 127-38-018 127-38-019 127-38-020 127-38-026 127-38-027 127-38-028 127-38-030 003-49-002 127-02-121 127-02-097 003-49-001 3-49-007 003-48-071 003-48-068 127-38-029 003-48-020 003-48-051 003-48-055 003-48-054 003-48-053 003-48-052 003-48-064 003-48-063 003-48-062 003-48-061 003-48-085 003-48-084 003-48-083 003-48-082 003-48-087 003-48-065 003-48-066 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(\\cc-maps\gis$\gis\admin\Personal\Planning.mdb) Project Location Map Attachment A Attachment B ACTION NO. 2016-3 RECORD OF THE COUNCIL OF THE CITY OF PALO ALTO LAND USE ACTION FOR 1700 EMBARCADERO ROAD: MITIGATED NEGATIVE DECLARATION, SITE AND DESIGN REVIEW, ARCHITECTURAL REVIEW AND DESIGN ENHANCEMENT EXCEPTION (15PLN-00394) On June 6, 2016, the City Council of the City of Palo Alto adopted a Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program; approved the Site and Design Review; Architectural Review; and, Design Enhancement application for construction for the construction of a new automobile dealership, and associated improvements on a 2.54 acre parcel in the Commercial Service (CS) with Site and Design Overlay Zone District, making the following findings, determination and declarations: SECTION 1. Background. The City Council of the City of Palo Alto (“City Council”) finds, determines, and declares as follows: A. Deeg Snyder of Gensler on behalf of Fletcher Jones, property owner, has requested the City’s approval to allow construction of a three-story automobile dealership and single-story car wash, and other site improvements for a total floor area of 61,510 square feet. The request includes a zone change to allow the inclusion of the Automobile Dealership (AD) combining district. (“The Project”). B. The project site is a single parcel (APN 008-03-065) of 2.54 acres in size in the Palo Alto Baylands “Private Lands” area. The site is currently developed with a vacant single-story 17,942 square foot restaurant building and the site contains and is accessible to existing utilities. The site includes an eighty (80) foot easement for the purposes of containing overhead electrical transmission utilities and underground storm-drain facility. The site is designated on the Comprehensive Plan land use map as Service Commercial and is located within the Service Commercial (CS) zoning district with Site and Design (D) overlay. The project includes the demolition of existing on-site buildings. C. The Planning and Transportation Commission (Commission) reviewed and recommended approval of the Project on April 27, 2016. The Commission’s recommendations are contained in Report ID# 6704 and attachments thereto. D. The Architectural Review Board (Board) reviewed and recommended approval of the Project on May 19, 2016. The Board’s recommendations are contained in Report ID# 6963 and attachments thereto. SECTION 2. Environmental Review. The City as the lead agency for the Project has determined that the project is subject to environmental review under provisions of the California Environmental Quality Act (CEQA) under Guideline section 15070, Decision to Prepare a Negative or Mitigated Negative Declaration. An Initial Study/Mitigated Negative Declaration was prepared in March 2016 for the project and identified potential significant impacts with the implementation of the project. Those impacts can be reduced to a level of less than significant with the incorporation of mitigation measures. On the basis of the whole record before it, that there is no substantial evidence that the project will have significant effect on the environment and that the mitigated negative declaration reflects the lead agency’s independent judgment and analysis. The City of Palo Alto Planning & Community Environment Department is the custodian of these documents. The mitigation measures required for this project have been included as conditions of approval in Section 9 of this Record. The Mitigation Monitoring and Reporting Program is included in this Record as Attachment G of staff report. SECTION 3. Site and Design Review Findings 1. The use will be constructed and operated in a manner that will be orderly, harmonious, and compatible with existing or potential uses of adjoining or nearby sites. The project is located within the vicinity of other developed property. The maximum FAR of the surrounding sites is generally 0.4:1, however, automobile dealerships are allowed to have a slightly higher FAR whether through a PC designation or AD combining district designation. The project will have a slightly larger building in part because the zoning allows for it and that the site and building are designed to be an efficient operation. The project is consistent with the Baylands Master Plan Site assessment design guidelines in that the project is designed with muted colors consistent with the Baylands and includes a horizontal design. The site is obscured from view with existing vegetation from the Baylands. 2. The project is consistent with the goal of ensuring the desirability of investment, or the conduct of business, research, or educational activities, or other authorized occupations, in the same or adjacent areas. The project would maintain desirability of investment in the same and adjacent areas, in that the proposed design, size and use of the site are consistent with the existing automobile dealerships and similar to other office and medical office uses in the vicinity. The construction of all improvements would be governed by the regulations of the current Zoning Ordinance, the Uniform Building Code, and other applicable codes to assure safety and a high quality of development. 3. Sound principles of environmental design and ecological balance are observed in the project. The project has been designed to enhance the boundaries of the site and protect off-site trees that provide screening from the Baylands area. Conditions of approval have been incorporated into the project and would be implemented to minimize impacts on biological resources, and protected trees. The design of the building is consistent with the Site Assessment Guidelines for the Baylands. 4. The use will be in accord with the Palo Alto Comprehensive Plan. The project proposal complies with the policies of the Land Use and Community Design element of the Comprehensive Plan, including: Policy L-5: Maintain the scale and character of the City. Avoid land uses that are overwhelming and unacceptable due to their size and scale. The project is an automobile dealership, which is automobile serving use. It is not expected that there be a lot of pedestrian activity associated with the use. As such it is typical to have a building surrounded by parking and vehicle circulation. Landscaping will provide visual screening from the adjacent roadways. The AD combining district allows for more intensity (additional FAR of 0.2:1) over the existing 0.4:1 FAR, so it is expected that the project will be slightly larger than surrounding uses other than the other two automobile dealerships. Policy L-42: Encourage Employment Districts to develop in a way that encourages transit, pedestrian and bicycle travel and reduces the number of auto trips for daily errands. As proposed, the project exceeds the number of required bicycle parking spaces. The project also proposes a bicycle amenity area catering to those visiting the Baylands area. Policy L-43: Provide sidewalks, pedestrian paths, and connections to the citywide bikeway system within Employment Districts. Pursue opportunities to build sidewalks and paths in renovation and expansion projects. The project proposes a bicycle amenity area that complements the City’s bicycle transportation network. Policy L-46: Maintain the East Bayshore and San Antonio Road/Bayshore Corridor areas as diverse business and light industrial districts. The project is an automobile dealership, which is consistent with the Commercial Service types of intensity and uses. The AD combining district allows for further intensification for automobile dealerships. Policy L-48: Promote high quality, creative design and site planning that is compatible with surrounding development and public spaces. The proposed building would be clad in metal panels and cement plaster system with natural grey and “sandy hook grey” (Baylands Standard) trim. Glass would be high performance, insulated, low-e glazing. The proposed dealership with an integrated sales, service and inventory building is efficient and innovative. Policy L-50: Encourage high quality signage that is attractive, appropriate for the location and balances visibility needs with aesthetic needs. The proposed signs are appropriate for the use and scale of the building and site. SECTION 4. Site and Design Approvals Granted. Site and Design Approval is granted by the City Council under Palo Alto Municipal Code Section 18.30(G).070 for application 15PLN-000394, subject to the conditions of approval in Section 9 of this Record. SECTION 5. Architectural Review Findings Comprehensive Plan and Purpose of ARB: Finding #1: The design is consistent and compatible with applicable elements of the Palo Alto Comprehensive Plan. Finding #16: The design is consistent and compatible with the purpose of architectural review, which is to:  Promote orderly and harmonious development in the city;  Enhance the desirability of residence or investment in the city;  Encourage the attainment of the most desirable use of land and improvements;  Enhance the desirability of living conditions upon the immediate site or in adjacent areas; and  Promote visual environments which are of high aesthetic quality and variety and which, at the same time, are considerate of each other. The project is consistent with Findings #1 and #16 because: The project is consistent with Policies L-5, L-42, L-43, L-46, and L-50.  The project is an automobile dealership, which is automobile serving use. It is not expected that there be a lot of pedestrian activity associated with the use. As such it is typical to have a building surrounded by parking and vehicle circulation. Landscaping will provide visual screening from the adjacent roadways.  As proposed, the project exceeds the number of required bicycle parking spaces. The project also proposes a bicycle amenity area catering to those visiting the Baylands area.  The project proposes a bicycle amenity area that complements the City’s bicycle transportation network.  The project is an automobile dealership, which is consistent with the Commercial Service types of intensity and uses. The proposed building would be clad in metal panels and cement plaster system with light grey and Sandy Hook grey trim. Glass would be high performance, insulated, low-e glazing. The proposed dealership with an integrated sales, service and inventory building is efficient and innovative. The typical negative aspects of an automobile dealership such as a lot of merchandise parked cars and service bays have been internalized in the building or on the roof deck, which will not be seen by those passing by the site.  The proposed signs are appropriate for the use and scale of the building and site.  As conditioned the site and building lighting will not affect the Baylands preserve area. Compatibility and Character: Finding #2: The design is compatible with the immediate environment of the site. Finding #4: In areas considered by the board as having a unified design character or historical character, the design is compatible with such character; Finding #5: The design promotes harmonious transitions in scale and character in areas between different designated land uses. Finding #6: The design is compatible with approved improvements both on and off the site. The project is consistent with Findings #2, #4, #5, and #6 because: The buildings in the immediate environment have a variety of heights, sizes and styles. It is important to note that the site is the only site with the CS zoning designation and will also be the only automobile dealership with the AD combining district. These designations allow for greater massing and height. The building is situated on a corner lot that would serve to anchor the intersection of Bayshore Road and Embarcadero Road. The site includes an easement that would preclude development within 80’-0” of Bayshore Road, which would provide some buffer from the street for the building. The proposed building would provide some visual interest with change in materials and articulations of the facades. The general design would not be out of character of the design of adjacent buildings and sites and strengthens the on-site theme of being recognized as an automobile dealership. The project seeks relieve from a “build-to” setback, which would be consistent with adjacent properties. The site has substantial setbacks from adjacent and nearby properties including from the Baylands, which the property is visible from to facilitate transition in scale and character. Functionality and Open Space: Finding #3: The design is appropriate to the function of the project. Finding #7: The planning and siting of the building on the site creates an internal sense of order and provides a desirable environment for occupants, visitors and the general community. Finding #8: The amount and arrangement of open space are appropriate to the design and the function of the structures. The project is consistent with Finding #3, #7, and #8, because: The project proposes an integrated automobile dealership with sales, service, customer parking and inventory in a building. As mentioned previously, the design allows for the internalization of certain negative aspects that typical with automobile dealerships. This design allows for better use of the property and compatibility with its surroundings. This allows for the site to include a bicycle amenity area, landscaping to buffer adjacent uses and the project also includes a balcony on the second level as an amenity to employees. Circulation and Traffic: Finding #9: Sufficient ancillary functions are provided to support the main functions of the project and the same are compatible with the project’s design concept. Finding #10: Access to the property and circulation thereon are safe and convenient for pedestrians, cyclists and vehicles. The project is consistent with Finding #9 and #10 because: The project includes an integrated automobile dealership that uses a multi-functional building and on- site facilities to support the use. The site has access from two streets and includes on-site circulation around the building. The design would reduce potential noise and as conditioned would reduce light pollution at night. Landscaping and Plant Materials: Finding #11: Natural features are appropriately preserved and integrated with the project. Finding #12: The materials, textures and colors and details of construction and plant material are an appropriate expression to the design and function and compatible with the adjacent and neighboring structures, landscape elements and functions. Finding #13: The landscape design concept for the site, as shown by the relationship of plant masses, open space, scale, plant forms and foliage textures and colors create a desirable and functional environment on the site and the landscape concept depicts an appropriate unit with the various buildings on the site. Finding #14: Plant material is suitable and adaptable to the site, capable of being properly maintained on the site, and is of a variety that would tend to be drought-resistant and to reduce consumption of water in its installation and maintenance. The project is consistent with Finding #11, #12, #13, #14 because: The project would protect a number of trees that are located immediately off-site. The proposed plant materials are suitable and adaptable in creating a desirable environment for the proposed use. Sustainability: Finding #15: The design is energy efficient and incorporates renewable energy design elements including, but not limited to: a. Careful building orientation to optimize daylight to interiors b. High performance, low-emissivity glazing c. Cool roof and roof insulation beyond Code minimum d. Solar ready roof e. Use of energy efficient LED lighting f. Low-flow plumbing and shower fixtures g. Below grade parking to allow for increased landscape and stormwater treatment areas The project is consistent with Finding #15 because: The project will incorporate sustainable materials, high efficiency glazing systems to meet the Green Building standards. The project includes onsite storm water management measures through landscaping. SECTION 6. Architectural Review approval Granted. Architectural Review Approval is granted by the City Council under Palo Alto Municipal Code Section 18.77.070 for application 15PLN-000394, subject to the conditions of approval in Section 9 of this Record. SECTION 7. Context-Based Findings (1) Pedestrian and Bicycle Environment. The design of new projects shall promote pedestrian walkability, a bicycle friendly environment, and connectivity through design elements. This finding can be made in the affirmative because the project includes more than the minimum amount of bicycle parking and provides a bicycle amenity area. (2) Street Building Facades. Street facades shall be designed to provide a strong relationship with the sidewalk and the street(s), to create an environment that supports and encourages pedestrian activity through design elements. This finding can be made in the affirmative because while the proposed use is considered automobile-serving, the project proposes linkages from the adjacent sidewalk to the site and building. The building is setback sufficiently as not to impose significant mass on the adjacent streets. (3) Massing and Setbacks. Buildings shall be designed to minimize massing and conform to proper setbacks. This finding can be made in the affirmative because the project is setback from the streets and provides perimeter landscaping to buffer the use from the adjacent roadways and properties. The building’s elements, including fenestration and articulation are horizontally oriented with exception of the elevator shafts, which if located centrally would reduce the efficiency of the building negating other positive aspects of the building design. (4) Low-Density Residential Transitions. Where new projects are built abutting existing lower scale residential development, care shall be taken to respect the scale and privacy of neighboring properties. This finding is not applicable. (5) Project Open Space. Private and public open space shall be provided so that it is usable for residents, visitors, and/or employees of the site. This finding can be made in the affirmative because since the project provides a bicycle amenity area for pass-by users and provides a second floor balcony for employees. (6) Parking Design. Parking needs shall be accommodated but shall not be allowed to overwhelm the character of the project or detract from the pedestrian environment. This finding can be made in the affirmative because the project includes parking within the building and not entirely as surface parking. (7) Large (Multi-Acre) Sites. Large sites (over one acre) shall be designed so that street, block, and building patterns are consistent with those of the surrounding neighborhood. This finding can be made in the affirmative in that the design of the facades, landscaping, signage is consistent with the surrounding development. (8) Sustainability and Green Building Design. Project design and materials to achieve sustainability and green building design should be incorporated into the project. As conditioned, the project will comply with the City’s Green Building and Energy Reach ordinances. SECTION 8. Design Enhancement Exception Findings (A): Deviation from “build-to” 10’-0” setback along Embarcadero Road; and (1) There are exceptional or extraordinary circumstances or conditions applicable to the property involved that do not apply generally to property in the same district. (A) This finding can be made in the affirmative in that the subject property is a corner lot and the proposal contemplates an integrated automobile dealership and service facility in a vertical model, which is atypical for this type of use. Implementing the proposal provides for an efficient use of the property and do to its operation keeps unnecessary vehicle trips associated with the business on-site as circulation around the building can be accommodated with the deviation from the setback. (2) The granting of the application is necessary for the preservation and enjoyment of a substantial property right of the applicant and to prevent unreasonable property loss or unnecessary hardships. (A) This finding can be made in the affirmative in that the proposal facilitates the efficient operation of the automobile dealership/service facility. Customer vehicles, inventory, sold inventory can be moved on-site without restrictions of using the adjacent Bayshore Road or Embarcadero Road. (3) The granting of the application will not be detrimental or injurious to property or improvements in the vicinity and will not be detrimental to the public health, safety, general welfare or convenience. (A) The requested design enhancement exception will not be detrimental or injurious to property or improvements in the vicinity. The project site is not expected to have substantial pedestrian activity that works well with “build-to” setback requirements. Other adjacent properties do not have similar setbacks. Design Enhancement Exception Approval is granted by the City Council under Palo Alto Municipal Code Section 18.77.070 for application 15PLN-000394, subject to the conditions of approval in Section 9 of this Record. SECTION 9. Conditions of Approval. Planning Division 1. SUBSTANTIAL CONFORMANCE. The plans submitted for a Building Permit shall be in substantial conformance with plans dated June 6, 2016, except as modified to incorporate the following conditions of approval and any additional conditions placed on the project by the Planning Commission or City Council. 2. CONDITIONS OF APPROVAL. The following conditions of approval shall be printed on the sheets of the plan set submitted with the Building Permit application. 3. BUILDING MATERIALS AND COLOR SCHEME. The approved building materials and color scheme shall be shown on the building permit drawings for all buildings, structures, and other features. 4. NOISE PRODUCING EQUIPMENT. All noise producing equipment shall be fully enclosed to reduce noise levels and shall not exceed the allowances specified in Section 9.10 Noise of the Palo Alto Municipal Code. 5. PROJECT ARBORIST. The property owner shall retain a certified arborist to ensure the project conforms to all Planning and Urban Forestry conditions related to landscaping/trees, as shown in the approved plan set. 6. TREE PROTECTION FENCING. Tree protection fencing shall be required to protect trees that are to remain during construction. 7. PLANNING FINAL INSPECTION. A Planning Division Final inspection will be required to determine substantial compliance with the approved plans prior to the scheduling of a Building Division final Any revisions during the building process must be approved by Planning, including but not limited to; materials, fenestration and hard surface locations. Contact your Project Planner. 8. LANDSCAPING PLAN. A landscaping plan shall be included with the plans submitted for the building permit. The plan shall include species type, size and quantities to be planted. The irrigation plan shall be included showing any mechanical irrigation systems. 9. LANDSCAPE MAINTENANCE. All landscape material shall be well maintained and replaced if necessary, to the satisfaction of the Urban Forester and Director of Planning. 10. SIGN PLANS. All signs shall comply with the City’s sign code or the applicant may apply for a separate sign adjustment for review before the Architectural Review Board for signs not meeting specific requirements. 11. GREEN BUILDING PROGRAM. Upon submittal of an application for a building permit, the project is required to comply with the City’s Green Building Ordinance. 12. LIGHTING. All exterior lights shall be designed to be programmable to turn off and on at specific times and dimmable as described in approved project plans. Lights shall be dimmed at least 50% or shut off between the hours of 10:00 PM and 7:00 AM. If complaints are registered regarding lighting for the site, then the operator shall work with the Planning and Community Environment Department to provide desirable levels of lighting, which may mean further limitations on hours of lightings and illumination intensity. 13. MITIGATION MEASURE (BIOLOGICAL). BIO-1 Exterior Lighting. All exterior lighting shall be shielded, directed downward, and designed to minimize light spillage beyond the property line. All exterior lighting shall also be reduced to security level lighting between the hours of 10:00 PM and 7:00 AM. Any proposal to change these specifications or hours must be accompanied by biological resources reports, to the satisfaction of the City of Palo Alto. 14. MITIGATION MEASURE (BIOLOGICAL). BIO-2 Nesting Bird Protection. To avoid disturbance of nesting and special-status birds, activities related to the project, including, but not limited to, tree removal, ground disturbance, and construction and demolition shall occur outside of the bird breeding season (typically February through August in the project region). If construction must begin within the breeding season, then a pre-construction nesting bird survey shall be conducted no more than 3 days prior to initiation of ground disturbance and vegetation removal activities. The nesting bird pre-construction survey shall be conducted within the Project Boundary, including a 300-foot buffer (500-foot for raptors), on foot, and within inaccessible areas (i.e., private lands) afar using binoculars to the extent practical. The survey shall be conducted by a biologist familiar with the identification of avian species known to occur in the area. If nests are found, an avoidance buffer (which is dependent upon the species, the proposed work activity, and existing disturbances associated with land uses outside of the site) shall be determined and demarcated by the biologist with bright orange construction fencing, flagging, construction lathe, or other means to mark the boundary. All construction personnel shall be notified as to the existence of the buffer zone and to avoid entering the buffer zone during the nesting season. No ground disturbing activities shall occur within this buffer until the avian biologist has confirmed that breeding/nesting is completed and the young have fledged the nest. Encroachment into the buffer shall occur only at the discretion of the qualified biologist. 15. MITIGATION MEASURE (TRANSPORTATION). T-1 East Bayshore Road and Embarcadero Road. The project applicant shall construct the following improvements and enter into a reimbursement agreement with the City for payment less their fair share of the improvement costs:  Revise the eastbound leg on Embarcadero Road to include two left-turn pockets, a through lane, and a shared through/right-turn lane. This improvement shall also include changing the east-west phasing from split phase timing to protected left turn phasing.  Restripe the northbound approach to have one left turn lane and one shared left- through-right lane. This would likely require modifying the median island and relocating the signal equipment on the west leg of the intersection. 16. This approval is contingent upon the adoption of an Automobile Dealership (AD) overlay to the subject property. The approvals herein shall not go into effect until 30 days following the second reading of such overlay ordinance. In the event the ordinance is the subject of a timely referendum, such approvals shall be stayed pending final outcome of such legal action. 17. INDEMNITY: To the extent permitted by law, the Applicant shall indemnify and hold harmless the City, its City Council, its officers, employees and agents (the “indemnified parties”) from and against any claim, action, or proceeding brought by a third party against the indemnified parties and the applicant to attack, set aside or void, any permit or approval authorized hereby for the Project, including (without limitation) reimbursing the City for its actual attorneys’ fees and costs incurred in defense of the litigation. The City may, in its sole discretion, elect to defend any such action with attorneys of its own choice. 18. IMPACT FEES. Prior to issuance of a building permit, a payment of Development Impact Fees shall be made. 19. NINETY (90)-DAY PROTEST PERIOD: California Government Code Section 66020 provides that a project applicant who desires to protest the fees, dedications, reservations, or other exactions imposed on a development project must initiate the protest at the time the development project is approved or conditionally approved or within ninety (90) days after the date that fees, dedications, reservations or exactions are imposed on the Project. Additionally, procedural requirements for protesting these development fees, dedications, reservations and exactions are set forth in Government Code Section 66020. IF YOU FAIL TO INITIATE A PROTEST WITHIN THE 90-DAY PERIOD OR FOLLOW THE PROTEST PROCEDURES DESCRIBED IN GOVERNMENT CODE SECTION 66020, YOU WILL BE BARRED FROM CHALLENGING THE VALIDITY OR REASONABLENESS OF THE FEES, DEDICATIONS, RESERVATIONS, AND EXACTIONS. If these requirements constitute fees, taxes, assessments, dedications, reservations, or other exactions as specified in Government Code Sections 66020(a) or 66021, this is to provide notification that, as of the date of this notice, the 90-day period has begun in which you may protest these requirements. Public Works Engineering 20. As discussed with the project Civil Engineer, two direct connections to the City’s storm drain line are acceptable. Revise the plans to eliminate connection 796. Also provide manholes at all the bends (796, 813, 797) 21. As describe on the response letter this project will require approximately 4 months of dewatering. See attached Notice to Owners/Applicants planning to Dewater and Construction basements in Palo Alto. Please review this letter, City Council adopted these requirements on February 1, 2016, there will be additional dewatering requirements for the applicants to submit with the Building Permit application. Applicant shall be ready to submit the dewatering plan with all of the items on this letter addressed. 22. C3 REQUIREMENTS: As of January 1, 2016, projects still under the Planning Entitlements phase are required to provide the third party certification prior to Planning entitlement approval. Once the proposed bio-retention areas are revised to be outside of the easement and not over the City’s storm drain line. Provide the stamped and signed C3 certification data forms and plans. 23. EXISTING EASEMENTS: Provide a copy of the approvals from entities who benefit from the-onsite easements to verify that the work within these easement would be permitted. 24. Provide the following note on the Site Plan and Structural plans to indicate, “The proposed project is a Substantial Improvement and shall comply with Palo Alto Municipal Code Chapter 16.52 Flood Hazard Regulations and FEMA’s requirements.” 25. FLOOD ZONE: Add a note on the plans shall indicate that the Assessor’s Parcel 008-03-065 is located within FEMA’s Special Flood Hazard Area Zone AE where the base flood elevation (BFE) was determined to be 10.5 as shown on the FIRM Panel Number 06085C0030H dated May 18, 2009. 26. FLOOD ZONE CONSTRUCTION MATERIALS AND METHODS: Add a note on the Structural, Architectural and Mechanical plans to indicate that all new construction and substantial improved structures shall be constructed with flood-resistant materials and utility equipment shall be resistant to flood damage as specified in FEMA’s technical bulletins and Palo Alto Municipal Code Section 16.52.130. b 27. FLOOD ZONE CERTIFICATION: An Elevation Certification shall be provided for all structure(s) and shall be prepared by a registered professional engineer or surveyor, and verified by a community official to be properly elevated. Such certification and verification shall be provided to the floodplain administrator based on PAMC section 16.52.130, and shall be prepared at 3 stages of construction: with the construction documents, during construction, and prior to building permit final. The elevation certificate prepared based on the existing structure and the proposed construction, shall be scanned and attached with the building permit construction documents. Certificates shall be prepared on the NAVD 28. The “Survey Requirements for Construction in the Special Flood Hazard Area” shall be added to the plan set. A pdf copy of the documents titled Plan Insert for Elevation Certification Requirements) is available on the City’s website http://www.cityofpaloalto.org/gov/depts/pwd/forms_and_permits.asp under Flood Zone Issues. 29. FLOOD ZONE VENTS: All new construction and substantially improved structures, with fully enclosed areas below the lowest floor are useable solely for the parking of vehicles, building access or storage, and which are subject to flooding shall be designed to automatically equalize hydrostatic flood forces on exterior walls by allowing for the entry and exit of floodwaters. This requirement shall comply with the guidelines set on FEMA’s technical bulletins, including but not limited to TB1-08, TB6-93 and TB7-93. See PAMC 16.52.130.c.3 for minimum criteria. Plot and label the vent openings on the structural details. There must be at least two openings for each enclosed area with 1 sq in of opening for each 1 sq ft of enclosed area. These openings must be placed no more than 12 inches above lowest adjacent grade. Provide on the drawings the following: a. a schedule showing the areas enclosed; b. the area of each opening; c. the number of openings required; d. a detail showing the location of the vent relative to adjacent grade; e. and the location of the openings on the foundation plan. These should also be incorporated into the structural drawings, since flood openings in the foundation affect the structural engineer’s design. Guidelines for flood openings can be found in FEMA Technical Bulletin 1-08, “Openings in Foundation Walls.” 30. DEMOLITION PLAN: Place the following note adjacent to an affected tree on the Site Plan and Demolition Plan: “Excavation activities associated with the proposed scope of work shall occur no closer than 10-feet from the existing street tree, or as approved by the Urban Forestry Division contact 650-496-5953. Any changes shall be approved by the same”. 31. GRADING PERMIT: The site plan must include a table that shows the earthwork (cut and fill) volumes. If the total is more than 100 cubic yards, a grading permit will be required. An application and plans including Rough Grading and Shoring Plans are submitted to Public Works separately from the building permit plan set. The application and guidelines are available on our Public Works website. http://www.cityofpaloalto.org/gov/depts/pwd/forms_and_permits.asp 32. ROUGH GRADING: provide a Rough Grading Plan for the work proposed as part of the Grading and Excavation Permit application. The Rough Grading Plans shall including the following: pad elevation, elevator pit elevation, ground monitoring wells, limits of over excavation, stockpile area of material, overall earthwork volumes (cut and fill), temporary shoring for any existing facilities, ramps for access, crane locations (if any), tree protection measures, etc. 33. LOGISTICS PLAN: The applicant and contractor shall prepare a construction logistics plan for the work associated with the Excavation and Grading permit. Plan shall be submitted to Public Works Engineering and shall address all impacts to the City’s right-of-way, including, but not limited to: pedestrian control, traffic control, truck routes, material deliveries, contractor’s parking, on- site staging and storage areas, concrete pours, crane lifts, work hours, noise control, dust control, storm water pollution prevention, contractor’s contact. The plan shall be prepared and submitted along the Grading and Excavation Permit. It shall include notes as indicated on the approved Truck Route Map for construction traffic to and from the site. Plan shall also indicate if the bus stop will need to be relocated. 34. SHORING PLAN: Provide a shoring plan for the existing utilities (if needed), to clearly indicate how the new structures will be constructed while protecting the existing utilities. If tiebacks are proposed they shall not extend onto adjacent private property, existing easements or into the City’s right-of-way without having first obtained written permission from the private property owners and/or an encroachment permit from Public Works. Plot and label the tree protection measures on the shoring plans. 35. GEOTECHNICAL REPORT: Shall clearly identify the highest projected groundwater level to be encountered will be ______ feet below existing grade. 36. DEWATERING: Basement excavation may require dewatering during construction. Public Works only allows groundwater drawdown well dewatering. Open pit groundwater dewatering is not allowed. Dewatering is only allowed from April through October due to inadequate capacity in our storm drain system. The geotechnical report for this site must list the highest anticipated groundwater level. We recommend that a piezometer be installed in the soil boring. The contractor shall determine the depth to groundwater immediately prior to excavation by using a piezometer or by drilling an exploratory hole if the deepest excavation will be within 3 feet of the highest anticipated groundwater level. If groundwater is found within 2 feet of the deepest excavation, a drawdown well dewatering system must be used, or alternatively, the contractor can excavate for the basement and hope not to hit groundwater, but if he does, he must immediately stop all work and install a drawdown well system before he continues to excavate. Based on the determined groundwater depth and season the contractor may be required to dewater the site or stop all grading and excavation work. In addition Public Works may require that all groundwater be tested for contaminants prior to initial discharge and at intervals during dewatering. If testing is required, the contractor must retain an independent testing firm to test the discharge water for contaminants Public Works specifies and submit the results to Public Works. Public Works reviews and approves dewatering plans as part of a Street Work Permit. The applicant can include a dewatering plan in the building permit plan set in order to obtain approval of the plan during the building permit review, but the contractor will still be required to obtain a street work permit prior to dewatering. Alternatively, the applicant must include the above dewatering requirements in a note on the site plan. The street work permit to dewater must be obtained in June to allow ample to time to dewater and complete the dewatering phase by October 31st. Please note that due to proximity to the bay this site may need to obtain the dewatering permit and commence dewatering in July to meet the October 31st deadline. Public Works has a sample dewatering plan sheet and dewatering guidelines available on our website. http://www.cityofpaloalto.org/gov/depts/pwd/forms_and_permits.asp 37. WATER FILLING STATION: Due to the California drought, applicant shall install a water station for the non-potable reuse of the dewatering water. This water station shall be constructed within private property, next to the right-of-way, (typically, behind the sidewalk). The station shall be accessible 24 hours a day for the filling of water carrying vehicles (i.e. street sweepers, etc.). The water station may also be used for onsite dust control. Before a discharge permit can be issued, the water supply station shall be installed, ready for operational and inspected by Public Works. The groundwater will also need to be tested for contaminants and chemical properties for the non-potable use. The discharge permit cannot be issued until the test results are received. Additional information regarding the station will be made available on the City’s website under Public Works. 38. GROUNDWATER USE PLAN: A Groundwater Use Plan (GWUP) shall be submitted for review for any project which requires dewatering. The GWUP, a narrative that shall be included in or accompany the Dewatering Plan, must demonstrate the highest beneficial use practicable of the pumped groundwater. The GWUP shall also state that all onsite, non-potable water needs such as dust control shall be met by using the pumped groundwater. Delays in submitting the GWUP can result in delays in the issuance of your discharge permit as Public Works requires sufficient review time which shall be expected by the applicant. 39. See attached Notice to Owners/Applicants planning to Dewater and Construction basements in Palo Alto. Please review this letter, City Council adopted these requirements on February 1, 2016, there will be additional dewatering requirements for the applicants to submit with the Building Permit application. 40. GRADING AND DRAINAGE PLAN: The plan set must include a grading & drainage plan prepared by a licensed professional that includes existing and proposed spot elevations, earthwork volumes, finished floor elevations, pad elevation, area drain and bubbler locations, drainage flow arrows to demonstrate proper drainage of the site. See Palo Alto Municipal Code Section 16.28 and Grading & Drainage Guidelines for Residential Development form for guidelines. http://www.cityofpaloalto.org/civicax/filebank/documents/2717 41. The Grading and Drainage Plan sheet GR03.00 is difficult to read, please use another CTB file when printing or modify the pen light weights to make this sheet more legible. As described on previous comment letter, it’s difficult to determine if any retaining wall are required along the project perimeter or to calculate the drive aisle slopes needed to raise the structure above the BFE. Note that the proposed parking slopes may exceed the allowed slope. 42. As shown on the plans applicant shall relocate the City’s existing 21-inch RCP storm drain line away for the proposed building foundations. The conceptual utility plan is to place a new 21-inch storm drain line in the drive aisle. The proposed storm drain line shall be design to drain by gravity and shall include manholes at the bends. The site drainage shall not be directly connected to the City’s line. No building structures shall be located over the new storm drain line and City easements. As part of the building permit application, applicant shall submit a schedule that includes the storm drain line replacement. Prior to building permit final, applicant shall record a new easement for the new storm drain line. The portion of the City’s existing line that is near the new building foundation shall be removed completely. 43. UTILITES AND BIO-RETENTION AREAS: Due to maintenance and inspection requirements associated with the bioretention areas, utilities that are not associated with the bio- retention design, shall not be installed within the bio-retention areas. It’s not clear if there are any existing or proposed utilities within the bio-rentention areas. Plot and label any existing lines to determine if these lines should be relocated or relocate the treatment areas if necessary. Identify any lines to be relocated. 44. STORM WATER TREATMENT: This project shall comply with the storm water regulations contained in provision C.3 of the NPDES municipal storm water discharge permit issued by the San Francisco Bay Regional Water Quality Control Board (and incorporated into Palo Alto Municipal Code Chapter 16.11). These regulations apply to land development projects that create or replace 10,000 square feet or more of impervious surface, and restaurants, retail gasoline outlets, auto service facilities, and uncovered parking lots that create and/or replace 5,000 square feet or more of impervious surface. In order to address the potential permanent impacts of the project on storm water quality, the applicant shall incorporate into the project a set of permanent site design measures, source controls, and treatment controls that serve to protect storm water quality, subject to the approval of the Public Works Department. The applicant shall identify, size, design and incorporate permanent storm water pollution prevention measures (preferably landscape-based treatment controls such as bioswales, filter strips, and permeable pavement rather than mechanical devices that require long-term maintenance) to treat the runoff from a “water quality storm” specified in PAMC Chapter 16.11 prior to discharge to the municipal storm drain system. Effective February 10, 2011, regulated projects, must contract with a qualified third-party reviewer during the building permit review process to certify that the proposed permanent storm water pollution prevention measures comply with the requirements of Palo Alto Municipal Code Chapter 16.11. The certification form, 2 copies of approved storm water treatment plan, and a description of Maintenance Task and Schedule must be received by the City from the third- party reviewer prior to approval of the building permit by the Public Works department. Within 45 days of the installation of the required storm water treatment measures and prior to the issuance of an occupancy permit for the building, third-party reviewer shall also submit to the City a certification for approval If pumps are required, plot and label where the pumps will be located, storm water runoff from pumped system shall daylight onto onsite landscaped areas and be allowed to infiltrate and flow by gravity to the public storm drain line. Storm water runoff that is pumped shall not be directly piped into the public storm drain line. 45. Bioretention swales shall be designed to use the full swale length for treatment, place the bubbler (outlet) and catch basin (inlet) at the ends of the swale. 46. Applicant shall be aware that the project may trigger water line and meter upgrades or relocation, if upgrades or relocation are required, the building permit plan set shall plot and label utility changes. If a backflow preventer is required, it shall be located within private property and plotted on the plans. Similarly if a transformer upgrade or a grease interceptor is required it shall also be located within the private property. Plot and label these on the Utility plan. 47. The following note shall be shown on the plans adjacent to the area on the Site Plan: “Any construction within the city right-of-way must have an approved Permit for Construction in the Public Street prior to commencement of this work. THE PERFORMANCE OF THIS WORK IS NOT AUTHORIZED BY THE BUILDING PERMIT ISSUANCE BUT SHOWN ON THE BUILDING PERMIT FOR INFORMATION ONLY.” 48. SIDEWALK, CURB & GUTTER: As part of this project, the applicant shall replace those portions of the existing sidewalks, curbs, gutters or driveway approaches in the public right-of-way along the frontage(s) of the property. Contact Public Works’ inspector at 650-496-6929 to arrange a site visit so that the inspector can discuss the extent of replacement work along the public road. The site plan submitted with the building permit plan set must show the extent of the replacement work. At minimum the curb and gutter and sidewalk along the project frontage shall be shown to be replaced. 49. PAVEMENT: East Bayshore is scheduled to be resurfaced in 2015. Any cutting into the pavement will trigger additional pavement requirements. Add the following note to the Site Plan adjacent to the public right-of-way: “Applicant and contractor will be responsible for resurfacing portions of Embarcadero Road and East Bayshore based the roadway surface condition after project completion and limits of trench work. At a minimum pavement resurfacing of the full width of the street along the project frontage may be required.” Plot and label the area to be resurfaced as hatched on the site plan. 50. Provide the following note on the Site Plan and Grading and Drainage Plan: “Contractor shall not stage, store, or stockpile any material or equipment within the public road right-of- way.” Construction phasing shall be coordinate to keep materials and equipment onsite or within private property. 51. IMPERVIOUS SURFACE AREA: The project will be creating or replacing 500 square feet or more of impervious surface. Accordingly, the applicant shall provide calculations of the existing and proposed impervious surface areas with the building permit application. The Impervious Area Worksheet for Land Developments form and instructions are available at the Development Center or on our website. To determine the impervious surface area that is being disturbed, provide the quantity on the site plan. 52. STORMWATER POLLUTION PREVENTION – The plan set shall include the “Pollution Prevention – It’s Part of the Plan” An electronic copy of this plan is available on the City’s website. http://www.cityofpaloalto.org/civicax/filebank/documents/2732 PRIOR TO BUILDING PERMIT FINAL 53. STORM DRAIN EASEMENT: The new easement shall be recorded and the existing easement shall be abandoned. 54. STORMWATER MAINTENANCE AGREEMENT: The applicant shall designate a party to maintain the control measures for the life of the improvements and must enter into a maintenance agreement with the City to guarantee the ongoing maintenance of the permanent C.3 storm water discharge compliance measures. The maintenance agreement shall be executed prior to the first building occupancy sign-off. The City will inspect the treatment measures yearly and charge an inspection fee. There is currently a $381 (FY 2015) C.3 plan check fee that will be collected upon submittal for a grading or building permit. Utilities Electrical Engineering 55. Industrial and large commercial customers must allow sufficient lead-time for Electric Utility Engineering and Operations (typically 8-12 weeks after advance engineering fees have been paid) to design and construct the electric service requested. 56. A completed Utility Service Application and a full set of plans must be included with all applications involving electrical work. The Application must be included with the preliminary submittal. 57. The applicant shall submit a request to disconnect all existing utility services and/or meters including a signed affidavit of vacancy, on the form provided by the Building Inspection Division. Utilities will be disconnected or removed within 10 working days after receipt of request. The demolition permit will be issued after all utility services and/or meters have been disconnected and removed. 58. All utility meters, lines, transformers, backflow preventers, and any other required equipment shall be shown on the landscape and irrigation plans and shall show that no conflict will occur between the utilities and landscape materials. In addition, all aboveground equipment shall be screened in a manner that is consistent with the building design and setback requirements. 59. Contractors and developers shall obtain permit from the Department of Public Works before digging in the street right-of-way. This includes sidewalks, driveways and planter strips. 60. At least 48 hours prior to starting any excavation, the customer must call Underground Service Alert (USA) at 1-800-227-2600 to have existing underground utilities located and marked. The areas to be checked for underground facility marking shall be delineated with white paint. All USA markings shall be removed by the customer or contractor when construction is complete. 61. The customer is responsible for installing all on-site substructures (conduits, boxes and pads) required for the electric service. No more than 270 degrees of bends are allowed in a secondary conduit run. All conduits must be sized according to California Electric Code requirements and no 1/2 – inch size conduits are permitted. All off-site substructure work will be constructed by the City at the customer’s expense. Where mutually agreed upon by the City and the Applicant, all or part of the off-site substructure work may be constructed by the Applicant. 62. All primary electric conduits shall be concrete encased with the top of the encasement at the depth of 30 inches. No more than 180 degrees of bends are allowed in a primary conduit run. Conduit runs over 500 feet in length require additional pull boxes. 63. All new underground conduits and substructures shall be installed per City standards and shall be inspected by the Electrical Underground Inspector before backfilling. 64. For services larger than 1600 amps, a transition cabinet as the interconnection point between the utility’s padmount transformer and the customer’s main switchgear may be required. See City of Palo Alto Utilities Standard Drawing SR-XF-E-1020. The cabinet design drawings must be submitted to the Electric Utility Engineering Division for review and approval. 65. For underground services, no more than four (4) 750 MCM conductors per phase can be connected to the transformer secondary terminals; otherwise, bus duct or x-flex cable must be used for connections to padmount transformers. If customer installs a bus duct directly between the transformer secondary terminals and the main switchgear, the installation of a transition cabinet will not be required. 66. The customer is responsible for installing all underground electric service conductors, bus duct, transition cabinets, and other required equipment. The installation shall meet the California Electric Code and the City Standards. 67. Meter and switchboard requirements shall be in accordance with Electric Utility Service Equipment Requirements Committee (EUSERC) drawings accepted by Utility and CPA standards for meter installations. 68. Shop/factory drawings for switchboards (400A and greater) and associated hardware must be submitted for review and approval prior to installing the switchgear to: Ibrahim Peek Assistant Electrical Engineer Utilities Engineering (Electrical) 1007 Elwell Court Palo Alto, CA 94303 69. For 400A switchboards only, catalog cut sheets may be substituted in place of factory drawings. 70. All new underground electric services shall be inspected and approved by both the Building Inspection Division and the Electrical Underground Inspector before energizing. 71. The customer shall provide as-built drawings showing the location of all switchboards, conduits (number and size), conductors (number and size), splice boxes, vaults and switch/transformer pads. 72. The follow must be completed before Utilities will make the connection to the utility system and energize the service:  All fees must be paid.  All required inspections have been completed and approved by both the Building Inspection Division and the Electrical Underground Inspector.  All Special Facilities contracts or other agreements need to be signed by the City and applicant.  Easement documents must be completed. Urban Forestry PRIOR TO DEMOLITION, BUILDING OR GRADING PERMIT ISSUANCE 73. BUILDING PERMIT SUBMITTAL- PROJECT ARBORIST CERTIFICATION LETTER. Prior to submittal for staff review, attach a Project Arborist Certification Letter that he/she has; (a) reviewed the entire building permit plan set submittal and, (b)* verified all his/her updated TPR mitigation measures and changes are incorporated in the plan set, (c) affirm that ongoing Contractor/Project Arborist site monitoring inspections and reporting have been arranged with the contractor or owner (see Sheet T-1) and, (d) understands that design revisions (site or plan changes) within a TPZ will be routed to Project Arborist/Contractor for review prior to approval from City. * (b above) other information. The Building Permit submittal set shall be accompanied by the project site arborist’s certification letter that the plans have incorporated said design changes and are consistent with City Tree Technical Manual Standards, Regulations and information: a. Provide a project arborist’s Updated Tree Protection Report (TPR) with building permit level mitigation measures, (e.g., resolve grading proximity issues with Public tree #2 and neighbor trees #3 and 5; exact TPZ scaled in feet). Provide plan revision directions to minimize root cutting conflicts that are obvious in the civil, basement, sidewalk improvement sheets. See TPR below. b. Palo Alto Tree Technical Manual Construction Standards, Section 2.00 and PAMC 8.10.080. 74. PLAN SET REQUIREMENTS. The final Plans submitted for building permit shall include the following information and notes on relevant plan sheets: a. SHEET T-1, BUILDING PERMIT. The building permit plan set will include the City’s fullsized, Sheet T-1 (Tree Protection-it's Part of the Plan!), available on the Development Center website at http://www.cityofpaloalto.org/civicax/filebank/documents/31783. The Applicant shall complete and sign the Tree Disclosure Statement and recognize the Project Arborist Tree Activity Inspection Schedule. Monthly reporting to Urban Forestry/Contractor is mandatory. (Insp. #1: applies to all projects; with tree preservation report: Insp. #1-7 applies) b. The Tree Preservation Report (TPR). All sheets of the Applicant’s construction level TPR approved by the City for full implementation by Contractor, Arbor Resources final report shall be printed on numbered Sheet T-1 (T-2, T-3, etc) and added to the sheet index. c. Plans to show protective tree fencing. The Plan Set (esp. site, demolition, grading & drainage, foundation, irrigation, tree disposition, utility sheets, etc.) must delineate/show the correct configuration of Type I, Type II or Type III fencing around each Regulated Tree, using a bold dashed line enclosing the Tree Protection Zone (Standard Dwg. #605, Sheet T-1; City Tree Technical Manual, Section 6.35-Site Plans); or by using the Project Arborist’s unique diagram for each Tree Protection Zone enclosure. 75. SITE PLAN REQUIREMENTS: In addition to showing TPZ fencing, add the following Notes on the specified Plan Sheets. a. Note #1. Apply to the site plan stating, "All tree protection and inspection schedule measures, design recommendations, watering and construction scheduling shall be implemented in full by owner and contractor, as stated on Sheet T-1, in the Tree Protection Report and the approved plans”. b. Note #2. All civil plans, grading plans, irrigation plans, site plans and utility plans and relevant sheets shall add a note applying to the trees to be protected, including neighboring trees stating: "Regulated Tree--before working in this area contact the Project Site Arborist at 650-321-0202"; c. Note #3. Utility (sanitary sewer/gas/water/backflow/electric/storm drain) plan sheets shall include the following note: “Utility trenching shall not occur within the TPZ of the protected tree. Contractor shall be responsible for ensuring that no trenching occurs within the TPZ of the protected tree by contractors, City crews or final landscape workers. See sheet T-1 for instructions.” d. Note #4. “Basement or foundation plan. Soils Report and Excavation for basement construction within the TPZ of a protected tree shall specify a vertical cut (stitch piers may be necessary) in order to avoid over-excavating into the tree root zone. Any variance from this procedure requires Urban Forestry approval, please call (650) 496-5953.” e. Note #5. “Pruning Restrictions. No pruning or clearance cutting of branches is permitted on City trees. Contractor shall obtain a Public Tree Permit from Urban Forestry (650-496- 5953) for any work on Public Trees” 76. TREE REMOVAL—PROTECTED & RIGHT-OF-WAY TREES. Existing trees (Publicly- owned or Protected) to be removed, as shown accurately located on all site plans, require approval by the Urban Forestry Tree Care Permit prior to issuance of any building, demolition or grading permit. Must also be referenced in the required Street Work Permit from Public Works Engineering. a. Add plan note for each tree to be removed, “Tree Removal. Contractor shall obtain a completed Urban Forestry Tree Care Permit # _____________ (contractor to complete) separate from the Building or Street Work Permit. Permit notice hanger and conditions apply. Contact (650-496-5953).” b. Copy the approval. The completed Tree Care Permit shall be printed on Sheet T-2, or specific approval communication from staff clearly copied directly on the relevant plan sheet. The same Form is used for public or private Protected tree removal requests available from the Urban Forestry webpage: http://www.cityofpaloalto.org/gov/depts/pwd/trees/default.asp 77. NEW RIGHT-OF-WAY TREES--PLAN REQUIREMENTS. New trees shall be shown on all relevant plans: site, utility, irrigation, landscape, etc. in a location 10’ clear radius from any (new or existing) underground utility or curb cut (see Note #4 above). a. Add note on the Planting Plan that states, “Tree Planting. Prior to in-ground installation, Urban Forestry inspection/approval is required for tree stock, planting conditions and irrigation adequacy. Contact (650-496-5953).” b. Landscape Plans shall state the Urban Forestry approved species, size and include relevant Standard Planting Dwg. #603, #603a or #604 (reference which), and shall note the tree pit dug at least twice the diameter of the root ball. c. Landscape plan shall include planting preparation details for trees specifying digging the soil to at least 30-inches deep, backfilled with a quality topsoil and dressing with 2-inches of wood or bark mulch on top of the root ball keeping clear of the trunk by 1-inch. d. Add note on the Planting & Irrigation Plan that states, “Irrigation and tree planting in the right-of-way requires a street work permit per CPA Public Works standards.” e. Automatic irrigation shall be provided for each tree. Standard Dwg. #513 shall be included on the irrigation plans and show two bubbler heads mounted on flexible tubing placed at the edge of the root ball. Bubblers mounted inside an aeration tube are prohibited. The tree irrigation system shall be connected to a separate valve from other shrubbery and ground cover, pursuant to the City's Landscape Water Efficiency Standards. 78. NEW TREES—SOIL VOLUME. Unless otherwise approved, new right-of-way trees each new tree shall be provided with 800 cubic feet of rootable soil area, utilizing Standard Dwg. #604/513. Rootable soil shall mean compaction less than 90% over the area, not including sidewalk base areas except when mitigated. Sidewalk or asphalt base underlayment [in lieu of compacted base rock] shall use an Alternative Base Material method such as structural grid (Silva Cell). Design and manufacturer details shall be added to relevant civil and landscape sheets. Each parking lot tree in small islands and all public trees shall be provided adequate rootable soil commensurate to mature tree size. Note: this expectation requires coordination with the engineer, arborist and landscape architect. a. Minimum soil volume for tree size growth performance (in cubic feet): Large: 1,200 cu.ft. Medium: 800 cu.ft. Small: 400 cu.ft. b. Landscape Plan. When qualifying for parking area shade ordinance compliance (PAMC 18.40.130) trees shall be labeled (as S, M or L). c. Engineered Soil Mix (ESM). When approved, Engineered Soil Mix base material shall be utilized in specified areas, such as a sidewalk base or channeling to a landscape area, to achieve expected shade tree rooting potential and maximum service life of the sidewalk, curb, parking surfaces and compacted areas. Plans and Civil Drawings shall use CPA Public Works Engineering ESM Specifications, Section 30 and Standard Dwg. #603a. Designated areas will be identified by cross-hatch or other symbol, and specify a minimum of 24" depth. The technology may be counted toward any credits awarded for LEED or Sustainable Sites certification ratings. 79. LANDSCAPE PLANS a. Include all changes recommended from civil engineer, architect and staff, including planting specifications if called for by the project arborist, b. Provide a detailed landscape and irrigation plan encompassing on-and off-site plantable areas out to the curb as approved by the Architectural Review Board. A Landscape Water Use statement, water use calculations and a statement of design intent shall be submitted for the project. A licensed landscape architect and qualified irrigation consultant will prepare these plans, to include: i. All existing trees identified both to be retained and removed including street trees. ii. Complete plant list indicating tree and plant species, quantity, size, and locations. iii. Irrigation schedule and plan. iv. Fence locations. v. Lighting plan with photometric data. vi. Landscape Plan shall ensure the backflow device is adequately obscured with the appropriate screening to minimize visibility (planted shrubbery is preferred, painted dark green, decorative boulder covering acceptable; wire cages are discouraged). vii. All new trees planted within the public right-of-way shall be installed per Public Works (PW) Standard Planting Diagram #603 or 604 (include on plans), and shall have a tree pit dug at least twice the diameter of the root ball. viii. Landscape plan shall include planting preparation details for trees specifying digging the soil to at least 30-inches deep, backfilled with a quality topsoil and dressing with 2-inches of wood or bark mulch on top of the root ball keeping clear of the trunk by 1-inch. ix. Automatic irrigation shall be provided to all trees. For trees, Standard Dwg. #513 shall be included on the irrigation plans and show two bubbler heads mounted on flexible tubing placed at the edge of the root ball. Bubblers shall not be mounted inside an aeration tube. The tree irrigation system shall be connected to a separate valve from other shrubbery and ground cover, pursuant to the City's Landscape Water Efficiency Standards. Irrigation in the right-of-way requires a street work permit per CPA Public Works standards. c. Add Planting notes to include the following mandatory criteria: i. Prior to any planting, all plantable areas shall be tilled to 12” depth, and all construction rubble and stones over 1” or larger shall be removed from the site. ii. A turf-free zone around trees 36” diameter (18” radius) required for best tree performance. d. Add note: “Mandatory Landscape Architect (LA) Inspections and Verification to the City. The LA shall verify the performance measurements are achieved with a letter of verification to City Planning staff, in addition to owner’s representative for the following: i. All the above landscape plan and tree requirements are in the Building Permit set of plans. ii. Percolation & drainage checks have been performed and are acceptable. iii. Fine grading inspection of all plantable areas has been personally inspected for tilling depth, rubble removal, soil test amendments are mixed and irrigation trenching will not cut through any tree roots. iv. Tree and Shrub Planting Specifications, including delivered stock, meets Standards in the CPA Tree Technical Manual, Section 3.30-3.50. Girdling roots and previously topped trees are subject to rejection. DURING CONSTRUCTION 80. TREE PROTECTION VERIFICATION. Prior to any site work a written verification from the contractor that the required protective fencing is in place shall be submitted to the Urban Forestry Section (derek.sproat@cityofpaloalto.org). The fencing shall contain required warning sign and remain in place until final inspection of the project. 81. EXCAVATION RESTRICTIONS APPLY (TTM, Sec. 2.20 C & D). Any approved grading, digging or trenching beneath a tree canopy shall be performed using ‘air-spade’ method as a preference, with manual hand shovel as a backup. For utility trenching, including sewer line, roots exposed with diameter of 1.5 inches and greater shall remain intact and not be damaged. If directional boring method is used to tunnel beneath roots, then Table 2-1, Trenching and Tunneling Distance, shall be printed on the final plans to be implemented by Contractor. 82. PLAN CHANGES. Revisions and/or changes to plans before or during construction shall be reviewed and responded to by the (a) project site arborist, Skender Construction, Bay Area Tree Specialists Richard Smith, 408-836-9147, or (b) landscape architect with written letter of acceptance before submitting the revision to the Building Department for review by Planning, PW or Urban Forestry. 83. TREE PROTECTION COMPLIANCE. The owner and contractor shall implement all protection and inspection schedule measures, design recommendations and construction scheduling as stated in the TPR & Sheet T-1, and is subject to code compliance action pursuant to PAMC 8.10.080. The required protective fencing shall remain in place until final landscaping and inspection of the project. Project arborist approval must be obtained and documented in the monthly activity report sent to the City. The mandatory Contractor and Arborist Monthly Tree Activity Report shall be sent monthly to the City (pwps@cityofpaloalto.org) beginning with the initial verification approval, using the template in the Tree Technical Manual, Addendum 11. 84. TREE PROTECTION. Tree protection fencing is not required for this minor project. However, the owner and contractor shall, as needed, protect and preserve all trees to remain on the site, subject to code compliance action pursuant to PAMC 8.10.080 and Construction Requirements of the City Tree Technical Manual, Section 2.00. 85. TREE DAMAGE. Tree Damage, Injury Mitigation and Inspections apply to Contractor. Reporting, injury mitigation measures and arborist inspection schedule (1-5) apply pursuant to TTM, Section 2.20-2.30. Contractor shall be responsible for the repair or replacement of any publicly owned or protected trees that are damaged during the course of construction, pursuant to Title 8 of the Palo Alto Municipal Code, and city Tree Technical Manual, Section 2.25. 86. GENERAL. The following general tree preservation measures apply to all trees to be retained: No storage of material, topsoil, vehicles or equipment shall be permitted within the tree enclosure area. The ground under and around the tree canopy area shall not be altered. Trees to be retained shall be irrigated, aerated and maintained as necessary to ensure survival. PRIOR TO OCCUPANCY 87. URBAN FORESTRY DIGITAL FILE & INSPECTION. The applicant or architect shall provide a digital file of the landscape plan, including new off-site trees in the publicly owned right-of- way. A USB Flash Drive, with CAD or other files that show species, size and exact scaled location of each tree on public property, shall be delivered to Urban Forestry at a tree and landscape inspection scheduled by Urban Forestry (650-496-5953). 88. LANDSCAPE CERTIFICATION LETTER. The Planning Department shall be in receipt of a verification letter that the Landscape Architect has inspected all trees, shrubs, planting and irrigation and that they are installed and functioning as specified in the approved plans. 89. PROJECT ARBORIST CERTIFICATION LETTER. Prior to written request for temporary or final occupancy, the contractor shall provide to the Planning Department and property owner a final inspection letter by the Project Arborist. The inspection shall evaluate the success or needs of Regulated tree protection, including new landscape trees, as indicated on the approved plans. The written acceptance of successful tree preservation shall include a photograph record and/or recommendations for the health, welfare, mitigation remedies for injuries (if any). The final report may be used to navigate any outstanding issues, concerns or security guarantee return process, when applicable. 90. PLANNING INSPECTION. Prior to final sign off, contractor or owner shall contact the city planner (650-329-2441) to inspect and verify Special Conditions relating to the conditions for structures, fixtures, colors and site plan accessories. POST CONSTRUCTION 91. MAINTENANCE. All landscape and trees shall be maintained, watered, fertilized, and pruned according to Best Management Practices-Pruning (ANSI A300-2008 or current version) and the City Tree Technical Manual, Section 5.00. Any vegetation that dies shall be replaced or failed automatic irrigation repaired by the current property owner within 30 days of discovery. Utilities Water-Gas-Wastewater Engineering PRIOR TO ISSUANCE OF DEMOLITION PERMIT 92. Prior to demolition, the applicant shall submit the existing water/wastewater fixture unit loads (and building as-built plans to verify the existing loads) to determine the capacity fee credit for the existing load. If the applicant does not submit loads and plans they may not receive credit for the existing water/wastewater fixtures. 93. The applicant shall submit a request to disconnect all utility services and/or meters including a signed affidavit of vacancy. Utilities will be disconnected or removed within 10 working days after receipt of request. The demolition permit will be issued by the building inspection division after all utility services and/or meters have been disconnected and removed. FOR BUILDING PERMIT 94. The applicant shall submit a completed water-gas-wastewater service connection application - load sheet for City of Palo Alto Utilities. The applicant must provide all the information requested for utility service demands (water in fixture units/g.p.m., gas in b.t.u.p.h, and sewer in fixture units/g.p.d.). The applicant shall provide the existing (prior) loads, the new loads, and the combined/total loads (the new loads plus any existing loads to remain). 95. The applicant shall submit improvement plans for utility construction. The plans must show the size and location of all underground utilities within the development and the public right of way including meters, backflow preventers, fire service requirements, sewer mains, sewer cleanouts, sewer lift stations and any other required utilities. 96. The applicant must show on the site plan the existence of any auxiliary water supply, (i.e. water well, gray water, recycled water, rain catchment, water storage tank, etc). 97. The applicant shall be responsible for installing and upgrading the existing utility mains and/or services as necessary to handle anticipated peak loads. This responsibility includes all costs associated with the design and construction for the installation/upgrade of the utility mains and/or services. 98. The applicant's engineer shall submit flow calculations and system capacity study showing that the on-site and off-site water and sanitary sewer mains and services will provide the domestic, irrigation, fire flows, and wastewater capacity needed to service the development and adjacent properties during anticipated peak flow demands. Field testing may be required to determined current flows and water pressures on existing water main. Calculations must be signed and stamped by a registered civil engineer. The applicant is required to perform, at his/her expense, a flow monitoring study of the existing sewer main to determine the remaining capacity. The report must include existing peak flows or depth of flow based on a minimum monitoring period of seven continuous days or as determined by the senior wastewater engineer. The study shall meet the requirements and the approval of the WGW engineering section. No downstream overloading of existing sewer main will be permitted. 99. An approved reduced pressure principle assembly (RPPA backflow preventer device) is required for all existing and new water connections from Palo Alto Utilities to comply with requirements of California administrative code, title 17, sections 7583 through 7605 inclusive. The RPPA shall be installed on the owner's property and directly behind the water meter within 5 feet of the property line. RPPA’s for domestic service shall be lead free. Show the location of the RPPA on the plans. 100. An approved reduced pressure detector assembly is required for the existing or new water connection for the fire system to comply with requirements of California administrative code, title 17, sections 7583 through 7605 inclusive (a double detector assembly may be allowed for existing fire sprinkler systems upon the CPAU’s approval). reduced pressure detector assemblies shall be installed on the owner's property adjacent to the property line, within 5’ of the property line. Show the location of the reduced pressure detector assembly on the plans. 101. All backflow preventer devices shall be approved by the WGW engineering division. Inspection by the utilities cross connection inspector is required for the supply pipe between the meter and the assembly. 102. Existing wastewater laterals that are not plastic (ABS, PVC, or PE) shall be replaced at the applicant’s expense. 103. Existing water services that are not a currently standard material shall be replaced at the applicant’s expense. 104. The applicant shall pay the capacity fees and connection fees associated with new utility service/s or added demand on existing services. The approved relocation of services, meters, hydrants, or other facilities will be performed at the cost of the person/entity requesting the relocation. 105. Each unit or place of business shall have its own water and gas meter shown on the plans. Each parcel shall have its own water service, gas service and sewer lateral connection shown on the plans. 106. A separate water meter and backflow preventer is required to irrigate the approved landscape plan. Show the location of the irrigation meter on the plans. This meter shall be designated as an irrigation account an no other water service will be billed on the account. The irrigation and landscape plans submitted with the application for a grading or building permit shall conform to the City of Palo Alto water efficiency standards. 107. A new water service line installation for domestic usage is required. For service connections of 4-inch through 8-inch sizes, the applicant's contractor must provide and install a concrete vault with meter reading lid covers for water meter and other required control equipment in accordance with the utilities standard detail. Show the location of the new water service and meter on the plans. 108. A new water service line installation for irrigation usage is required. Show the location of the new water service and meter on the plans. 109. A new water service line installation for fire system usage is required. Show the location of the new water service on the plans. The applicant shall provide to the engineering department a copy of the plans for fire system including all fire department's requirements. 110. A new gas service line installation is required. Show the new gas meter location on the plans. The gas meter location must conform with utilities standard details. 111. A new sewer lateral installation per lot is required. Show the location of the new sewer lateral on the plans. 112. Where public mains are installed in private streets/PUEs for condominium and town home projects the CC&Rs and final map shall include the statement: “Public Utility Easements: If the City’s reasonable use of the Public Utility Easements, which are shown as P.U.E on the Map, results in any damage to the Common Area, then it shall be the responsibility of the Association, and not of the City, to Restore the affected portion(s) of the Common Area. This Section may not be amended without the prior written consent of the City”. 113. All existing water and wastewater services that will not be reused shall be abandoned at the main per WGW utilities procedures. 114. Utility vaults, transformers, utility cabinets, concrete bases, or other structures cannot be placed over existing water, gas or wastewater mains/services. Maintain 1’ horizontal clear separation from the vault/cabinet/concrete base to existing utilities as found in the field. If there is a conflict with existing utilities, Cabinets/vaults/bases shall be relocated from the plan location as needed to meet field conditions. Trees may not be planted within 10 feet of existing water, gas or wastewater mains/services or meters. New water, gas or wastewater services/meters may not be installed within 10’ or existing trees. Maintain 10’ between new trees and new water, gas and wastewater services/mains/meters. 115. To install new gas service by directional boring, the applicant is required to have a sewer cleanout at the front of the building. This cleanout is required so the sewer lateral can be videoed for verification of no damage after the gas service is installed by directional boring. 116. All utility installations shall be in accordance with the City of Palo Alto utility standards for water, gas & wastewater. Public Art 117. If the applicant chooses to pay in-lieu of commissioning art on site, the funds must be paid prior to the issuance of a building permit. 118. If the applicant chooses to commission art on site, then they must complete both initial and final reviews and receive approval from the Public Art Commission prior to the issuance of a permit. Building Department 119. Plans shall include an analysis of the occupancies separations. 120. Plans shall include an analysis of the exit (egress) system. 121. Plans shall include the location(s) of the accessible path(s) that include the public right-of-way. 122. All parking areas shall include accessible parking spaces as required by 2013 CBC 11B. Fire Department 123. Install a NFPA 13 fire sprinkler, NFPA 14 standpipe, NFPA 24 underground fire service and NFPA 72 fire alarm system under separate permit. 124. Install two (2) on-site fire hydrants. Install one (1) public fire hydrant on Embarcadero Road. 125. This facility shall meet the requirements of the 2013 CA Fire Code section 510 RE: Emergency Responders Radio System. 126. Fire Department access roadways shall meet the requirements of the 2013 CA Fire Code Section 503 and Appendix D including section D105. Green Building Local Energy Reach Code for Non-Residential Projects The following conditions apply to the project: 127. The project includes new construction and therefore triggers the Local Energy Efficiency Reach Code. For all new non-residential construction: The performance approach specified within the 2013 California Energy Code shall be used to demonstrate that the TDV Energy of the proposed building is at least 15% less than the TDV Energy of the Standard Design. (Ord. 5326 § 1 (part), 2015) Green Building Requirements for Non-Residential Projects The following conditions apply to the project: 128. The project is a new nonresidential construction project greater than 1,000 square feet and therefore must comply with California Green Building Standards Code Mandatory plus Tier 2 requirements, as applicable to the scope of work. PAMC 16.14.080 (Ord. 5324 § 1 (part), 2015). The project applicant shall indicate the requirements on the Permit Plans. The submittal requirements are outlined here: www.cityofpaloalto.org/gov/depts/ds/green_building/default.asp. 129. The project is a new building over 10,000 square feet and therefore must meet the commissioning requirements outlined in the California Building Code section 5.410.2 for Planning Approval. The project team shall re-submit the Owner’s Project Requirements (OPR) in accordance with section 5.410.2.1 with an updated Basis of Design (BOD) in accordance with 5.410.2.2 that reflects the design elements finalized between Planning Approval and Permit Submittal. The project shall also submit a Commissioning Plan in accordance with 5.410.2.3 and the GB-3 and GB-4 requirements listed on the green building section of the Development Services webpage. 130. The project is a nonresidential projects exceeding $100,000 valuation and therefore must acquire an Energy STAR Portfolio Manager Rating and submit the rating to the City of Palo Alto once the project has been occupied after 12 months. PAMC 16.14.380 (Ord. 5324 § 1 (part), 2015). The Energy Star Project Profile shall be submitted to the Building Department prior to permit issuance. Submittal info can be found at: https://www.cityofpaloalto.org/gov/depts/utl/business/benchmarking_your_building.asp. 131. EMERGENCY DROUGHT REGULATIONS: The project is a non-residential new construction project with a landscape of any size included in the project scope and therefore must comply with Potable water reduction Tier 2 in accordance with the Emergency Drought Regulations effective June 1st, 2015. Documentation is required to demonstrate that the Estimated Total Water Use (ETWU) falls within a Maximum Applied Water Allowance (MAWA) using the ET adjustment factor (ETAF) of 0.55 for landscaped areas. Special Landscape Areas (SLA) will be given an allowance of 0.45. The resulting ETAF for SLA shall be 1.0. (PAMC 16.14 (Ord. 5324 § 1 (part), 2015) and the Emergency Drought Regulations link below: http://www.documents.dgs.ca.gov/bsc/2015TriCycle/BSC-Meetings/Emergency-Regs/HCDEF-01-15- ET-Pt11.pdf 132. The project applicant shall update sheet L-6 to reflect the landscape calculations and information above on the Permit Plans. 133. The project includes a new or altered irrigation system and therefore must be designed and installed to prevent water waste due to overspray, low head drainage, or other conditions where water flows onto adjacent property, non-irrigated areas, walks, roadways, parking lots, or structures. PA 16.14.300 (Ord. 5324 § 1 (part), 2015). 134. The project includes a new or altered irrigation system and therefore the irrigation must be scheduled between 8:00 p.m. and 10:00 a.m. unless weather conditions prevent it. Operation of the irrigation system outside the normal watering window is allowed for auditing and system maintenance. Total annual applied water shall be less than or equal to maximum applied water allowance (MAWA) as calculated per the potable water use reduction tier. PAMC 16.14.310 (Ord. 5324 § 1 (part), 2015). ). The project applicant shall indicate the requirements on the Permit Plans. 135. The project is outside the boundaries of the recycled water project area and is greater than 1,000 square feet and therefore must install recycled water infrastructure for irrigation systems. PAMC 16.14.230 (Ord. 5324 § 1 (part), 2015). The project applicant shall indicate the requirements on the Permit Plans. 136. The project is either new construction or a rehabilitated landscape and is greater than 1,000 square feet and therefore must install a dedicated irrigation meter related to the recycled water infrastructure. PAMC 16.14.230 (Ord. 5324 § 1 (part), 2015). The project applicant shall indicate the requirements on the Permit Plans. 137. The project is a nonresidential new construction or renovation project and has a value exceeding $25,000 and therefore must meet Enhanced Construction Waste Reduction Tier 2. PAMC 16.14.240 (Ord. 5324 § 1 (part), 2015). The project shall use the Green Halo System to document the requirements. 138. The project includes non-residential demolition and therefore must meet the Enhanced Construction Waste Reduction - Tier 2. PAMC 16.14.270 (Ord. 5324 § 1 (part), 2015). The project shall use the Green Halo System to document the requirements. 139. The project is a new non-residential structure and therefore must comply with the City of Palo Alto Electric Vehicle Charging Ordinance 5324. The project shall provide Conduit Only, EVSE-Ready Outlet, or EVSE Installed for at least 25% of parking spaces, among which at least 5% (and no fewer than one) shall be EVSE Installed. The requirements shall be applied separately to accessible parking spaces. See Ordinance 5324 for EVSE definitions, minimum circuit capacity, and design detail requirements. PAMC 16.14.380 (Ord. 5263 § 1 (part), 2013) See https://www.cityofpaloalto.org/civicax/filebank/documents/43818 for additional details. 140. The project has indicated the locations of the EVSE infrastructure on sheet A0.3. The following are required at Post-Construction after 12 months of occupancy. 141. The project is a nonresidential projects exceeding $100,000 valuation and therefore must acquire an Energy STAR Portfolio Manager Rating and submit the rating to the City of Palo Alto once the project has been occupied after 12 months. PAMC 16.14.250 (Ord. 5324 § 1 (part), 2015). Submittal info can be found at: https://www.cityofpaloalto.org/gov/depts/utl/business/benchmarking_your_building.asp. The following are optional to the project team: Optional Zero Net Energy Design Review: 142. OPTIONAL: The project is a new construction or remodel of a commercial project and therefore may elect to engage the City of Palo Alto consultant, BASE Energy Inc, free of charge. BASE will assist the project in targeting Zero Net Energy and exceeding the Title 24 Energy Code. Rebates may be available via working with Base. For more information, visit cityofpaloalto.org/commercial program or call 650.329.2241. The applicant may also contact Ricardo Sfeir at BASE Energy at rsfeir@baseco.com to schedule a project kick-off. Utilities Incentives & Rebates 143. OPTIONAL: The project may be eligible for several rebates offered through the City of Palo Alto Utilities Department. These rebates are most successfully obtained when planned into the project early in design. For the incentives available for the project, please see the information provided on the Utilities website: http://www.cityofpaloalto.org/gov/depts/utl/business/rebates/default.asp Bird-Friendly Building Design 144. OPTIONAL: The project contains a glazed façade that covers a large area. The project should consider bird-safe glazing treatment that typically includes fritting, netting, permanent stencils, frosted glass, exterior screens, and physical grids placed on the exterior of glazing or UV patterns visible to birds. In some cases, bird-friendly treatment is invisible to humans. Vertical elements of the window patterns should be at least 1/4 inch wide at a minimum spacing of 4 inches, or have horizontal elements at least 1/8 inch wide at a maximum spacing of 2 inches. The applicant should reference the San Francisco Guidelines for Bird-Safe Buildings: http://www.sf-planning.org/index.aspx?page=2506. SECTION 10. Term of Approval. 1. Site and Design Approval. In the event actual construction of the project is not commenced within two years of the date of council approval, the approval shall expire and be of no further force or effect, pursuant to Palo Alto Municipal Code Section 18.30(G).080. 2. Architectural Review and Design Enhancement Exception Approval. In the event actual construction of the project is not commenced within one year of the date of council action, the Director of Planning may extend such time for a maximum of one year, pursuant to Palo Alto Municipal Code Section 18.77.090. PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: APPROVED: _________________________ ____________________________ City Clerk Director of Planning and Community Environment APPROVED AS TO FORM: ___________________________ Senior Asst. City Attorney Attachment C NOT YET APPROVED Ordinance No. Ordinance of the Council of the City of Palo Alto Amending Section 18.08.040 (Zoning Map and District Boundaries) of the Palo Alto Municipal Code to change the classification of certain property on 1700 Embarcadero Road from CS (D) to CS (D)(AD) The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. A. The Planning and Transportation Commission, after duly noticed hearing held April 27, 2016, has recommended that section 18.08.040 (the Zoning Map) of the Palo Alto Municipal Code be amended as hereinafter set forth; and B. The City Council, after due consideration of this recommendation, finds that the proposed amendment is in the public interest and will promote the public health, safety and welfare. SECTION 2. Section 18.08.040 (Zoning Map and District Boundary) is hereby amended by changing the zoning of 1700 Embarcadero (the “subject property”), from “Commercial Service Site and Design Review Combining District” to “Commercial Service Site and Design Review and Automobile Dealership Combining District”. The subject property is shown on the map labeled ‘Exhibit A’ attached hereto and incorporated herein by reference. SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 4. The Council finds that the adoption of this ordinance is covered under the provisions of the California Environmental Quality Act pursuant to CEQA Guideline section 15070, Decision to Prepare a Negative or Mitigated Negative Declaration and 15074, Consideration and Adoption of a Negative Declaration or Mitigated Negative Declaration. The City Council finds on the basis of the whole record before it (including the initial study and any comments received), that there is no substantial evidence that the project will have a significant effect on the environment and that the negative declaration or mitigated negative declaration reflects the lead agency's independent judgment and analysis. The Planning & Community Environment Department is the custodian of the records. NOT YET APPROVED SECTION 5. This ordinance shall be effective on the thirty-first date after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: NOT PARTICIPATING: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Senior Asst. City Attorney City Manager Director of Planning & Community Environment Exhibit A The property shown on this map labeled 1700 has an existing zoning designation of CS(D). The proposed ordinance changes the zoning designation to CS(D)(AD). The AD addition is for the Automobile Dealership overlay. 1 Application Narrative: Mercedes-Benz of Palo Alto Scope of Work, Existing and Proposed Use: The proposal for the Mercedes-Benz of Palo Alto is located on the corner of East Bayshore Road and Embarcadero Road on the 2.54 Acre site formerly operated as Ming’s Chinese Restaurant. The new business will be a retail sales and repair service operation with ancillary carwash for internal business use. The current project is undergoing a rezoning process for automotive use, which would align this corner with adjacent properties and businesses on Embarcadero. The proximity to the Freeway and neighboring commercial office buildings makes this area accessible to the public while not impacting nearby residential zones. The adjacent businesses on Embarcadero consist of two automotive use dealerships, representing Honda Motors and a new designed building for Audi. Overall Design Concept Statement: Mercedes-Benz in Palo Alto is conceived as a unique building utilizing a compact footprint, which employs vertical transportation elements and internal ramps for vehicular movement through the multi-floor structure to minimize the site’s surface parking and congestion of vehicle storage on the surface lot. The design of the building is more consistent with a multi-storied corporate office building in massing and scale compared to a typical traditional automotive dealership typology of large connected single-story volumes. Site Design Intent The site is bound on two sides by Embarcadero Road and East Bayshore Road. These streetscapes each have an existing mature tree line that will provide immediate sense of a mature site development. Creating an entrance to the Baylands area along the Embarcadero and Bayshore streetscapes, the site introduces trees for increased shading, a Baylands-inspired landscape (including native plantings), and public amenities (bench seating, bike repair and water station). Site design takes cues from the adjacent Byers Eye Institute property with mixtures of berms, ornamental grasses, granite pathways, and low concrete landscape walls. Further, the site will incorporate a Public Art component. Functionality of the site has been taken into consideration by maximizing the allowable FAR to facilitate a vertical dealership model which does not require acres of impervious surface lots and multiple buildings as a traditional typology. Primary access to the site is planned from Bayshore Road in order to mitigate congestion on the more heavily trafficked Embarcadero thoroughfare. Mercedes-Benz Autohaus Design principles: The Mercedes-Benz Autohaus global design corporate image has its aesthetic and architectural roots in the modern and technical/industrial detailing. It is a design which celebrated technology of emerging building materials and industrial processes in Europe during the industrial revolution. Today’s application of these principles manifest through corporate identity elements such as: ·Exposed steel expressed both in the interior and exterior and the use of metal and glass to exhibit the car as a showpiece inside an articulated modern environment. ·The open plan concept, with expansive glass and high performance envelopes generally are composed of massing and light versus ornamentation. ·The use CI elements such as the distinctive MB columns and exposed steel beam and roof edge with complementing color pallets in poured concrete, silver, grey and limited black accents are intended to promote clean sharp forms, which have variations in contrast and accentuate the volumes of the buildings. Attachment D 2 Application Narrative: Mercedes-Benz of Palo Alto Through the Sketch Study session and initial ARB meeting, the application of these principles has been modified to align more closely with the horizontal articulations and volume changes consistent with the Baylands design attributes, as executed in the Byers Eye Institute and other adjacent buildings. Further, the building’s materiality incorporates both Mercedes-Benz Autohaus Design and Baylands Design Guideline color tones. Building Massing: The building’s mass is articulated in distinct ways to create quality environments for both customers and employees by optimizing daylighting and natural ventilation through the use of expansive glazing on all building sides and the inclusion of exterior patio spaces. Building mass has been broken down as to provide more distinct architectural elements and maintain the horizontal nature of the Baylands design nature. Per discussions in the Sketch session and preliminary ARB meeting, each building elevation is treated with architectural features and façade treatment that relate and express the internal functions and orientation. The objective of the building design is to maximize passive design opportunities while employing rigorous systems design to insure the performance metrics meet and/or exceed code. Building Performance and Materiality: The sustainable impact of the building is of great importance. Insulated walls with metal panel and finish plaster, high efficiency glass with protective bird coatings, insulation of mechanical heating and cooling, as well as passive ventilation strategies, are used to maximize the building’s energy performance. Sensitivity to light pollution from the building envelope and the site lighting design are targeted to achieve highest code standards. Development of natural lighting strategies, as well as the outdoor space, have been designed to optimize orientation and wind in service of promoting a healthy environment for all customers and staff throughout the building. The building’s proposed material palette draws from both the Mercedes-Benz Autohaus Design, utilizing silver and black materials, and the Baylands Design Guidelines, utilizing Sandy Hook Grey material. The independent structure adjacent to the primary building is the carwash structure. Its design aligns with the architectural tone of the primary building on all four sides and employs the industry’s most effective recycled water recapture system. Construction Methodology: Mercedes-Benz of Palo Alto has an elevated finished floor slab on a series of piers to establish the required height above sea level per FEMA standards. This elevated floor design allows the site to be naturally drained to BMP surface treatment located around the perimeter of the site. The primary structural system will be a steel frame building with metal stud and insulated wall cladding system on all sides. The exterior skin is composed of both aluminum metal panel rain screen systems and high performance plaster with a continuous insulated skin condition. All glass is a low e coated high performance glass with bird film to achieve extremely high R values and to mitigate excessive mechanical loads and equipment, resulting in lower energy consumption. The Carwash structure is designed as a slab on grade beams and piers with drainage mitigation per the City requiring openings at the base course of block for water to pass though in case of flooding. The construction is structural block with steel framed roof deck and exterior cladding matching the building in metal panel and high performance plaster. The structure has overhead doors on both ends. 3 Application Narrative: Mercedes-Benz of Palo Alto Relationship of Site and Existing Context The building’s relationship to the site, while different than the current single story Ming’s restaurant, will align with the existing context in several ways: · With regards to materiality, the exterior appearance will have similar technical feel of the new Audi Design being completed on adjacent site. · Per the Bayland’s Guidelines for Private Lands, the project utilizes the listed color, Sandy Hook Grey, as a significant portion of façade color. · The color also has some commonality utilizing silver with MB also incorporating dark grey/concrete and Sandy Hook grey. · The use of Glass and Metal skin as well as smooth plaster finishes. · With respect to the massing and height, the new MB Palo Alto store has a more commercial office massing consistent with the adjacent Byers Eye Institute building. · In addition, all building sides and fenestration have a horizontally proportional design. · The site takes advantage of existing mature trees on the street, which is taking cues from the Byers Eye Institute, the streetscape will employ similar berms and native landscape species. · The rear portions of the building facing the Baylands Nature Preserve are heavily screened by trees and the windows are minimized to reduce illumination. · All rooftop lighting is minimized with limited poles and integrated lighting in concealed wall locations to meet the minimum foot candle requirements. On Site Looking Northeast SITE PHOTOGRAPHS On Site Looking North Looking North from Site Existing Building Looking Northwest from Site Looking Northwest from Site Looking at Site from Baylands Trail (Southeast) Looking at Site from South Byers Institute (2452 Watson Ct.) Example of Baylands Inspired Theme Photo simulation of project using Southeast trail picture. ATTACHMENT F Project’s Conformance with Zoning Code Regulations 1700 Embarcadero Road / File No. 15PLN-00394 Table 1: CONFORMANCE WITH CHAPTER 18.16 & 18.30(F) (CS DISTRICT & AD COMBINING DISTRICT) Regulation Required Proposed Conformance Minimum Building Setbacks Front Setback 0-10 ft to create an 8-12 ft effective sidewalk 40 feet Project Conforms with DEE approval Interior Side Yard None 56 ft Project Conforms Street Side Setback None 80 ft Project Conforms Rear Setback None 50 ft to main building 5 ft to car wash building Project Conforms Floor Area Ratio (max) 66,384 s.f. (0.6:1) 0.4:1 (44,256 sf) 0.2:1 (22,123 sf) bonus 0.56:1 (61,510 sf) 0.39:1 (43,786 sf) 0.16:1 (17,724 sf) Project Conforms Lot Coverage None 28,213 s.f. (25.5%) Project Conforms Building Height 50 feet 50 ft Project Conforms Table 2: CONFORMANCE WITH CHAPTER 18.52 (Off-Street Parking and Loading Requirements) Parking Spaces Required Proposed Conformance Customer/Employee Vehicle outdoor display: 1:500 s.f. (2,551/500 = 5) Showroom/Sales: 1:400 sf (30,475/400 = 76) Car Wash/Service Repair: 1:350 sf (19,756/350 = 56) 139 spaces* Surface: 43 2nd Floor: 66 3rd Floor: 30 Total: 139 Project Conforms Bicycles 1: 10 employees 7 spaces 8 spaces Project Conforms *Rounding Attachment G Final Initial Study/Mitigated Negative Declaration (Hard copies will be distributed to the City Council on June 2) http://www.cityofpaloalto.org/news/displaynews.asp?NewsID=2281&TargetID=319 Attachment H Hardcopies were provided to City Council and Libraries only Project plans can be reviewed at: http://www.cityofpaloalto.org/news/displaynews.asp?NewsID=2281&TargetID=319 Architectural Review Board Staff Report (ID # 6963) Report Type: Action Items Meeting Date: 5/19/2016 City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-3221 Summary Title: 1700 Embarcadero Road (Mercedes Benz) Title: 1700 Embarcadero Road [15PLN-00394]: Request by Deeg Snyder, on behalf of Jones Palo Alto Real Property, LLC for a Major Architectural Review and Site and Design Review to demolish the existing approximately 18,000 square feet building and construct a new approximately 62,000 square feet building for an automobile dealership. The application includes Design Enhancement Exception requests to allow deviation from the 10 feet build-to-line from Embarcadero Road and Bayshore Road. A request to apply the Automobile Dealership (AD) zoning overlay is also being considered separately by the Planning and Transportation Commission. Environmental Assessment: Mitigated Negative Declaration. Zoning District: Service Commercial and Site Design Review Combining District CS (D). From: Hillary Gitelman Lead Department: Planning and Community Environment Recommendation It is recommended that the Architectural Review make a recommendation to the City Council to: 1. Adopt the Mitigated Negative Declaration 2. Approve the Design Enhancement Exception 3. Approve the Architectural Review application Report Summary The subject project was previously reviewed by the Architectural Review Board (ARB) on three other occasions. The Municipal Code encourages the Director of Planning and Community Development to make a decision on projects after three public hearings. However, the Director has requested this application return to the ARB for limited review of items that were not resolved at the previous May 5th hearing. These items are 1) lighting City of Palo Alto Planning & Community Environment Department Page 2 details and photometric study, 2) revised landscape plan that includes larger native trees that screen the building, and 3) a darker color for the stair tower at the front of the building. Earlier staff reports include background information, project analysis and evaluation to City codes and policies; these reports are available online; a copy of the first report without prior attachments is available in Attachment G. Below are links to the subsequent reports: November 19, 2015 - https://www.cityofpaloalto.org/civicax/filebank/documents/49848 February 18, 2016 - https://www.cityofpaloalto.org/civicax/filebank/documents/51101 May 5, 2016 - https://www.cityofpaloalto.org/civicax/filebank/documents/52196 The purpose of this report is to restate the three main comments made by the Board and detail the applicant’s response to those comments. The analysis section below builds upon the information contained in earlier reports and modified to reflect recent project changes. Planning staff supports the project and recommends the Board forward a recommendation of approval to the City Council based on the draft findings and conditions, or as modified by the Board. Project Description Applicant proposes a three-story automobile dealership project on Embarcadero Road in the Bayshore Employment Center. The project replaces a single-story restaurant building built in 1968; the structure is not a historic resource. The project is subject to architectural review findings, context-based design criteria and compliance review with the Baylands Master Plan Site and Assessment Design Guidelines. Implementing the project requires a rezone to include the Automobile Dealership (AD) combining district. As designed, the project meets the applicable zoning requirements with the exception of a “build-to” setback requirement along Embarcadero Road. This necessitates approval of a Design Enhancement Exception (DEE). Since the site includes the Site and Design Review (D) combining district, and the applicant has requested a rezoning, the project will also be reviewed by the Planning & Transportation (PTC). The ARB last considered this project on May 5, 2016. A video recording of the Board’s meeting is available online: http://midpenmedia.org/architectural-review-board-43/ At the May 5th hearing, the applicant presented a color scheme for the building that was changed to be consistent with the Baylands Master Plan by including the ‘sandy hook grey’ color prescribed by the plan, as well as the elimination of height exception request and elimination of a canopy adjacent to the car wash facility. With the changes, the applicant proposes an overall Floor Area Ratio (FAR) of 0.56:1 (0.6:1 permitted on sites with an Automobile Dealership combining district [proposing 0.4:1 for the dealership and 0.16:1 for the showroom bonus]). Site coverage proposed is 25.5 percent, whereas within the CS zone, there is no maximum site coverage standard. On the ground level, City of Palo Alto Planning & Community Environment Department Page 3 the project includes a car wash facility, landscaping, a surface parking facility to support 43 customer parking spaces, vehicle display area, and provision of solid waste and recycling enclosures. Additional parking facilities would be available within the building; however, customers’ vehicles would be parked via a valet service. Customer parking spaces are exempted from gross floor area inclusions. New car inventory parking spaces would be provided both on- site and off-site (the details of the inventory parking for off-site have not been finalized). Draft findings and conditions are included with this report, including DEE findings related to the setback deviation request. Requested Entitlements, Findings and Purview: The following discretionary applications are being requested:  Architectural Review – Major (AR): The process for evaluating this type of application is set forth in PAMC 18.77.070. AR applications are reviewed by the ARB and recommendations are typically forwarded to the Planning & Community Development Director for action within five business days of the Board’s recommendation. Action by the Director is appealable to the City Council if filed within 14 days of the decision. However, since this project includes other actions that require approval by the City Council, the Board will make their recommendation to the City Council. AR projects are evaluated against specific findings. All findings must be made in the affirmative to approve the project. Failure to make any one finding requires project redesign or denial. The findings to approve an AR application are provided in Attachment B.  Design Enhancement Exception (DEE): This is to deviate from the “build-to-line” (percentage of building along the front setback) requirement within the CS district. The process for evaluating this type of application is set forth in PAMC 18.76.050. DEE applications are reviewed by the ARB and recommendations are typically forwarded to the Planning & Community Environment Director for action within five business days of the Board’s recommendation. Action by the Director is appealable to the City Council if filed within 14 days of the decision. As with the AR, the Board will make its recommendation on the DEE to the City Council. DEE projects are evaluated against specific findings. All findings must be made in the affirmative to approve the project. Failure to make any one finding requires project redesign or denial. The findings to approve a DEE application are provided in Attachment B.  Site and Design Review: The process for evaluating this type of application is set forth in PAMC 18.30(G).060. These applications are reviewed by the Planning & Transportation Commission (PTC) and recommendations are forwarded to the City Council. Site and Design Review projects are evaluated against specific findings. All findings must be made in the affirmative to approve the project.  Amendment to Zoning Map: This is a request to add the Automobile Dealership (AD) combining district. The process for evaluating this type of application is set forth in PAMC 18.80. Rezone applications are reviewed by the PTC and recommendations are forwarded to the City Council. City of Palo Alto Planning & Community Environment Department Page 4 Analysis1 During the ARB’s deliberation at its last meeting, a majority of the Board expressed comments indicating its support for the project, subject to conditions. However, as the dialogue continued there were three unresolved issues that the Board concluded required further refinement. The intent of this meeting is to focus on those three issues enumerated below: 1. Lighting details and photometric study. The Board requested that the applicant provide details on the types of light fixtures, locations, photometric plan, and overall description of how the site lighting will operate. In response, the applicant provided the specific light fixture information and manufacturer’s specifications. The project would include overhead, wall-mounted, ground-mounted, and bollard lighting. The designs are contemporary and are grey and black in color. Based on the photometric plan, the highest levels of site lighting are along Bayshore Road and the roof deck, which includes parking. The lighting however, is located at the center of the roof (8’-6” tall above roof deck or 4’-6” above the parapet) or along the parapets, which shield the lighting from spilling over the edge. There is no exhibit that demonstrates from what distance these two light standards would be visible if at all. The applicant states that the lighting will be controlled by a central lighting system and that the roof deck and car wash area lighting will turn off after close of business. The Bayshore Road elevation, the balcony facing Bayshore Road lighting would be reduced by 50 percent at a pre-defined time (Currently, the condition of approval is 10:00pm for this action). 2. Revised landscape plan with larger native trees to screen the building along the street. Along Embarcadero Road, the applicant proposes Red Oak (newly proposed) along with London Plane trees. The Red Oaks would reach 50’-0” in height with a canopy of 45’-0”. The London Planes would reach 50’-0” in height and a 30’-0” canopy. The Red Oaks are native to northeastern US. The London Plane is a hybrid of the American Sycamore typically found in urban environments because of its hardiness. Along the building, three Afghan Pines (60’-0” tall and 20’-0” wide) are newly proposed to be located in landscaped islands, which are also not native to California. 1 The information provided in this section is based on analysis prepared by the report author prior to the public hearing. The Architectural Review Board in its review of the administrative record and based on public testimony may reach a different conclusion from that presented in this report and may choose to make alternative findings. A change to the findings may result in a final action that is different from the staff recommended action in this report. City of Palo Alto Planning & Community Environment Department Page 5 Along Bayshore Road, the existing Evergreen Elm street trees would remain accented by the proposed London Planes near the electrical transmission tower. Closer to the building Holmford Pears (40’-0” tall and 15’-0” wide) would be planted in landscaped islands. The crape myrtle trees are not proposed. Along the west and south property lines Brisbane Box (30’-0” tall and 25’-0” wide) are proposed along with London Planes as occasional accents. 3. Darker color for the stair tower at the front of the building. The building includes concrete, stucco, and metal paneling. The concrete is a natural gray color; the stucco is either “sandy hook grey” or “wrought iron” depending on the location; and the metal paneling is either silver, gray, or black depending on the location. Specifically, as proposed, the material and color for the front stair tower is a natural gray concrete with color pigment added. The applicant has responded to the Board’s comments by adding a darker gray color pigment to the concrete, thereby using color to visually reduce the prominence of this building element. The applicant will provide a sample of this at the meeting. Prior staff reports have detailed the project compliance with applicable zoning regulations and required application findings. A link to those reports is provided in the background section. Environmental Review The Mitigated Negative Declaration indicates that with implementation of the project there could be potential significant environmental impacts to Biological resources and Transportation systems. Mitigation measures are proposed to reduce these impacts to less than significant through surveys for nesting birds and avoidance; and reduction of light sources after 10:00pm. Regarding transportation, the project may impact the level of service at the Embarcadero/East Bayshore intersection. Mitigation is proposed to reduce this impact to less than significant by reconfiguring the lanes and providing a change in the traffic signal timing. See Attachment H for the Initial Study/Mitigated Negative Declaration. Public Notification, Outreach & Comments 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 day in advance. Notice of a public hearing for the May 5, 2016 ARB hearing was published in the Daily Post on April 19th and the Palo Alto Weekly on April 29th. Postcard mailing occurred on April 20th. At that hearing, the Board continued the item to a date certain. Public Comments As of the writing of this report, no project-related, public comments were received. City of Palo Alto Planning & Community Environment Department Page 6 Alternative Actions In addition to the recommended action, the Architectural Review Board may: 1. Recommend approval of the project with modified findings or conditions; or 2. Recommend project denial based on revised findings. Report Author & Contact Information ARB2 Liaison & Contact Information Sheldon S. Ah Sing, Consultant Planner Jodie Gerhardt, AICP, Planning Manager (650) 938-1111 (650) 329-2575 sahsing@m-group.us jodie.gerhardt@cityofpaloalto.org Attachments:  Attachment A: Project Location Map (PDF)  Attachment B: Findings (DOCX)  Attachment C: Conditions of Approval (DOCX)  Attachment D: Zoning Compliance (DOCX)  Attachment E: Comp Plan and Baylands Consistency (DOCX)  Attachment F: Site Photographs (PDF)  Attachment G: ARB Report 11-19-2015 (PDF)  Attachment H: Initial Study/Mitigated Negative Declaration (PDF)  Attachment I: Project Plans (Lighting Plan & Revised Plans) (PDF) 2 Emails may be sent directly to the ARB using the following address: arb@cityofpaloalto.org City of Palo Alto (ID # 7052) City Council Staff Report Report Type: Inter-Governmental Legislative Affairs Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Governor's By Right Housing Proposal Title: Authorization for the Mayor to Sign a Letter Regarding the Governor's By Right Housing Proposal From: City Manager Lead Department: Planning and Community Environment Recommendation: Staff recommends that the City Council discuss the Governor’s “By Right” Housing Proposal, and authorize the Mayor to sign a letter stating the City’s position on the proposal. Background & Discussion: Summary of Governor’s Streamlining Affordable Housing Approvals In an effort to encourage housing production, Governor Jerry Brown has proposed to streamline the approval of certain multifamily housing projects that include a portion of deed- restricted affordable units. The proposal would give certain multifamily projects “by right” entitlement to develop, thereby removing a local government’s discretionary authority to reject such projects and shortening the approval process. The proposal – called Streamlining Affordable Housing Approvals – is contained in a trailer bill to the Governor’s May 2016-17 budget revision. Shortly after its original introduction, on June 1, the Governor’s office released a series of amendments to the bill. (Attachment A.) The Legislature is required to adopt and forward to the Governor a final budget by June 15th. Budget trailer bills go into effect immediately upon signature by the Governor. It is not yet clear whether the Legislature will hear the bill in connection with the budget or elect to defer consideration until August. The Governor’s affordable housing proposal would add section 65913.3 to the Government Code. For qualifying projects, cities (including charter cities) could not require discretionary review such as a conditional use permits. Since approvals of qualifying projects would be ministerial, California Environmental Quality Act review would not be required. City of Palo Alto Page 2 To achieve permitted “use by right”1 status, a housing development project must meet six separate criteria:  The proposed development must be a (1) newly constructed structure; (2) containing two or more dwelling units; (3) that includes residential units only or is a mixed-use development where nonresidential uses are limited to “neighborhood-commercial” in nature and located only on the first floor; and (4) does not include a second unit or the conversion of an existing structure to condominiums.  The applicant must notify the local government that it intends to proceed under section 65913.3 and certify, under penalty of perjury, that the development conforms to all of the statute’s requirements;  The development must be consistent with applicable objective general plan and zoning standards at the time the application is submitted to the local government2;  The development must be located on an “urban” site, i.e., either immediately adjacent to parcels developed with urban uses3 or surrounded by at least 75 percent of parcels developed with urban uses or is bounded by a natural body of water;  The development must be attached housing with at least 20% of the units to be set aside (deed-restricted for at least 30 years) for lower-income residents (those making 80% or less of median gross income). However, the affordability requirement is reduced if the development is within a half-mile of a “transit priority area”4. In that case, only at least 5% of the units must be set aside for very-low income residents (those making 50% or less of area median income) or 10% set aside for lower-income residents (those making 80% or less of area median income); and  If the site is not a designated housing site, then it may not be on certain types of land (e.g., prime farmland, wetlands, very high fire hazard zone, hazardous waste site, delineated earthquake fault zone or flood plain). The proposal also includes streamlined processing for qualifying projects. If the city determines the project is inconsistent with general plan and zoning standards, it must give written 1 Gov. Code § 65583.2(i) defines the phrase “use by right” to mean “that the local government's review of the owner-occupied or multifamily residential use may not require a conditional use permit, planned unit development permit, or other discretionary local government review or approval that would constitute a ’project’ for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code [i.e. the California Environmental Quality Act].” 2 The June 1 amendment defines “objective” planning standards as “land use and building intensity designation applicable to the site under the general plan and zoning code, land use and density or other objective zoning standards, and any setback or objective design review standards.” 3 “Urban uses” is defined in the proposal as any residential, commercial, public, institutional, transit or transportation passenger facility, or retail use, or any combination of those uses. 4 “Transit priority area” is defined by the proposal as “an area within one-half mile of a major transit stop that is existing or planned, provided the planned stop is scheduled to be completed within the planning horizon included in a Transportation Improvement Program adopted pursuant to [federal law].” City of Palo Alto Page 3 documentation of, and explain the reasons for, the inconsistency within 30 days of the application’s submittal. If this deadline is missed or the documentation regarding the inconsistency is inadequate, the development is deemed to qualify for “by right” approval. Note that from a practical standpoint this expedited timeline essentially eliminates the ability for the Council to conduct a public hearing on the project. Such projects would remain subject to design review, but design review must take place within 90 days from the application’s submittal and “shall not in any way inhibit, chill, or preclude” ministerial approval. Provided the project conformed with objective general plan and zoning standards, the proposal would make all land use permits ministerial.5 Projects that would directly displace existing residents (e.g., by demolishing an existing residential building) would be subject to the California Relocation Assistance Act. Concerns Raised by League of California Cities and Other Interest Groups Though the proposal has garnered some local agency support (San Francisco and Los Angeles), the League of California Cities and other interest groups have raised several significant concerns. The League has expressed concern over the elimination of public hearings and the exclusion of elected city council members from critical local land use decisions. While current State law6 places limits on the city’s ability to deny certain housing projects, the proposal goes further by making it nearly infeasible to conduct a public hearing within the 30 day review period and by removing local discretion over land use entitlements, other than nominal design review. Both the League and environmental groups expressed concern over elimination of CEQA review. The CEQA exemption is based on the assumption that whatever environmental analysis was conducted for the city’s general plan is sufficient for every project site. Absent adequate environmental review many of these projects risk being built in locations where more analysis and greater local review might have otherwise determined to be unsafe without mitigation measures. At housing advocates’ insistence, the new amendments protect existing affordable housing by not offering the streamline exemption unless the developer replaces the existing affordable units at comparable affordability levels. Housing advocates and the League continue to object 5 Government Code Section 65913.2 (g) provides: “The review of a permit, license, certificate, or any other entitlement by any public agency with land-use authority over any development that satisfies subdivision (b) of this section shall be ministerial.” 6 Examples of state laws placing limitations on local control over housing projects include: Density Bonus law requiring concessions and extra density for qualifying projects (Government Code Section 65915 et seq.); Housing Accountability Act restricting city’s authority to disapprove certain housing projects (Government Code Section 65589.5); Housing Element law requiring cities to zone for state allocated housing share (Government Code Section 65580 et seq.); Second Unit law requiring ministerial approval of certain projects (Government Code Section 65852.2.). City of Palo Alto Page 4 to the bill’s affordability requirement which in Palo Alto’s case is less than the City’s existing below market rate inclusionary requirement applicable to for sale units. The Governor’s latest proposal is included as Attachment A. The League of Cities’ summary of the proposal (Attachment B) and a draft letter of opposition (Attachment C) are also attached. Attachments:  Attachment A: Proposed Trailer Bill on By Right Housing (PDF)  Attachment B: League of Cities Summary of the Govs Proposal 05-20-16 EAS (PDF)  Attachment C: Letter Opposing the Gov's By Right Housing Proposal (PDF) 1 Streamlining Affordable Housing Approvals – Proposed Trailer Bill Technical Modifications SECTION 1. Section 65400.1 is added to the Government Code, to read: 65400.1. (a) A development applicant or development proponent pursuant to Section 65913.3 of the Government Code may submit information describing the development, including, but not limited to, land use and zoning designations and requested permit(s) for the development to the Department of Housing and Community Development in a reporting format to be made available. The information submitted shall be compiled along with information pursuant to subparagraph (B) of subsection (2) of subdivision (a) of Section 65400 and Section 65588 of the Government Code as follows: (i) Upon receipt of a local government determination regarding the development submittal, or (ii) Issuance of a building permit for the development. (b) The Department of Housing and Community Development shall annually review and report on its website the information that has been submitted pursuant to this section. SEC. 2. Section 65913 of the Government Code is amended to read: 65913. (a) The Legislature finds and declares that there exists a severe shortage of affordable housing, especially for persons and families of low and moderate income, and that there is an immediate need to encourage the development of new housing, not only through the provision of financial assistance, but also through changes in law designed to do all of the following: (1) Expedite the local and State-supported residential development process. (2) Assure that local governments zone sufficient land at densities high enough for production of affordable housing. Attachment A 2 (3) Assure that local governments make a diligent effort through the administration of land use and development controls and the provision of regulatory concessions and incentives to significantly reduce housing development costs and thereby facilitate the development of affordable housing, including housing for elderly persons and families, as defined by Section 50067 of the Health and Safety Code. These changes in the law are consistent with the responsibility of local government to adopt the program required by subdivision (c) of Section 65583. (b) The Legislature further finds and declares that the costs of new housing developments have been increased, in part, by the existing permit processes and by existing land use regulations and that vitally needed housing developments have been halted or rendered infeasible despite the benefits to the public health, safety, and welfare of those developments and despite the absence of adverse environmental impacts. It is therefore necessary to enact this chapter and to amend existing statutes which govern housing development so as to provide greater encouragement for local and state governments to approve needed and sound housing developments. (c) It is the intent of the Legislature that the provisions of Section 65913.3 of the Government Code advance all of the following: (A) the provisions of Government Code Section 65008; (B) implementation of the State planning priorities pursuant to Government Code Section 65041.1; (C) attainment of Section 65580 of the Government Code; (D) significant actions designed to affirmatively increase fair housing choice, furthering the objectives of the Federal Fair Housing Act, 42 U.S.C. 3601, and 3 implementing regulations; and (E) the objectives of the California Global Warming Solutions Act of 2006, commencing with Section 38500 of the Health and Safety Code. (F) compliance with non-discretionary inclusionary zoning ordinances adopted by localities. SEC. 3. Section 65913.3 is added to the Government Code, to read: 65913.3. (a) For the purposes of this section, the following terms shall have the following meanings: (1) “Approved remediation measures” shall mean measures included in a certified environmental impact report to mitigate the impact of residential development in the subject location; or uniformly applied development policies or standards that have been adopted by the city or county to mitigate the impact of residential development in that location. (2) “Affordable rent,” or “Affordable housing cost” shall be as defined by Health and Safety Code subdivision (b) of Section 50053, or subdivision (b) of 50052.5 respectively. (13) “Attached housing development” or “development” means a newly constructed structure containing two or more dwelling units that is a housing development project, as defined by subdivision (2) of subsection (h) of Section 65589.5 of the Government Code, but does not include a second unit, as defined by subdivision (4) of subsection (i) of Section 65852.2 of the Government Code, or the conversion of an existing structure to condominiums. (4) “Department” means the Department of Housing and Community Development. (2)”Designated housing sites” means sites designated to allow housing development by the general plan, a zoning ordinance, or for which a certified environmental review document includes provisions to mitigate potential harm. (35) “Land-use authority” means any entity with state-authorized power to 4 regulate land-use permits and entitlements conferred by local governments. (46) “Land-use restriction” means covenants restricting the use of land, recorded regulatory agreements, or any other form of an equitable servitude. (57) “Major transit stop” means a site containing an existing rail transit station, a ferry terminal served by either a bus or rail transit service, or the intersection of two or more major bus routes with a service interval frequency of 15 minutes or less during the morning and afternoon peak weekday commute periods, and offering weekend service. (68)“Public agency” means a federal, state, or local government agency, or a local or regional housing trust fund which has been funded or chartered by a federal, state, or local government agency. (79) “Required by law to record” means, but is not limited to, a development applicant or development proponent is required to record a land-use restriction based on any of the following: (i) As a condition of award of funds or financing from a public agency. (ii) As a condition of the award of tax credits. (iii) As may be required by a contract entered into with a public agency. (810) “Transit priority area” means an area within one-half mile of a major transit stop that is existing or planned, provided the planned stop is scheduled to be completed within the planning horizon included in a Transportation Improvement Program adopted pursuant to Section 450.216 or 450.322 of Title 23 of the Code of Federal Regulations within the adopted general plan or specific plan of a local government. (911) “Urban uses” means any residential, commercial, public institutional, transit or transportation passenger facility, or retail use, or any combination of those uses. (b) A development that satisfies all of the following criteria shall be a permitted use by right as that term is defined in subdivision (i) of Section 65583.2 of the Government Code: (1) The development applicant or development proponent has submitted to the 5 local government its intent to utilize this authority, and certifying under penalty of perjury that, to the best of its knowledge and belief, it conforms with all other provisions identified herein. (2) The development is consistent with the following objective planning standards: land use and building intensity designation applicable to the site under the general plan and zoning code, land use and density or other objective zoning standards, and any setback or objective design review standards, all as in effect at the time that the subject development is submitted to the local government pursuant to this section. (3) The development is located on a site that is either immediately adjacent to parcels that are developed with urban uses or for which at least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses or is bounded by a natural body of water. (4) The development must be an attached housing development, for which the development applicant or development proponent already has recorded, or is required by law to record, a land-use restriction, which shall require all the following: (A) A duration of at least 30 years or more. (B) Enforceability byThat any public agency and or by any member or members of the public, including non-profit corporations, may bring and maintain an enforcement action. (C) For developments within a transit priority area, a restriction of the development’s real property to a level of affordability equal to or greater than either of the following: (i) At least ten percent of the total units of a housing development for lower income households, as defined in Section 50079.5 of the Health and Safety Code. (ii) At least five percent of the total units of a housing development for very low income households, as defined in Section 50105 of the Health and Safety Code. (D) For developments not within a transit priority area, a restriction of the development’s real property to a level of affordability equal to or greater than at 6 least twenty (20) percent or more of the residential units restricted to and occupied by individuals whose income is eighty (80) percent or less of area median gross income. (5) Except for developments that are located on designated housing sites, Unless the development incorporates approved remediation measures in the following locations as applicable to the development, the development is not located on a site that is any of the following: (A) Either “prime farmland” or “farmland of statewide importance,” as defined pursuant to United States Department of Agriculture land inventory and monitoring criteria, as modified for California, and designated on the maps prepared by the Farmland Mapping and Monitoring Program of the Department of Conservation. (B) Wetlands, as defined in Section 328.3 of Title 33 of the Code of Federal Regulations. (C) Within a very high fire hazard severity zone, as determined by the Department of Forestry and Fire Protection pursuant to Section 51178 of the Government Code, or within a high or very high fire hazard severity zone as indicated on maps adopted by the Department of Forestry and Fire Protection pursuant to Section 4202 of the Public Resources Code; however, this limitation shall not apply to sites excluded from the specified hazard zones by a local agency pursuant to subdivision (b) of Section 51179 of the Government Code or sites that have adopted sufficient fire hazard mitigation measures as may be determined by their local agency with land-use authority. (D) Hazardous waste site that is listed pursuant to Section 65962.5 of the Government Code, or a hazardous waste site designated by the Department of Toxic Substances Control pursuant to Section 25356 of the Health and Safety Code, unless the Department of Toxic Substances Control has cleared the site for residential use or residential mixed-uses. (E) Within a delineated earthquake fault zone as determined by the State Geologist in the official maps published thereby. (F) Within a flood plain as determined by maps promulgated by the Federal Emergency Management Agency, unless the development has been issued a 7 floodplain development permit pursuant to Sections 59 and 60 of Title 44 of the Code of Federal Regulations. (G) Within a flood way as determined by maps promulgated by the Federal Emergency Management Agency, unless the development receives a no rise certification in accordance with Section 60.3(d)(3) of Title 44 of the Code of Federal Regulations. (H) Within an area determined by the Department of Housing and Community Development to be inappropriate for affordable housing development by additional objective criteria, including areas severely lacking in access to public transit, accessibility to employment or educational opportunities, and residentially supportive retail and service amenities, all as to be determined through regulations adopted by the Department at its discretion; until the Department adopts such regulations this subparagraph (H) shall not be interpreted to prohibit any such site. operative nor apply. The Department is authorized, but not mandated, to adopt regulations to implement the terms of this subparagraph (H); and such regulations shall be adopted pursuant to the Administrative Procedures Act set forth in Government Code section 11340 et seq. Division 13 of the Public Resources Code shall not apply to either: the Department’s adoption of the regulations authorized by this section, or any financial assistance awarded by any public agency to any development that satisfies subdivision (b) of this section. This section shall be operative regardless as to whether the Department adopts the regulations authorized by this section. Division 13 of the Public Resources Code shall not apply to the Department’s adoption of the regulations authorized by this section. (6) Unless the proposed housing development replaces units at a level of affordability equal to or greater than the level of a previous affordability restriction, the development must not be on any property that is any of the following: (A) A parcel or parcels on which rental dwelling units are, or if the dwelling units have been vacated or demolished in the five-year period preceding the application, have been subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of lower or very low income. (B) Subject to any other form of rent or price control through a public entity’s 8 valid exercise of its police power; or occupied by lower or very low income households. (c) If the applicable city, county, or city and county determines that the development is inconsistent with at least one of the objective planning standards delineated in paragraph (2) of subdivision (b), then it must provide the development proponent written documentation of which standard or standards the development is not consistent with, as well as explain why the development is not consistent with that standard or standards, all within thirty (30) calendar days of submittal of the development to the local government pursuant to this section. If the documentation described in this subsection fails to identify the objective standard or standards that the development is not consistent with, if it fails to provide an explanation of why it is inconsistent therewith, or if it is not provided to the development proponent within thirty (30) calendar days of submittal, then for the purposes of this section, the development shall be deemed to satisfy paragraph (2) of subdivision (b) of this section. (d) Any design review of the development shall not exceed ninety (90) days from the submittal of the development to the local government pursuant to this section, and shall not in any way inhibit, chill, or preclude the ministerial approval provided by this section and the effect thereof. (e) A development that satisfies subdivision (b) of this section shall not be subject to the requirements of Section 65589.5 of the Government Code in order to be accorded by right status under this section. (f) This section does not relieve an applicant or public agency from complying with the Subdivision Map Act (Division 2 (commencing with Section 66410)). (g f) The review of a permit, license, certificate, or any other entitlement, including, but not limited to: the enactment and amendment of zoning or design review ordinances or guidelines, the issuance of zoning variances, the issuance of conditional use permits, and the approval of tentative subdivision maps, by any public agency with land-use authority over any development that satisfies subdivision (b) of this section shall be ministerial. (h g) This section shall be enforceable pursuant to a writ of mandate issued pursuant to Section 1085 of the Code of Civil Procedure. 9 (i h) The development applicant or development proponent may submit information describing the development pursuant to Government Code Section 65400.1(a). (j i) The Legislature finds and declares that this section shall be applicable to all cities and counties, including charter cities, because the Legislature finds that the lack of affordable housing is a matter of vital statewide importance. (k j) Any and all individuals displaced by a development that is approved through the ministerial process authorized by this section shall be accorded relocation assistance as provided in the California Relocation Assistance Act set forth in Section 7267.8 et seq. California Real Property Acquisition and Relocation Assistance Act, set forth in Chapter 16, commencing with Government Code Section 7260. The development proponent shall be responsible for paying for relocation assistance expenses incurred by any local agency as a result of this section. (l k) This section shall apply, notwithstanding anything to the contrary contained in this code or in any other law. May 20, 2016 1 Streamlining Affordable Housing Approvals Proposed Trailer Bill The Governor’s proposal for streamlining affordable housing approvals requires cities and counties to approve: •A certain type of housing project with modest levels of affordable units •As a permitted “use by right” •With no public input; •With limited ministerial review; and •No CEQA compliance. What types of housing projects are included? Newly constructed structure containing two or more dwelling units in a project that is entirely residential or part of a mixed-use development that comply with the criteria summarized in the next question. The proposal does not apply to the construction of a second unit or the conversion of an existing structure to condominiums. [NOTE: The proposal is not clear. The language could be interpreted to mean that a single-family housing development is also included.] What restrictions are placed on the location of these housing projects? A housing project can be located on a “designated housing site.” That means a site designated to allow housing development by the general plan, a zoning ordinance, or, for which a certified environmental review document includes provisions to mitigate potential harm. (From Administration presentations to the Legislature on this proposal it is evident that using the word “or” here rather than “and” is not an oversight.) If a housing project is not located on a “designated housing site,” the project may not be located on a site that is any of the following: (1) “prime farmland” or “farmland of statewide importance;” (2) wetlands; (3) within a very high fire hazard severity zone; (4) hazardous waste site; (5) within a delineated earthquake fault zone; (6) within a flood plain; or (7) within a flood way. (The listing of these lands is not as comprehensive as other environmental statutes that list endangered species, native plants, habitat, historic resources, etc.) What is a permitted “use by right?” This means that a city may not require a conditional use permit, planned unit development permit, or other discretionary review or approval that would constitute a “project” for purposes of CEQA. [NOTE: This means that approval of a housing project covered by the proposal is not subject to any environmental evaluation under CEQA.] Attachment B May 20, 2016 2 What is the approval process for a housing project that qualifies for permitted “use by right” review? A city’s review of a permit, license, certificate, or any other entitlement including amendment of zoning ordinances, design review ordinance, zoning variances, conditional use permits, and tentative subdivision maps would be considered “ministerial.“ Ministerial review involves only the use of fixed standards or objective measurements. The public official merely applies the law to the facts as presented but uses no special discretion or judgment in reaching a decision whether or how a project should be carried out. (Typical examples of issues that require the exercise of discretion are: Is there as safe route to local schools? Where is the best location for entrances to the development? What is the impact of the vehicle miles traveled generated from the development on the city and regional transportation network? Is the design sufficiently compatible with the community character? Etc.) Within 30 days of receiving an application, the public official must either approve the development or explain why it is inconsistent with objective general plan and zoning standards. If public official fails to respond within 30 days or fails to provide explanation, project is deemed to be consistent with general plan and zoning standards. What else is included in the proposal? • Declaration that the proposal applies to charter cities • Requirement to pay relocation assistance if the project displaces individuals • Declaration that it overrides anything to the contrary in the existing law. What criteria must a housing project comply with to qualify for permitted “use by right” review? A housing project must be: • General plan and zoning: Consistent with objective general plan and zoning standards in effect at the time the application is submitted • Location: Located anywhere in the state on a site that is either immediately adjacent to parcels that are developed with urban uses or at least 75% of the perimeter of the site adjoins parcels that are developed with urban uses; • Affordability (TPA): For developments within a transit priority area1, subject to a restriction lasting 30 years requiring at least 10% of the units be 1 A transit priority area is an area within ½ mile of a major transit stop that is existing or planned within the adopted general plan or specific plan of a local May 20, 2016 3 affordable to lower income households or at least 5% of the units to be affordable to very low income households. • Affordability (non-TPA): For developments outside a transit priority area, subject to a restriction lasting 30 years requiring at least 20% of the units to be affordable to households whose income is 80% or less of area median gross income. Comments and Concerns No public review The hallmark of local government land use decisions has been the public hearing. A public hearing (1) allows interested members of the community to inform the decision-makers of their support or opposition to the project; and (2) guarantees that property rights will not be impacted without the “due process of law.” The Governor’s proposal allows the following types of land use decisions to occur without any public review: o General plan amendment o Zone change o Conditional use permit o Tentative subdivision map o Zoning variance Excluding the elected decision makers The proposal excludes the elected city council and board of supervisors from land use decisions. These public officials are elected to represent their constituents and to be available and responsive. The proposal asks appointed staff, who are not directly accountable to local voters, to make the policy decisions: this is the arena reserved for elected officials. Local governments are already required to approve housing but with public hearings and CEQA review • Housing Accountability Act (20% lower income; 100% moderate income or middle income; emergency shelter) (Gov. 65589.5) government. This is similar to areas described for environmental streamlining under SB 375, but under this measure, projects in these areas would be exempt from CEQA. May 20, 2016 4 Must approve a housing project that is consistent with general plan and zoning ordinance unless (1) specific adverse impact on public health or safety; (2) housing is not needed; (3) denial required to comply with state or federal law; (4) project is on land zoned for agriculture or resource preservation. • “No net loss” (Gov. 65863) May not reduce the residential density for any parcel unless remaining sites identified in housing element are adequate to accommodate RHNA • Density bonus (Gov. 65915) Must award density bonus and other concessions and incentives when development includes 10% lower income, 5% very low income, senior citizen, or 10% for moderate income in common interest development • Least cost zoning (Gov. 65913.1) Must zone sufficient land for residential use with appropriate standards to meet housing needs for all income categories identified in housing element. When land is zoned, then Housing Accountability Act requires approval. • Second units (Gov. 65852.2) Must approve second unit with ministerial review. City may not adopt ordinance that totally precludes second units in residential zones unless specific adverse impacts on public health, safety, and welfare. • Ministerial approval of multifamily housing (Gov. 65589.4) Must approve as a permitted use multifamily housing structure located on an infill site that is consistent with general plan and zoning ordinance in which at least 10% of the units are affordable to very low income households; or at least 20% available to lower incomes; or 50% affordable to moderate income households. No project level CEQA review The proposal requires ministerial review of a housing project if it is consistent with “objective general plan and zoning standards.” CEQA review that is required for both the general plan and zoning ordinance does not extend to the project level. CEQA review that is required for both the general plan and zoning ordinance may May 20, 2016 5 have occurred many years before the development application is submitted. Cities and counties will not be able to determine whether site-specific conditions or changed circumstances and new information require environmental mitigation. If for some reason a previous environmental document was helpful in evaluating the project, the bill does not allow a city to impose conditions to require compliance with previously-adopted mitigation measures. What is an “objective” general plan and zoning standard? The general plan is a policy document. It is the “constitution” of a city or county. It is the document that sets forth the community’s vision in the various required elements. Objective standards are included in implementing ordinances and project-level review, not in a general plan. An example of an “objective” zoning standard might be an inclusionary housing requirement. However, if a housing development chooses not to comply with this “objective” standard, the applicant can request a zone change to eliminate the requirement. The proposal requires the city to approve the request as a ministerial decision. Cost of relocation The proposal allows a developer to tear down an existing structure, displace existing residents, and then requires the city or county – that has no discretion in whether or not the structure is torn down or the new housing is built – to pay relocation costs. Affordable housing will not remain affordable A housing development must be “required by law to record” a land-use restriction based on (1) a condition of award of funds or financing from a public agency; (2) as a condition of the award of tax credits; (3) as might be required by contract entered into with a public agency. In other words, if a developer does not receive funding for the affordable housing, the housing will not remain affordable. Breadth of the proposal The proposal states that it applies “notwithstanding anything to the contrary contained in the law.” It is not possible to accurately evaluate the impact of this statement because of its breadth. City of Palo Alto Office of the Mayor and City Council June ___, 2016 Honorable Assembly Member Adrin Nazarian Chair, Assembly Budget Subcommittee #4 State Capitol, Room 6026 Sacramento, CA 95814 Fax: 916-319-2199 Honorable Senator Richard Roth, Chair, Senate Budget Subcommittee #4 State Capitol, Room 5019 Sacramento, CA 95814 Fax: 916-323-8386 RE: Governor’s By Right Housing Proposal Notice of Opposition Dear Honorable Chairs Nazarian and Roth: After considerable examination, the City of Palo Alto opposes the recently released proposal by the Governor to limit local discretionary land use approvals of specified housing developments by having such approvals be considered “ministerial” actions. This decision would effectively eliminate opportunities for public review, project-level environmental review and any helpful design review, all of which promote thoughtful and sustainable housing development. We believe that such fundamental policy changes should not be rushed through as a budget proposal, but merit extensive review by the appropriate policy committees in a deliberative fashion. Perhaps most importantly, the 30 day review and response time required by the proposal effectually eliminates public review of these major development projects, which, in turn, undermines the principals of transparency and public engagement. P.O. Box 10250 Palo Alto, CA 94303 650-329-2571 650-328-3631 fax Attachment C Page 2 June ____, 2016 ___________________________ Absent such principals, the integrity of local government may be at stake. While it may be frustrating for some developers to modify their projects to address concerns about traffic, parking, massing and other development impacts, those affected by such projects have a right to have their concerns considered. Indeed, it is the public nature of the development process that encourages decision makers to balance the interests of all stakeholders for any given project. Moreover, public review and discussion uphold the accountability of elected officials and ensures a fair process for all proposals. Without an adequate opportunity for the public to voice concerns or support for a project, the Governor’s proposal risks eroding the fundamental trust between developers, the public, and local elected officials. Restricting design review is also short-sighted. A community’s character is often first defined by the design of its built environment. The people that make up that community and the local experts that can offer technical insights should be allowed a reasonable amount of time to consider and contribute to that design. More practically, the design review process can serve as the time to gain the most community support for a proposed project. Condensing the timeline for design review weakens the opportunity to foster community acceptance and needlessly raises the possibility of long term frustration for the project’s neighbors. Restricting the city’s ability to deny a project based on significant compatibility concerns or simply bad design eliminates meaningful design review. The dangers of State housing mandates were recently on display here in Palo Alto when a developer used the State’s density bonus law to secure design “concessions” and approval to construct a mixed use building with over 21,000 square feet of commercial development on the basis of agreeing to deed restrict three units as affordable. In this instance, the State’s mandate demanded local approval of a project and concessions for a 19% increase in lot coverage and an increase in commercial density that will exacerbate the City’s jobs/housing imbalance. We are concerned that the Governor’s current proposal will have similar unintended consequences. Amendments, published as recently as June 1, 2016 have improved the proposal. It now clarifies that housing projects subject to the proposal’s provisions must comply with the Subdivision Map Act; and other amendments diminish the ambiguity about what objective zoning standards the project must satisfy. These clarifications, while helpful Page 3 June ____, 2016 ___________________________ still limit local control by maintaining the review of many permits and entitlements as ministerial. Finally, the low affordability thresholds near “transit priority areas” remain a concern for Palo Alto because the City’s inclusionary requirement is 15% city wide, which is 5-10% higher than the transit priority area requirements in the proposal. We are sure there is a proposal that better balances the interests of local governments and the State, both of which are necessary to craft an effective solution to the current housing crisis. On behalf of the residents we represent who deserve a voice in the future shape of their communities, the City of Palo Alto respectfully states our opposition to this measure. Sincerely, Mayor City of Palo Alto cc: Senator Jerry Hill, (via e-mail: senator.hill@senate.ca.gov) State Assembly Member Rich Gordon (via email: Andrew.berthelsen@asm.ca.gov) Seth Miller, Regional Public Affairs Manager, League of California Cities, (via e- mail: smiller@cacities.org ) Dan Carrigg, League of California Cities, (via e-mail: CarriggD@cacities.org) City of Palo Alto (ID # 6913) City Council Staff Report Report Type: Informational Report Meeting Date: 6/6/2016 City of Palo Alto Page 1 Summary Title: Sale of Transfer Development Rights for the Sea Scout Building Title: Status Report Update of the Sale of Transfer Development Rights for the Sea Scout Building Located at 2560 Embarcadero Road From: City Manager Lead Department: Administrative Services EXECUTIVE SUMMARY This is an informational report and no action is required by the Council at this point. The purpose of this report is to provide an update on the sale of Transferable Development Rights (TDR) for the former Sea Scout Building located at 2560 Embarcadero Road and which is owned by the City. BACKGROUND Environmental Volunteers (EV) is the tenant at the former Sea Scout Building. On January 19, 2016, the City Council reviewed several issues related to the Sea Scout building and the relationship with EV that needed resolution. The following recommendations were approved by Council motion: A. Approve the Request for Proposal (RFP) for the sale of 2,500 square feet of Transferable Development Rights (TDR) from the Sea Scout Building (without inclusion of parking exemptions) at the minimum starting price of $225 per square foot; and authorize the City Manager or his designee to execute and complete the sale of the subject TDR that do not contain “Parking Exemption Rights” to the highest qualified bidder(s), at a price not less than $225 per square foot; and B. Authorize the City Manager or his designee to reimburse the Environmental Volunteers (EV) in the amount of $300,000 from TDR proceeds for rehabilitation and capital improvement expenses for the Sea Scout Building. C. Reduce the payment from EV to the City for the construction cost of the public restroom from $75,000 to $35,000. D. Direct staff to return to Council, at a later date, regarding the TDR sale price and the use of any excess funds above $300,000, and to transfer any excess funds to EV for the City of Palo Alto Page 2 maintenance of the building, if allowed by the TDR Ordinance, or, if not allowable, transfer the funds to a historic renovation fund. For additional background information regarding the former Sea Scout Building, please refer to CMR: 6372. DISCUSSION Following the Council’s direction, staff issued an RFP for the sale of TDR on March 1, 2016 and closed the bidding process on March 31, 2016. TDR totaling 2,500 square feet were divided into three lots of 800, 800 and 900 square feet to accommodate bidders who desired smaller amounts of TDR footage. The City received three TDR proposals and selected the highest qualified bids according to the terms and condition of the offering. Details of the proposals and the result of the sale are shown in the table below. The price per square foot of $405 set a new record for the sale of TDRs in the City of Palo Alto. The sale of 2,500 square feet generated a total of $918,000. Name Lot Number Square Footage Bid Offered Per SQ FT Total Bid Value Mills Family LLC Lot One 800 $405 $324,000 Mills Family LLC Lot Two 800 $405 $324,000 Anthony A. Carrasco Lot Three 900 $301 $270,900 Total $918,900 Per Council’s direction, the City issued a payment to Environmental Volunteers in the amount $265,000. The amount results from the deduction of $35,000, the amount of EV’s contribution toward construction of a public restroom, from the TDR sales proceeds of $300,000. In addition, staff researched Council’s question on whether it was possible to apply funds in excess of $300,000 toward maintenance costs of the former Sea Scout building. Analysis of the Ordinance indicated that such use is not allowed. Therefore, excess funds in the amount of $653,900 will be dedicated toward rehabilitating other City owned historical buildings. Resource Impact The amount of $653,900 will reside in a holding account until the end use for the funds is approved. The City will segregate the fund and accrue interest earnings consistent with the interest earnings of the City’s investment portfolio to be used for rehabilitation of other City owned historical properties. Policy Implications Sale of the TDRs allows for a final payment to EV and settles all outstanding issues relating to the lease between the City and EV. This outcome is consistent with prior Council direction and policy. City of Palo Alto Page 3 Environmental Review Sale of development rights for the former Sea Scout Building is Categorically Exempt from California Environmental Quality Act (CEQA) review under CEQA guidelines section 15305, Minor Alterations in Land Use Limitation. The rehabilitation project was Categorically Exempt from CEQA review pursuant to CEQA guidelines section 15331, Historical Resource Restoration/Rehabilitation, as a project limited to maintenance, repair, and rehabilitation in accordance with the Secretary of Interior standards for historic preservation.