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HomeMy WebLinkAbout2026-06-09 Policy & Services Committee Summary MinutesPOLICY & SERVICES COMMITTEE SUMMARY MINUTES Page 1 of 15 Regular Meeting June 9, 2026 The Policy & Services Committee of the City of Palo Alto met on this date in Council Chambers and via virtual teleconference at 6:00 p.m. Present In-Person: Chair Lythcott-Haims, Councilmember Reckdahl, Vice Mayor Stone Absent: None Call to Order Chair Lythcott-Haims called the meeting to order. Public Comment Manpreet lived adjacent to a commercial property in the Barron Park area. The neighboring property kept dogs in a yard 24 hours a day, 7 days a week, across a narrow alley directly facing Manpreet’s house. The dogs were 24 feet from Manpreet's bedroom window and routinely barked in response to activity in the alley, including pedestrians, cyclists, and vehicles. A 2- minute barking episode at 2 a.m. could disrupt the entire family’s sleep. For over a year, Manpreet had been working with Code Enforcement regarding excessive barking from these dogs. Despite numerous complaints and ongoing communication with City staff, the issue remained unresolved. Manpreet was concerned that the ordinance was almost impossible to enforce because it required enforcement personnel to personally witness the violation, defined as a dog barking continuously for 10 minutes within a 15-minute window. Video recordings from residents were not accepted for enforcement purposes. City staff informed Manpreet of mitigation measures, such as installing a visual screen to prevent the dogs from reacting to activity in the alley; however, no effective remedy had been implemented. To determine whether the current barking dog ordinance and enforcement policies provided residents with a practical path to relief from dog barking disturbances, Manpreet requested that the Committee add a future agenda item for a staff report examining complaint volume and enforcement outcomes. SUMMARY MINUTES Page 2 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 Action Items 1. Nonprofit Partnership Workplan: Follow-up Recommendation on Lease – Lawn Bowls Club Lease Extension. CEQA Status – Exempt Under CEQA Guidelines Section 15301. Lupita Alamos, the Assistant to the City Manager, delivered a presentation. During the Policy & Services Committee meeting on November 19, 2025, staff proposed a framework for evaluating future nonprofit leases, based on the 2022 audit recommendations, best practices, and the nonprofit guiding principles established in October 2024. The framework provided guidance on the partnership's public benefit, financial relationship, and stability, as outlined in the staff report. On November 19, staff presented 3 long-term nonprofit leases nearing expiration (Gamble Garden, Winter Lodge Tennis, and the Palo Alto Lawn Bowls Club) and cross-walked each lease against the proposed framework. At that time, the Committee requested that staff return with additional information and improvements regarding the public benefit aspect of the framework, particularly access and pricing for Winter Lodge Tennis and the Palo Alto Lawn Bowls Club. The Committee had previously addressed the Gamble Garden and Winter Lodge Tennis leases; therefore, tonight’s discussion focused on the Palo Alto Lawn Bowls Club lease. Palo Alto Lawn Bowls had been the City’s nonprofit partner since 1964. The property included a lawn bowling green, clubhouse, and storage shed. Rent was approximately $16,000 per year, with 2 percent annual increases. Palo Alto Lawn Bowls Club was responsible for minor clubhouse maintenance, operating expenses, utilities (except water), and insurance. The City was responsible for maintenance of the lawn bowl green, structural maintenance and repair of the clubhouse, and water costs, approximately $55,000 annually. The 10-year lease expired in March 2026, with a holdover clause in effect. Ms. Alamos, Assistant to the City Manager, noted that Real Estate Manager Sunny Tong was online and available to answer technical questions about the lease. Palo Alto Lawn Bowls' previous public access hours were Sundays at 1 p.m. In response to Policy & Services Committee feedback that limited public access and membership fees posed barriers to public enjoyment of the property, Palo Alto Lawn Bowls Club proposed the following no-cost public access hours: In winter, Tuesdays, Thursdays, and Saturdays from 1 p.m. to 4 p.m., and Sundays from 1:30 p.m. to 4:30 p.m.; in summer, Tuesdays, Thursdays, and Saturdays from 10 a.m. to 1 p.m., Wednesdays from 5:30 p.m. to 7 p.m.; and Sundays from 1:30 p.m. to 4:30 p.m. Ms. Alamos, Assistant to the City Manager, was recently informed that Sunday summer public access hours included noon. Palo Alto Lawn Bowls Club proposed reducing clubhouse rental rates for Palo Alto residents by 10 percent. The grounds will remain locked outside of public hours to maintain the integrity of the lawn bowl green. The clubhouse was available to the City when not in use by Palo Alto Lawn Bowls Club. The Palo Alto Lawn Bowls Club relied on membership fees, tournaments, and clubhouse rentals to pay its rent to the City. Staff’s recommended action tonight was for the Committee to recommend Council approval of Palo Alto Lawn Bowls Club’s lease. Staff will work with the Palo Alto Lawn Bowls Club to finalize the lease terms, including annual performance measures and public use reporting statistics, to SUMMARY MINUTES Page 3 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 ensure the facility remains a public resource. Staff will include the proposed framework in the Real Estate Policies and Procedures for evaluating future leases. Councilmember Reckdahl recounted an experience from years ago when he and his young children wandered by the Palo Alto Lawn Bowls Club. The door was open, so they entered. Inside, they found friendly members who happily showed the kids how to roll the ball. They spent about an hour there, which became one of their best experiences, leaving Councilmember Reckdahl with very fond memories. Councilmember Reckdahl noted that the community was always looking for youth activities. Councilmember Reckdahl wondered whether high school students might be interested in lawn bowling, and it could be a great opportunity for intergenerational engagement. After researching online, Councilmember Reckdahl discovered that the Palo Alto Lawn Bowls Club had 130 members, which he found impressive. Councilmember Reckdahl indicated his desire to renew the club's lease but he wanted the club to incorporate more people. Vice Mayor Stone appreciated the expanded public access and believed the Palo Alto Lawn Bowls Club provided a valuable community benefit worthy of the City’s continued financial support and this lease extension. Chair Lythcott-Haims discovered lawn bowling when she joined the City Council, prompting her to question how many others were aware of the City-subsidized Palo Alto Lawn Bowls. Chair Lythcott-Haims asked whether the club conducted outreach to inform the public that they are welcome and tracked how many nonmembers came for a lesson, dropped in to play, or reserved the clubhouse. Chair Lythcott-Haims noted the website said, “become a member,” but it was not immediately clear that the public could drop in. The website stated that the clubhouse was available for public rentals only from April through October. The Committee was tasked with determining whether Palo Alto Lawn Bowls conferred a public benefit. Chair Lythcott-Haims was interested in providing public access equitably. Chair Lythcott-Haims asked whether there was any data on how many members of the public annually use Gamble Garden, Winter Lodge Tennis, and the Palo Alto Lawn Bowls Club. Chair Lythcott-Haims stressed the importance of understanding what the City was getting for these 2 acres, for which the City received $16,000 a year, to justify the City’s cost of $55,000 a year. Ms. Alamos, Assistant to the City Manager, indicated that staff would begin collecting information on the number of members and nonmembers using the resource. City Manager Ed Shikada commented that establishing this framework would set common metrics for the City’s community partner organizations. John Yee, the President of the Palo Alto Lawn Bowls Club, mentioned that in the past, the Castilleja High School coach had asked the club to allow students to visit. The club invited the students on several occasions, lending them about 20 sets of equipment for about 2 weeks, enabling them to practice on the school’s artificial green in the middle quad area. The club had numerous rentals from businesses in the tech sector for employee events; however, many of SUMMARY MINUTES Page 4 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 those individuals lived outside Palo Alto, making it inconvenient for them to join the club. The Palo Alto Lawn Bowls Club had no paid staff members. The club recruited volunteers to help guests learn the game. The club offered lessons during public access hours. Those who come to learn how to bowl are required to sign a waiver, which is typically between 10 and 40 people. The rental chairperson kept records of companies interested in rentals, along with the number of guests who would participate in bowling or use the clubhouse. The club had signs that read “Visitors Welcome.” Mr. Yee joined the club in 2009 after retiring; members welcomed him and helped him learn the game. Last week, the Santa Clara Registrar of Voters rented the clubhouse, and a similar arrangement was planned for November’s general election, which may explain why the club's website stated that the clubhouse was only available for rentals through October. The green was closed when the City performed maintenance in the spring and fall; however, the clubhouse remained open. Councilmember Reckdahl echoed Chair Lythcott-Haims’s questions about metrics and outreach. Councilmember Reckdahl suggested that the City inform the Youth Council of this opportunity and asked how else the City could improve communication between the Palo Alto Lawn Bowls Club and middle- or high school students. Councilmember Reckdahl also praised the facility’s beauty and expressed a desire to maximize its use. Ms. Alamos, Assistant to the City Manager, stated that the lease, which will be brought forward for Council approval, will include specific metrics. The Palo Alto Lawn Bowls Club will provide an annual report on those metrics. In the coming weeks, staff will review the lease and explore opportunities for the Palo Alto Lawn Bowls Club to enhance its visibility, including potentially listing it on the City’s website and advising the club on outreach strategies to high school students to foster youth engagement and intergenerational connections. MOTION: Vice Mayor Stone moved, seconded by Councilmember Reckdahl, to recommend the City Council approve the Nonprofit Partnership Workplan long-term lease framework and extend the Palo Alto Lawn Bowls lease. MOTION PASSED: 3-0 2. Recommendation to the City Council Regarding Adoption of an Ordinance Adding New Chapter 9.75 (Fair Chance in Housing) to Title 9 (Public Peace, Morals, and Safety) of the Palo Alto Municipal Code to Limit the Use of Criminal History Information in Rental Housing Decisions. CEQA Status: Exempt Under CEQA Guidelines Section 15061(b)(3). Planner Rebecca Atkinson presented on the Fair Chance in Housing ordinance, covering its history, the major revisions following the City Council's April 2025 review, and staff recommendations. This ordinance was part of the City’s broader efforts in recent years to promote certainty, stability, and fairness in the rental market. After staff’s discussions with the Human Relations Committee, the City Council reviewed the draft ordinance and referred it to the Policy & Services Committee for further analysis of the following topics: the anchor date for SUMMARY MINUTES Page 5 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 the lookback period, the length of the lookback period and the types of offenses, and clarifications regarding exemptions related to the California Sex Offender Registry and circumventions. Staff recommended that the anchor date be the date of disposition, as it is the most reliably reported date. Other potential anchor dates, such as the date of release from incarceration or other post-conviction milestones, were often unavailable. If the anchor date was not specified, a related conviction may be considered by default, while still allowing the renter the opportunity to demonstrate that it falls outside the relevant lookback period. Staff proposed a lookback period of 3 years for misdemeanors and 5 years for felonies. The proposed ordinance included exceptions for certain convictions under federal or other state laws for conduct that is lawful in California. Out-of-state felonies would be classified as misdemeanors if the renter could prove that the offense was a misdemeanor in California. Staff did not include additional tiers for serious or violent crimes, as detailed in the staff report. The revised draft incorporated the following changes and clarifications in response to Council feedback: Exempt all single-family residences from the ordinance’s applicability; landlords may consider current sex offender registry status at the time of the background check; and landlords are not prohibited from using other lawful screening tools, such as employment verification. Staff did not add additional anticircumvention language to the revision because the existing ordinance language addressed potential circumvention and provided clear procedures, documentation, and implementation guidance. Staff recommended that the Committee provide feedback on the revised draft ordinance and recommend City Council adoption. If the Committee agreed, staff would place the ordinance on the consent calendar for first reading. The published staff report contained a footnote numbering issue caused by a software conversion error. The citations were correctly associated with the text, and no footnotes were missing; however, Footnote 41 referred to Footnote 38. Public Comment: Hamilton H. noted that under the California Fair Housing Law, landlords cannot impose blanket no-felon policies, cannot consider arrests that did not lead to convictions, and must show that any convictions are directly related to legitimate housing safety concerns. California law prohibits tenant screening agencies from including criminal convictions older than 7 years. Hamilton H. expressed concern that the ordinance would prevent landlords from conducting criminal background checks until they have made a conditional offer to rent. The ordinance would impose a complex process of notices, waiting periods, individual assessments, written justifications, and opportunities for applicants to respond. Any mistakes during this process could expose landlords to complaints, litigation, and significant legal expenses. Hamilton H. believed a major flaw in the ordinance was that the lookback period would start from the date of disposition rather than the date of release from incarceration. A person who had served more than 5 years in prison could receive these protections immediately upon release, without demonstrating any period of law-abiding behavior in the community. Hamilton H. cited CDCR statistics showing that 39 percent of released prisoners were convicted of a new crime within 3 years, including about 22 percent who were convicted of a new felony. Hamilton H. stated that while it was important for Palo Alto to support second chances, this should not come at the expense of the safety of current SUMMARY MINUTES Page 6 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 residents. Hamilton H. urged the Committee to reject the ordinance and instead rely on existing state protections. Councilmember Reckdahl noted that this issue was sent to staff in 2021 but the Clean Slate Act has passed since then. Councilmember Reckdahl asked whether staff had examined the Clean Slate Act, as it seemed to him that the proposed ordinance was duplicating efforts. Under the Clean Slate Act, misdemeanors are automatically sealed 1 to 2 years after release, depending on the offense, rather than after conviction; and low-level felonies are sealed 4 years after completing parole, provided there were no offenses during that period. From a financial and staff workload perspective, Councilmember Reckdahl believed the Clean Slate Act offered a better solution than the City creating its own legislation that staff would have to monitor and update to remain consistent with state law. Councilmember Reckdahl noted that the ICRAA state law prohibits landlords from using any data that is more than 7 years old, including bankruptcy or criminal background information, and it includes provisions for challenging erroneous data. Planner Atkinson thought there was value in the ordinance's anchor date and 3-year lookback period rather than Clean Slate’s parameters. Deputy City Attorney Madeleine Salah stated that the Committee could recommend adherence to the thresholds set by the Clean Slate Act. Deputy City Attorney Salah noted that commercial criminal history databases were often plagued by erroneous and unreliable records, underscoring the need for a procedure to present mitigating information or evidence of inaccuracies. The Clean Slate Act did not include provisions regulating interactions between landlords and renters. While the ICRAA provided methods for challenging and correcting erroneous data from credit reporting agencies, it did not assist individuals when applying to rent an apartment in ensuring that landlords understand there has been an error. Vice Mayor Stone inquired about the Clean Slate’s number of years for misdemeanors and felonies. Vice Mayor Stone noted that the staff report presented a compelling argument that the most challenging period for individuals was shortly after their release, a point addressed in the proposed ordinance. Vice Mayor Stone asked for staff's thoughts on the Clean Slate Act and on the inaccuracy of criminal databases. Vice Mayor Stone sought clarification on the differences between state law requirements and the proposed draft ordinance besides the number of years, and he wanted to confirm that the proposed ordinance included exemptions for convictions from other states related to the criminalization of reproductive or gender- affirming care. Vice Mayor Stone asked the police chief for his perspective on the ordinance, including its impact on public safety, recidivism rates, and associated risks. Vice Mayor Stone expressed his support for the staff's recommendation of a 3-year lookback for misdemeanors, using the date of disposition as the anchor date. Vice Mayor Stone preferred a 10-year lookback for felonies but thought the City should align with the state’s 4-year lookback for felonies from the completion of a sentence, with clarification needed on whether this includes the end of parole. Vice Mayor Stone suggested that hate crimes be treated as felonies with the longest possible lookback period. Vice Mayor Stone initially favored a 3-tier approach to differentiate SUMMARY MINUTES Page 7 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 between misdemeanors, felonies, and serious/violent felonies, but he was persuaded by staff's strong argument in the staff report that such an approach could be difficult and inequitable due to the varying ways that states treat felonies. Deputy City Attorney Salah believed Clean Slate was 1 year from the completion of the sentence for misdemeanors and 4 years for felonies but she would have to check whether completion of the sentence referred to the end of parole or release from incarceration. The draft ordinance measured the lookback period from the date of disposition. Under state law, 7 years was the cutoff for reporting criminal history. The Fair Employment and Housing Act recommended, but did not require, procedures to show that a landlord’s policy considering criminal history information did not have a discriminatory effect. Deputy City Attorney Salah confirmed that the proposed draft ordinance included exemptions for convictions from other states that criminalized reproductive or gender-affirming care. Chair Lythcott-Haims questioned if there was parole after a misdemeanor. City Attorney Christopher Jensen thought custodial sentences for misdemeanor convictions were rare in Santa Clara County. Police Chief James Reifschneider deferred to staff to answer the question about recidivism. From a safety perspective, landlords want access to as much information as possible when deciding on the best tenant. However, Chief Reifschneider believed it was important to strike a balance between a landlord's desire for information and our desire, as a society, to provide individuals with the opportunity to turn their lives around and need housing to continue reforming their behavior. Chair Lythcott-Haims expressed appreciation for the proposed ordinance addressing differing statuses and terminology for individuals convicted in other states and aligning them with how California regards their actions; and she was pleased with the proposed exemption for single- family homeowners, regardless of whether they reside in the property. Chair Lythcott-Haims recognized that there were nuances the state had not addressed in the Clean Slate Act that the City might want to address with an ordinance. Chair Lythcott-Haims inquired about the practicality of incorporating and referencing the Clean Slate Act in the ordinance, including the number of years and using the date of release as the anchor date, while still maintaining the provisions that allow tenants to correct their records and the other tenant-landlord protections. Chair Lythcott-Haims thanked the staff for including the Council meeting minutes in the staff report. Although Council members expressed concerns about using the disposition date as the anchor, given that someone could have committed a heinous crime long ago, Chair Lythcott- Haims understood that the staff continued to recommend using the disposition date because data on release dates was not as robust as data on disposition dates. Chair Lythcott-Haims questioned why the state of California confidently relied on release dates in the Clean Slate Act, yet the City should not. SUMMARY MINUTES Page 8 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 Deputy City Attorney Salah indicated that it was feasible to incorporate and reference the Clean Slate Act in our ordinance, if that was what the Committee wished to recommend. Deputy City Attorney Salah noted concerns about the reliability of data and recordkeeping when dealing with private entities, such as credit reporting agencies, compared with official agencies that rely solely on their official records. Deputy City Attorney Salah confirmed that the Clean Slate Act’s 4-year period began upon completion of probation or parole. City Attorney Jensen clarified that this applied to felonies but that they needed to verify whether it applied to misdemeanors. Chair Lythcott-Haims expressed strong support for the release date as the anchor date, emphasizing that the date of disposition did not address the concern about how long it had been since an individual was in the system. Chair Lythcott-Haims asked whether a third party had access to information when the state or county had incarcerated or adjudicated someone. Deputy City Attorney Salah explained that landlords use commercially available criminal history databases that may draw on publicly available data from the internet and may not rely solely on official state records. If a record is sealed at the time of the check, it does not guarantee that it will not erroneously appear in a commercially available criminal history report. According to Councilmember Reckdahl’s online research, once California sealed a record, private background-check companies were legally prohibited from reporting or relying on that expunged information for employment or housing. Chair Lythcott-Haims asked whether states without a Clean Slate law maintained publicly searchable criminal history databases. Councilmember Reckdahl stated that 12 states have passed Clean Slate laws. The landlord can use a conviction within 7 years from another state but California law prevents using information that is more than 7 years old. Vice Mayor Stone raised a concern regarding the Clean Slate Act not taking effect until 4 years after an individual completes their parole. For example, if someone is sentenced to 30 years but is released after 12 years and then spends the next 18 years on parole, the proposed ordinance provided protection when they seek housing. Councilmember Reckdahl pointed out that the state could consult professors specializing in recidivism to provide data-driven insights. Councilmember Reckdahl believed the state could make a more informed decision than Palo Alto in this regard. If new data indicated changes in recidivism rates, the state could modify the Clean Slate Act accordingly. In contrast, staff would need to continuously monitor current data and adjust the ordinance as necessary. Councilmember Reckdahl reviewed academic papers examining the probability of recommitting different types of offenses over time. The study found that using the release date, rather than the sentencing date, was significantly more effective because individuals do not mature while incarcerated; only after release, when they are on their own, do they have the opportunity to mature. Councilmember Reckdahl stated that the State’s decision to use the release date SUMMARY MINUTES Page 9 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 instead of the sentencing date was not made for convenience; rather, it reflected what was most effective. Councilmember Lythcott-Haims highlighted that data indicated recidivism was less likely when individuals had housing, which presented a competing set of values between wanting to protect society from anyone who was potentially harmful and helping people reenter society and lead a better life, and they need housing in order to do so. Vice Mayor Stone asked whether the ordinance could include a 10-year lookback for felonies or whether we were restricted to a 7-year lookback by the state's Fair Housing law. Deputy City Attorney Salah explained that state regulations implementing the Fair Employment and Housing Act referenced separate state statutes but adopted the same standard that information cannot be reported after 7 years. Under state regulations, arrests that did not lead to a conviction and juvenile convictions cannot be considered. Deputy City Attorney Salah clarified that the Clean Slate Act standard for misdemeanors was 1 year from the date of judgment and the sentence has been completed. City Attorney Jensen believed that implementing a 10-year lookback period for felonies might conflict with state law. City Attorney Jensen stated that it was up to the City Council to decide whether to allocate resources to create a City ordinance that addressed out-of-state data and offered prospective tenants a remedy against landlords. Councilmember Lythcott-Haims reminded the Committee that this goes to the consent calendar only if there is a unanimous decision. Vice Mayor Stone referenced the summary minutes while drafting his motion to incorporate his colleagues’ feedback. Vice Mayor Stone proposed that the lookback period should begin on the date of release from incarceration, when applicable, or on the date of disposition or sentencing when no incarceration is imposed. Consistent with state law, Vice Mayor Stone proposed a 7- year lookback period for felonies and hate crimes and a 3-year lookback period for misdemeanors. MOTION: Vice Mayor Stone moved to recommend the City Council adopt the ordinance for first reading with the following changes: 1) lookback period will be from the date of release from incarceration, when applicable, or disposition or sentencing where no incarceration is imposed 2) lookback period length of time will be 3 years for misdemeanors and 7 years for felonies, and any crime where a hate crime was committed will be subjected to a 7-year lookback regardless of if it was a misdemeanor or felony. Chair Lythcott-Haims noted that the motion’s 7-year lookback for felonies was more conservative than the Clean Slate Act’s 4 years following the completion of probation or parole SUMMARY MINUTES Page 10 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 and the staff recommendation of 5 years. Chair Lythcott-Haims voiced concerns about being overly restrictive and less focused on providing fair opportunities for formerly incarcerated individuals. Chair Lythcott-Haims supported defining the lookback period to start on the date of release, where applicable. Chair Lythcott-Haims was more interested in the timeframes outlined in the Clean Slate Act: 1 year for misdemeanors and 4 years for felonies. Chair Lythcott-Haims questioned whether there was any justifiable evidence to warrant additional years in this city. Chair Lythcott-Haims highlighted that the state had research to support its timeframes, so she did not see why the City would adopt a more conservative stance than the state. City Attorney Jensen explained that the Investigative Consumer Reporting Agencies Act (ICRAA) prohibited the release of a report that included an arrest, indictment, information, misdemeanor, complaint, or conviction of a crime with a date of disposition, release, or parole that antedated the report by more than 7 years from the most recent of those events. Vice Mayor Stone was originally supportive of a 10-year lookback for felonies, so the 7 years in his motion was a compromise from the staff recommendation of 5 years. Vice Mayor Stone believed that landlords and other tenants should have the right to know, to some extent, the criminal history, particularly of violent felons who might be moving in next door. Vice Mayor Stone noted that the Clean Slate Act potentially looked at a much longer window of time because 4 years after parole completion could be far more than 7 years since somebody has been released, as many people are released after serving one-half or one-third of their sentence but probation or parole could be up to the length of the original sentence. Vice Mayor Stone sought clarification of Clean Slate’s 1 year after misdemeanors. Chair Lythcott-Haims noted that the Council discussed release or disposition but did not consider probation and parole. Chair Lythcott-Haims was concerned that 4 years after probation or parole could be a very long time. Councilmember Reckdahl mentioned that many apartment owners voiced their frustrations in Sacramento about the Clean Slate Act. Councilmember Reckdahl feared that if the City attempted to create its own version of the law, it would create the same interactions with local landlords. Councilmember Reckdahl believed the state had done a reasonable job on this issue. Councilmember Reckdahl regarded resource conservation and uniformity across cities as valid reasons to adhere to the state’s legislation, unless there was a compelling argument to deviate from it, which he had not yet observed. Deputy City Attorney Salah explained that both conditions must be met for misdemeanors: 1 year has passed since the judgment was entered, and the sentence is complete. It is not that 1 year has passed since the sentence is complete. City Attorney Jensen added that sometimes a person does not serve the sentence immediately upon sentencing and conviction. SUMMARY MINUTES Page 11 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 Vice Mayor Stone asked whether Chair Lythcott-Haims was comfortable with staff’s recommendation of 5 years for felonies, while keeping 7 years for hate crime convictions. The motion was edited accordingly. Chair Lythcott-Haims noted that the Committee lacked data on the average length of time a person is incarcerated for a felony, as well as the average duration of probation or parole. Staff did not provide a recommendation on the lookback timeframes if an alternative anchor date was used. City Attorney Jensen reiterated that the current draft ordinance could fill gaps, such as those related to out-of-state convictions and procedural protections. One approach would be for the ordinance to incorporate state standards, where possible, in the timeframes and definitions, and to extend protection to out-of-state convictions. VICE MAYOR STONE WITHDREW HIS MOTION. MOTION: Chair Lythcott-Haims moved, seconded by Vice Mayor Stone, to bring the ordinance (Attachment A) back to the Policy & Services Committee with the following recommendations: 1. Compare state standards on lookback times and definitions and explore whether they can be harmonized with the ordinance, 2. Extending the protections of in-state standards to out-of-state convictions, 3. Hate crimes will be subjected to the maximum lookback period applicable under state law, and 4. Incorporate the procedural protections in the current draft ordinance into the revised ordinance. MOTION PASSED: 3-0 3. Recommend Approval of the Office of the City Auditor Annual Risk Assessment and FY 2027 Audit Plan and Corresponding Task Orders. CEQA Status: Not a Project City Auditor Kate Murdock presented the results of the Citywide Risk Assessment and the proposed FY 2027 Audit Plan. The goal of this process was to identify the City’s most significant risks, ensure audit resources were directed to the City’s highest risks and priority areas, and avoid duplication of efforts. This year’s risk assessment involved interviews with executive leadership and key staff, facilitated risk workshops, feedback from City Council, and a review of organizational documents and data. The findings from this effort informed the proposed FY 2027 audit plan. The risk assessment used a structured, risk-based methodology. Each identified risk was assessed based on its potential impact and likelihood, resulting in an overall SUMMARY MINUTES Page 12 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 risk rating. This comprehensive strategy captured current and emerging risks facing the City. Risk Synergy sessions were held with leadership and key staff from 15 departments, with discussions focused on departmental objectives and operations, organizational and staffing changes, emerging risks and challenges, and existing controls and mitigation efforts. Feedback from City Council Members was incorporated to ensure that strategic priorities and community concerns were reflected in the assessment. The outcome was a prioritized list of risk areas. Each identified risk was assessed using two criteria: impact and likelihood. The impact criterion evaluated financial significance, effects on residents and customer experience, and potential influence on City Council priorities and organizational goals. The likelihood criterion considered factors such as operational complexity, the regulatory environment, the effectiveness of monitoring activities, current conditions, and known challenges. Fraud risks were considered across relevant functions. The audit universe encompassed the major operational areas and activities that may be subject to audit review throughout the organization. Operational areas were revisited for each department and updated based on management’s feedback to ensure that all significant City functions were taken into account during the risk assessment process and in the audit plan. The assessment identified the highest-rated risks. The objective of this assessment and the accompanying audit plan was to provide assurance and recommendations in areas where improvements could yield the greatest value. Appendix C of the report included a list of Top- Rated Risk Areas, with arrows indicating those included in this year's proposed audit plan. Areas that had recently been audited or were under evaluation or improvement by management were deferred to avoid redundant or irrelevant audit findings and recommendations. Areas audited in the last 2 years included building permit fees, utility billing, and traffic safety improvements. The FY27 Proposed Audit Plan consisted of 2 audits and 4 advisory projects. One proposed audit will focus on the City's capital improvement project management. The preliminary objective was to determine whether management and oversight processes supported the timely, coordinated, and cost-effective delivery of operationally ready capital projects. The second audit will examine City and departmental performance metrics, evaluating whether key measures help departments ensure efficient operations and whether processes were actively monitored and managed. The 4 advisory projects were: models and approaches for improving outcomes for individuals and families experiencing homelessness in small cities; best practices for Council meeting management; AI governance and usage best practices and pitfalls; and employee mental health and wellness. City Auditor Murdock believed that the FY27 Proposed Audit Plan would provide meaningful insights and support continuous improvement across the organization. Public Comment: There were no requests to speak. Councilmember Reckdahl noted that Slide 7 showed 5 arrows, while the audit plan included 6 elements. Councilmember Reckdahl requested an explanation of the rating score calculation and asked whether the impact score considered the severity of the problem and the potential for feasible improvements. Councilmember Reckdahl asked what the seventh, eighth, and ninth SUMMARY MINUTES Page 13 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 items were that were not included in this year’s audit plan. Councilmember Reckdahl wanted to know whether any of the 6 items in the audit plan had undergone recent changes. Councilmember Reckdahl asked whether City Auditor Murdock had in-house experts available for the various audit topics or needed to hire outside consultants. City Auditor Murdock believed that Council meeting management was not included in the list of Top-Rated Risk Areas, so it may have been considered a medium-rated risk. Feedback from the Council and staff indicated that Council meeting management would be a valuable focus for an advisory project. City Auditor Murdock explained that the rating score was determined by calculating the likelihood and impact scores. Chair Lythcott-Haims noted that Council meeting management had a rating of 12, prompting her to question how this could be justified as one of the 6 focus areas, especially given numerous issues in the red category with scores around 20 points. City Auditor Murdock explained that the rating system served as guidance, not the sole factor, in selecting items for the audit plan. The list of Top-Rated Risk Areas included items that had already been audited. Another consideration was avoiding scheduling 2 audits in the same department. Occasionally, issues with a lower risk rating may attract significant attention and need to be addressed even if they do not pose a significant financial risk to the City. The impact score evaluated the potential financial, reputational, and other impacts on the City. Whether an issue could be completely mitigated or triaged was not considered in the impact score. This year, leadership participated in the scoring. The score was influenced by an individual’s perceptions and experiences, as well as budget documents and objective metrics. Code enforcement and the permitting process have undergone changes and are potential audit topics for next year. The procurement process has remained a concern during City Auditor Murdock's tenure. Recently, an advisory project on contract solicitation and authority levels was completed, and the Administrative Services Department will present an update in the fall. Many procurement timeliness issues may be resolved once the contract solicitation and authority levels are updated. Record retention was mentioned as a potential audit area but was not rated as high risk. City Auditor Murdock was not aware of any recent changes in capital project management. When considering performance measures, a significant priority for the Council was government efficiency. Departments manage resources by establishing key performance targets. Over the past year, significant work was done on oversized vehicles, and there has been media attention on the growing population of individuals experiencing homelessness in Palo Alto. Therefore, best practices from other small cities for addressing homelessness will be provided, along with service models and their reported success. City Auditor Murdock noted that one benefit of partnering with Baker Tilly was their extensive team of 11,000 employees, including subject matter experts in all audit areas. These experts bring a wealth of experience from roles such as city manager, police chief, nonprofit leadership, and academia, and they can be leveraged for audits. SUMMARY MINUTES Page 14 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 Chair Lythcott-Haims asked whether the Finance Committee had approved this $517,000 project and included it in the FY 2027 budget. Chair Lythcott-Haims sought clarification on the differences between advisory and audit projects. Chair Lythcott-Haims urged City Auditor Murdock to focus on cities where a significant percentage of the population lives in vehicles. Chair Lythcott-Haims emphasized that comparisons to cities primarily dealing with large encampments of unhoused individuals or homeless shelters would not be beneficial for Palo Alto, as most of its unhoused population lives in vehicles. Regarding the management of Council meetings, Chair Lythcott-Haims suggested that an audit subheading should focus on the time it takes to move an agenda item from start to finish, as well as how often items are referred back and forth by the Council. An arrow in the list of Top-Rated Risk Areas pointed to Human Resources employee benefits and workers' compensation, prompting Chair Lythcott-Haims to question whether this was the best alignment for the item on employee mental health. Assistant City Manager Kiely Nose confirmed that the FY 2027 Audit Plan was aligned with the current FY 2027 proposed budget. City Auditor Murdock explained that a traditional audit identified findings and offered recommendations rather than quantifying problems, whereas an advisory project presented observations and recommendations. Baker Tilly conducted a couple of advisory projects to provide information and explore available solutions for the City to consider. Audit findings required significantly more time for Baker Tilly, whereas making observations in advisory projects required less time. During the overtime audit, it was noted that there had been an increase in workers’ compensation cases related to mental health. Therefore, Baker Tilly discussed this with Human Resources to determine whether it would be a useful topic to investigate further, and Human Resources agreed it was worth examining, particularly for high- stress jobs. Chair Lythcott-Haims acknowledged that an increase in workers' compensation claims posed a risk to the City and that we do not want employees to be stressed to the point of qualifying for workers' compensation, which makes this issue fall under employee retention or recruitment. Chair Lythcott-Haims asked how often auditors examined mental health, how it was defined and assessed, and who conducted those assessments. Chair Lythcott-Haims urged City Auditor Murdock to identify someone at Baker Tilly with appropriate expertise. City Auditor Murdock stated that Baker Tilly had a group that conducted performance audit work, much of which focused on organizational behavior and structures. Baker Tilly had previously addressed these issues with other Cities. MOTION: Councilmember Reckdahl moved, seconded by Vice Mayor Stone, to recommend the City Council approve the Citywide Annual Risk Assessment and FY 2027 Audit Plan. MOTION PASSED: 3-0 SUMMARY MINUTES Page 15 of 15 Policy & Services Committee Meeting Summary Minutes: 06/09/2026 Future Meetings and Agendas Deputy City Manager Chantal Cotton Gaines noted that this was the last meeting before the break. Deputy City Manager Cotton Gaines will work with the Chair on agenda items for the next meeting, scheduled for Tuesday, August 11. Adjournment The meeting was adjourned at 8:10 p.m.